Nuptial Agreements
Baroness Shackleton of Belgravia Excerpts(1 year ago)
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Baroness Shackleton of Belgravia
To ask His Majesty’s Government what plans they have to introduce the draft Nuptial Agreements Bill, as drafted and recommended by the Law Commission in its Matrimonial Property, Needs and Agreements report, published on 26 February 2014 (HC 1089).
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bellamy) (Con)
My Lords, it was announced on 4 April that the Law Commission will be conducting a review of the law on financial provision on divorce. While this review is taking place, the Government do not consider it the right time to legislate in respect of nuptial agreements. The Government favour a holistic rather than a piecemeal approach to any future legislative reform in this area.
Baroness Shackleton of Belgravia (Con)
My Lords, I am disappointed but not surprised by that response. I declare my interest as practising in this field. It is well known that this is stand-alone legislation which came about as a consequence of a House of Lords decision in Radmacher in 2010. During the coalition, the Law Commission set up a paper and, as a consequence, in 2014 there was a response which is oven-ready for putting on the statute book.
Instead of that happening, with almost indecent haste and despite the warnings, the no-fault divorce law has proceeded through these Houses. We have more people with pre-nuptial agreements and more people getting divorced, and there is no direction for the judges as to how the law has changed as a consequence of these agreements being enforceable. Please can the Minister explain why it is acceptable to delay this legislation, which would be quite simple to push through, in circumstances where the courts are over-burdened, the judges have no direction and lawyers practising in this field have lucrative groundhog days ahead?
Lord Bellamy (Con)
My Lords, I thank my noble friend Lady Shackleton for her question. The answer is twofold: first, the Government consider that the present root-and-branch review of financial provision is better than looking at a particular outcrop within that landscape. Secondly, any Government have to prioritise. In recent years, priority has been given, for example, to the Domestic Abuse Act 2021; the Divorce, Dissolution and Separation Act 2022, which introduced no-fault divorce; and the Marriage and Civil Partnership (Minimum Age) Act 2022, which made it illegal to marry under the age of 18. These are all fundamental reforms and I make no apology for prioritising those measures.
Divorce: Financial Provision
Baroness Shackleton of Belgravia Excerpts(1 year, 1 month ago)
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Lord Bellamy (Con)
My Lords, I pay warm tribute to the noble Baroness, Lady Deech, my noble friend Lady Shackleton and many others for their work in this area. Respectfully, I do not accept the characterisation that the Government have misled everybody; we have had our hands somewhat full in recent times. The Matrimonial Causes Act 1973 reaches its 50th anniversary this year and a review of financial provision is indeed opportune. The Government are in close consultation with the Law Commission, which we consider the most appropriate body to carry out that review.
Baroness Shackleton of Belgravia (Con)
My Lords, I declare my interest as a practitioner in this field for 40 years. The law is hopelessly out of date: it relies entirely on finance and the discretion of judges. The judges have a fiefdom now in that, since 3 October 2017 you cannot go to the Court of Appeal if leave is refused, so their discretion is absolute. It is normally commercial judges who change the law, and arbitrators, mediators and judges need guidance. There is no use in having a divorce if the money is not sorted out; the house has to be sold and the children are caught in the conflict. Divorce practitioners like me make a fortune in arguing, because the guidelines are 50 years out of date. I know that this is not a vote winner and does not appeal to the masses, but many people in this country are touched by this and I would like an assurance that it will be included in the King’s Speech as vital business on the agenda, because responsible Governments do service to this.
Lord Bellamy (Con)
My Lords, these matters will be considered fully in a forthcoming review, hopefully by the Law Commission. That commission is completing important work on surrogacy at this moment. Subject to final agreement, I hope to make a further announcement very soon indeed.
Her Late Majesty Queen Elizabeth II
Baroness Shackleton of Belgravia Excerpts(1 year, 7 months ago)
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Lord Robertson of Port Ellen (Lab)
My Lords, ordinarily on such occasions the repetition of words and sentiments can be tedious and unproductive. Too often we hear, “Everything’s been said, but not yet by everyone”, or the House of Lords equivalent, which is, “Everything’s been said, but not yet by me.” However, in the last 48 hours the repetition of such words as duty, service, honour, decency, commitment and dedication does not jar at all; it seems both appropriate and fitting when they apply to the 70 year-long reign of the late Queen Elizabeth. She set a standard and a vector against which all who serve in public life can and indeed should be measured, and we should be profoundly grateful for that example, as well as for so many other things. Indeed, she was the gold standard—the glue that kept a fractious country together when multiple pressures of populism and extremism were tearing, but never destroying, our communal fabric. With our latest Prime Minister and the nation facing serious crises in energy, the cost of living, health and a foreign war, her example of cool, clear thinking is more necessary than ever it was.
As these two days of debate have shown, we all have memories of Her Majesty the Queen, especially those of us who had the opportunity to meet her. My latest one was of returning last year the insignia of the Chancellor of the Order of St Michael and St George by Zoom. I have to say that she was a lot more comfortable with the situation then I was. “Come forward”, she demanded, “I can’t see you”, as I nervously walked towards the screen at the end of the long room.
However, I have another vivid memory, of her visit in 1996 with the Princess Royal to Dunblane after the ghastly murders in the primary school. The noble Lord, Lord Forsyth, was the Scottish Secretary at the time and the local MP. I was his shadow and both a local resident and a parent. We were, at that time anyway, tough political adversaries, but we had been welded together by the tragedy in that small community. We witnessed that day the monarch, with just her presence and simple words, speak to and for a grieving town and indeed a shell-shocked nation. It helped immeasurably to bind some of the gaping wounds of that time, and that was her powerful effect.
Another, more pleasant memory I have is of when, as Defence Secretary, I brought the then Crown Prince of Saudi Arabia, Crown Prince Mohammed, to Balmoral to meet the Queen. After our lunch, he accepted an offer from her to see the estate but, boy, was he astounded, coming from a country which banned women from driving, to find the Queen behind the wheel of the Land Rover and rolling off without the rest of the party. I was at the castle entrance when they all came back. She looked at me and said, “I think he thought I was driving too fast.” I said nothing at all. Then she said, “I also think he thought I was lost.” I bravely said, “Well, you can’t get lost. You’re the Queen, and where you are is where you’re supposed to be.” She frowned at me and then said emphatically, “Quite right”, and marched away. Soon after that, the Crown Prince became King of Saudi Arabia, and belaboured every visiting Brit with stories of the Queen’s mad driving.
