Is 50/50 fair? Fairness, finances and divorce with Joshua Rozenberg and David Hodson

In this episode, Kate is joined by Joshua Rozenberg and David Hodson to discuss whether 50/50 is a fair way to divide money and property during a divorce or separation.

Joshua Rozenberg is the UK’s most experienced legal commentator. David Hodson is an English solicitor, mediator, arbitrator, and part-time (deputy) family court judge specialising in complex financial family law cases.

Episode #92: Is 50/50 fair? Fairness, finances and divorce with Joshua Rozenberg and David Hodson

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About Joshua

Joshua Rozenberg KC (hon) is Britain's most experienced full-time legal commentator. He is the only journalist to have been appointed as Queen's Counsel honoris causa. He is an honorary Master of the Bench (bencher) of Gray's Inn and a non-executive board member of the Law Commission. His most recent book is 'Enemies of the People?' How Judges Shape Society. After taking a law degree at Oxford, he trained as a solicitor, qualifying in 1976. Since 2008, he has written for the Law Society Gazette, the Guardian and The Critic magazine. Joshua was the BBC's legal correspondent for 15 years before moving in 2000 to The Daily Telegraph. After resigning as legal editor in the summer of 2007 he continued to write a weekly column until the end of 2008. Joshua returned to the BBC in 2010 to present the Radio 4 series Law in Action. In 2012, he was included by The Times in its independently-judged list of the UK's 100 most influential lawyers, the only journalist to feature. Joshua is known for his independence, authority, and ability to explain complicated legal issues with simplicity, clarity, and wit. He appears regularly on Sky News, on the BBC's various news outlets and other news networks in the UK and abroad.

About David

Prof. David Hodson OBE KC(Hons) MCIArb is a co-founder partner of The International Family Law Group, which works with international families and their children. He is an English solicitor, mediator, arbitrator, Australian (NSW) solicitor and a deputy (part-time) family court judge at the Central Family Court (DDJ in the FRC at the CFC) in London and Western Circuit. He is a member of the English Law Society Family Law Committee, a Fellow of the International Academy of Family Lawyers, a member of LawAsia, the Family Law Section of the Law Council of Australia and a similar contributor to many family law organisations worldwide. He is a regular speaker at international family law conferences around the world. He was awarded the OBE for services to international family law. He was appointed the (now) KC (Hons) in March 2022 by virtue of making a significant impact on the law of England and Wales. He is the editor and primary author of the LexisNexis textbook ‘The International Family Law Practice’ (6th ed). He is a Visiting Professor at the University of Law and an Honorary Professor of Law at Leicester University.

Episode summary:

In April 2023, the Law Commission of England and Wales launched a review of the laws determining how finances are divided between couples when they divorce or end a civil partnership. This is the backdrop of the episode; Kate, Joshua and David explore ‘fairness’ and whether 50/50 is consistently fair in the Law Commission's Review of rules around how money and property should be divided.

Kate, Joshua and David look at the current law and the potential reforms being considered. They discuss the 'sharing principle', whether 50/50 should be the default for how finances are divided between couples and how the court deals with 'needs' cases.

Episode summary:

Kate Daly: [00:00:00] Welcome to the Divorce Podcast, where we explore all aspects of ending relationships, separation, and parenting apart. If your marriage or partnership has ended, or you have friends and family who are separating, this podcast is for you. I'm Kate Daly, a Relationship Counsellor, Divorce Specialist, and co-founder of Amicable, the online legal service for separating couples.

Kate Daly: In each episode, we look at relationships and separation from different angles, including the emotional, legal, and social. I'm joined by experts and special guests who share their own unique stories, experience, and tips with the goal of helping people end relationships in a kinder, and better way. In this episode, I was joined by the UK's most experienced legal commentator, Joshua Rosenberg and family court judge David Hodson to talk about fairness and [00:01:00] finances in the context of divorce and separation.

Kate Daly: David is an English solicitor, mediator, arbitrator, and part time deputy family court judge specializing in complex financial family law cases. He's also an Australian solicitor and co-founder of the International Family Law Group, which works with international families and their children. Joshua trained as a solicitor following his law degree at Oxford.

Kate Daly: He was the BBC's legal correspondent for over 15 years. before becoming the Daily Telegraph's legal editor in 2000. Joshua presents the popular Radio 4 series, Law in Action, writes a column for the Law Society Gazette, and appears regularly on Sky News and across the BBC. This episode is all about fairness and finances.

Kate Daly: We look at the current law and court system, as well as potential reforms that are being considered by the Law Commission of England and Wales upcoming review. We look at the idea of fairness [00:02:00] and whether that means that 50 50 should be the default for how finances are divided between couples when they divorce or end a civil partnership.

Kate Daly: If you loved this episode then please subscribe and rate us on your preferred listening platform. Welcome Joshua and welcome David. Hello Kate. So today we're talking about fairness and finances. In April 2023, the Law Commission of England and Wales launched a review of the laws that determine how finances are divided between couples when they divorce or end civil partnerships.

