Dominika Anita Gabrielsson Brack v Per Cenny Brack
| Jurisdiction | England & Wales |
| Judge | Lady Justice King,Lord Justice Peter Jackson,Lord Justice Lewison |
| Judgment Date | 20 December 2018 |
| Neutral Citation | [2018] EWCA Civ 2862 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: B6/2017/0195 |
| Date | 20 December 2018 |
[2018] EWCA Civ 2862
Lord Justice Lewison
Lady Justice King
and
Lord Justice Peter Jackson
Case No: B6/2017/0195
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
FAMILY DIVISION
The Honourable Mr Justice Francis
Royal Courts of Justice
Strand, London, WC2A 2LL
Patrick Chamberlayne QC (instructed by Sears Tooth) for the Appellant
Martin Pointer QC and Peter Mitchell (instructed by Irwin Mitchell) for the Respondent
Hearing dates: 21 st November and 22 nd November 2018
Approved Judgment
This is an appeal from an order made by Mr Justice Francis, on 22 December 2016, in financial remedy proceedings.
The case centred on a series of three prenuptial agreements made between Dominica Brack (the wife), and Per Cenny Brack (the husband) in 2000. The judge found that, although there were no vitiating factors which would militate against the agreements being effective, the terms of the agreements were unfair in that they failed to provide for the needs of either the wife or the children of the marriage.
The judge also held that the prenuptial agreements contained a prorogation clause, the effect of which was to give exclusive jurisdiction in respect of the parties' maintenance obligations to the courts of Sweden (maintenance obligation includes all “needs” including housing). The judge held, however, that he retained residual jurisdiction to determine the “rights of the parties in property”.
The judge went on to hold that, as “needs” had been prorogated to Sweden by virtue of the maintenance prorogation clause (“the MPC”), he was prohibited from making orders under the Matrimonial Causes Act 1973, other than in relation to strict property rights, even in relation to the unmet needs.
The judge accordingly attempted to make up the shortfall in the wife's needs by way of:
i) An order for sale of the jointly owned matrimonial home pursuant to section 17 Married Women's Property Act 1882.
ii) Orders under Schedule 1 Children Act 1989 whereby (a) the husband was to provide a property, up to the value of £2m, as a home for the children until they cease full time education, whereupon the wife's right to occupy the property would cease; (b) £35,000 towards the cost of a car for the wife; (c) child maintenance and a carer's allowance of £95,000pa.
The appeal raises two issues:
i) On the facts of this case, was there a valid MPC in the agreements, or any of them, depriving the English courts of jurisdiction to provide directly for the needs of the wife in financial remedy proceedings?
ii) As a matter of general principle, where there is no MPC and a court has found there to be a prenuptial agreement with no vitiating factors which, however, fails adequately to provide for the needs of the wife and any children, is the court limited to making only such orders as will meet the wife's needs?
Background
The husband and wife are Swedish by birth and nationality. They were married on 29 December 2000, having lived together for 6 years. The marriage broke down in 2014. There are 2 children of the marriage.
During the course of the marriage, the family lived variously in the United States, Belgium, and most recently, in the United Kingdom.
The husband was a racing driver. He achieved considerable success on the United States IndyCar circuit before a serious crash in October 2003 effectively brought his racing career to an end. Since his accident, the husband's principal source of income has been from the active management of his substantial asset portfolio.
Following the birth of the children, the wife was the homemaker. Other than her half share in the former matrimonial home, the wife has no assets in her own name and has debt, some of which is owed to the husband consequent on his having lent her £95,000 towards her legal costs (and upon which he charges interest at 5% per annum). That £95,000 has proved to be but a drop in the ocean. In the 4 years since their separation, the parties have spent in excess of £1m in legal fees in relation to the financial remedy proceedings, with further significant costs being incurred in relation to the arrangements for the children. By the time of trial, the wife was in debt to the tune of £350,000.
Each of the parties have made equal, but different, contributions to the marriage. At the time of trial, the assets accumulated during the duration of the relationship, amounted to a little under £11m; £1.8m of which represents the net equity in the former matrimonial home.
