A pre-nuptial agreement is not currently binding in English Law. Couples have many reasons for entering into these agreements, such as to displace legal principles for sharing assets equally on divorce.
Prenups have become increasingly popular as people marry later in life or remarry. People want to protect the money and assets they have accumulated before they get married such as property, savings, or pensions.
In the absence of a pre-nuptial agreement, on divorce the family home would be subject to the sharing principle with the starting point being equality. A pre-nuptial agreement can therefore be helpful if you were to start divorce proceedings.
Judges have shown an increased willingness to recognise pre-nuptial agreements and promote spousal autonomy in respect of parties’ financial affairs. A pre-nuptial agreement is the ideal way to record what parties intentions are in relation to financial matters before marriage.
For the Court to take the pre-nuptial agreement into account if the marriage breaks down, it is essential the agreement is made with a full appreciation of the implications and the content of the document is deemed fair. This is why legal advice will be required for both parties to the agreement.
The concept of fairness has evolved concerning pre-nuptial agreements. An agreement is likely to be considered unfair where it provides nothing for one party, regardless of the duration of marriage and needs. Consideration should be given to fairness if children are hoped for.
The definition of needs can be the cause of acrimony and will often lead to litigation on relationship breakdown. A pre-nuptial agreement can be helpful in identifying agreed needs before divorce, to prevent arguments at a later date. The agreement will set out which assets are ‘non-matrimonial’ in nature i.e. those that will not usually be subject to the equal sharing principle, such as inherited assets or assets acquired before marriage.
Pre-nuptial agreements primarily benefit the wealthier spouse who will usually be advised not to marry without entering into such an agreement. The less wealthy party will often be advised not to sign such an agreement, because they would be financially better off without having such a pre-nuptial agreement.
Despite this conflicting approach, with our help a compromise can almost always be reached. Prenuptial agreements are complicated documents on which you should seek specialist legal advice.
If you are married or in a civil partnership, you may wish to enter into a post-nuptial agreement to set out what will happen to your assets and property if your relationship breaks down.
Furley Page has expertise in advising on pre-nuptial and post nuptial agreements and agreements for unmarried couples.