Kate Daly: The review's aim is to determine whether the current law provides a cohesive framework in which divorcing couples can expect both fair and sufficiently certain outcomes. A preliminary report will be produced by September 2024, but the debate has already begun. So, in this episode, we look at some of the issues driving the need for reform. [00:03:00]

Kate Daly: But don't worry, any new law is not likely to come into force for several years. So, let's start with the current system and the law underpinning it. David, when a couple decides to divorce and divides their money and property, what does the current law actually say and where can we find it?

David Hodson: Kate, thank you.

David Hodson: The problem is finding what is the law. One would think that something so important as how to sort out the money, the property, the cash on divorce would be laid out in a piece of legislation or somewhere authoritatively laid down by Parliament and the courts and the judges, et cetera, so that anyone could simply go to it, turn it up, Obviously online on an app or something and say, ah, that's the law.

David Hodson: Maybe they need to go to see a lawyer to sort out some of the elements, uh, what aspects of disclosure, but by and large, that's what it is. Now, let's go away with my spouse or my civil partner. This applies to civil [00:04:00] partnership. Although not cohabitants and let's do as much of it as we can using lawyers where we really have to.

David Hodson: Sadly, that is not the point. It isn't available in any one place. And this is one of the drivers for why there might be now the time for some reform. The law that you would look at is in a piece of legislation going back to 1973, the matrimonial causes act. So, 50 years, everything in life has changed in 50 years, society, people, expectations of marriage have changed.

David Hodson: And the law that was in 73 is unrecognizable. Nobody would ever find out what the present law is by looking at that piece of legislation. Why is that? Well, because of a very good element, namely judge made law. And the judges in our English system have changed the law. That's their ability under a common law system.

David Hodson: They've changed the law, and mostly they've done a very good job. And crucially in the year [00:05:00] 2000, there was a major case that completely changed the direction of our law. So, what is it? Kate, the question you really asked me, and I'm terribly sorry to go into where you find it, because that's actually quite important.

David Hodson: What is it? In some ways, it's alarmingly simple. Well, you wouldn't expect it to be too simple, but it's alarmingly simple. All the assets that have been acquired during a marital relationship, which would include some pre-marital cohabitation, up to the date of separation are shared equally, unless they are required for fairness reasons, and fairness reasons almost always means needs.

David Hodson: And the non-marital assets are not shared at all, unless again required for needs. And that's, in two sentences, I would like to think as good a summary as one can get. But hovering around the outside are so many uncertain issues. And that's where the problem has come.

Kate Daly: Joshua, what do you think are the primary criticisms of the present law as David [00:06:00] has set out?

Joshua Rozenberg: Hey, you mentioned the Law Commission and they're the government's law reform advisors and they set out a number of topics in April, topics that they're going to look at and I want to pick five of them and I think the first is the most important. The first one is the discretionary powers given to judges over the division of financial assets and whether there's a need for a clear set of principles enshrined in law to give more certainty to divorcing couples.

Joshua Rozenberg: I'll come back to that in a moment, but there are four more. How maintenance payments for an ex-spouse or former civil partner should work. How much consideration the court should give to the separating parties behaviour, orders relating to pensions, and whether they're overlooked when dividing the divorcing party's assets.

Joshua Rozenberg: And the fifth of them is the factors that judges must consider when deciding which, if any, financial remedy orders to make. Now going back to the first of those, should there be a clear set of principles to give more certainty to divorcing [00:07:00] couples? I think everybody thinks that there should be. The trouble is, And I think David hinted at this, the more certainty there is, the less discretion there will be for judges to do justice in an individual case.

Joshua Rozenberg: But of course, how often does that happen? How often do you have judges deciding individual cases? That was the basis on which the law was drafted more than 50 years ago. There would always be a judge to sort it out, but that happens in only a very small proportion of cases. These days, as you know very well, Kate, most divorcing couples can't afford to go to court.

Joshua Rozenberg: And even if they could, they wouldn't have enough money to allow each of them to get a fair share. So, I think the real challenge is to find a cheap and cheerful formula that can work for ordinary people, put that into an app that anyone can use while at the same time working out what's fair for the wealthy couples who can afford to go to court.

Kate Daly: Well, that's the distinction, isn't it? There's a big difference between these principles being decided for people who are not in a needs bracket. And the people who are in the [00:08:00] needs bracket, because as David mentioned right at the beginning, a needs case trump everything. So even if we had this formula.

Kate Daly: If ultimately most of the people coming through are a needs case, which is where there's not enough money for everybody to just divide into, and everybody's housed, everybody's got enough money to live on day to day, and everyone's got enough money in retirement, because they're the kind of basics, aren't they, that we need to cover.

Kate Daly: So, if most people fall into the needs bracket, will any of this Law Commission review actually have an impact on most normal people, or will the needs principles still be the same?

David Hodson: I'm very happy to answer that. I very much hope so. I do a lot of international work and I'm proud of our English family justice system.

