LM v KD
| Jurisdiction | England & Wales |
| Judge | BAKER LJ |
| Judgment Date | 12 November 2018 |
| Neutral Citation | [2018] EWHC 3057 (Fam) |
| Court | Family Division |
Jurisdiction – Brussels IIa – Italian judicial separation and property proceedings –Child’s habitual residence in England – Jurisdiction in matters ofparental responsibility – Prorogation and best interests of child – Italian court declined jurisdiction in matters concerning child – Financial issues concerning child – ToLATA proceedings concerning property in London held as joint tenants – Whether rights in property arising out of matrimonial relationship – Relevance of possible English Pt III application by wife.
The husband and wife were both of Italian origin; they married in Italy in 2006 and had one child together. At the time of their marriage, they opted for the Italian community of property regime but in 2008, after the husband inherited over €4 million in liquid assets plus 68 real estate properties from his uncle, the couple executed a notarised deed, opting instead for separation of property. In 2009 they purchased a valuable property in London, executing a declaration of trust in Form TR1 recording that the beneficial interest was held by the parties as joint tenants; this became their family home. They separated in January 2016, when the wife and the child moved to rented accommodation elsewhere in London.
The couple were involved in five sets of proceedings. The first in time were the husband’s judicial separation proceedings, issued in Italy in March 2016; the husband asked the Italian court for an order separating the couple, an order dealing with custody issues and another setting child maintenance at €500 pm plus further payments in respect of her healthcare and education. His application did not include any reference to capital orders or orders in respect of the London property (or indeed any other property). The wife then made three separate applications to the English court, seeking: a child arrangements order; an order under the Trusts of Land and Appointment of Trustees Act 1996 (ToLATA) for sale of the family home with an equal division of the net proceeds and an order under sch 1 of the Children Act 1989, for school fees and child maintenance (on the basis that the Child Maintenance Service had no jurisdiction as the husband’s income derived entirely from Italy). The husband then made a second Italian application in October 2016 (the property proceedings), seeking declaratory relief in respect of the inheritance from his uncle.
The wife had attempted to issue English divorce proceedings, but accepted that these needed to be stayed when it became clear that the Italian court was first in time. However, in her October 2016 response to the husband’s separation petition, she expressly challenged the jurisdiction of the Italian court to deal with matters relating to the child’s custody and maintenance. In the wife’s defence and counterclaim in the husband’s second Italian proceedings, in December 2016, she asked the Italian court to stay the proceedings in respect of her claims concerning the London property. The husband argued that at various stages she later accepted Italian jurisdiction in both matters; certainly in May 2017 she invited the Italian court to accept jurisdiction concerning the child for the purpose of making urgent orders.
The husband participated fully in the English children arrangements proceedings, including a fact-finding hearing to explore the wife’s allegations that the husband had physically and emotionally abused her and the child. An order dated January 2017 contained an express declaration that the parties agreed that the English court had jurisdiction in respect of all matters about where the child should live and what contact she should have with the husband. Until November 2017, the husband did not express any objection to the English court’s jurisdiction in respect of the child’s custody, although he did dispute its jurisdiction in relation to financial matters concerning the child. In March 2017, an English judge ruled that the English court had jurisdiction in matters of child maintenance, relying on an expert report setting out the decision in A v B (Case C-184/14). In February 2018 the Italian court provided that the couple should live separately but ruled that it had no jurisdiction over matters of parental responsibility, because the child was habitually resident in England; it also ruled that claims for child support should be left to the English court, applying A v B. In May 2018, this ruling was confirmed on appeal. This was not technically the end of the matter, however, as a final decision on all matters, including jurisdiction was to be made at the end of the process, by a panel of three judges known as ‘the Collegio’.
