For many years, lawyers have advised their clients that there was no point in drawing up prenuptial agreements before the couple married or agreements to regulate their finances after they married. This was because divorce courts would not be bound by them.
Since 2010, divorce courts have been prepared to give effect to a nuptial agreement that is freely entered into by each party fully understanding the implications, unless it would be unfair to hold the parties to that agreement.
As a result of the courts’ changed approach and social changes, more couples are seeking a formal agreement either prior to marriage or after marriage.
It is an agreement entered into in advance of a marriage which sets out the arrangements the parties intend to make. It can outline arrangements for living together during the marriage but more usually identifies assets and income and the division of those assets and income in the event that the marriage ends.
A postnuptial agreement is entered into after the marriage but in all other respects is very similar to a prenuptial agreement.
You should take legal advice early. Ideally, if you take advice at least six months before the date of the marriage, this will give your advisers and you time to properly consider a range of issues. You may need financial advice or tax advice, as well as legal advice. If you at least take some initial advice early, you can prepare the information which your lawyer will need in good time.
Prenuptial agreements should be signed at least 28 days before the wedding so as to avoid the risk of signing under duress which could invalidate the agreement. Where couples leave it too late to sign 28 days ahead of the wedding, they can enter into a postnuptial agreement afterwards. Some couples have both a prenuptial and a postnuptial agreement.
It can take your solicitor some time to properly draft your nuptial agreement. Such agreements can be quite complicated. Many couples assume that nuptial agreements are “off the shelf” documents, but they are not. Each is specific to the couple involved. It is therefore important that you take legal advice as early as possible.
Each party should have their own separate legal representation to ensure that each of them properly understands their own interests in the matter and how their circumstances will be affected by signing the agreement. If one of the couple signs the agreement without taking legal advice, this may weaken the strength of the agreement as they may not have properly understood the very significant rights which they may have abandoned by signing the agreement.
It is important that both parties are free to enter into the agreement. Such agreements inevitably mean that one or both parties are conceding certain rights, so may be worse off as a result of entering into the arrangement. Provided the parties understand that that is what they are doing, the agreement should be upheld, but if parties do not understand that, this may invalidate the agreement.
The agreement should be binding, but a divorce court can consider it and if the court is not satisfied that:
then a divorce court could set aside the agreement or modify it.
At Neves we frequently draft nuptial agreements and advise on the effect of such arrangements when a marriage fails. If you are thinking of marrying, why not have a chat with a member of our Family Team? You can get in touch at email@example.com.