Spotlight Profile: Kyra Cornwall, Barrister, 1 Hare Court

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Spotlight Profile: Kyra Cornwall, Barrister, 1 Hare Court

In this Spotlight Profile, we are talking to Kyra Cornwall, Barrister at 1 Hare Court in London, England.  Kyra specializes in high profile matrimonial matters and has extensive experience working on family law matters involving international jurisdictions including Cayman Islands, Singapore, France, Russia and Hong Kong.

Kyra, it is such a pleasure to speak with you today as I know you run a very busy practice in London, England as Barrister to many high-profile matrimonial clients.  Kyra, this is your first spotlight profile here on Hong Kong Divorce, can you tell our readers more about yourself and the work that you do in the matrimonial arena in London? 

Thank you so much for inviting me. It’s a pleasure to be involved!

I am a Barrister practising at 1 Hare Court, the leading matrimonial finance set in England and Wales. We are based in the heart of legal London, in the middle of the Temple, and specialise in matrimonial finance cases. In my ten years at the Bar, I have developed a practice involving lots of international families, both representing them directly in England and Wales, and offering English advice where proceedings are taking place abroad.

Your practice extends to international jurisdictions.  Can you tell us the link that you have to matrimonial matters here in Hong Kong and your experience working on Hong Kong cases?

In 2017, I was awarded the Pegasus Scholarship by the Inns of Court which enabled me to spend that summer in Hong Kong working firstly at Withers then at Temple Chambers (with Richard Todd QC) and finally sitting in on cases at the Family Court with Her Honour Judge Melloy. The purpose of the scholarship is to enable lawyers to build their international awareness and forge links abroad. I had a particular interest in Hong Kong as my father’s family are from Hong Kong originally, and so had been looking for a way to develop international links on a professional basis as well as personally. That summer certainly gave me the ability to do both of those things.

Over the course of my stay, I was fortunate to meet a huge number of family law practitioners and was given a real insight into a legal system that is so similar to that in which I practise in the UK.  Since returning to the UK, I have maintained a Hong Kong focus to my work from London, continuing to advise on cases which include connections to Hong Kong.

Have you noticed any changes or differences in your practice as a result of Covid-19 and the ongoing pandemic?

Absolutely. When the pandemic hit in London, many practitioners were still working from hard copy papers and almost all court hearings were in person. Suddenly the courts were closed and the legal world had to take a giant leap into the 21st century. Within a matter of weeks, papers were being sent electronically and court hearings were taking place via video platform. Although there were some teething problems at the outset, in my view this has been transformative for life as a lawyer and at the Bar particularly.

Prior to the pandemic, a significant portion of my life was spent travelling to Court, waiting around at Court and travelling home again. Being able to operate remotely has virtually removed this, enabling people to work more efficiently and improving work life balance for practitioners.

Beyond this, for those cases involving parties based internationally or where a party has to travel a lot for work, the advent of video platform hearings has also made it much easier for them to be involved without disrupting their working lives so much.

That’s not to say that there have not been problems: there have been technical glitches along the way and there are difficulties when a party does not have more than one screen available to them, but for the most part I think that the pandemic has forced the legal profession to take positive steps that I hope will remain in place moving forward.

One of your areas of specialty is marital agreements.  Hong Kong follows the United Kingdom landmark decision as seen in Radmacher v Granatino [2010] UKSC 42.  Do you see the law evolving or changing in the future with respect to marital agreements in the UK? 

Since the landmark decision in Radmacher, the courts have had to grapple with the questions of whether the parties had all the information material to their decision(s) to enter into a marital agreement, whether each party intended that the agreement should govern the financial consequences of the marriage ending and whether in all the circumstances this is fair.

Whilst the 2010 decision was followed by the Law Commission report in 2014 which suggested that marital agreements should in essence be upgraded to “Qualifying Nuptial Agreements” – i.e. enforceable contracts – in an attempt to provide more certainty to parties, this has not been made into law.

The current approach in the English courts is to focus on the circumstances in which agreements were reached and where they leave the parties in real terms financially, based on all the circumstances of the case. The recent reported decisions demonstrate a reluctance for the court to uphold agreements which are unfair or which do not meet needs objectively (see for example Brack v Brack [2018] EWCA Civ 2862, Ipekci v McConnell [2019] EWFC 19, IU v OS [2020] EWFC 98). The existence of an agreement does not automatically drive a case into needs territory only; it is one of the factors that weighs in the balance. Equally, a lack of legal advice does not automatically render an agreement unfair (see for example Versteegh v Versteegh [2018] EWCA Civ 1050).

