Securing your future before you marry
Prenuptial agreements can provide a measure of certainty and the means of protecting pre-marriage assets, inheritance, and existing family commitments such as children from a previous marriage.
A significant percentage, currently around 50%, of marriages now end in divorce. It is therefore natural that mature adults might wish to agree what should happen in the event of a breakdown of the relationship.
A prenuptial agreement is a document in which a couple set out their rights in relation to any property, debts, income and other assets purchased together or acquired individually (eg, through inheritance), or that they have bought into a relationship.
Legally, once married all of these assets become matrimonial assets and, unless specifically protected, are thrown into a single financial pot. The primary purpose of a “pre-nup” will frequently be to limit the potential claims on the wealth of one of the parties to the marriage.
Anyone contemplating marriage should consider whether they need one.
Do I need a prenuptial agreement?
If the answer is “Yes“ to any of the following scenarios a prenuptial agreement could be right for you.
- I am thinking of getting married and want to protect my property in case it doesn’t work out.
- I am about to marry for the second time and want to limit any potential claims on the settlement I received from my first marriage if things go wrong again.
- I am a widower thinking of marrying again. I want to protect my assets in case things go wrong.
- I am about to marry but worry that if things go wrong we could end up in a costly and lengthy argument about “who gets what”
- I am about to marry for the second time but want to protect my assets to ensure I have something to leave in my will to the children from my first marriage if my new relationship breaks down.
What is a prenuptial agreement?
A prenuptial agreement is a document in which a couple set out their rights to any property, debts, income and other assets purchased together or acquired individually or that they have bought into their relationship in the event that the relationship ends.
How do I get a prenuptial agreement?
- If you have decided to marry don’t wait till the last minute make it a priority in your wedding plans. An agreement signed on the way to your stag or hen party is less likely to be upheld than one carefully thought out and signed a month or so before.
- Both parties must take independent legal advice. This avoids accusations, further down the line if things go wrong, that undue pressure was put on one party or the other to sign the agreement. It also means that both parties can ensure that the party with the most to lose understands the nature and implications of the agreement they are about to sign.
- Full disclosure of each party’s respective financial positions must be made prior to the agreement being prepared.
- Think carefully about the terms and make the agreement as precise, clear and detailed as possible.
- Think about and decide upon how you would deal with changes in circumstance that may arise during the marriage. For example, if you are thinking of having children, loss of employment, inheritances, pension provision, and the acquisition of further assets and what would happen in these instances.
- Also consider putting in reviews of the agreement at agreed periods during the marriage, the length of the marriage can have a bearing on whether or not the agreement remains enforceable and regular reviews of the provision can help with this.
Will a prenuptial agreement stand up in Court?
When you marry your assets become ‘matrimonial assets’ and, unless specifically protected can be considered for division between you within divorce proceedings. The main purpose of a prenuptial agreement is to limit the potential claims on the assets of one of the parties to the marriage and avoid costly litigation over “who gets what”.
At present a prenuptial agreement does not carry the same weight as a Court order and will not ‘automatically’ be upheld or enforced by an English or Welsh court in the event of a divorce and/or disagreement.
The courts do however take them seriously, as a prenuptial agreement is evidence of your intentions to one another in the event of your relationship breakdown and one of the factors that a court may take into account when looking at all the circumstances of your case.
The Court will carefully consider things like:
- Did the party with the most to lose understand the nature of the prenuptial agreement?
- Did he/she have independent legal advice?
- Was he/she under pressure to sign?
- Was there full financial disclosure?
- Would an injustice be done if the prenuptial agreement were upheld?
For advice on prenuptial agreements call Woolley & Co, Solicitors on 0800 321 3832 or request a call using our online form.