Pre-nuptial agreements – an insurance policy, ‘just in case’
When we move home, we take out contents insurance just in case the worst should happen. Nobody anticipates having to make a claim, but it’s there to protect us – just in case. The same applies to pre-nuptial agreements. Far from the unromantic picture painted by the press, who delight in revealing which latest celebrity couple has signed a ‘pre-nup’, many couples are now signing pre-nuptial agreements because they make good financial sense – just like an insurance policy.
Radmacher v Granatino – a landmark case
While pre-nuptial agreements aren’t legally binding, courts are obliged to uphold them providing it is fair to do so. And a landmark court case in 2010 set a precedent for due weight being given to properly prepared agreements.
Before the couple in question married, they entered into a pre-nuptial agreement at the wife’s request. Her family had offered to gift her a substantial portion of their wealth provided that an agreement was signed. Upon their divorce, the judge initially decided to reduce the weight accorded to the agreement due to the circumstances in which it was signed. However, when the wife appealed, the Court of Appeal upheld her bid that the agreement should have been given more decisive weight.
Who should consider a pre-nuptial agreement?
Any couple where the partners own assets prior to their marriage, such as monetary gifts from parents for the purchase of property, shares in a family business, or assets acquired from a previous relationship, may wish to consider a pre-nuptial agreement. It is also a good idea for those with inherited wealth, as it avoids the stress of potential conflict with family members who may be uncomfortable with the idea of the family inheritance being lost or divided in the event of your separation.
How does it work?
Each partner must consult an independent family lawyer, who will provide guidance tailored to their circumstances and assist in drawing up the agreement. They will also ensure that you meet the required criteria for any agreement to be upheld by a court. For example, the document should be signed a minimum of six weeks before your marriage to give it the best chance of being upheld. Each partner must also make a full and frank disclosure of their assets, and the division of assets must be fair to both parties.
A post-nuptial agreement can follow at any time after your marriage, allowing you to make amendments to your pre-nuptial agreement should your circumstances change.
Consult our experts
At Attwaters Jameson Hill, we are extremely supportive of couples seeking to enter into pre-nuptial agreements. They are a cost-effective way to resolve financial arrangements following the breakdown of a marriage, and alleviate the stress and uncertainty of not knowing what the future might hold. Marriage is an emotional time, and having an agreement in place will help reduce any anxiety, enabling you to get on with your lives together.
Please visit our page on pre-nuptial agreements for more information.