Peace of Mind in Partnership: Understanding Nuptial Agreements

With spouses looking to protect their existing wealth and the Courts placing more weights on Nuptial Agreement, they are quickly becoming more common in society and marriages. Nuptial Agreements can be prepared as a “pre-nup” which is entered prior to the marriage or a “post nup”, which is entered into after a marriage with both carrying the same weight.

Nuptial Agreements can be an effective means to protect existing wealth, or future inheritance, and assets obtained during the marriage but have not “matrimonialise”, that is those assets that have become intertwined with other marital finances.

The Supreme Court case of Radmacher v Granatino (2010) set out the guiding principles for the court to consider when deciding to give effect to a nuptial agreement. Nuptial Agreements should be entered into freely, with no signs of duress, fraud, or undue influence, with the parties having provided full and frank financial disclosure, the parties should each obtain independent legal advice and therefore would be fully understanding on the implications of the agreement and that, unless given the circumstances at the time of the divorce, it would not be fair to uphold the agreement. However, parties are to be warned that these are simply guidelines, and even a failure to have met one of the above may not be completely fatal to an agreement being upheld.

Nuptial Agreements in England and Wales are still not legally binding however there appears to be clear encouragement from the court, and in recent cases over the last decade since Radmacher, that the court will respect the idea of autonomy in mature adults, and that they should be entitled to make informed decisions relating to their future without court intervention. However, those entering into a Nuptial Agreement should keep in mind that the courts will consider the fairness and impact of an agreement at the time of divorce, it is therefore advisable that any agreement has a review clause, and ensure that children are provided for, or contain provisions for the needs of any future children of the marriage.

The courts will retain the far-reaching discretion that they currently hold when dividing matrimonial assets with needs, especially those of the children, remaining a fundamental principle in the decision-making process.

Thinking about a nuptial agreement?

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