David Hodson: It's got its faults, many faults, but I'm proud of it, because it does give effect to the sacrifices and commitments people make to marriage. Giving up work for maybe 10, 15, 20 years, as a judge, I hear people saying, but [00:09:00] I haven't worked as a, I don't know, medical secretary or as a teacher or whatever, and technology has changed, or everything has changed.

David Hodson: Going back into the workplace after marriage is very difficult. Many people move countries are either together or one may move for the other giving up a huge amount and the idea that we divide 50 50 Kate the title of this podcast is 50 50 fair is really quite attractive. It's lovely for sort of nerds like me who can sort of get a little calculator out and we family lawyers are very good at dividing by two, not much else but dividing by two.

David Hodson: But dividing by two doesn't produce fairness in the majority of the medium, modest, even lower big money cases because it doesn't reflect the sacrifices and commitments. But that's where the reform process may well go because it is ostensibly easy. We are surrounded in England and Wales, Wales is part of England for these purposes, [00:10:00] by Scotland and continental Europe, all of whom would say, well, 50 50.

David Hodson: With maybe a little bit added on. French for Ecuador, distribution, whatever phrase you want to use, fairness. And this seems to me, as Joshua was saying, the real heart of our problem. How do we have a law that can work out the weight we give to this commitment without derogating, taking away from marriage in any way, the commitment that people take to marriage.

David Hodson: Because I've heard it said by people say, well, if we're going to divide 50 50, why should I give up my career? Why should I move countries? Why should I give up my accommodation? We'll spend my accommodation on nice holidays, and we'll live in your property. And then at the end of it, it's still one person's property.

David Hodson: This is the challenge for us. And frankly, I don't think the Law Commission should be making any proposals until we've listened to the public. Easy to say. I sound like a; I sound like a politician. Oh, dear. That's not good news. But I [00:11:00] think we've got to listen to the public and I think we will find those different people have different views by age, 20s and 30s, 50s and 60s, background, professional, and succinct from stay at home.

David Hodson: All sorts of issues.

Kate Daly: Well, it begs the question, doesn't it, Joshua, which does fare exist in legal terms then when you're looking at how finances can be dealt with on divorce? And is it possible then from your perspective as a sort of commentator and a journalist, is it possible to have a fare that fits everybody as David sort of alludes to?

Joshua Rozenberg: No, I don't think it is. I mean, if you look at Part two of the Matrimonial Causes Act, 1973, which is the basic legislation, you'll find pages and pages, uh, of provisions about financial relief, but the word fair doesn't appear at all. I did a word search earlier and it's simply not there, but it's not surprising if you're a wife.

Joshua Rozenberg: And you've sacrificed your career to look after the children. You won't think it's fair if your wealthy [00:12:00] husband leaves you for another woman unless he pays you enough to compensate you for your, uh, loss of earnings over 20, 25 years. If you're a lonely man and you're seduced into marrying a younger woman, you won't think it's fair if she leaves you after a few months and she demands half your fortune.

Joshua Rozenberg: What's fair depends on the circumstances.

Kate Daly: So it feels like that the law commission's got quite a tricky job to do then because We're sort of damned if we do and damned if we don't on the one hand I know from talking to lots of people we talk to people every day and I know lots of people the first thing they say to me is I’m not trying to be money grabbing I just want what's fair and I always have to unpack what fair means to them because as you say, it's a very Individual perspective and for a lot of people fair is sharing Things in half without necessarily thinking through that one person may have a lot more spending power.

Kate Daly: They may have lines of credit open to them that the other one doesn't. They may be mortgageable in a way that somebody [00:13:00] who's given up a career and doesn't have, you know, lots of pay slips in the background is mortgageable. So really getting underneath what's fair is very important. And as you say, Joshua, it's the individual context that's important.

Kate Daly: So how is the. Law commission going to resolve on the one hand, the sort of public desire for fairness. And on the other hand, when you get into this and you're a little bit more experienced and you sort of dealing with this day to day, this kind of system of having judge-based law at the moment.

Kate Daly: possibly leads to fair outcomes for people in quite difficult circumstances. So how are we going to get the balance, David? Well, can I?

Joshua Rozenberg: just chip in here, uh, Kate? Because I, I can tell you a little bit about how the Law Commission works because, uh, you may not know this. I'm, uh, what's called a non-executive board member of the Law Commission.

Joshua Rozenberg: That means I go to its board meetings, but I have no responsibility for its proposals. They're not discussed with me. Those are a matter for the five law commissioners themselves. Not for anybody [00:14:00] else, but I do know their processes and their first thing is what they call a scoping exercise. They're going to talk to lawyers like you, David.

Joshua Rozenberg: They're going to talk to lawyers more broadly. They're going to talk to judges. They're going to talk to everybody working in the field. And they're going to try to assess the problem and they will be obviously listening to what people say. They will then come up with preliminary proposals in the autumn of next year.

Joshua Rozenberg: And they will send those rounds for everybody to comment on. They will look at the comments and then they will come up with final proposals, but it'll be for the government to decide what to do. Now I I've been thinking about this myself and I hasten to say, this is entirely my idea, it's not a law commission idea, but I've just put this forward for discussion.

