08 October 2014
Is now the time to plan a prenup?
Planning your wedding is a time of great excitement. There is so much to think about – the venue, the ceremony, the dress, the honeymoon … and the prenuptial agreement?
Those two words could stop many a happy couple in their tracks before they get anywhere close to exchanging rings. Yet the reality is that more and more couples are considering them as a wise precaution in the event of future marital discord.
Sue Andrews, partner and family law specialist at leading Thames Valley legal firm B P Collins LLP, explains how prenuptial agreements work and outlines the benefits of planning ahead.
“Marriage imposes obligations and rights of mutual commitment and support on each spouse. If a husband and wife decide to divorce, they cannot simply opt out of the jurisdiction of a court, which will always want to ensure that the needs of both partners, and any children, are adequately provided for,” she explains.
Typically, couples may decide on a prenuptial agreement where one brings more wealth into a marriage and wants to protect it in the event of divorce. For example, this could be inherited wealth, a business, investments or other property already owned prior to the marriage. Or it may be that one party already has children and wants to preserve property or monies for them.
“A prenuptial agreement records a couple’s agreed intentions about financial arrangements if the relationship ends in divorce or separation,” Sue said. “Judges have a wide discretion when making financial orders, however they must have regard to a prenuptial agreement when considering all of the circumstances, and it is likely to influence their decisions and impact upon the amount of any award.”
Although not legally binding, Sue says the amount of weight attached to prenuptial agreements has been increasingly influential since a Supreme Court decision in 2010. In simple terms, as long as a couple have entered freely into an agreement and had a full appreciation of its implications, the court should take it into account during divorce proceedings.
The reference to “freely” is important, says Sue, who advises that both parties take separate, independent legal advice to ensure fairness and that there is no duress or chance of misrepresentation. Each side must be open and honest with the other, so that if one party is giving up future rights or entitlements, they make an informed decision with all relevant information.
“If you decide a prenuptial agreement is for you, then the time to make the arrangements is as soon as you decide to get married. It’s no good waiting until a couple of months before the big day because the emotion and the stress can put huge pressure on both parties,” she added.
“It should be an agreement between a future husband and wife or civil partners, and not one person imposing what they want on the other, and it will hopefully go some way to reducing or preventing expensive court proceedings in the future.”
Of course, the circumstances prior to the wedding will no doubt change as the marriage evolves. The longer a marriage lasts, the more likely it is that events will overtake it. The arrival of children, decisions around who goes out to work and who stays home to look after them, buying a home, illness, redundancy will all impact on the “fairness” of the original agreement and so it should be reviewed. However, even if not, the prenuptial agreement will still be considered, but may have less significance.
Having a prenuptial agreement won’t give you a cast iron guarantee on the outcome, but it can certainly affect the way the Judge applies his or her discretion when making the final award and that has to be worthwhile. “More importantly,” concluded Sue, “couples are more likely to resolve matters amicably because they have already addressed matters.”