Prenuptial Agreements are not binding but are becoming more influential in the right circumstances. On 20 October 2010 the Supreme Court Judgement was released in the case of Radmacher –v- Granatino. It will have a significant impact on the treatment of prenuptial agreements (and post-nuptial agreements) on divorce settlements.
Our conclusions about Radmacher –v- Granatino can be found here.
The use of prenuptial, post-nuptial and cohabitation/ living together agreements serve a useful purpose for some couples, but we recommend they are only undertaken with professional guidance. Here we provide some basic information about their use:
- Written agreement between a couple who intend to marry or enter in to a civil partnership
- Ideally the couple should complete the terms of the agreement within 21 days prior to the date of the marriage or civil partnership
- The agreement deals with the couples intentions in the event of the marriage/civil partnership failing and covers, for example:
- (a) preservation of assets acquired during the marriage/civil partnership;
- (b) the agreement generally incorporates a review clause:
- (i) after X years (usually five years);
- (ii) in the event of a birth of a child to the parties.
In providing a review clause the parties must then decide whether they wish to continue the terms of the agreement for a further period of time.
In the event of marriage breakdown/breakdown of civil partnership, the agreement is of evidential value only and the weight that the Court will attribute to the agreement will be dependent upon, for example, the length of the marriage/civil partnership, whether there are any children of the relationship as well as all the Section 25 factors of the Matrimonial Causes Act 1973.
Reasons for Entering a Pre Nuptial Agreement
- Either party has or may acquire a family inheritance which they wish to protect in the event of the marriage/civil partnership failing
- Where either party to the marriage/civil partnership has assets acquired through their own initiative, for example, savings, property, business assets which they would wish to protect in the event of the relationship failing
- Where either party was previously married or in a civil partnership and if they wish to preserve the assets acquired in the previous marriage/civil partnership.
- In entering in a Pre Nuptial Agreement, the couple must disclose to one another the details of all assets held by them. It is recommended that an assets schedule should be attached to the agreement recording the assets then held
- Both parties should take independent legal advice when entering such an agreement and the couples representatives should certify that the agreement is approved on behalf of their respective clients
- Pre Nuptial Agreements can be dealt with through the collaborative process
For more information contact Aileen Hartnett.