Joshua Rozenberg: I think what we're saying already in this podcast is that the rich are different from us. They do need different rules. Of course, it's difficult to draw the line, you know, who's rich. You could pick a figure, I don't know, joint assets of 10 [00:15:00] million pounds, and you could say everybody who's got more than that sort of money goes into a top tier.

Joshua Rozenberg: You'd pay much more to go to court. The court fee would be higher. But the case would be decided by a judge and there would be a discretion for the judge to move cases in or out of the top tier. But for the rest of us, well, you'd expect technology to be involved. I don't think we are ready for cases to be decided by artificial intelligence, but I don't see why we shouldn't be able to develop an online calculator.

Joshua Rozenberg: Both spouses would feed in information about their earnings, savings and commitments. The system would calculate what payments, if any, a spouse should pay the other. It wouldn't be binding, but it would give them a starting point. And what I'm trying to say is there should be different systems, a cheap and cheerful one for ordinary people, and, uh, perhaps a bespoke system, a tailor-made system for those who can afford it.

David Hodson: I would totally agree with Joshua, totally agree that that can only be the way forward. Heck, we're 2023. Uh, this law will [00:16:00] unlikely come in until much before 2030. Frankly, we're looking at a piece of legislation for the middle of the 21st century. It's inconceivable that every case has to come to Kate@amicable or myself as a, a, a lawyer or a part time judge.

David Hodson: Inconceivable. And, uh, so I would totally support Joshua, that must be, and I think a good number of the so-called wealthy, the over 10 to 15 million, would be doing the same if it's a long marriage or assets acquired during the marriage. Not phenomenal amounts, but certainly large amounts. Why wouldn't they want to share?

David Hodson: Because I think we, uh, diminish the feelings of the public. Who want a fair outcome? Kate, I know the service you produce through Amicable. People would be coming to you to say, we'd like a fair outcome. Our clients come to me. And yes, of course, there are a few who, who come with different motives. But most of them say to the first thing, say, what are we going to do?

David Hodson: How [00:17:00] can we settle this? What is fair as a mediator? That's all I hear from that. So, I think what we need to do is work out what do we think is fair. And then many in society would say, okay, that's fair enough.

Kate Daly: I mean, it sounds eminently sensible, Joshua, what you've proposed and David and I probably, well, David doesn't disagree, neither do I, but we shouldn't be seduced by its simplicity because that is a very radical departure from what we have now, isn't it?

Kate Daly: Because it's effectively, like you say, a two-tier system, recognizing that needs cases need to be treated differently to people who are super wealthy and have more than enough assets to go around. What sort of arguments does somebody make if they're super wealthy about not sharing? What is that distinction then?

Kate Daly: Because David says, well, most people will want to say, well, I'll share everything, but there must be some arguments why there'd be a reason not to share things. What are those arguments? We

David Hodson: already have a system, a gatekeeping [00:18:00] system, where if a case has a particular complexity, assets over 15 million, et cetera, it goes up to a high court judge.

David Hodson: All the rest stay at the first instance level. The irony is that the bigger money cases are in some ways easier to settle. If one has acquired 40 million during the marriage, you divide it by two, 20 million. I'm not going to say everyone will happily live off 20 million, but most people in the real world would say, yes, we can.

David Hodson: Thank you very much indeed. So, there's a curious element that apart from the real hundreds of millions, where they say, well, was there a special contribution? How was it acquired? Et cetera. They are easy. The harder cases are the middle and the higher, lower income cases where there is so little to go around.

David Hodson: Trying to take the family home and try and produce two houses out of it so that the children could be put into it. Taking modest income, maybe an element of income worth support. And dividing, they're far, far harder, and I have no doubt the Law [00:19:00] Commission will be looking and saying, how can we help those cases, and they are far harder to put into an app.

David Hodson: So, there's part of it, there's the real problem, but the funnelling, hyping those off, it's significantly happening at the moment. And they are the cases that, only the cases get publicity. Yeah, I

Kate Daly: think that's a big issue though, isn't it? Because the part of the problem is that the whole narrative is slightly skewed by the media attention.

Kate Daly: So, we hear about the big cases, we hear about the very difficult divorces and the sort of show trials and the people who command a lot of public attention, but they aren't the everyday. And it's very difficult when you're trying to help everyday people. to try and steer them away from what they've heard in the media.

Kate Daly: So how do we tackle sort of the reporting of more everyday average cases? I'm going to push that to Joshua to start with.

Joshua Rozenberg: The family courts are more open than they were. And even when they're not open to the [00:20:00] public, lawyers and accredited bloggers are allowed in under certain circumstances. There are various pilot schemes going on at the moment, and there is a move under the present president of the family division, the most senior judge in the family courts of England and Wales, Andrew McFarlane, to increase openness.