My final point is to talk about the Queen’s deep loyalty to the Commonwealth; my noble friend Lord Boateng also mentioned that. When she made that famous pledge to preserve and protect the Commonwealth at the point when she took the Throne, it was not some nominal pledge or promise, it was to her a sacred commitment. That passionate commitment to the unique and precious club of like-thinking nations that is the Commonwealth was to matter to her over all her years, especially those years when not a few irritated politicians would quite happily have strangled the organisation. Getting past the Queen, dispassionate and non-partisan as she might well have been, would have required a lot more tenacity and political force than is possessed by any mere politician yet to be born. The Commonwealth survives and thrives because of Her Majesty and her promise.
Last night, as so many have said, the new King spoke to the nation with raw personal feeling about the loss caused by the Queen’s death and what it meant to the Royal Family. It was a moving and incredibly significant address. The fact is, however, that we are all her family, and he spoke for us in our loss as well. He becomes King at a momentous time and we must, with memories of his mother fresh in our minds, wish him the very best in his demanding new role. The family that is his nation is with him.
Baroness Shackleton of Belgravia (Con)
My Lords, having read and listened to the many and various tributes to our beloved Queen and her exemplary life and selfless service to this country, the Commonwealth and the realms, it is impossible to do her justice. I should like, with humility, to pay a small tribute to her private family life. As any working parent knows, striking the work/life balance is almost impossible, but despite performing the most demanding job in the whole world for seven decades as a working mother, a working grandmother and a working great-grandmother, she juggled until the day she died. I am in no doubt that her family and the line of succession was of paramount importance to her.
I should like to share three vignettes of her humanity. This is the first. My brothers, three years younger than me, attended the same gym class as Prince Andrew and, as a consequence, were invited to Buckingham Palace to his birthday parties. On returning home, my mother, cross-examining the boys, said, “What was Andrew’s mummy like?”, to which one of them responded, “Mummy, she was just like any other mummy”, and then, referring to her brooch, “but she wears a much bigger badge.”
Secondly, sitting next to one of her nephews at a dinner, he told me that during his parents’ separation and divorce, the Queen and her family had been like a port in a storm when life had been very difficult for them. This sentiment was echoed by many of her grandchildren, who, over the Jubilee, spoke movingly of her extreme kindness to them.
Thirdly and lastly, I had the privilege on two occasions to meet the Queen on my own, save for the presence of a private secretary. The meetings concerned family matters, and I was left in absolutely no doubt that she loved and cared passionately about all concerned. She was totally fair and non-judgmental, and did all in her power to ameliorate and solve the very difficult problems they were suffering from. She was loyal to her family to the end, and I can think of no better way of showing our immense gratitude to her than supporting her children, her grandchildren and great-grandchildren at this sad time and in future.
She passed the baton on, and for her, there was no question of changing any rules mid-term. To make sense of her sacrifices and her passing, and to reward her unstinting service to all of us, we can do no better than to wholeheartedly support our monarch, His Majesty King Charles III, and his family, as she would have wished and prayed for.
The Lord Bishop of London
My Lords, I share with this House, our country and many across the world the profound sadness at the death of the late Her Majesty Queen Elizabeth. In June this year, we gathered at St Paul’s Cathedral for the national service to celebrate her Platinum Jubilee. In that service, words were read from the letter to the Philippians:
“Let your gentleness be known to everyone”.
The writer goes on to say that
“whatever is true, whatever is honourable, whatever is just, whatever is pure, whatever is pleasing, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things … and the God of peace will be with you.”
We have heard from many that Her Majesty the Queen, in the 70 years of her reign, lived a life of integrity and service to others, but she also lived a life as a model of gentleness. In Her Majesty, we found someone who carried lightly her own importance, a genuine humility and gentleness, while fully knowing what her role in the Church and the state was. We have heard from my most reverend friend the Archbishop about how, as Bishops, we pay homage. As the Bishop of London, I paid it not virtually but in person. There, kneeling, with your hands enfolded by Her Majesty the Queen’s hands, you pray. My memory of that occasion was of gentleness: not of the power of state or of her role, but of gentleness. That is the image and feeling that remains with me. Having prayed with the Queen, I often reflected that there was no need for an oath of obedience.
Many of us simply have not known life without Her Majesty the Queen. She has been our nation’s unerring heartbeat. I give thanks that she is now with the God of all peace. My prayers are with the Royal Family and His Majesty King Charles. God save the King.
No-fault Divorce
Baroness Shackleton of Belgravia Excerpts(2 years, 1 month ago)
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Lord Wolfson of Tredegar (Con)
My Lords, I have not had representations from those entities, but I dare say that the department might have done. We get representations, frankly, from all areas of the legal profession, and indeed more broadly, all the time. We will look at this issue on its merits. We have set out that we want to make sure that financial matters are dealt with as amicably as possible. The divorce Act will be a very good start and, as I say, we are encouraging it through family hubs, mediation vouchers and many other ways too.
Baroness Shackleton of Belgravia (Con)
My Lords, I speak as a foot soldier operating under the current system. I would like to explore with the Minister the redundancy of the current legislation, which is now 40 years old. Society has changed, as has the way we operate, and the rules are so left to the judge’s discretion that there is an industry—I am almost ashamed to practise in it—which fine-tunes, for money, applications for ancillary relief because no one can predict the outcome of such an application accurately. We talk about the mythical mediator, but the mediator has to know what the rules are, because how can they mediate without the rules being clear and explicit? The noble Baroness, Lady Deech, and I—
Baroness Shackleton of Belgravia (Con)
I would like my noble friend the Minister to be nailed down to a timetable, and I would like to know what that is because—I was going to build up to the question—we are fully welcoming the Act that Parliament has passed facilitating divorce without the end of the financial remedies being sorted. We need a timetable.