That said, anecdotally I would say that a marital agreement that, for example, excludes sharing or fixes provision, does often have the impact of reducing a party’s claim where otherwise they might achieve more.

In Hong Kong, we see many expatriate couples with questions on whether to file in Hong Kong versus their home countries.  What advice would you give to those individuals who have a connection to both Hong Kong and England & Wales in terms of jurisdiction in regards to their divorce?

If I were to meet with a new client who had the option of getting divorced in both Hong Kong and England & Wales, I would suggest that they take local advice in both jurisdictions before making a decision. Where the outcome is likely to be similar (as between Hong Kong and England & Wales), it is likely to come down to questions of practicality.

There is one change coming in England & Wales however that may benefit one or both parties. No fault divorce is due to be brought in from April 2022 (i.e. being able to get divorced without having to plead any allegations of blame). This will hopefully help to drive down tensions and therefore reduce some of the distress that divorce proceedings can bring.

There’s sometimes an ongoing belief that England is a better forum to divorce because of the higher potential in terms of ancillary relief (finances) and costs.  Is this true or is this simply a misconception?

Both England & Wales and Hong Kong adopt bespoke outcomes on divorce, applying the concept of sharing, and the homemaker is seen to contribute just as much as the breadwinner. On that basis, assets in both jurisdictions are divided on a sharing basis if needs are met. Yes, the numbers are big, but England & Wales and Hong Kong are broadly similar in their approach to outcome.

To that extent, whilst London has the reputation of being generous on divorce, I think that is more due to the system that we apply (i.e. very similar to that of Hong Kong) as compared to the rest of the world. Broadly the same principles apply between England & Wales and Hong Kong when dividing assets and awarding maintenance, but other factors will play into needs-driven outcomes, such as the cost of living, parties’ abilities to work (e.g. visa issues), and access to the courts (Hong Kong grants jurisdiction where parties have a “substantial connection” at the date of petition/application, England & Wales operates a more stringent test).

This was such an interesting chat Kyra, thank you so much for your time.  We look forward to having you on board again to discuss other interesting and key topics in the area of matrimonial law!

About Kyra: 

Kyra is a barrister at 1 Hare Court in London, England.  Kyra specializes in financial remedies, claims after foreign divorce, nuptial agreements and jurisdiction disputes.  She is a member of the Family Law Barrister Association (FLBA) and the Inner Temple.

Kyra is described as a “a star in the marking, super clever, slick, elegant and professional” and “a smiling assassin” by both clients and peers.

Kyra’s practice is concentrated on high profile and international matrimonial cases, specifically issues dealing with forum disputes, cases with international trust and company structures, cases with complex issues of enforcement, issues of privilege and cases involving the enforcement of nuptial agreements. She regularly represents husbands and wives in high value and prominent matters, both led and alone in the High Court. She advises clients nationally and internationally, from jurisdictions including the Cayman Islands, Singapore and France, and has a particular interest in cases with links to Hong Kong, having undertaken the Pegasus Scholarship there in 2017.

Kyra is a contributing author of Rayden and Jackson on Divorce and Matrimonial Matters, a comprehensive and key guide for family law practitioners

For more information about Kyra and her practice, you can visit her Chambers’ website:  https://www.1hc.com/people/kyra-cornwall/

 

 

 

Spotlight Profile: Madeleine Booth, Barrister at Bernacchi Chambers

In this Spotlight Profile, we are talking to Madeleine Booth, Barrister at Bernacchi Chambers in Hong Kong.  Madeleine was recently named as one of the leading family and divorce law barristers in Hong Kong for 2021 by Doyles Guide.

Over the next year, we will touch base with Madeleine to discuss various hot topics in the area of matrimonial law and delve deeper into each subject and gain insight from her, as a barrister with expertise in the family law arena.

Madeleine, we spoke to you in September 2019 (pre-Covid) and you gave us a great rundown and overview of your work as a barrister in Hong Kong, pointing out the differences between a barrister and solicitor and the work that you do.  Can you tell us how you have been since pre-Covid days and whether you have seen any changes in the matrimonial sector since the Covid-19 pandemic? 

Since the last occasion, there’s certainly been a shift in the matrimonial sector as a consequence of the pandemic. To give just two key examples, there’s firstly been an unforeseeable, dramatic impact to various industries, which has had a knock-on effect on people’s income and perhaps even resulted in one or both spouses losing their job. Due to this, there’s been a marked increase in applications for variation of maintenance (monthly sums payable from one spouse to another, and/or for the benefit of the children of the family), as payments are no longer affordable or sustainable, either because of the loss of a job or a dramatic cut to an individual’s income.