Joshua Rozenberg: Now, I'm not saying that, um, um, so many ordinary cases go to court, and I'm not saying that if they do, they should necessarily be reported, but the more that the media is able to see what goes on in court, the more likely they are to be able to report. ordinary cases. Now, again, it's the high profile cases that, uh, I read, uh, about almost every day in the times as, as one particular newspaper, which seems to do quite a lot of these, you know, people want to read about rich people and they want to say, um, you know, they're, they're rich, but they may not be wise.

Joshua Rozenberg: And, and it's the sort of thing you like to read about and that's the way the world works. And we're not going to stop there. But it is important [00:21:00] for people to understand that these are very, very unusual cases. I think most people know that because most people haven't got these millions of pounds to play with, but there is a role in educating the public.

Joshua Rozenberg: It's the sort of thing you do, Kate, in your work, when you deal with people who, who consult you for advice and you, David, as well in your job. And there is a certain amount that can be done. If we were to, uh, just to be practical for an idea of an app. Which would calculate this sort of money that, um, might be payable from one spouse to another, if any, if they can afford it.

Joshua Rozenberg: Well, you only have to look at the way that the online divorce form works at the moment and all the other forms that the government is responsible for. It asks you questions, and when it asks you questions, it gives you information. So, it tells you information and then asks you a question on it. And of course, uh, in those circumstances, you could have a page on an online form, which would tell you a little bit about how [00:22:00] it works and then ask you questions about your own circumstances.

Joshua Rozenberg: It's perfectly possible for the government to put out objective information about how the system works. I agree.

David Hodson: entirely. In addition, about 18 months ago, the President of the Family Division, Sandra McFarlane, asked all first instance judges, these are judges not in the High Court cases, to report at least 10 percent of their judgments.

David Hodson: And most of us, part time, full time, went, Oh, gulp! That's a big, big, big ask. But it's happening. It's happening under the radar. One won't see these cases reported in the Times for exactly the same reason Joshua said. They're not sexy, they don't involve big money, etc. These are ordinary cases which have got a sticking point, one particular reason why they haven't settled.

David Hodson: And that particular reason Will feature one day in Exeter, will tomorrow be in Manchester, and the following day, maybe in Norfolk. And so, these cases are now being reported, they're being read by lawyers, and um, they are illustrations only. They're not making new law, [00:23:00] but they're simply illustrations of how it's being worked out.

David Hodson: Now if we were to take that further and say, well look, can we combine this together with some form of AI? And like Joshua, I agree that AI won't be creating our law for a few years yet. But we've struggled in family law because we haven't had the big data and suddenly now we're now getting this could be combined The other point is that Joshua has said is that whenever anyone needs to can apply for a consent order They've got to fill in quite a long document, but it's an information for a consent order And again, one of our leading judges, um, Nicholad Mostyn has enabled that to be put in a form Where we can now collect data Um, and that pro, that progress is going ahead again in the last 18 months.

David Hodson: And so hopefully in the next two years or so, we can bring that all together and we can say, ah, in these sorts of circumstances, the outcome was that. And by bringing all this together, we can then, sorry, we're not app obsessed, neither is, but we can bring it [00:24:00] together and say, Ah, if that happened in five out of six cases in which the assets were of this sort of range, oh, why don't we do something similar?

Kate Daly: It's super interesting, this whole sort of area of, you know, where technology may or may not take the desire for people to get a fair outcome. We've mentioned a couple of times this idea of a sharing principle. David, can you just explain what that sharing principle is? Because lots of people listening to this aren't, you know, experts like I guess you guys are and so just.

Kate Daly: Just go back a bit and explain the sharing principle to us, if you would.

David Hodson: I think it's a question of what marriage is, Kate. Going back, let's not concentrate on the doors, let's go back to say what is marriage. What do people think they are entering into? Well, of course they understand that because of the marriage vows, etc.

David Hodson: But in financial terms, what are they entering into? And one of the main concepts that the law has is to compare marriage to a professional partnership. Two people enter into a business, I know, [00:25:00] run a plumber's business or run a lawyer's business, any two or more people in a common business together. And that's an equal business and they take the profits equally and they take the liabilities equally.

David Hodson: And the courts have said, well, marriage in many ways is like a marital partnership. And when the partnership ends, and sadly I was involved in a partnership dispute, I'm not sure whether it's easier or worse than a divorce, but um, they're not easy. But if somebody comes in, looks at the assets and says, here's the total of the assets, 50 50, divide them up.

David Hodson: Now, it's not the pre partnership assets, the prestart of the marital relationship. It wouldn't be inheritances and gifts of various forms. And it wouldn't be assets beyond a particular date after the separation. But that apart, one simply adds it up, and this is why it can be easily used in a form of calculator, add it up, what's 50 50, does that meet our respective needs coupled with any other assets that we may have separately? [00:26:00]

David Hodson: If it does, that's it. Full stop. End of settlement. And that's why in some of the bigger money cases, of course, it's so relatively easy. If it doesn't provide it, where does one then look? Well, that's at the time where you say, let's look at the interests of the children, do the interests of the children with the primary carer, if we're still using that sort of terminology, um, need, we need to change it a little bit.

David Hodson: And that's where the needs invariably come in.