Lord Wolfson of Tredegar (Con)
My Lords, I am not sure whether my noble friend is a foot solider or somewhere between a major-general and a field marshal in this area of the law. May I gently suggest that perhaps not all lawyers charge by the word? I respectfully say that in this area of law, as in many areas of law, there is a balance to be struck between discretion on the one hand and certainty on the other. You need clear rules, but you also need a judge to have discretion to do the right thing in the individual case. That is what we will be striving for when we look at this area of the law about financial provision on divorce.
Divorce: Effect on Children
Baroness Shackleton of Belgravia Excerpts(9 years, 5 months ago)
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Baroness Shackleton of Belgravia (Con)
My Lords, I speak as one of the evil lawyers who practise in this area of the law. Does the Minister recognise that children’s disputes are very difficult to settle when financial disputes are rampaging through the courts? It is very difficult to settle financial disputes, particularly in non-wealthy families. The wealthy of course have the privilege of spending as much money as they like on lawyers, and where the law remains uncertain, the judge’s discretion is so large. Can the Minister assure us that the Government will address the issue of certainty, which the Bill of the noble Baroness, Lady Deech, seeks to address? It is a political matter and not one to be left to the judges.
Lord Faulks
My noble friend is well qualified to tell the House about the difficulties in settling matters, including those concerning children, where there are other, financial aspects that remain uncertain. She will be aware that the Ministry of Justice and the Department for Education recently published A Brighter Future for Family Justice, which covers the implementation of the Children and Families Act. That encourages mediation and the creation of child arrangements orders as opposed to the old contact orders and residence orders, and presumes the involvement of each parent in the life of the child. I am sure that the House will agree that, whatever the difficulties in financial arrangements, the interests of the children must come first.
Divorce (Financial Provision) Bill [HL]
Baroness Shackleton of Belgravia Excerpts(9 years, 5 months ago)
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Baroness Shackleton of Belgravia (Con)
My Lords, I rise to thank the noble Baroness, Lady Deech, for bringing in the Bill and to declare my interest as a practitioner in matrimonial law for 30-plus years. I am grateful to the noble Baroness because the Bill is overdue and much needed. It provides some clarity and simplicity for those of us who operate in the field, at the moment without proper statutory guidance. It is vital that the matters that she is addressing are put forward for debate, and reform is long overdue.
The simplicity behind the Bill is wonderful. It applies not only to what happens when things go wrong and people get divorced but to the drafting of prenuptial agreements, which is practically impossible if one does not know what is going to happen at the other end if a marriage, civil partnership or same-sex marriage is dissolved. Such agreements are become increasingly fashionable, despite the fact that there is nothing in Section 25 of the 1973 Act about the enforceability of prenuptial agreements. The courts are therefore enforcing them in circumstances that they think may or may not be fair. There is no official guideline from Parliament as to how they should be enforced.
There should be a purer definition of what people can expect upon the breakdown of a marriage. This is not for rich people who can afford to spend a small percentage of their money litigating matters. They can have the luxury to do what they want, like they can in everything else. This is for the average person who goes into a marriage trying to protect the assets that they previously acquired and knowing what they are going to end up with, should it break down. I welcome these amendments and the Bill. I thank the noble Baroness very much indeed for introducing it.
Lord Kennedy of Southwark
My Lords, this amendment in the names of the noble Baronesses, Lady Deech and Lady Wilcox, my noble friend Lord Grantchester, and the noble and learned Lord, Lord Walker of Gestingthorpe, and the other amendments in the group—namely, Amendments 14, 15, 15A, 16, 18 and 19—deal with matrimonial property, an issue central to the Bill.
The new clause proposed by Amendment 6 is detailed and, as we have heard from the noble Baroness, Lady Deech, and the noble and learned Lord, makes it clear that the split of assets on divorce should be limited to property acquired after marriage by the couple. The family home will be treated as matrimonial but property, gifts and inheritances acquired before the marriage will not be matrimonial or available for sharing.
I very much see the point that without the certainty that the proposed new clause aims to give, couples run the risk of spending vast sums of money fighting over the division of assets and thereby reducing the assets that they are left with. As the noble Baroness, Lady Deech, said, to reduce costs we need to make things simpler and clearer for divorcing couples. These are welcome amendments that seek to do just that. I also associate myself with the comments of the noble Baroness, Lady Shackleton of Belgravia, in thanking the noble Baroness, Lady Deech, for bringing forward the Bill.
Baroness Deech
My Lords, in moving Amendment 7, I will speak to Amendments 8 to 13 as well. What binds them together is that they concern prenuptial and post-nuptial agreements.
First, let me counter criticisms I have heard. Unfortunately, it is no good saying that nobody ever contemplates the end of their marriage. Only too sadly, it is unavoidable to think of it. There cannot be anyone in this House who has not had a member of their family go through divorce—or, indeed, has not been divorced themselves. It is a very current feature of life. I know the arguments that the Bishops might have put forward, had they been here: that having a prenuptial agreement somehow undermines marriage. That is not so. Such agreements are common in every country in Europe and in North America. In all those places the divorce rate is lower than it is here, except possibly in the United States. I do not think it can be argued that they in any way undermine marriage. Moreover, the Supreme Court swept away the public policy issue that there is somehow something wrong with making an agreement about the end of a marriage in the famous case of Granatino v Radmacher, which was unusual in that it was the wife who was very wealthy and the husband, although comfortable, was not quite so wealthy.
First in this group, I took account of what was a glaring omission in the first draft. The prenuptial or post-nuptial agreement must of course be in writing. That is covered by Amendment 7. This was a mere oversight. It follows the recommendation of the Law Commission in its report on matrimonial property agreements and it follows practice abroad. There can be hardly any dissent from that. Amendment 8 is an improved draft: a way of saying that prenuptial and post-nuptial agreements are binding.
