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Pre-Nuptial Agreements

Pre-Nuptial Agreements

What is a pre-nup? 

A pre-nuptial agreement is an agreement which is signed by a couple in anticipation of them marrying and which provides clarification as to how they would wish to deal with their financial arrangements, both during the marriage and also in the event of there being a breakdown of the marriage.  The parties may also wish to deal with other non-financial arrangements in the agreement eg in relation to the upbringing of any children. 

Are pre-nups legally binding? 

Contrary to popular belief, pre-nuptial agreements are not binding under English law.  At the moment, it seems unlikely that Parliament will change the law whereby such agreements will become binding.  Therefore pre-nuptial agreements cannot bind a court as to the provision it would wish to make for the parties in the event of a divorce.  

However recent family law case law, such as Radmacher v Granatino (2010), have made it clear that judges are giving more weight to sensible pre-nuptial agreements and in many cases, such an agreement has determined the type of financial settlement made by the judge.  English law is therefore now leaning in favour of upholding pre-nuptial agreements wherever it is feasible and just to do so. 

It remains the case though, that such agreements are not contractually binding upon the parties and therefore, in the event of there being a dispute between the parties, the agreement would still need to be sanctioned by a court. 

How does a court decide if a pre-nup should be binding? 

When deciding whether the parties going through a divorce should be bound by a pre-nuptial agreement, a court will typically ask itself the following questions:- 

  1. Were there circumstances attending the making of the agreement that detract from the weight to be accorded to it? 
  2. Were there factors that actually enhance the weight to be attached to it? 
  3. Do the circumstances now prevailing make it fair or just to depart from the agreement? 

It is likely a court will give effect to a pre-nuptial agreement provided it is freely entered into by each party with a full appreciation of its implications unless it would not be fair to hold the parties to their agreement. 

If a couple wish to enter into a pre-nuptial agreement, prior to their marriage, it is therefore important that this agreement is fair, there has been no undue pressure by one party on the other, each party has fully disclosed to the other their financial circumstances and each party has had the opportunity to seek their own legal advice.  Provided these minimum safeguards are met, then there is a strong likelihood that a court would uphold the terms of the agreement, even if the agreement provides for one of the parties receiving a lower financial settlement than they would have achieved if they had proceeded to a fully contested final hearing. 

Considerations when making a pre-nuptial agreement 

Pre-nuptial agreements can be extremely useful to anyone entering into a marriage where they already have an amount of wealth and wish to preserve their financial assets in the event of a marriage subsequently failing.  It is extremely important that the pre-nuptial agreement is prepared correctly if it is to have a significant effect in any divorce settlement. 

When entering into a pre-nuptial agreement, it should be borne in mind how future events, such as one of the parties giving up work, whether voluntarily or due to illness, or the parties having children together is likely to be considered a relevant change in circumstances which could mean the terms of the original pre-nuptial agreement are no longer fair.  It is therefore important that in the event of there being any such change in the parties' circumstances, the terms of the original pre-nuptial agreement are reviewed and if need be varied, with the consent of both parties, so as to ensure that the agreement at all times remains fair and provides for the basic needs of the parties. 

Questions about pre-nups and divorce

If you should require any advice and assistance with regard to a pre-nuptial agreement, or indeed any other family matter, then please contact Mr David Berridge, who is the Head of the Family Law Department, on 0116 2548871 or email him at dberridge@braybray.co.uk 

Bray & Bray has three main offices in Leicestershire, contact us to discuss an enquiry or a case you have or for a no obligation chat about your situation call our friendly family law team today at your local office by clicking on the links below;

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