Kate Daly: Okay. So, I guess that's where it becomes a bit tricky then, isn't it? Because you've got this idea in people's minds of the sharing principle, but then it's the needs and it's what the needs are and what's a need versus a desire. And that's where it becomes instinctively human, I guess, and, and where people like yourself or us or whoever need to get involved to try and tease out that.

Kate Daly: Joshua, do you think there's any hope of codifying? Okay. That kind of subtlety, or is this where, and I get quite a B in my bonnet about this, I don't think there's a, there's [00:27:00] technology and there's humans and one have to triumph over the other. My sort of raison d'etre is, it's the mix of the human and the technology that makes something amazing.

Kate Daly: So, we shouldn't be trying to get rid of humans, but there is a place for humans. I feel like I'm leading you into an answer here, Joshua, so feel free to disagree, but can you codify it?

Joshua Rozenberg: Well, let me tell you about a human who's trying to do just that. Uh, she's called Baroness Deitch, Ruth Deitch. I know her very well.

Joshua Rozenberg: She has, uh, she's a member of the House of Lords and, uh, she is an academic lawyer. She started her legal career at the Law Commission. Uh, she's done many things in, in life. The things that she's trying to do and had been trying to do for some time is to persuade parliament to change the law and to codify the law to enact a law because she says that the current law is not fit for purpose.

Joshua Rozenberg: It was designed according to outdated concepts and is not appropriate. And what she is proposing is very much along the lines that David has just outlined with, [00:28:00] with one or two details. She says that the property, a couple acquired during a marriage. It would normally be shared equally between them, unless that would be unfair.

Joshua Rozenberg: Well, that could be unfair because they'd agreed otherwise, and we haven't spoken yet about agreements between spouses, about what should happen if a marriage breaks down. But yes, it would be shared unless they've agreed otherwise. Or because one of them had already squandered the assets, spent all the money, uh, I don't know, given it to somebody else or bet it on the horses or whatever people do if they want to be vindictive or they're feckless.

Joshua Rozenberg: Or because the money was needed for children under the age of 21. That's her proposal, which brings us back to what you were saying about needs. And she says that the couple's behaviour wouldn't make any difference. Unless one of them had obviously acted unfairly. Now that's in a private member's bill, which she has been putting to parliament.

Joshua Rozenberg: Uh, she doesn't have the [00:29:00] support of the government, uh, which of course has sent all this off to the law commission and, uh, without the support of the government, it's not going to become law. But it is a blueprint for codifying to some extent the current law and yet getting rid of aspects of the current law that she for one think are not any more appropriate.

Kate Daly: Is it fair then to divide everything 50 50 if in under that blueprint and that proposal we still have for example a gender pay gap? So how do you square things like gender pay gap and future ability with Current marital assets, where's the crossover in that? I'm going to come to David on that one. So, if you've got Baroness Deitch saying everything should be divided 50 50, it doesn't take account then of what people can do with their 50 percent potentially.

Kate Daly: So, is that fair, David, how do we get around that issue?

David Hodson: No, it's clearly patently not fair. I've supported Ruth Deitch. for a number of years in calling for reform, but I don't agree necessarily with [00:30:00] that reform model. No, it's clearly not fair. The nature of marriage is that sometimes one spouse supports the other.

David Hodson: I won't pursue my career. I will look after the household so that your career can go forward. The good time's coming. We will support each other, or I'll support you, and in due course your career will take off, and then we will have the fruits of that. Sadly, too often we see when the good times come, so to speak, that the marriage breaks down.

David Hodson: So clearly, it's not fair. And that's where I have a problem with that straight 50 50 approaches. It's where I see a problem when I'm dealing with a number of cases with continental European countries and such. It's patently not fair. The problem we have, and the Law Commission will have been that it's predictable.

David Hodson: It's certain. It's clear. It enables people to settle easily, and I think the Law Commission will have a dilemma because they will say, on one hand, everyone is crying out for predictability, clarity, certainty, ease [00:31:00] of settlement, and of course, why not? And yet on the other side, there are the sirens crying out, well, there must be fairness.

David Hodson: And let's be frank, there is a significant gender component within this and not always, but significantly, it would be the woman who would lose out because of it. And there, I think, will be the predictability regarding some fettered discretion for that needs based aspect of it. Can I come on from that, if I may, to carry on what Joshua said about marital agreements?

David Hodson: Because the answer, you may say, oh well, it's easy, enter into a marital agreement. And again, Ruth Deutscher rightly is promoting that. The Law Commission recommended there should be binding marital agreements. And I'm sorry to have to come back. Again, there is a gender component to this. Why would you enter into a marital agreement?

David Hodson: For certainty, predictability, etc. But often, because one party will do better as a result than if they were able to use the law. And the person who does better is [00:32:00] often not the woman. Not always, but often it is. And it was Baroness Hale, in a major case, drew attention to the gender element, the duress, the pressure, perhaps duress is too strong a word, the pressure that's brought to sign.