Amendment 9 is about disclosure. Obviously, if people are making a prenuptial or post-nuptial agreement they ought to tell each other what their assets are before they sign it. This amendment seeks to deter legal challenges to an agreement if a small or unimportant asset was overlooked and not declared. For example, if a wife omitted to mention in her list of assets her second-hand car kept somewhere else in the country, one would not want the agreement voided for that unimportant failure to disclose. How many of us could at any time make a completely comprehensive and accurate list of everything we own? Therefore, the amendment provides that a failure to disclose will not ruin the prenup or post-nuptial agreement provided that the asset is not of great significance. I have been advised by judges that there is no need to make any fresh statutory rules about disclosure—hence Amendment 12.
Amendment 11 is meant to prevent someone who would not be damaged taking advantage of non-disclosure. Others will give more substantial examples of that. For instance, if a wife failed to disclose her second-hand car, she could not rely on that to destroy the prenuptial agreement so as to give her an advantage. The idea is that, set against a background of clarity in dividing up assets, the court will accept the prenuptial or post-nuptial agreement as binding.
The Supreme Court has already almost worked into that position, but it attached so many conditions in the well known case of Granatino v Radmacher that about a dozen other cases followed where couples argued simply over whether the prenuptial agreement was binding. If they start going to court to argue about that, the very point of the agreement is undermined and costs accumulate.
The provisions in this group of amendments cumulatively will give very strong, although not complete, force to the binding nature of a prenuptial or post-nuptial agreement. Because the normal laws of contract will apply, if there is a mistake, duress or fraud, it will be possible to undermine a prenup. Section 35 of the Matrimonial Causes Act provides, in limited circumstances, a way to attack a post-nuptial agreement, so that is already quite common.
The great advantage of this provision is the encouragement that it will give people to get married. The noble Baroness, Lady Wilcox, who apologises for not being in her place today as she has been called abroad on urgent business, told me enthusiastically about her feelings and those of other Members of this House of riper years who might contemplate a second marriage. People who do so, having once been widowed or divorced, may well say to themselves, “But if I get married again, all the property that I inherited from my first husband or everything I have worked for might, in the event of a second breakdown, go to the second spouse and his family”. I think that most people of a riper age who are thinking of getting remarried would prefer to keep their property for their original family, and the existence of a prenuptial agreement would encourage and help them.
The prenuptial agreement is very common in other countries. Of course, as your Lordships know, there is many a transnational marriage these days. People who were married abroad get divorced here and vice versa. An English person marries someone from abroad who takes it as a matter of course that there should be a prenuptial agreement. Years ago, I had a student at my college in Oxford who got engaged. She came bouncing in to see me and said, “I’m engaged, Mrs Deech. I’m engaged. Who do I go to? Which lawyer do I see about my prenup?”. That was about 20 or 30 years ago, and one can well imagine how my jaw dropped. However, she was Canadian, from Quebec, and that is what they do in Quebec, in France, and in other places. Having decided to get married, the young couple go off and see a lawyer to discuss what they call the “matrimonial regime”, where they talk about what sort of property ownership will apply. It does not undermine their marriages in those countries. As I have said, their divorce rate is lower than ours.
I find it very curious that when the average couple in this country spend £20,000 on arranging a wedding, and spend years doing it—we all know just how complicated these things are—they do not spend just a few pounds on going to see a lawyer to decide who is going to own the property and how things are going to be sorted out. It runs contrary to our nature—or at least it used to. However, I think, and hope, that the noble Baroness, Lady Shackleton, will explain to us that these prenups and post-nups are catching on, because, sadly, none of us can be unaware of how these things can go wrong and what it will cost us. As I said, the Supreme Court has already pretty much worked itself into this position.
Therefore, I very much hope that your Lordships will accept this group of amendments, which will make prenups and post-nups binding against a background of dividing up assets fairly on divorce and will give couples a clue as to what is fair when drawing up a prenup. Alternatively, they might say, “No, I’m not going to draw up a prenup. Don’t you love me? We don’t need a prenup”. I am sorry to say that that would be a bit naive these days but this group of amendments would greatly improve the situation for couples with a foreign element, older couples embarking on a second marriage and couples where there is a great disparity of wealth: the model who marries the footballer, the singer who marries the Russian oligarch and so on. It is perfectly understandable that they might want to discuss how those assets should be owned and divided up. It is too late for me, I am afraid, but not necessary anyway. However, I very much hope that this House and the Government will recognise that that is modern society and that the amendments would greatly help a number of couples. I beg to move.
Baroness Shackleton of Belgravia
My Lords, I support the concept behind this pillar of the Bill. It is vital that there is more clarity as to when, why and where prenuptial agreements should be binding. If they are made de rigueur in this country, as they are in other countries, there will not be any romance in it; it will just be like trotting along to get your marriage licence. There will be WH Smith forms and, if the couples do not take legal advice, they will be protected.
There are problems because the current law does not provide for binding prenuptial agreements but there is a lot of travel within the European Community. People come to this country having signed a prenuptial agreement which is not a prenuptial agreement: it is a property regime which, with no legal advice, is translated into a prenuptial agreement in this country, and it causes a lot of problems. If people know in clear terms that those are not going to work, then they will know where they stand. They will know what will work and they can be given appropriate advice before they arrive here if they are intending to come to this country.
My noble friend Lady Wilcox believes that this proposal will positively encourage marriage, and I support that wholeheartedly. Unfortunately, I see a cottage industry in my profession of stepchildren encouraging divorce. It is forced upon a parent so that the parent can, putting it crudely, collect the money before they die because there is no prenuptial agreement. Therefore, divorce is being promoted by stepchildren so that assets on one side of the balance sheet can be collected and they can profit by inheritance. That is ugly. A prenuptial agreement would avoid such circumstances.
Also, second marriages are often broken by stepchildren. If those stepchildren know that their financial security is intact and protected by law, there is every chance that the marriages will survive. Speaking in my other capacity as a patron of the Marriage Foundation, I believe that everything should be done to enhance the prospect of people remaining married. Prenuptial agreements protect people because they know what will happen to them should the ghastly event of divorce happen. It is very important that people get independent legal advice because at the time they get married they are, in my experience, concentrating on the dress, bridesmaids, venue and canapés and not what may go wrong. To have people in love not being properly shown the horrors of divorce is a mistake.