In May 2017, the husband’s counsel conceded that the wife’s ToLATA claim to the London property was within the exclusive jurisdiction of the English court, but argued that it should be stayed, in the judge’s discretion, to enable the issue to be dealt with in the context of the Italian matrimonial proceedings. The judge declined to stay the wife’s ToLATA claim, observing that, given the lack of any ancillary relief proceedings in England, it was preferable for the property issue to be dealt with sooner rather than later. An Italian ruling on 1 June 2017 expressly accepted that issues relating to the London property fell outside the ambit of the Italian property proceedings.
The husband appealed both the English rulings, arguing that both the children arrangements proceedings and the ToLATA proceedings should be stayed by the English court and these issues decided in Italy.
Held – (1) Given that the Italian court had, in unequivocal terms, declined jurisdiction to make orders in respect of parental responsibility under Council Regulation (EC) No 2201/2003 (Brussels IIa), the English court, as the court second seised, was no longer obliged to stay its proceedings. The fact that the Italian Collegio at the final hearing was going to give an ultimate ruling on the question of jurisdiction did not require the English court to stay proceedings any longer. Distinguishing Re M, the Italian court had declined jurisdiction so far and if the English court were still required to stay proceedings, no forum would currently be available for the parties to determine matters of parental responsibility or child maintenance. The courts must adopt a sensible and pragmatic approach to jurisdictional rules; a party could not be without a remedy. The English court was entitled to exercise jurisdiction in respect of the child (see [104], [105], below).
(2) Whilst it would not be open to the English court, in the context of proceedings to recognise and enforce an order, to review a decision by a foreign court as to jurisdiction under art 24 of Brussels IIa, the court was not prevented from observing, respectfully, that the Italian courts were entirely correct in their view that jurisdiction in respect of matters relating to parental responsibility rested with the English court. The child was habitually resident in England. The issue of parental responsibility has been before the English court for a prolonged period without a challenge to the court’s jurisdiction. It was difficult to see any basis upon which any Italian court could possibly conclude that jurisdiction had been prorogued to the Italian court under art 12 of Brussels IIa. The fact that, at one stage, the wife had invited the Italian court to accept jurisdiction for the purpose of making urgent orders manifestly did not satisfy the requirements of art 12 that the jurisdiction of the court be accepted expressly or otherwise in unequivocal manner at the time the court was seised. In any event, art 12(1) further required that the prorogation of jurisdiction must be in the superior interests of the child and the court respectfully agreed with the Italian analysis that it was in the best interests of the child for the English courts to continue to exercise jurisdiction in respect of parental responsibility (see [106], [107], below).
(3) It followed, therefore, applying the CJEU decision in A v B, that jurisdiction in respect of child maintenance, governed by Council Regulation (EC) No 4/2009 (the Maintenance Regulation) also lay with English court. Where there were proceedings in one jurisdiction in respect of the status of the parents, and proceedings in another jurisdiction in respect of parental responsibility, an application relating to child maintenance should be regarded as ancillary to the latter proceedings rather than the former. The legal principles established in A v B were clearly applicable throughout the EU (see [109], below).
(4) The husband and wife’s rights in the London property did not arise out of a matrimonial relationship so as to take this case outside Council Regulation (EC) No 1215/2012 (Brussels I Recast). The fact that the husband and wife were married was an important part of the context in which the property had been purchased, since the purpose for its acquisition had been to provide a family home for the parties and their child, but the rights in the property arose out of the express declaration of trust set out in the TR1 form, not from the matrimonial relationship (see [111], below).
(5) Applying Komu v Komu (Case C-605/14) [2016] 4 WLR 26 and Magiera v Magiera[2016] EWCA Civ 1292, where the principal subject matter of a claim was to achieve a sale of the property, it involved ‘the external relations of the trust, rather than (or at the very least, as well as) the internal relations of the trust’ and rights in rem which had effect ergo omnes. As in Magiera, this wife was seeking to ‘protect the powers attached to her interest by bringing about a transfer of a right of ownership in the house by a sale of it’. In those circumstances, jurisdiction plainly lay with the courts of England under art 24(1) of Brussels I Recast, as England was the country where the property was situated (see [112], below).
(6) Whilst there were related proceedings in Italy concerning the...
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