David Hodson: The Law Commission then recommended it should be 28 days before the marriage. Well, hang on, 28 days, 29 days? The dress has been bought. Everything's booked. Um, then make it nine months or ten months or whatever. And what do you do about a case where two people start off in modest means and then during the marriage one of them really hits boom?

David Hodson: They create an IT system, or they hedge fund, or they end up with a large sum of money and it's agreed each will keep their own. How much should you review it? And then last of all, do you require people to go and see a lawyer before they enter into this agreement? Now, that's the position in Australia.

David Hodson: Can we really see the government, um, both political parties are not particularly fans of lawyers, one may [00:33:00] think. Can we see either political party bringing in a law to say, oh, well, don't worry guys, you can enter into a marital agreement to be decided, but each of you have got to see a lawyer. Um, Joshua, you're the expert, not me, I don’t think that will fly.

Joshua Rozenberg: I don't think it'll fly at all. No, it's very difficult. And I mean, you know, well, I'm very old fashioned. I've been married for more than 49 years. And you know, when I got married, these marital agreements weren't there. And it's the last thing that we would have thought of signing. I'm very glad we didn't.

Joshua Rozenberg: You know, extraordinary idea to us, and I suspect they're used more in second marriages than they are in, in first marriages of young people. But you know, I certainly remember when I joined the staff of the BBC at the age of 24, I was told what my pension would be at the age of 60, which seemed an impossible time away.

Joshua Rozenberg: Of course, I now look back to that age and, you know, if somebody had said to me, well, you're getting married now, but you have to work out what you're going to do if you get divorced in, I don't know how many years’ time, I would have thought it was preposterous. And the idea that you would have [00:34:00] to do it.

Joshua Rozenberg: Well, it doesn't sound very romantic. So no, I can't say that's a very attractive idea. And David's absolutely right. The idea of the government paying for it doesn't fly at all.

Kate Daly: And it strikes me that if we go down this road of having sort of a more formulaic idea, or Promoting or encouraging people to get it down on paper in some format, whether that's a proper legal agreement or whether it's something else that, you know, the court would agree they would look at, then I wonder whether that actually starts to change human behaviour as well, and whether actually what you get is a situation where people start to think about marriage in a very different way.

Kate Daly: Perhaps don't enter it in quite the same way, and that's not necessarily a good or a bad thing. But at the moment, you know, when we speak to people, lots of people don't understand that actually marriage is a form of a legal contract and there are consequences, legal consequences to being married when it comes to dividing money and property later down the [00:35:00] line.

Kate Daly: So, if at the moment we don't understand that, or lots of people don't make that link, then is there not something about trying to. Help people make the decision about whether or not to marry, which I can't see any government wanting to decide that actually encouraging people not to marry is a good thing because it's more expensive as a nation for people not to marry.

Kate Daly: I get that, but I wonder whether it then starts to impact on the social dynamics of society, David.

David Hodson: Yes, this is one of the things I really worry about our present law. The public doesn't know what it is and therefore they are living their lives without a knowledge of certain aspects of the law. If there's a premarital asset, one of theme’s got a family, a second property, not talking about the family home, that's likely to start from a sharing presumption.

David Hodson: They've got a second property. And they say, oh, well, I've got married, I'm going to put it into joint names. That's the romantic thing to do. That's what everyone has done through the centuries. And they use [00:36:00] that to, you live off, et cetera, et cetera. And it's shared. And then on divorce, it is put into, it is effectively a 50, 50 division.

David Hodson: And then you've got somebody else in identical circumstances, maybe wealthier, maybe they've got professional advisors. They send them along to somebody like me and I say, oh no, keep it in your soul’s name. Don't allow the income from it, the rental, et cetera, to go into the joint bank account. Put it into your sole bank account.

David Hodson: And then at the end of the year, if sadly the marriage were to end, it is entirely yours. It won't be shared. And I feel really strongly, sorry, Kate, I say very, very strongly. We must not have a law for one and another law for those who are wealthy enough to actually get the advice to plan. If it means that that were to be codified, the question you put to Joshua a little earlier, if it means that were to be codified and people change their behaviour as to what they put into joint names, then so be it, that is an outcome of a public debate, a consultation, and going through [00:37:00] Parliament.

David Hodson: That may be so. But let's please not have a position where some people lose out because they do the appropriate, uh, I'll be old fashioned, traditional romantic thing of, um, darling I love you, let me put my pre-marital asset, the sort of property I've got in Portugal, or an investment property into joint names, and therefore lose out.

David Hodson: I think that's really important. There are a couple of other areas where, because the law is judge made, and again, not necessarily critical of that, but its judge made and therefore people don't know about it, they don't change their behaviours or similar. Nobody, unless they're doing a marital agreement, in their right mind, would go and see a lawyer before they get married.

David Hodson: There's plenty of other more important people to see. And so that, that's where the problems lie. We cannot have two different forms of behaviour in

Kate Daly: laws. And of course, you know, the, the way that things are moving at the moment, many more organizations are offering joint advice, couple advice, obviously we've started that whole trend of having, you know, one person [00:38:00] helping both of you, but that's becoming very much more popular.

