If you are engaged to be married, the last thing on your mind is likely to be the division of your finances should you end up divorcing the person that you are shortly to marry. However, it is important that you know that you might end up being financially disadvantaged by marrying and subsequently divorcing your fiancé. To protect your position, it might be a good idea to consider entering into a pre-nuptial agreement.
What is a pre-nuptial agreement?
A pre-nuptial agreement is created between the parties to an intended marriage or civil partnership that aims to clarify how any marital dispute is to be resolved should the marriage break down. For the majority, financial arrangements will be the main focus of such agreements, but the parties might also include proposed child arrangements and/or agree the jurisdiction where their divorce or dissolution proceedings will take place.
What are the legal implications pre-nuptial agreements?
It is important to note that under the current UK legal framework, a pre-nuptial agreement is merely persuasive on the Court. It is not necessarily legally binding. The Court is under an obligation to ensure that any proposed financial settlement following a divorce is fair and reasonable. The Court cannot simply rubber stamp a pre-nuptial agreement as it might produce a result that is profoundly unfair.
In order to ensure that a pre-nuptial agreement is as persuasive as possible, there are several legal rules and processes that must be followed. At heart though, the Court will want to see that a pre-nuptial agreement has been entered into without unfair pressure being placed on either party, and that both parties have a full understanding of the other’s pre-marital finances and the legal implications of it what they are signing. To that end, both parties to a pre-nuptial agreement must be encouraged to take independent legal advice about the proposed agreement well in advance of the date of the wedding. This might include a party being advised to take expert advice from a family law Barrister or other expert about the legal or practical effect of any agreement.
Further, a pre-nuptial agreement cannot be entered into if there are less than 28 days to the date of marriage. This avoids any allegation that a party has been unduly pressurised into signing the agreement. As these documents are bespoke, they can take considerable time to draft and be approved. Both parties should have sufficient time and opportunity to negotiate the terms of the agreement freely.
A pre-nuptial agreement must also include provision for periodic review after the agreement has been entered into (typically every two to three years to ensure that the agreement reached remains fair and reasonable). Of course, your finances and circumstances can change substantially over time and a pre-nuptial agreement should be reconsidered in the event that there is a material change in either party’s financial position and in the event that children are born to the parties.
If there is insufficient time to negotiate the terms of a pre-nuptial agreement before the wedding, then it might be preferable to negotiate the terms of a post-nuptial agreement after the wedding.
Should I sign up to a pre-nuptial agreement?
The decision to enter into a pre-nuptial agreement can be a difficult one to raise with your fiancé and such agreements can also be expensive.
Common examples of why one party might be keen to enter into a pre-nuptial agreement are:
- There is a significant disparity in wealth between the parties
- One party has children prior to the marriage, and that party might want to protect that their children’s inheritance
- One party has been involved in a contentious divorce previously
- There are properties or assets in other countries that might need protecting.
If you are considering entering into a pre-nuptial agreement, or a post-nuptial agreement, our Solicitors can advise you regarding the practice and procedure so that you can make an informed decision about your options.
Please get in touch with the Family Team today and we would be more than happy to discuss your matter further. Please call us at our office in Leicester on 0116 255 4855 or our office in Loughborough on 01509 610 312 and ask to speak to a member of the Family Team. Alternatively, you may prefer to email us at legal@johnsonastills.com or complete our enquiry form.