Secondly, the situation caused by the pandemic has generally been a stressful, demanding time for families; both parents and children alike in many respects, and for a drawn out, extended period of time. Tensions and frustrations, exacerbated by limitations on travel and economic pressures, have led to fractures in marriages and co-parenting difficulties that have reportedly led to an increase in applications to the Family Court, whether it be for divorce, custody applications, relocation applications, or other relief. Unfortunately, the rise in cases coupled with the Family Court’s reduced operations for several months due to Covid-19 has resulted in an increase in delays for hearings. However, the judiciary is now working harder than ever to help clear the “backlog” caused.

What types of matrimonial disputes are you seeing more of with the changing social and economic climate in Hong Kong with the Covid-19 pandemic?  Do you anticipate any changes post-Covid?

As I alluded to earlier, there’s been an increase in variation of maintenance and interim maintenance applications, meaning requests by one spouse to (generally) reduce the amount of periodic payments made by them to the other spouse and/or paid for the benefit of the children of the family. This is usually due to a change in the applicant spouse’s earnings or sudden loss of work. Hand in hand with this is the rise in enforcement procedures as, when one party can no longer afford to pay, they begin defaulting on payments as they fall due. As a result, the other spouse may take out an application to enforce these arrears of payments, whether it be by an Order 45 Rule 6 application, judgment summons procedure, or seeking a prohibition order (which prevents a party from leaving Hong Kong until the sum owed is paid).

I would also say that there’s been a rise in relocation applications, where one spouse wishes to leave Hong Kong and relocate to another jurisdiction with the children of the family. Again, these cases are on the rise because of the global shift in socio-economic environments caused by the pandemic. A party may need to relocate because of the loss of work opportunities in Hong Kong and the better prospects of work in another country. If a party loses their job, Hong Kong may no longer be affordable and they may need to relocate back to their country of origin to seek familial support, or where costs of living are lower, or for education opportunities/better quality of life for their children.

It’s been predicted that Covid-19 is here to stay for the foreseeable future. It is uncertain at present what changes will occur once the pandemic is brought under control, but hopefully greater stability for families in Hong Kong.

We want to continue our discussions with you on several hot topics in the area of matrimonial law, which we will do over the course of this upcoming year.  To begin our series discussing hot topics in matrimonial law, let’s first tackle an area of great interest for those living in Hong Kong: marital agreements.

In Hong Kong, marital agreements are taken into consideration by the courts, but it’s not a guarantee that it will be followed.  Do you see that changing going forward, especially as other jurisdictions rely heavily on these types of agreements?

There have been no developments that would suggest that the interpretation of marital agreements in Hong Kong will change in the foreseeable future. Hong Kong often looks to other commonwealth jurisdictions, predominantly the United Kingdom, when considering evolutions in the law. The shift in Hong Kong’s approach to marital agreements followed the 2010 landmark decision of Radmacher v Granatino [2010] UKSC 42, in the UK (adopted in Hong Kong in the Court of Final Appeal decision SPH v SA (2014) 17 HKCFAR 364).

Currently, the approach to marital agreements in Hong Kong is that, whilst the Court is not obliged to give effect to nuptial agreements, they should give weight to them in circumstances where it is fair to do so. What will be considered “fair” depends on the facts of the particular case. In appropriate cases, the Court will hold the parties to their agreement and will not impose terms that it would otherwise have ordered were it not for the agreement. This is consonant with the current approach of the Courts in England.

Do Hong Kong courts take into consideration cross-jurisdiction agreements?  For example, what happens if an individual who is married overseas, moves to Hong Kong and subsequently gets divorced in Hong Kong and a marital agreement prepared and signed overseas is at the center of the dispute?

The same considerations would apply to a nuptial agreement whichever jurisdiction it is made in. The Hong Kong Family Court will consider whether it is fair to give the agreement weight in accordance with the principles set out in Radmacher, including but not limited to (1) whether the parties to the agreement were properly advised; (2) whether there was full financial disclosure prior to the signing of the agreement; (3) whether there was any duress exerted on one of the parties to sign the agreement; and (4) whether any unforeseen circumstances have arisen since the agreement that would render it unjust to hold the parties to it.

Have you ever had to argue before the Courts in Hong Kong regarding a marital agreement dispute?  In order to avoid future disputes with respect to marital agreements, what tips or advice can you give to those entering into these types of marital agreements? 

