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Pre-nuptial and Post Nuptial Agreements

Pre-nuptial and Post Nuptial Agreements

Pre-nuptial agreements are formal agreements entered into prior to marriage or civil partnership setting out who will own what when they are married and usually attempting to set out what will happen in the event  of a divorce or separation.  Such agreements are sometimes referred to as ‘pre-partnership agreements’ for civil partners.  Post-nuptial agreements are essentially the same thing but entered into after marriage or civil partnership and before separation is planned.

In many countries outside the UK, pre-nuptial agreements are a normal feature and are regularly enforced as binding agreements by foreign courts. However in England and Wales such agreements are not directly legally binding on the courts when deciding how to divide assets.   Currently the court will attach considerable weight to the existence of such an agreement and may hold the parties to its terms if it can be shown that it was entered into freely, with full consideration of the implications and it would not be unfair to either party to uphold it.

What is involved?

Discussing pre-nuptial agreements with your partner can be awkward but having an honest financial discussion about money before marriage is often a good idea to put financial expectations on the table before the ceremony.  An agreement may be used for some of the following: -

  • To establish the value of non-monetary contributions to a marriage, such as being a stay at home partner and career sacrifices
  • To cover your pre-marriage nest egg (such as your home, pension plan, stock portfolio, or property)
  • To protect gifts and inheritances you receive
  • To ensure that in the event of death or divorce, you will avoid difficult disputes over property (such as family businesses, stock options, licenses and practices, pension plans, and copyrights)
  • To protect the financial well-being and any inheritance intended for children from a previous relationship
  • To allocate any pre-marriage ownership/partnership in a business
  • To protect yourself from your partners' pre-marriage debt, i.e. credit card debt or prior loans

Although such agreements will not bind the court, there are some steps that can be taken to help demonstrate that the agreement has been entered into freely and fairly.  

We strongly recommended that each party to the agreement obtains independent legal advice from a specialist Family Solicitor.  This helps to show that you both understood the implications of the agreement when entering into it.

Full disclosure of your assets and income to your partner helps to show that you were both fully aware of the financial implications of the agreement. It is important that both of you have all of the information which is material to your decision, and that both of you intend that the agreement should govern the financial consequences of your marriage or civil partnership coming to an end.

The agreement must be entered into freely by both of you and there should be no evidence of duress or undue pressure before entering into the agreement.  Ideally agreements should be entered into several months before the wedding or civil partnership.

If the pre-nuptial or post-nuptial agreement is weighted too far in favour of one person, there is less chance of it being upheld by the court on divorce.  Whilst the reasoning behind signing a pre-nuptial or post-nuptial agreement often includes securing a more favourable financial settlement for one of you, it is still important to ensure that the agreement is realistic in light of current divorce law. The court is unlikely to uphold an agreement that would result in one of you being left in a predicament of real need, whilst the other enjoys an excess.

It is recommended that pre-nuptial and post-nuptial agreements should only last until the birth of the first child of the family or for up to a period of five years. Whilst pre-nuptial and post-nuptial agreements can be prepared to provide for the birth of children or to last for longer periods, they will have a reduced chance of being upheld by the court on divorce in their entirety because it is often difficult to predict what impact these significant changes will have upon the family at the relevant time. It is possible to review an agreement by way of a (further) post nuptial agreement after being married for several years.  It is much harder to try and uphold an agreement in a lengthy marriage.  This is because English courts must consider all the circumstances of a marriage when making a settlement and no matter how accurate the forecasting when the agreement is drafted, it is difficult to take account of all the experiences a couple may enjoy in a lengthy marriage.

Why we are different

Whether you are contemplating a pre-nuptial agreement or have received an agreement, it is essential to seek advice at an early stage.  We can help you decide whether a pre-nuptial agreement is right for you and understand the rights you may be acquiring or surrendering.  We can expertly draft an agreement for you, if required in a timeframe that suits your arrangements.

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