Kate Daly: So, the idea that people will go off and seek individual advice at that early stage seems. Less and less likely to me, it feels like people may well go as a couple prior to marriage to take some advice, but the likelihood is from my perspective is as the world moves on, is that that will be jointly given advice and then people will almost like a financial planning session with the legal bit sort of.

Kate Daly: interwoven into it. So, I guess the link, although this could be seen as a very isolated piece of work with the Law Commission, the link in terms of the behaviour it potentially drives and the scope for unintended consequences seems huge. Absolutely huge. I'm conscious of time and Joshua, I just wanted to come back to this idea that the Law Commission is going to put some kind of report forward in September 2024.

Kate Daly: What then from a sort of public perspective will happen? Can people get involved in giving their [00:39:00] views on this? What, what, how will it all be communicated?

Joshua Rozenberg: Not only can they, but they certainly should. And that's what the Law Commission wants. So, for example, it might have public meetings. It might have videoconferences.

Joshua Rozenberg: It will certainly publish a report, but it will also publish a summary, and often it publishes what it calls an easy read version. The law commissioner concerned will give interviews, broadcast, take part in programs, take part in podcasts like these, because the law commission wants to know what people think.

Joshua Rozenberg: Certainly, they will consult the profession, the people directly involved, but they will want to hear from people who have been through a divorce, people who are married. People who want to give the benefit of their experience to the law commission. So, they will consult widely. And as I say, they will add up the views on one side or the other.

Joshua Rozenberg: It doesn't follow that the side which has the most support will necessarily be what they recommend. But they [00:40:00] certainly will in many cases move from their provisional recommendations, provisional proposals to final recommendations that are different in the light of what people say. It's very important that when this comes out, people should be consulted, and they should make their comments known.

David Hodson: I would say, Kate, as you said at the very beginning, this is many years away. In the meantime, in the nicest possible sense, forget about it. Please take part. Absolutely take part, as Joshua said. In the meantime, sort out matters without going to court. Take legal advice. I'm bound to say that because it's crucial that people have a good understanding of their legal position.

David Hodson: But having taken legal advice, sorted out as far as possible through mediation, through a life coach, a sort of. Work that amicable does through arbitration, through lawyers negotiating on their behalf, the vast majority do not go to court either because they can't afford it or frankly, because they don't need to because I've sorted it out on route, [00:41:00] maybe commence proceedings to get disclosure.

David Hodson: But again, there are ways of sorting it out without going to a final hearing. So, my strange to say as a lawyer, I would be saying. Please take legal advice, understand your position, and then find a way to resolve it without going to court, because that really is, in most cases, not all, some do need a decision, but in most cases, the least good scenario, whether it's under the law that we've got in 2023, or it is the law that we've got in 2031.

David Hodson: Post law commission, whatever it is, uh, and Joshua and I will do our, we'll be involved in helping them, we hope, but whatever comes out still, one thing I think we can certainly say is the law commission will keep saying go to mediation, go to dispute resolution, don't use the courts.

Kate Daly: Exactly. What a great note to end on.

Kate Daly: That's the thrust of the podcast is to try and keep things amicable and stay away from the court. So, it's lovely to have that echoed by two such distinguished guests. [00:42:00] David and Joshua, thank you both very much for joining me. Where can people find out more about you, Joshua? I

Joshua Rozenberg: do a blog on a platform called Sub stack and the address is Rosenberg, which is R O Z E N B E R G.

Joshua Rozenberg: sub stack. com. And, uh, if you look at that blog, uh, which I write too much every day, um, then you'll be able to follow what I write. The, it's called A Lawyer Writes. If you just search for my name, Rosenberg, R O Z E N B E R G. And ideally add the word Sub stack, S U B S T A C K, uh, you'll find it, and, uh, I would be delighted if you follow what.

Kate Daly: I write.

Kate Daly: Wonderful. We'll put that in the show notes too, so anybody listening can, uh, see the link there. And David, what about you? I was going to.

David Hodson: say, without being a creep, could I highly commend Joshua's columns? I read, I won't say first thing in the morning, but I read it fairly early. When it comes through, first thing more they, they really are helpful. [00:43:00]

David Hodson: And for myself it would be through my firm's website, the International Family Law Group that is IF for International Family Law group.uk.com. And we put out quite a lot of information on there really, because we want to help people understand what the law is here and abroad. There are relatively few lawyers around the country doing family law who would safely say, well, come to me regardless.

David Hodson: Most of us are trying to get our clients to sort it out in one way or another. And giving good information is part of that. So iflg. UK. com. He says quickly checking his own website.

Kate Daly: Don't worry, we'll put the full addresses in the show notes, so they will all be there for people to click on and click through to find out more about you both.

Kate Daly: You can find me on Twitter. I'm at Kate underscore daily, and you can hear about new podcast episodes by subscribing for updates and visiting the divorce podcast. com or from your own favourite listening platform. It's just been an [00:44:00] absolute pleasure talking to you both. Thank you very much for joining me and thank you everyone for listening.