A judge has confirmed that the long arm of the law does not stretch overseas for British expats and their Qualifying Recognised Overseas Pension Schemes (QROPS) in the case of divorce.
The question of jurisdiction arose in the long-running and bitterly disputed divorce of Amit and Ankita Goyal in The Family Court.
The couple divorced in August 2013, but financial matters relating to Mr Goyal’s pension are still before the courts.
In October 2015, he was ordered to pay a cash lump-sum and maintenance to his wife.
However, he appealed the decision claiming as he had transferred his £87,000 pension to an annuity in India and that a British court did not have the power to order him to share his pension with his former wife.
No power to make order
He argued that the law applied to pensions based in the UK and not elsewhere.
Judge Lord Justice McFarlane upheld the appeal.
“This appeal, which concerns an application for a pension sharing order within financial remedy proceeding following a divorce, raises the question of what jurisdiction, if any, the Family Court may have to make an order transferring or assigning one spouse’s interest in a pension annuity policy to the other spouse outside the statutory scheme established by the Matrimonial Causes Act 1973,” said the judge.
He went on to explain that the court had no power to make a sharing order against an overseas pension, adding ‘even if the country concerned would enforce the order’.
The judge added that the court would not dismiss the wife’s claim, but agreed to set aside the claim in case the money came back to the UK.
Appeal upheld
“The husband cannot invite us to do more than set aside the order,” said McFarlane.
“There is no justification for this court going further and actually dismissing the wife’s pension sharing order application on its merits.”
The ruling reinforces decisions in other cases that place money held in a QROPS beyond the reach of British courts in the event of a separation or divorce.
A spouse could make a sharing application in the country where the fund resides, if that country has laws allowing the action, or leave the application open should the money come back to Britain.