I wholly agree with this measure becoming part of the statute. I was the lawyer for Mr Granatino and it was an ugly shock when the Supreme Court decided to apply contractual measures to something that had hitherto, as part of the Matrimonial Causes Act, not been legally enforceable.
Lord Faulks
My Lords, this has been a useful and instructive debate on this interesting and significant area. There are those who retain great faith in the institution of marriage. The noble Baroness herself said that, and I for one see no tension between thinking that and nevertheless being of the view that it is important there should be some sensible provision about prenuptial agreements. Her student may have been anticipating a trend by suggesting going to a lawyer almost immediately, in the heady days of announcing her engagement. A number of popular songs that suggest going to see the preacher at that juncture may have to be amended to reflect this different approach.
These amendments all relate to this clause. Amendment 9 changes the threshold of the duty of disclosure placed on both parties for the prenuptial or post-nuptial agreement to be binding on both parties. The Bill currently requires that the parties fully disclose their assets before the agreement will be binding on them and this amendment would require only “proper disclosure”.
Amendment 7 corrects the omission of the requirement in the Bill for a prenuptial or post-nuptial agreement to be made in writing. I recall that that point was specifically drawn to the House’s attention by the noble and learned Lord, Lord Scott of Foscote, at Second Reading. As the noble Baroness said, this is an essential prerequisite and a key feature of the recommendations made by the Law Commission.
The intention is clearly to protect people entering into prenuptial agreements by imposing the formality of a written and signed agreement. However, the Government have already indicated that we have reservations about the lack of flexibility in the Bill for the court to override an agreement that is unfair or does not adequately provide for “needs”. This is especially so given that people often enter into a prenuptial agreement at a point when they are not as realistic about events, sadly, as they should be.
The Government has yet to consider the detailed proposals for binding matrimonial property agreements put forward by Law Commission in its report on Matrimonial Property, Needs and Agreements. We have informed the commission that a final decision on the proposals should be made by the new Government after the election. However, the Government would not seek to oppose this amendment to the Bill.
The requirement under the existing divorce process is for both parties to make,
“full, frank, clear and accurate”,
disclosure of their assets using form E. We have concerns that undefined “proper” disclosure would be open to interpretation and offer scope for possible hiding of assets in a way that the current requirement is designed to avoid.
Amendment 8 amends the formulation of subsection (1) of Clause 3 and, if I have understood it correctly, is intended only to tidy up the drafting and not to change its substantive effect. The amendment seeks to replace the words,
“binding on the parties and is to be given effect unless”,
with “binding on them unless”. However, I believe that normal legislative drafting convention means that the effect would be to omit the crucial word “unless”, which is necessary to apply the conditions set out in paragraphs (a) to (e) of subsection (1).
Amendment 11 inserts a new substantive provision into the clause which sets out the requirements for a prenuptial or post-nuptial agreement to be binding. It does not set a new condition for the agreement to be binding; rather, it provides that only the person who has been disadvantaged can rely upon failure to obtain legal advice or failure to disclose assets as a means to make the agreement non-binding. The Government remain generally concerned about the lack of protection for people entering into binding prenuptial or post-nuptial agreements under the terms proposed in the Bill. These amendments do not appear to improve significantly on the protection offered and are substantially different from the approach recommended by the Law Commission, which would preserve the ability of the court in appropriate cases to override an agreement made between the parties where in the view of the court its terms are manifestly unfair or where they fail to provide adequately for needs. The Government have yet to consider the Law Commission’s detailed proposals. In relation to the Bill we are concerned that leaving prenuptial agreements to be subject to the rules of contractual law around validity and enforceability, and post-nuptial agreements subject to review by the court under the provisions set out in Section 35 of the Matrimonial Causes Act 1973, does not amount to a coherent set of protections.
Amendment 12 would remove the possibility of the Lord Chancellor making rules to specify what constitutes the full disclosure of assets, which is one of the requirements in the Bill for the prenuptial or post-nuptial agreement to be binding. The noble Baroness said that she has been advised that the law in relation to disclosure is sufficiently clear not to need further elaboration. As already noted, the second amendment would alter “full disclosure”, which as she rightly says is well understood, to “proper disclosure”. The Government agree that there are already established principles around disclosure. I understand that the noble Baroness is really concerned with what might be regarded as de minimis omissions from the list, but I do not think that that would in fact cause a difficulty on the existing rules. We are concerned that the use of the term “proper disclosure” could open up some areas of concern.
Baroness Shackleton of Belgravia
Would the Minister clarify that he is talking about form E? Form E is an incredibly detailed analysis of someone’s wealth; it could not be fuller than full disclosure. Is the Minister talking about disclosure of that nature, because I think that the amendment is meant to catch disproportionate non-disclosure? Form E is the most comprehensive document known to man. It goes down to the last £500 or number of pairs of cufflinks that a man may own.
Lord Faulks
I am not seeking to suggest that form E is not an extremely thorough document and I am sure that my noble friend is absolutely right on the point. But the amendment seeks to alter the rules from “full disclosure” to “proper disclosure”. If form E is going to be what proper disclosure is, my noble friend may well be right. My point is simply that proper disclosure appears to be a different description. If I have understood her correctly, the noble Baroness, Lady Deech, said that this was in order to ensure that the whole thing could not be set aside on the basis of a failure to include in the list something that someone had forgotten about or which was so trivial that it did not enter the heads of those entering into it. I understand that that is the aim, but the Government remain concerned that “proper disclosure” could open the door to someone saying, “Well, it was not proper for me to disclose that”. That is my answer to my noble friend.
Finally, Amendment 13 alters the court’s powers when dealing with the division of property on divorce when a prenuptial or post-nuptial agreement is to be treated as binding on the parties so that instead the court can make a financial order as described in amended Clause 1(3). The orders the court can make under the revised clause are an order for a lump sum payment, a property adjustment order, a pension sharing order, a pension compensation sharing order and corresponding provisions of the Civil Partnership Act 2014 and the Marriage (Same Sex Couples) Act 2013 in so far as the provisions of the 2013 Act are not already covered by the provisions of the Matrimonial Causes Act 1973 as amended by the Bill. This increases the range of orders which can be made. However it still falls some way short of the flexibility that the courts currently have under the 1973 Act and, for the reasons I have already given, the Government still have some concerns about the approach.