Having set out the background, which is relatively conventional in terms of the parties' respective contributions, the judge said:
“[22]…apart from two significant issues to which I now turn, this may well have been a case where the assets would have been broadly shared between the parties. I recognise that there may still have been arguments about the extent to which some of the assets were non-matrimonial in character, but in my judgment it is highly unlikely that the parties would have spent hundreds of thousands of pounds on high quality legal advice and litigation about such arguments but would have reached a compromise tolerable to each of them.”
The two “significant issues” to which the judge referred were:
i) The impact of the three prenuptial agreements; and
ii) Whether there was an effective MPC for the purpose of Article 4 of Council Regulation (EC) No 4/2009 of 18 December 2008 on jurisdiction, applicable law, recognition and enforcement of decisions and cooperation in matters relating to maintenance obligations (the Maintenance Regulation). The effect of an Article 4 MPC, if valid, would be that all issues in relation to maintenance were within the exclusive jurisdiction of the Swedish courts.
In order to determine the issues, it was necessary:
i) In respect of the prenuptial agreements, for the judge:
(a) to hear evidence and to make findings of fact in relation to the agreements and, in particular, to determine whether any of the standard vitiating factors of duress, fraud or misrepresentation were present, or whether there was pressure or exploitation of a dominant position by the husband which would serve to negate the effect of any agreement ( Radmacher v Granatino [2010] UKSC 42, [2011] 1 AC 534 ( Radmacher) [71]). In the present case, the wife alleged that the husband had obtained her signature on each of the agreements by misrepresentation;
(b) In the event that no vitiating factors were present, to decide whether the agreements were “fair” and to what extent the court should give effect to the agreements in question.
ii) In respect of the purported MPC, the judge had to decide whether there was, on the facts of the case, a prorogation clause valid under European law. This issue was and remains, a matter of construction and required no specific findings of fact.
The Prenuptial Agreements
Three prenuptial agreements were signed by the parties in the months leading up to their marriage. The first and third of those agreements, known respectively as the “Niagara agreement”, dated 10 July 2000, and the “Gothenburg agreement”, dated 26 December 2000 (being the locations where each were signed), were, for all relevant purposes, in identical terms and upon being translated from the Swedish, provided as follows:
“ PRENUPTIAL AGREEMENT
andPROROGATION AGREEMENT
The undersigned… who intend to contract a marriage with one another, by this conclude the following prenuptial agreement. Furthermore, we enter into a prorogation agreement in which we determine what law and court shall apply and as to the distribution of property between ourselves.
Prenuptial Agreement
All property acquired by each of us independently before entering into marriage or which will be acquired during the marriage as well as any property which will replace that property together with all revenue generated by all property shall make up the private property of each of us independently, in which the other spouse shall have no right by marriage to community property or other joint property rights.
Prorogation Agreement
Moreover, we agree that in the case of separation between the two of us Swedish law shall apply at the distribution of our property and that any dispute as to that property shall be settled in accordance with Swedish law before the City Court of Stockholm, Sweden.”
Each of the documents was signed and dated by both the husband and wife.
At the time of the signing of the Niagara agreement and prior to the marriage, the husband and wife were living in the United States, where the husband was pursuing his racing career. On 11 December 2000 (18 days before the marriage), the second in time of the three agreements (“the Ohio agreement”) was entered into by the parties. This document was a far more lengthy and detailed document than either the Niagara or Gothenburg agreements, and was wide-ranging in its prenuptial terms covering, by way of example; pensions, taxes and medical expenses, as well as (at Clause 12) the issues that would arise upon “Termination Of The Marriage”. The wife received clear, legal advice that she should not sign the agreement on the ground that it was unfair, but, notwithstanding that advice, decided that she wished to do so.
Clause 12 of the Ohio agreement dealt with, inter alia, how the matrimonial home should be divided, and made financial provision for the children. Significantly for the purposes of this appeal, within Clause 12 is found the following provision:
“Each party hereby irrevocably waives, releases and relinquishes any and all claims or rights that he or she now or hereafter might otherwise have, including without limitation any rights acquired of virtue of the marriage, to...
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