In recent years, we have seen a big change in couples’ attitudes towards their finances. With approximately 45% of marriages ending in divorce, Prenuptial Agreements are becoming increasingly popular.
A Prenuptial or Premarital Agreement, commonly abbreviated to “pre-nup”, is a written contract created prior to marriage, seeking to regulate the prospective spouses’ financial liabilities and responsibilities towards each other in the event of a divorce or separation.
Legally, once married all of these assets become matrimonial assets and, unless specifically protected, are thrown into a single financial pot. The primary purpose of a prenuptial agreement will frequently be to limit the potential claims on the wealth of one of the parties to the marriage.
Prenuptial agreement provide a good starting point in the event of a marriage breakdown, and can be very effective in cases where the marriage itself was short. It provides clear evidence of the assets that each spouse brought to the marriage, and how they wished to deal with those at the start.
Prenuptial agreement can also assist couples who are marrying for a second time in protecting any settlement received from their first marriage. If there are children from a previous relationship, they may wish to ensure that any money or property that they have at the time of the marriage is preserved for the said children.
For those who have inherited, or have assets that have been in their family for generations, a prenuptial agreement provides a way, potentially, to ring-fence inherited property in the event of a divorce or civil partnership dissolution.
What should you consider when looking into getting a prenuptial agreement. Well, you must think carefully about the terms and make the agreement as precise, clear and detailed as possible. Both parties must provide full disclosure of each parties respective financial positions and this must be made prior to the agreement being prepared. Both parties should think about and decide upon how best to deal with changes in circumstance that may arise during the marriage. For example, if you are thinking of having children, loss of employment, inheritances, pension provision, and the acquisition of further assets and what would happen in these instances. Both parties must take independent legal advice. This avoids accusations, further down the line if things go wrong, that undue pressure was put on one party or the other to sign the agreement. It also means that both parties can ensure that the party with the most to lose understands the nature and implications of the agreement they are about to sign.
You must note, at present a prenuptial agreement does not carry the same weight as a Court order and will not ‘automatically’ be upheld or enforced by an English court in the event of a divorce and/or disagreement. However, if drafted properly by a specialist family Solicitor a Prenuptial Agreement can be persuasive evidence to the court in setting out how a couple agreed, before they married, to divide their property, and this can have a significant impact on the outcome of a divorce case.
So, the court all in all do take prenuptial agreement seriously.
The Court will carefully consider things like:
- Did the party with the most to lose understand the nature of the prenuptial agreement?
- Did he/she have independent legal advice?
- Was he/she under pressure to sign?
- Was there full financial disclosure?
- Would an injustice be done if the prenuptial agreement were upheld?
If you are contemplating that a prenuptial agreement is just what you need and would require further advice, contact us at Optimal Solicitors.