EUPillar B v D (also known as AB v CD) Court of Session (Outer House), 22 December 2006, [2006] CSOH 200 (Lord Brodie)

Summary

AB, the pursuer, raised this action of divorce against CD, the first defender, seeking a capital sum of £1million. The second defender was a trustee, ie the Bank of Scotland Trust Company (International) having a place of business in Jersey. AB resided in Scotland and CD formerly had resided in Scotland too, but he then left his address without disclosing any subsequent address to AB. The action proceeded as undefended as AB was not present and not represented. No issue arose in relation to jurisdiction, but the Court noted that jurisdiction in the action was founded on the habitual residence of the pursuer in Scotland throughout the period of one year prior to the raising of the action as provided by s.7(3)(b) of the Domicile and Matrimonial Proceedings Act 1973. On the basis of the evidence, the Court was satisfied that the marriage between the pursuer and the first defender had broken down irretrievably and therefore it was appropriate to grant decree of divorce. The remaining issues were related to financial provision sought by the pursuer by a payment of a capital sum of £1million. The Court valued the matrimonial property of £2,854,000 and, based on the principle of the sharing of the net value of matrimonial property as set out in s 9(1)(a) of the Family Law (Scotland) Act 1985, considered £1million sought by the pursuer appropriate to order payment of that sum. However, the Court underlined that a decree for payment was only useful insofar as it was capable of enforcement. The Court continued that since the first defender no longer resided in the UK and resided part of the time in France, the pursuer would have to take steps to enforce it outwith the UK and her prospects of doing so successfully would be enhanced if, in a Contracting State, she could bring herself within the provisions of Brussels I. The Court addressed the distinction between matters of maintenance and matrimonial property as required by the Brussels regime. This was an important distinction, because while an order in respect of maintenance is capable to be enforced under Brussels I since it is within its scope under Art 5(2), an order in respect of rights in property arising out of a matrimonial relationship is not so because it is excluded from its scope by Art 1(2). The Court found that that the application for financial provision in this action was ancillary to proceedings concerning the status of a person, it had been brought in a court which, according to its own law, had jurisdiction to entertain those proceedings and the relevant jurisdiction had nothing to do with the nationality of the parties. Therefore, the Court had jurisdiction under Art 5(2) of Brussels I and the only issue to decide for the Court was the characterisation of a decree for capital payment. The Court examined this issue under the relevant CJEU case law and stated that the characterisation of the decree was not dependent on the form of the payment whether it was periodical or lump sum, but on the aim of the court as deduced from its reasoning. The Court decided that from ss 9 and 11 of Family Law (Scotland) Act 1985 a purpose of an award of financial provision was to provide for the maintenance of the economically weaker spouse by the economically stronger spouse. The Court granted a decree of divorce. The Court also granted decree for payment of £1million, with interest at eight per cent per annum from the date of decree, and of that sum attributed £500,000 to maintenance as that term was used in Brussels I, which reflects the Court’s purpose of making 50% of the sum capable to be enforced by the pursuer outwith the UK under Brussels I. The enforcement of a maintenance judgment within the EU is now governed by the EU Maintenance Regulation and a similar capital award today should be split in the way suggested by Lord Brodie to guide other courts in the EU as to what is enforceable as maintenance under the EU Maintenance Regulation.