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Q&A: Prenuptial Agreements: for better or for worse?

Prenuptial Agreements are often associated with the super-rich and famous, going hand-in-hand with the extensive media coverage of their lavish wedding celebrations and an in-depth analysis of the cost of their big day. However, not every marriage has a fairy tale ending, and as celebrities such as Paul McCartney have discovered in recent years, the cost of divorce can be substantial, £24.3 million in his case. Prenuptial Agreements attempt to make divorce settlements fairer to avoid these traditional 50:50 split settlements whilst ensuring children and dependents are protected financially.

1. What is a Prenuptial Agreement?

A Prenuptial Agreement is an agreement entered into by a couple before their marriage or civil partnership which seeks to describe what should happen in the event that their marriage breaks down. The content of a Prenuptial Agreement can vary widely, but commonly includes provisions for the division or protection of property and spousal support in the event of divorce or breakup of marriage.

2. Are Prenuptial Agreements enforceable in the UK?

Prenuptial Agreements are currently not legally binding in England and Wales within divorce proceedings, but if properly entered into they are now very likely to be taken into account by the Courts when considering a settlement. This law may change in the future.

In a 2010 case between a wealthy German heiress Katrin Radmacher and her French husband Nicholas Granatino, the Supreme Court indicated that such agreements can ‘in the right case’ have decisive weight in a divorce settlement and highlighted that the Courts may take these agreements very seriously. In this case the Prenuptial Agreement provided that on divorce, neither party would have any financial claims against the other, but on divorce the husband made claims for financial provision; ignoring the Prenuptial Agreement. Initially the High Court held that the agreement was unenforceable as the Husband had not had independent legal advice prior to signing the Prenuptial Agreement and the Wife had not made any disclosure of her assets. However, the Supreme Court dismissed the Husband’s appeal from the Court of Appeal and the Prenuptial Agreement was enforced.

How significant this ruling will be with regard to other cases has yet to be seen. The circumstances of the case were quite unusual. However, it appears that when a marriage is short and both sides have entered into such an agreement of their own free will and with the benefit of legal advice, pre-nuptial agreements may be becoming persuasive. However, it is important to remember that a change in circumstances, such as the birth of a child may make the agreement invalid.

Most European countries recognise pre-nuptial agreements and Resolution - First for Family Law (formerly the Solicitors Family Law Association) has called on the Government to enact legislation in the UK to make such agreements enforceable in the UK courts. The possibility of creating formal legislation to govern pre-nuptial agreements is under discussion in Governmental and legal circles.

The Law Commission is due to consider whether a change in the law recognising Prenuptial Agreements is required and whether any new legislation should be drafted. They are due to publish their report in 2012.

3. What should I do to protect my assets with a Prenuptial Agreement?

In the UK it is important to have a properly drawn-up Prenuptial Agreement so as to avoid the legal pitfalls.

For example:

It is important to ensure that both parties obtain independent legal advice, and that you are both fully aware of all the financial circumstances by way of full financial disclosures by both parties.

Any agreement should also be entered into no less than 21 days before the day of the marriage to avoid allegations of duress.

Provision must be made for dependents or children from previous relationships.

4. What is a Post-nuptial Agreement?

A Post-nuptial agreement is similar to a Prenuptial Agreement but it is reached after the marriage or civil partnership has already taken place. See ‘Post-nuptial agreements – the basics’.

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Contact me for further information on Prenuptial Agreements.

  • Kevin Bristow
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  • Claire Schneck
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  • Joanne McDonald
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  • Mary I'Anson
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The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.