For richer, for poorer: London reigns as world divorce capital
Las Vegas may be the best place for marriage but London is known as divorce capital of the world — and a Malaysian beauty queen’s bid for a big money split in court on Friday is only the latest in a long line of foreign break-ups.
Thousands of wealthy Chinese, Russians, Americans and Europeans, many of whom work in the City of London financial district or own property in Britain, now end their marriages before an English judge.
Few are as rich as businessman Khoo Kay Peng, worth at least Â£400 million (500 million euros, $640 million) and Pauline Chai, tales of whose 1,000 pairs of shoes and Â£22,000 monthly spending on a Rolls Royce plus chauffeur has enthralled Britain’s press.
But their case has drawn fresh attention to a phenomenon which has made a handful of lawyers almost as rich as some of their clients.
“England has become very attractive for wives, in particular because awards here are considerably higher than almost anywhere in the world,” said Sandra Davis, head of the family law department at Mishcon de Reya.
“By the same count, it’s a jurisdiction that the wealth creator generally wants to avoid,” added Davis, who represented Diana, princess of Wales in her divorce from Prince Charles and US model Jerry Hall in her split from Rolling Stones singer Mick Jagger.
A judge at London’s High Court will decide on Friday whether Chai and Peng’s divorce after over 40 years of marriage should be heard in London, as the former Miss Malaysia wants, or in Malaysia, in line with her husband’s wishes.
As Chai lives in England — in a Â£30 million mansion outside London surrounded by 1,000 acres (405 hectares) of parkland featuring a menagerie of animals — her lawyer, “Diva of Divorce” Ayesha Vardag, argues that the case should be heard here.
If it is, it could set a new record for England’s biggest divorce payout due to the length of their union.
That is currently held by late Russian oligarch Boris Berezovsky, who reportedly paid up to Â£220 million to his ex-wife Galina Besharova in 2011.
– ‘Short answer is money’ –
While no precise figures exist on how many divorces in London have an international element, lawyers say they are common.
Davis said 75 percent of her clients in this field had an international link.
So what is it about England which makes it such an attractive destination for divorce?
“The short answer is money,” said Elizabeth Hicks, a partner at law firm Irwin Mitchell.
Following a landmark case in 2000, English courts start from the assumption that marital assets should be split 50/50, favouring the less wealthy spouse.
This contrasts with many other countries and means awards in England are several times bigger than they would be elsewhere.
Another factor is that pre-nuptial agreements, signed before marriage to protect the richer spouse’s assets, are not legally binding in England.
English judges also take into account a wider range of assets when calculating each spouse’s wealth, which also appeals to the less wealthy partner.
Hicks said that in Italy, for example, courts hearing the case of an entrepreneur splitting from his or her partner would not factor in the value of the business.
“You get a bespoke answer. It’s properly scrutinised,” added Richard Collins, a partner at law firm Charles Russell.
The super-rich are not the only foreigners to divorce in the English courts.
While most cases are legitimate, it emerged last month that 179 Italian couples who had been trying to avoid lengthy procedures in their own country had divorces granted in England cancelled as they had never lived here.
Courts had been supplied with a fake English address in a scam organised by an Italian agency.
While divorce lawyers may be happy with the extra fees that foreign splits bring them, some legal figures fear that they are clogging up the English courts with crude disputes over money.
James Holman, a senior judge hearing an earlier stage of Chai v Peng, deplored it as an “appalling” dispute which was “squeezing out the many needy litigants who need precious court time to recover their children from abduction or seek their return from care.”