Will London Become the Divorce Capital of the World?

In an era where divorce tourism is becoming increasingly common, with the globe-trotting super-wealthy trying to split up wherever will give them the best deal, London has the potential to become the divorce capital of the world.


Some divorcing couples battle over who keeps the wok they got as a wedding gift.

In cases where multimillionaires divorce, multiple properties, hefty offshore assets, and substantial trust funds can make the fighting even more prolonged and bitter.

One such case, the divorce between Elena Golubovich and Ilva Golubovich, both in their twenties and from wealthy Russian families, saw the former spouses pay out legal costs of more than 2 million pounds ($3.22 million). Mrs Golubovich tried to get the divorce heard in London, where the couple had lived, while Mr Golubovich, a financier, rushed through a divorce in Russia.

British courts are historically seen as more favorable to the less wealthy partner in the marriage than other jurisdictions. In China, for example, there is no legal obligation to pay child support.

The McFarlane case, where wife Julia McFarlane was awarded 250,000 pounds annually and about 3 million pounds in capital for her contribution to her husband’s career as a wife and mother of their three children, is one of the best-known recent settlements.

The judge ruled that Mrs McFarlane was entitled to a large slice of her husband’s earnings because she had given up a promising career as a lawyer when they married.

The British legal system is also attractive to some people because both partners are legally required to make full disclosure of their assets, while in some countries, including Spain, the onus is on the spouses to prove how much their soon-to-be former husband or wife is worth.

The international super-rich can get divorced in London even if they are not British-born or wed, because under a British regulation known as Part 3 jurisdiction, they can get divorced here if they have substantial links to the UK, such as owning a property.

"It’s obviously very international here, and London has lots of international couples," Frank Arndt, head of the international department at Stowe Family Law, told CNBC.com. "You do need some substantial presence in the UK."

The decision over how much child support or alimony should be paid can continue in the UK even if one party has got a decree absolute issued elsewhere, as in the case of the Goluboviches.

In a recent case involving a divorcing Nigerian couple, Agbaje v Agbaje, the wife was able to get a higher settlement under British law because the couple owned a home in the country and their children had been educated there.

"Even if you start proceedings somewhere else, one partner can come back to the UK. That’s a very nasty tool against the wealthier partner," Arndt said. "A lot of them will try to get as far away as possible."

Wealthier partners may have good reason to stay clear of London.

In 2006, Melissa Miller walked away from a childless marriage of less than three years with 5 million pounds of her fund manager ex-husband’s 17.5 million pound fortune.

"Every husband saw that with fear," said Arndt.

And former Beatle Paul McCartney paid out 24.3 million pounds to former wife Heather Mills in 2008, after six years of marriage.

This settlement is dwarfed by the rumored 100 million pounds paid out by Russian tycoon Boris Berezovsky when he divorced his second wife Galina. This figure has never been confirmed.

While pre-nuptial agreements, or pre-nups, are not formally recognised under British law, they are increasingly common and can be binding.

In the case of German paper heiress Katrin Radmacher, appeal judges in the UK ruled last year that her ex-husband Nicolas Granatino was only entitled to 1 million pounds of her fortune, as stated in their pre-nup.

Arndt said that he would advise all high net worth individuals to sign pre-nups as they are being formally recognised more often.