California dreaming...

Posted: 26/10/2015


Ellie Hampson-Jones, an associate with the Penningtons Manches LLP London family department, has recently returned from an exchange program with Harris Ginsberg LLP, Los Angeles. In this article, in conjunction with Randi M Akasaki, an associate at Harris Ginsberg, she shares a brief insight into the similarities and differences between the two jurisdictions, focusing primarily on the family law issues which may arise following the breakdown of a relationship.

A version of her article is published today on the home page of the Spear’s website.

The article

Many (including Sting) talk of an “Englishman in New York”, yet not enough coverage is given to the estimated 200,000 British living in Los Angeles, never mind the abundance who are taking on the world one microchip at a time from Silicon Valley. More than ever, people are choosing to live between California and London, or relocating permanently from one location to the other. For example, British Airways now operates a daily flight direct to San Jose (home to Adobe, Apple, Cisco, eBay, Google and Intel) in addition to its daily schedule to San Francisco and Los Angeles.

While one may consider itself the home of surfing, boast of more than 360 days of sunshine a year and consider a ‘toad in the hole’ to be a wildlife issue, surprisingly there are a number of similarities between the cultural make up of Los Angeles and London. Both are home to hundreds of thousands of millionaires, both have vast eclectic industries which make them global financial powerhouses and both act as second homes for a wide variety of nationalities ranging from France, Russia, Iran to Korea. The melting pot which arises in each of these jurisdictions can result not only in complicated tax positions but also, and importantly, complex international family issues.

Divorce - the blame game

In keeping with their sunny dispositions, the Californians operate a ‘no-fault’ policy for the grounds for divorce. The primary basis for commencing a divorce in the state of California is “irreconcilable differences,” which is simply a box on a form that needs to be checked. The court does not take either party’s behaviour into consideration in making its orders at any time during the divorce proceedings except, perhaps, for the purposes of child custody and legal fees. In contrast, England relies on a ‘fault’ system. One party must petition for divorce (or the dissolution of a civil partnership) and, in doing so, must prove there has been an irretrievable breakdown of the marriage evidenced by one of five facts, either adultery, unreasonable behaviour or certain periods of separation. The most common fact relied upon in England is unreasonable behaviour with the court accepting relatively anodyne allegations. Most English lawyers are uncomfortable with the present ‘fault’ based approach, which can result in greater acrimony between couples.

Cohabitation

Neither Californian nor English law recognises the concept of ‘common law marriage’. Couples who cohabit, regardless of the length of time of the cohabitation, will not be entitled to seek financial relief from their partner. In short, neither party has a legal obligation toward the other for financial support and financial claims are limited to those made on behalf of children or, in a limited number of cases, for a legal or equitable interest in property.

Both jurisdictions afford some recognition to ‘cohabitation agreements’. While California will uphold these agreements as long as they abide by California’s contract laws, the position in England is not as clear. In England, the agreement may not be upheld although it may provide useful evidence of a common intention held by the parties.

Child and spousal support

In English law, child and spousal support (also referred to as maintenance or periodical payments) are treated entirely separately. A party’s obligation to provide child support is a duty owed to a child, not the child’s primary carer. Child support is calculated by reference to the Child Support Act 1991 and jurisdiction for a claim is managed by the Child Maintenance Service. 

The formula for calculating how much child support is due is made by reference to the non-resident parent’s gross income and the amount of nights a year the child spends with that parent (ie the parent with whom the child does not live). The English court will not have jurisdiction for child support, save in exceptional circumstances such as when the non-resident parent’s gross income exceeds £156,000 per annum.

Upon the breakdown of a marriage, one party may be required to provide maintenance to the weaker financial party. In England, the decision as to whether or not to make an order for maintenance is not calculated by a formula. An order is entirely discretionary and is made by reference to a number of factors including the parties’ earning capacity, resources and standard of living. Traditionally, courts have awarded the dependent spouse joint lives maintenance (ie until their death or remarriage). However, it is certainly not guaranteed in all cases and recent court led discussions have led to an increased emphasis on moving the weaker financial party to self-sufficiency.

When approaching support, the laid back, take your chance approach is confined to the surf. For the Californians are very clear: child support is calculated by software known as DissoMaster, which takes into account the parties’ incomes and amount of custodial time with the children. The software is also used to determine spousal support on a limited basis. The software has been in place for some 20 years, proving that when it comes to leveraging technology to make life simpler, clearer and more straightforward, the Californians know their stuff.

Property division

One of the biggest differences between Californian and English law is the division of property upon divorce. In England, property is redistributed at the discretion of the court following consideration of factors set out in section 25 of the Matrimonial Causes Act 1973. The court is invited to consider these factors in conjunction with three key principles which have emerged as a result of judicial interpretation of section 25: needs; sharing; and compensation.

Regardless of how property is introduced in to the marriage (ie by way of gift or inheritance), it may form part of the matrimonial ‘pot’ if it can be demonstrated that a spouse requires the property to meet their needs. The parties’ needs will always trump equal sharing of assets. In the event that the parties’ needs are met, then the concept of sharing will prevail. The ultimate objective of the court is to give each party an equal start on the road to independent living. In California, property acquired during the marriage is “community property” and, upon divorce, the community property is divided equally. 

However, property that is acquired before marriage, after marriage, via gift, or via inheritance is “separate property” and remains the property of the acquiring spouse. In practical terms, this often means that California is more favourable for the spouse who made his or her fortune prior to marriage or who has family money.

Privacy

In England, all family-related matters proceed in private (save for those matters which the presiding judge concludes should be heard in public). In particular, in financial proceedings, the court firmly holds that the parties’ obligation to provide full and frank disclosure should not be fettered by the fear of confidential information making its way into the public domain.

In complete contrast, visiting lawyers from outside California linger outside courts in session in trepidation unaware that the majority of cases in California proceed in public.

Conclusion

This article is just a whistle stop tour between the two jurisdictions. It is important to note that, although many of the legal concepts between California and England are broadly similar, the process and approach adopted by each jurisdiction can be extremely different and produce significantly different outcomes.

If you are conducting life between the two jurisdictions or have connections to both areas, it is sensible to gain advice immediately upon issues arising, or in advance, to help understand how the law may affect the outcome of your case.

Both Harris Ginsberg LLP and Penningtons Manches LLP are well known for their expertise in international family law and have authored the chapters on their respective jurisdictions in the recently published Family Law: A Global Guide (Third Edition 2015), published by Thomson Reuters.


Return to news headlines

Penningtons Manches Cooper LLP

Penningtons Manches Cooper LLP is a limited liability partnership registered in England and Wales with registered number OC311575 and is authorised and regulated by the Solicitors Regulation Authority.

Penningtons Manches Cooper LLP