Yes, I have been involved in cases regarding marital agreement disputes. A nuptial agreement is generally more likely to be accorded weight if it can be shown to be both substantively and procedurally fair. Three foundational suggestions in respect of pre-nuptial agreements would be as follows:

  • Discuss the terms of the nuptial agreement well in advance of the marriage date (at least 28 days if not longer), which will assist in demonstrating that there was no duress or pressure on either party to sign the agreement in a hurry before the wedding date.
  • Both parties should receive independent legal advice (the parties cannot share one lawyer to advise them) on the agreement and should enter into it with full understanding and appreciation of its terms.
  • There should be sufficient disclosure to illustrate that the agreement was an informed decision.

It is very important to seek legal advice for a nuptial agreement from a qualified solicitor to ensure that its terms are substantively fair to both parties.

Thank you so much Madeleine for all your insight into this important topic.  We look forward to speaking to you again to discuss other key topics of interest!

About Madeleine: 

Madeleine’s practice encompasses both civil and criminal law, with a particular specialization in matrimonial work. Madeleine was recently named as one of the leading family and divorce law barristers in Hong Kong for 2021 by Doyles Guide.

In the Family Court, Madeleine has experience in contested financial and child related matters, and family related company and trust cases.

Having represented clients at Financial Dispute Resolution hearings, Children’s Dispute Resolution hearings, as well as at trial for preliminary issues (third party interests/property/companies), financial issues (MPS applications, ancillary relief trials) and child related matters (such as custody disputes, and applications under the Guardianship of Minors Ordinance), Madeleine’s experience is broad.

Madeleine is often called upon to make applications under s.17 of the MPPO, setting aside dispositions or applying for injunctions, on an urgent basis.

Madeleine also has experience in a number of other areas of legal practice, including civil litigation and criminal law. She has assisted senior counsel, and acted as sole legal counsel, in multiple hearings and trials at each level of court in Hong Kong, from its magistracies to the Court of Final Appeal. Madeleine appears in the High Court of Hong Kong regularly with respect to civil litigation matters, including trust related cases, injunctions, torts of harassment, intimidation, and unlawful means conspiracy, as well as summary judgment applications.

Madeleine’s experience extends beyond advocacy to include providing written opinions and legal advice, as well as assisting in mediations and arbitrations.

Cross Border Views on Inherited Wealth

This article looks at how inherited funds are treated from a cross-border perspective. To the surprise of many, inherited wealth in a divorce may be treated differently depending on the jurisdiction in which you file for divorce. Location is therefore an important factor to consider when divorcing. To unpack this topic, let’s explore and contrast how inherited wealth is treated in Hong Kong vs. the United States of America, in particular the community property state California.

1. Inheritance in Divorce in California: California, like many other states, is a community property state. This means that in a divorce, all property acquired during the marriage is divided equally between the divorcing parties. An exception to this rule occurs when an individual receives an inheritance during the course of the marriage. In those circumstances, under California law, an inheritance is separate property and therefore will be excluded from the division of assets and debts in a family estate (Family Code Section 770).

It is important to note that when an individual receives an inheritance, the monies received must be traceable to the source so there is no confusion as to whether the money is separate property or community property. That is why it is always a good idea to open a separate bank account and deposit inheritance monies into this separate account to identify them and keep them separate. Otherwise, by depositing inheritance funds in a joint community bank account, you are commingling funds. When monies become commingled, it can become very difficult to trace monies back to the separate property source and your former spouse may have an argument that all inherited funds were already spent during the marriage and therefore all remaining funds in the joint account are community property and must be split equally. When in doubt, always keep clean records of any inherited funds and keep records of how these monies have been spent. If you don’t keep track, a tracing expert may be enlisted but tracing can become quite expensive and time-consuming thereby stalling the divorce.

2. Gifts Are Separate Property in Divorce in California: Another exception occurs when an individual receives a gift. For example, if you receive a beautiful piece of jewelry from your spouse for an anniversary or birthday, this gift is generally excluded from the division of assets and debts in a family estate. If, however, the gift could be considered of substantial value, the courts will then look at the asset more carefully and it may be subject to division taking into account the parties’ wealth and finances.

If the asset is determined to be of substantial value, it is community property and must be divided between the parties – unless of course, either party can present a written transmutation agreement changing the character of this asset from community to separate.