Divorce (Financial Provision) Bill [HL]
Baroness Shackleton of Belgravia Excerpts(9 years, 10 months ago)
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Baroness Shackleton of Belgravia (Con)
My Lords, I practise in this area of law, and started five years after the 1973 Act came into being. I begin by praising the judiciary. In a world in which trust is a rare commodity, where politicians, the police and the press have all been found lacking, the judiciary is without question beyond reproach and stands out as a beacon of hope, commanding the confidence and respect of this country, as well as of others who choose to litigate their disputes here.
The judges work tirelessly, many of them for a fraction of what they have been earning in practice. In the field of law in which I practise, however, the legislation on which they depend is overdue for review and is no longer fit for purpose because its interpretation relies too heavily on the discretion of the individual enforcing it, thereby making it more difficult to predict and therefore advise on the outcome of a particular case. This creates uncertainty; and uncertainty creates litigation. It is for this reason that I wholeheartedly support the Bill, and I am very grateful to the noble Baroness, Lady Deech, for introducing it.
When one enters the building that houses most of the family courts, there is a life-size statue of a judge. The judge has a blank face and a wig, and the statue sits, with its commanding presence, before you go into court. The purpose of its existence is to show the users of the court that the identity of a judge is an irrelevance, and that the outcome of a case would be much the same, whoever happened to be occupying the blank face. Unfortunately, this is not always the case.
I shall give a clear example of a case in which I was involved a few years ago. First, by way of background, I shall try to zoom through 30 years of matrimonial finance in a most simple form—which I hope will please my noble friend Lady Wilcox. The courts initially, when I started to practise, looked at the one-third rule—the division of assets by a third. After that, the deciding criteria were normally the wife’s reasonable requirements, their needs. So one had to go through the expenditure, right down to the postage stamps, to justify the amount of money that one was looking for, in addition to a housing fund, and the surplus was generally kept by the person who earned it. This continued to be the case until the case of White, at the end of the last century or the beginning of this one, when the House of Lords decided that that was not what the statute intended, that needs were not the overriding criteria, and that the principle of sharing the surplus fairly—whatever that might mean—was the correct interpretation of the statute.
The case I refer to involved a huge amount of money, approximately £100 million, accumulated over a 33-year marriage. The facts were not disputed. Every case, before it gets adjudicated in the High Court or in the Principal Registry of the Family Division has to go before a financial dispute resolution, in which the judge sits as a mediator. That judge cannot hear the final hearing, but predicts—or tries to predict—what the outcome will be at the final hearing and encourages the parties to settle. One could call them “supreme mediators”. The judge on this occasion, having heard the facts, decided that the assets should be split equally, 50:50. She was completely deaf to any argument that the husband had made an exceptional contribution, saying that it was much more difficult to live with a genius, control-freak, high-achieving man than with a bog-standard one who had not made that amount of money; and she said that the wife’s contribution in bringing up the family was unquantifiable. The wife was happy with that and the husband was not.
The case went to a full hearing. On exactly those facts, the trial judge decided the man had made an unmatched contribution and awarded the wife 40%. That was a swing of £20 million. It was more than he had in fact offered, but nevertheless, it made it worth while for him to continue and for her not to accept the amount that was offered at the FDR. That leaves the law in a mess, because nobody knows when special contribution kicks in, what it means—it could be something that is not quantifiable in money—and what percentage would be applied to give recognition that someone has made an unmatched contribution. The Bill sorts that out.
Another example of uncertainty is the evolution of prenuptial contracts. When I started off they were considered to be repugnant for public policy reasons: no one should contemplate the breakdown of a contract that was meant to be lifelong. You can see judges slowly changing and shifting until the case of Granatino, which I was involved in and which nobody who practised believed would happen without the intervention of Parliament. We are now left with a situation where prenuptial contracts appear to be pivotal in many cases, but the Act is silent on this. We need help.
Uncertainty of outcome creates an industry for lawyers to litigate. It makes it difficult or impossible to have successful mediation, and the financial costs—not to mention the unquantifiable human cost mentioned by many noble Lords, aggravated often by delay because the courts are too full—are vast and unnecessary. The Bill seeks to limit the discretion of a court and provide direction from Parliament for matrimonial finance. I commend it and thank the noble Baroness, Lady Deech, for introducing it.
Lord Faulks
I am not altogether sure whether that is a serious question, but of course human nature is not different. The answer is that there is no perfect solution to these difficult problems, as I am sure all noble Lords would agree. The Scottish solution is one that is certainly worthy of great consideration. The current solution in the law of this country is rather different. At the moment we are all concerned to find a solution which best serves the interests of all parties on divorce. Scotland has much to teach us, but it does not have necessarily the perfect answer. We need to learn from the experience in Scotland while accepting that human nature is the same in Scotland as it is in England.
As I say, the Bill provides for matrimonial property agreements to be binding upon couples on divorce. In its proposals on matrimonial property agreements, the Law Commission has strongly recommended that the courts should be able to depart from a matrimonial property agreement where this is considered necessary in order to protect the needs of a spouse or in the interests of any children. The Bill departs from that proposition. In its proposals on matrimonial property agreements, the Law Commission set out a comprehensive list of the requirements necessary to underpin enforceable agreements made prior to divorce. In considering the Law Commission’s proposals, the Government wish to reflect on the sufficiency of safeguards before committing to legislate to make agreements enforceable. We are currently considering those and, as my noble friend Lord McNally said, we will announce our response to them in the very near future. That will be in August—albeit that I heard what he said about the undesirability of reflecting and responding in that particular month.
The Bill’s proposals differ quite substantially from the recommendations made by the Law Commission in the light of really extensive consultation, which included consultation with family practitioners—although I am glad to say that this debate has benefited from the contribution of family practitioners. The proposals in the Bill are substantially different and their likely effects are at least unclear.
