A nuptial agreement is a contract entered into by spouses or civil partners to regulate the ownership of money, property, assets and responsibility of debt. Nuptial agreements may also deal with income, including the earnings, future earnings and interests under trusts.

There are a few myths which may prevent couples from entering into a nuptial agreement.

“Nuptial agreements are not upheld”

A common misconception is that nuptial agreements are not upheld in England and Wales. Whilst nuptial agreements do not have a statutory footing, they are mostly enforced by the Court following Radmacher v Grantino, providing the nuptial agreement adheres with the factors set out by the court. The following factors will be considered:

  • The terms must be clear, certain and comphrensive
  • Both parties must openly give full details to the other of their financial circumstances
  • Both parties must enter into the agreement freely and understanding the terms
  • Both parties had the opportunity to take independent legal advice
  • There must be no undue pressure to enter the agreement
  • The agreement should be signed a good time before a wedding

The court will consider the nuptial agreement in light of the overall fairness of the division of assets and ensure that both parties needs are met, specifically with regards to housing and income. A nuptial agreement that does not provide for one party’s needs is unlikely to be upheld. It is possible for the court to uphold one part of the agreement whilst considering another part of the agreement to be unfair.

“Nuptial agreements are not for everyone”

Another common misconception is that nuptial agreements are only for the very wealthy. In England and Wales, the court has a wide discretion to divide assets and income fairly on divorce or dissolution, which may differ from the view of parties. Couples may wish to get a nuptial agreement for the following reasons:

  • One party having assets from their previous marriage
  • One party wishing to retain control of a family business
  • Couples without children who wish to ringfence their own savings accumulated before the marriage
  • One party wishing to ringfence assets for their children from a previous marriage or relationship
  • Protecting inheritances
  • One party having experienced a divorce before and wishes to avoid a repeat of the process
  • Large debts or obligations in the name of one party

Nuptial agreements can assist by resolving potential areas of dispute which reduces overall legal costs later down the line for the parties. At the very least, nuptial agreements provide a clear record of which assets each party has when they entered into the marriage and can identify which assets were accumulated during the marriage.

“You are not able to change nuptial agreements”

Nuptial agreements are living documents. It is advisable to regularly review a nuptial agreement and to give consideration to changes in circumstances such as the birth of any children, loss of employment and inheritance. Whilst there is no set review period, a minimum of 5 years is given as a benchmark for a nuptial agreement before a review is needed.

“It is too late to have a nuptial agreement”

Ideally, a pre-nuptial agreement should be signed at least 28 days before the wedding to stand the greatest chance of being upheld. Planning a wedding can be both an exciting yet stressful time, therefore it is advised to instruct a solicitor well in advance of the wedding date to ensure all necessary measures are put in place.

Most will only think of a ‘pre-nuptial agreement’, however, it is not too late to have a nuptial agreement during a marriage, usually called a ‘post-nuptial agreement’. These work in the same way as pre-nuptial agreements. Couples may wish to enter into a post-nuptial agreement for a few of the following reasons:

  • There was not sufficient time to sign a pre-nuptial agreement before the wedding
  • To vary the terms of a pre-nuptial agreement pre-nuptial agreement
  • One party comes into unexpected wealth after the marriage i.e. an inheritance which they wish to ringfence for their children
  • Where it would be beneficial to define “matrimonial property” and “non-matrimonial property” i.e. in relation to business assets

Talk to our Family Law Team

For comprehensive advice on pre-nuptial agreements or any area of matrimonial law, email us at sols@gordonsols.co.uk or call our Guildford team on 01483 451900.

 

About the Author

Liberty

Liberty Lawson

Trainee Solicitor