3. Inherited Wealth in Divorce in Hong Kong: Over the years, there has been much debate over how inherited funds should be treated in a divorce in Hong Kong and whether these funds should be excluded from division. In Hong Kong, inherited wealth are those assets that come from a source wholly external to a marriage. Like Great Britain, the courts in Hong Kong have regard to the “yardstick of equality” as a starting point, meaning the goal is to divide the asset pool fairly. Courts in Hong Kong may however, veer from this principle and make adjustments, thereby dividing assets “unequally” if after reviewing certain statutory factors, taking into account the whole of the asset pool, reasonable needs, compensation and applying the “sharing principle” if assets exceeds the needs, in addition to the specific circumstances surrounding the divorce, and finds that an individual’s inheritance could be a resource to fulfill and satisfy an individual’s reasonable needs and the needs of the children post-divorce (See the Hong Kong landmark case titled DD v LKW (2010) 13 HKCFAR 537.) As a result, the Court may heed to flexibility in order to find a suitable answer to the circumstances of each case whereby the objective is to reach a just result that is fair for both parties. Thus, unlike California, inheritance funds received by an individual in Hong Kong may be taken into account because it forms part of the asset pool that is a financial resource to one or both of the parties. Stephen J. Peaker, head of the Family Law Department at Oldham, Li & Nie (OLN) and a fellow of the International Academy of Family Lawyers (IAFL) says: “The issue of inherited wealth is becoming more and more prevalent in Hong Kong, both in contested and uncontested cases. The economic success of Hong Kong and the natural passage of time combined have created substantial inherited wealth. One of the key areas of dispute on succession is in relation to family businesses, often with enormous value where one party inherits a business interest. This business can be valued as part of an asset pool and unsurprisingly, this is viewed by the creators of the wealth as inherently unreasonable and has led to the proliferation of generational trusts and the increase in prenuptial agreements.”

It is interesting to note that in Hong Kong, the Court may consider an inheritance even if it has not yet been received, but provided an individual is set to receive an inheritance in the near future or has a perceived resource. Additionally, if you’re involved in a short-term marriage and there are inheritance funds in the asset pool, the courts may not consider the inheritance in the asset division yet if it is a long-term marriage, the courts may include inherited funds, unless these funds were kept entirely separate.

It is important to understand and become knowledgeable of the specific laws of your jurisdiction. Speak with a professional about how to protect your inheritance and what can be done to avoid any issues when dividing assets in your divorce. If you’re getting married, you may want to speak with a family law professional to discuss a prenuptial agreement and ways to avoid any issues in the event of a divorce. Being well prepared will help avoid any heartache in the future!

Prenuptial Agreements In Hong Kong

A common question among those planning to marry is whether a prenuptial agreement is a necessary prior to marriage.  This is dependent on your circumstances but before we delve into whether it is necessary and enforceable in Hong Kong, it is important to know what exactly a prenuptial agreement is.

A prenuptial agreement is a contract between you and your fiancé as you both contemplate marriage.  In a prenuptial agreement, you and your fiancé outline terms that you both agree in relation to issues such as the division of assets and debts upon a divorce.  These agreements may also deal with maintenance for your spouse upon divorce as well.

It is important to note that prenuptial agreements generally do not cover issues related to child custody and child support/maintenance.

Generally speaking, if you are young with minimal assets and this is your first marriage, a prenuptial agreement may not be needed.  If your fiancé has substantial assets that he/she would like to protect in the unlikely event of a divorce, then a prenuptial agreement may be a good idea, giving you and your future spouse peace of mind.

The question then is whether prenuptial agreements are enforceable in Hong Kong.  Hong Kong generally follows UK law and in the UK, there was a case called Radmacher v. Granatino in 2011 whereby the UK Supreme Court declared that the Court should give effect to these types of agreements on the basis that it is freely entered into by each party with an understanding and appreciation of its implications unless of course it would be unfair to do so in the circumstances.  Following this important decision in the UK, the Hong Kong Court of Final Apeal in a 2014 case called SPH v SA stated that the principles in Radmacher should be regarded as the law in Hong Kong.

With that being said, it is important to note that in Hong Kong, this is still a developing area of law and there is no set decision as to whether a prenuptial agreement will be held enforceable in a divorce in its strictest sense.  Unlike jurisdictions like California where the Court will take into consideration the terms of a prenuptial agreement, Hong Kong law is still very new and it effectively depends on the circumstances of each individual case.

It is therefore exceptionally vital for you to consult with a professional matrimonial lawyer who is well-versed in such a subject.  Be sure to provide as much detail to your solicitor so that he/she can provide you with his/her best advice with respect to whether a prenuptial agreement would be your best option in your circumstances because of the importance of having a well-drafted and detailed agreement to protect you in the event of divorce.

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