I appreciate, as I am sure the whole House does, the noble Baroness’s desire to ensure that financial division on divorce and on dissolution of a civil partnership is made simpler so that people will much more easily be able to estimate what they are likely to receive and be better able to negotiate with each other, and that couples should be able to enter into agreements to determine what they would receive on divorce.
The Government are considering the Law Commission’s report on matrimonial property agreements and how these could be made binding, and will respond in the near future. The report recommends making information available on the likely outcomes of financial applications on divorce—that has been developed during the debate—but recommends that there should be no change to the law governing “need”. The Government are concerned to give proper consideration to these and all the recommendations made by the Law Commission.
The Government recognise that divorcing couples often need help to reach an agreement and should be encouraged to avoid court proceedings. There is unanimity that court proceedings very rarely help in resolution of these disputes. They are far too expensive and the result is usually damaging both financially and, very often, to the future happiness of warring parties and children. The Government are therefore particularly anxious to encourage people to use family mediation and other forms of alternative dispute resolution.
For those who are eligible, legal aid is available for mediation. Under the Children and Families Act 2014, from 22 April this year applicants for financial orders and for financial provision on divorce must attend a mediation information and assessment meeting—
Baroness Shackleton of Belgravia
Mediation and indeed prenuptial contracts are practically impossible unless the outcome has some certainty as to what you are mediating for or what you are trying to anticipate when you are drafting a prenuptial contract. Unless the law is tidied up so that practitioners understand what the outcome would be to prevent the litigation, it is impossible to mediate.
Lord Faulks
I take the noble Baroness’s point but those helping the mediation, albeit that there is inevitably a measure of uncertainty because of the discretion given to the court, by reference to their experience and therefore what judges are customarily doing in a particular case, will nevertheless be able to advise on what is a likely outcome and what is perhaps in the best interests of the parties, and at least assist with the possibility of their not proceeding to court to have the matter heard there.
The application forms for the orders contain details of the provisions for the meetings and potential exemptions that might apply. The Government believe that these requirements will bring a significant number of people to learn about mediation and use it to resolve their disputes. Notwithstanding the point that the noble Baroness, Lady Shackleton, makes about uncertainty, if parties are happy with the outcome, that is of itself a desirable purpose in having this mediation. As my noble friend Lord McNally said, mediation has generally got a good story to tell, and increasingly that is the case.
The Government will not oppose the Bill receiving its Second Reading today but do have reservations about its approach and scope. What, however, I can take back to the department is the very clear—in fact, I think unanimous—view of those participating in today’s debate that the time has come for Parliament to intervene. That of itself is an important message that I can take back to government decision-makers about the future of this field of law. However, we consider that we are already addressing these issues. We shall continue to do so, greatly assisted by all the work that the noble Baroness has done and by the contributions to this excellent debate by all noble Lords.
Legal Aid, Sentencing and Punishment of Offenders Bill
Baroness Shackleton of Belgravia Excerpts(12 years, 1 month ago)
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Lord Neill of Bladen
My Lords, perhaps I may add a word to what the noble Lord, Lord Cormack, said. It seemed to me that he put his finger absolutely on the point. We are faced with a decision on whether the rule of law is being complied with in the proceedings on this amendment. It seems to me—and I have heard it from every speaker—that it is an indefensible provision. It is bound to have a terrible effect on a small group of disadvantaged people. They are required to build a case in this difficult area of welfare and social security law. Anyone who has had any personal experience of advising a litigant who is unaided and comes in saying, “Could you please advise me about this problem?”, does not need to look at the problem for more than five minutes before realising the difficulty in finding out what the law is. You have to find out the current state of the statute or the statutory instrument on which you seek to rely, which is quite a difficult area in itself with the rate of amendments that take place. Then there is the current state of case law or the latest court ruling in the relevant area, which could be almost inaccessible nowadays to ordinary people who have to have a lawyer. I am convinced by what I have heard that to segregate a group and say, “Legal aid and advice of any sort will not come to you from any public fund”, is something to which this House ought not, for one moment, lend its support.
Baroness Shackleton of Belgravia
My Lords, I speak in support of the amendment in the name of the noble and learned Baroness, Lady Butler-Sloss, as regards delegating to the mediator whether a person should be eligible for legal aid. I speak from my interest as a practising lawyer in this area. By delegating to the mediator, the lawyer cannot possibly be encouraged to take on work which would otherwise not be fit for purpose and it will simply be too late unless someone responsible can take the case on and protect the child in question.
Lord Phillips of Sudbury
My Lords, there is very little to add in what has been a remarkably unanimous debate—“Sit down”, says one voice. It is extraordinary that not a single dissentient voice has been heard in an hour and 48 minutes. I hope that the Minister, who has the unenviable task of summing up this group of amendments, will take on board the passion with which the House has spoken. Nearly everyone has been saying, in one way or another, that for us as a Parliament to legislate benefits for the most needy, the poorest, the least articulate and the most vulnerable and then to deny them the means of accessing those rights is not right. That will undermine a society which is already in tension. We live in difficult times. I put it to my noble friend, who I know would agree with what I have said, and to the Lord Chancellor, that for a Government to cut the lifeline—for that is what it is—of millions of our fellow citizens in getting the modest help that the state has provided for them must be the most bizarre form of saving.
Perhaps I can add a word about the advice centres. Not enough has been said today about the 60-odd law centres and the 100-odd independent legal advice centres. Together with the 200 CABs that have a specialist adviser, they deliver value for money which I suspect you could not find in virtually any other part of our nation state. That is because not only do they do that work for rates of pay that those of us in the private profession would spurn, but they are backed by an army of volunteers. The CAB movement has hundreds of thousands of people who turn out to give generalist advice which, frankly, does not achieve its purpose without the specialist trained advisers at their backs, who currently are getting contracts from the legal aid scheme. I realise the problem for the Government in trying to match the need for cuts with what society needs and I realise that my noble friend has already conceded the amendment which we put forward to allow the Lord Chancellor to bring back into scope legal aid areas that will be cut out by this Bill, but the profoundest issue here is the nature of the society to which we want to belong. Is it still to be a welfare state, or is it not? Is it right that a couple of years ago two bankers whom I can think of earned more than the entire sum that is being spent on legal aid for all the law centres and CABs? Is that the society that we want to be part of? No, say I; and no, I suspect, say all of us.
