Shopping around: different jurisdictions in family law
Jeremy Hogg, Lawyer, MST Lawyers
In today’s world of affordable international air travel and global trade, it is increasingly common to find families with roots in two or more countries. This usually arises where:
- One party to a relationship has immigrated to another country for study or work and meets their partner in their new country;
- One or both parties from different countries come together for the purposes of a relationship, either in one of their home countries or in a third country; or
- Families travelling overseas together on a long-term basis for work or other reasons.
When these cosmopolitan families suffer a relationship breakdown, however, the parties to the relationship find themselves faced with the question of which legal jurisdiction is best equipped to deal with the formal aspects of the separation and, perhaps more importantly, which jurisdiction will provide a particular party with a ‘better’ outcome.
As a current ongoing legal dispute between a Malaysian fashion mogul and his former beauty queen wife about whether the English or Malaysian courts should determine the division of their $750 million empire demonstrates, the difference in legal jurisdiction can be big business. Though most couples do not have a small fortune to argue over, the question of which jurisdiction to prosecute proceedings in remains an important question for separated parties to consider.
The following are factors that may have an impact on a parties’ choice of jurisdiction and should be considered prior to taking any action in a separation with international aspects:
- Jurisdiction to apply: The first issue that must be considered is whether or not a party meets the requisite residency or citizenship requirements to make an application in a particular jurisdiction. For example, for matrimonial property proceedings in the Australian courts at least one of the parties (but not necessarily the party making the application) to the marriage must be an Australian citizen, ordinarily resident in Australia or present in Australia at the date of making the application to the Court. There are additional hurdles in place for parties to a de facto relationship, however, and different jurisdictions will have their own sets of requirements to be met before a party has the right to apply to the Court for assistance.
- Operation of laws: The drafting and operation of legal instruments, together with case law, in each jurisdiction will differ and may favour one or the other party, such as along gender lines or between financially stronger and weaker parties.
- Some aspects of family law, such as spousal maintenance or child support, may not be available in every jurisdiction. Other jurisdictions may treat certain types of property differently; for example, under Australian family law the courts have wide discretion to deal with property held in trusts controlled by one or both parties whereas under New Zealand family law trusts tend to be untouched during a property settlement.
- Overall outcome: Where one jurisdiction might offer a party with a better outcome in relation to property settlement, it may otherwise be deficient in terms of spousal maintenance. Parties will likely find that all aspects of a matter must be dealt with in a single jurisdiction and they should accordingly consider all aspects of the jurisdiction before deciding where to issue proceedings. A common exception to this is that financial matters and parenting matters (including child support) may often be dealt with in separate jurisdictions.
- Practicality of enforcement: An Australian Court order that provides for a party to retain a piece of real estate located in Shanghai or a bank account in Milan is unlikely to be effective or enforceable in those jurisdictions.
- A ‘better’ outcome which cannot be enforced is of little use and accordingly it is important for parties to consider the practicalities of where assets are located before choosing a jurisdiction in which to prosecute their case. Similarly, for practical purposes the decision of where to carry out parenting proceedings will in most circumstances necessarily be the jurisdiction in which the child resides.
- Variation within jurisdictions: While Australia primarily operates under a federal family law regime (save for some variation in Western Australia), this is not the case in all jurisdictions. For example, the various nations within the United Kingdom operate quite different family law systems, and in the United States each state has its own laws and procedures. It is of vital importance then that any advice obtained regarding appropriate jurisdiction is sought from a practitioner operating in the actual jurisdiction in question.
- Impact of proceedings between jurisdictions: In Australia it is possible (and common) to obtain a divorce without having determined a final outcome in relation to the parties’ finances. In many other jurisdictions, however, the issues of divorce and financial settlement are inextricably linked and one cannot occur without the other. This can lead a party who has been divorced in Australia, but who has not finalised their property settlement, to be excluded from seeking assistance from a Court in another jurisdiction in which those two processes are linked.
- Accordingly, parties should consider the issue of jurisdiction carefully prior to commencing any sort of family law action as they may otherwise be unwittingly closing doors for themselves in other jurisdictions.