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Prenuptial Agreements

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What is a prenuptial agreement?

A prenuptial agreement (sometimes called a pre-nup or premarital agreement) is an arrangement entered into by a couple before their marriage. The agreement is designed to set out what should happen regarding any financial arrangements if the marriage ends in divorce.

The effects of pre and post nuptial agreements under UK law

It is only since 2010 that the courts have begun to regard nuptial agreements as binding. Even now, the court retains a wide discretion to approve or alter them if the consequences would be grossly unfair to one of the parties. This usually arises where there has been a change of circumstances not contemplated by the parties when the agreement was made, altering and the basis upon which the parties anticipated their arrangements would be made after divorce.

A good example would be if one of the parties became seriously and permanently ill or had a disabling accident after the agreement had been made. For example, if the nuptial agreement said that, for example, after a divorce, neither party was able to look to the other for continuing support but, because of the health condition, that ill or injured party was unable to work, it would be unfair that the other should not have an obligation to support his/her former spouse.

Similarly, if the agreement said nothing about what the situation would be if the parties had children and by the time of the separation and divorce they do, the court will scrutinise the agreement very carefully against the current financial situation to decide whether the agreement remains fair.

The factors that will be relevant in deciding whether a nuptial agreement should be binding

The court will take into account the following circumstances when deciding whether the parties remain bound by a nuptial agreement:
• Did each party have independent legal advice before signing the agreement?
• Did each party make full and honest disclosure of their financial position before signing the agreement?
• Was either party put under pressure to sign the agreement?
• Does the agreement fairly meet the needs of everyone (the parties and any children) in the circumstances at the time of the divorce?

When should parties consider a prenuptial agreement?

It is wise to begin discussions about the possibility of a pre-nuptial agreement well before the date of the wedding. There is much to be dealt with, including making full financial disclosure and taking legal advice. At the very latest, any prenuptial agreement should be signed no less than 28 days before the wedding.

For agreements made after marriage, there is less hurry but if the parties believe that there is an advantage in having such an agreement, then they will want to put it place as soon as is reasonably possible.

What are the advantages of a pre or post-nuptial agreement?

The law allows the judges a very wide discretion on how to deal with financial matters after a divorce.

Nuptial agreements are most likely to be of benefit, at least to one of the parties, if there is a considerable amount of money involved. Similarly, if one (or sometimes both parties) bring to the marriage what might be called ‘family assets’ e.g. farms, businesses, trusts, inherited wealth etc.

Nuptial agreements made before marriage also have another benefit. They provide clear evidence of who owned what at that stage. The significance of this is that assets brought into the marriage can, in many circumstances, be disregarded when financial arrangements are being made at the time of a divorce. This is called non-matrimonial property. It is therefore less likely to be divided equally, because it is not the product of the marriage partnership.

How Barnes Harrild & Dyer Solicitors can help

For further information and a free telephone consultation, reach out to us via the blue contact boxes at the top of this page, and a divorce and family solicitor from our Central London or Croydon office will get back to you with a same day response

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