As a signatory to Amendment 101, I hope that, with all the difficulties, my noble friend will make some solid commitments that enable those advice centres to continue doing their phenomenal job—the CABs alone deal with more than 100,000 tribunal cases—because, frankly, if they cannot, I fear for the consequences.
Legal Aid, Sentencing and Punishment of Offenders Bill
Baroness Shackleton of Belgravia Excerpts(12 years, 3 months ago)
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Baroness Shackleton of Belgravia
I shall speak in support of the noble and learned Baroness, Lady Butler-Sloss, in particular on Amendment 41, which deals with child abduction. I saw the Minister wave his white hanky, which I hope is a sign of peace. If we are to look after what is in the paramount interest of a child, in most circumstances, that means contact with both parents. In the absence of legal aid, the parent who does not want to have contact effective—who wants to frustrate contact—will simply up sticks and go off with the child. If that happens, it is extremely important that measures are taken instantly to return the child because, if not, the child will become accustomed to living in the place to which it is abducted and it will be much more difficult to get it back. Absence of legal aid will encourage people to do that, which is of great concern.
Baroness Scotland of Asthal
My Lords, the Minister has had a powerful display of the House’s feeling on these matters. It is of note that not one person has spoken during Committee in support of the Government's position. Perhaps that is not surprising. When we consider issues that refer to children who have not been responsible for poor conduct but have found themselves in difficult and painful positions, the House has always spoken with one voice to protect the child and ensure that their rights are upheld. That is something that all sides of this House have always agreed and acted on in unison. I, for one, am not surprised that we have had powerful speeches from all Benches about the paramount interests of the child and the need to ensure that legal advice and support is available.
If the Government's proposals succeed, as the House knows, they will mean that more than 210,000 fewer private family cases will qualify for legal help; 45,000 fewer private family cases will qualify for legal representation; and 68,000 children will be affected by legal aid being removed for family contact and finance disputes. The noble and learned Baroness, Lady Butler-Sloss, spoke about the importance of family contact, as did the noble Baroness, Lady Shackleton.
The reason that there is unison on that issue is that any noble Lord who has participated in family cases knows the difficulty that such contact cases promote. Of the 68,000 children who will be deprived of legal aid, the majority fall within the poorest sector of society, because 95 per cent of those in receipt of civil and family legal help are in the bottom income quintile. That means that they are most in need of help, support and succour. The social implications are considerable. Fifty-seven per cent of the members of Resolution who were surveyed believe that parents risk losing contact with their children in at least half of its cases. That amounts to more than 4,000 children according to the lawyers surveyed alone.
The rise in the number of litigants in person for whom mediation is unsuitable and legal aid is unavailable will add more pressure to the court system, which is facing the closure of 40 per cent of courts. Ninety-nine per cent of those asked said that cases take longer when parties represent themselves, and the noble and learned Baroness, Lady Butler-Sloss, gave graphic examples of what will happen when a case takes a week. At the moment, more than 90 per cent of private family law cases are settled. The 10 per cent which go to law are the most intractable and most difficult.
Family law is slightly different from many other forms of litigation. Most family lawyers worth their salt see their job as damage limitation because, when a family breaks down, everyone loses and there are no winners. Therefore, if a case has to go to court, we are dealing with even greater failure. The court has grown accustomed to relying on lawyers who, in this area, are not rich fat cats. Over half of those surveyed who practise family law earn less than £35,000 and a fifth earn less than £25,000, which is less than the UK’s median annual salary. We are dealing with people who are trying to give succour to families.
The wide spectrum of law that has been spoken about—welfare law, family law and housing law—all interact. Stephen Cobb, chairman of the Family Law Bar Association, put it succinctly when he said that without access to justice—by which he meant effective access—for broken families, wider society would pay a very high price indeed. That is what we have heard echoing right around the Chamber from virtually every single speaker today.
The Family Justice Review has identified that in a significant number of cases serious child welfare and safeguarding concerns are raised when families appear in a private law court case, and those can trigger investigations by local authorities and result in public law proceedings. Statistics in the NSPCC’s report of November 2011, All Babies Count, show that around 20,000 children are living with a parent who has used class A drugs in the past year—we are talking about babies under a year old—around 100,000 live with a parent who is a problem drinker, and around 150,000 live with a parent who has a common mental health problem. One in every two cohabiting couples will have split by the time their children are five years old, and at least half of these children will face a parental breakdown. Not all couples will require a courtroom but, for those who do, many vulnerable adults will have no access to justice in private law and will be left with a choice of mediation or litigation in person—litigation which will add to, not detract from the difficulties that the family is likely to face.
For all the reasons that have been given powerfully by every single speaker, I seriously ask the noble Lord to think again. I respectfully suggest that the Government’s approach to this issue lacks foresight. It lacks full consideration of the consequences of the Bill for families for whom legal funding is not available, legal advice is not affordable and mediation is unlikely to be suitable. The cost of mediation is currently estimated by the Government to be between £6,000 and £10,000. If the Government’s own figures are right, the research indicates that it is likely to cost £48 million to undertake the mediation proposed. If half of those cases do not succeed in reaching a settlement, we will be left with dealing with them in the court in a way that is unlikely to be helpful if legal advice and support are not made available.
One of the benefits of having had such powerful speeches and it now being so late is that the noble Lord will have one relief: namely, that I do not intend to deal with each and every speech seriatim. I know that that at least is something which will make him smile, although I suppose that nothing else from this debate is likely to. I invite him to take away from this debate the strong expression made by every single speaker that what this Government are proposing is unjust, wrong, and should no longer continue. The noble Lord may think that he will get rejoicing not only in the ranks by further waving the white handkerchief. If that wave is to say he concedes, I can tell him that there will be much rejoicing in heaven.