What is a prenuptial agreement?
A pre-nuptial agreement is an agreement made between two persons before their marriage that sets out how they want their assets to be divided between them if they were to later separate or get divorced. The pre-nuptial agreement can also set out how they will arrange their finances during their marriage.
I have already got married – is it too late to enter into a nuptial agreement?
No, you can enter into a Post-nuptial agreement. This is a legal agreement made between persons who are already married to each other. In common with a pre nup, the agreement will usually set out how you wish your assets to be divided with your spouse if you later separate or divorce. Some post-nuptial agreements also detail how you currently arrange your finances as a couple and how this will continue or change during your marriage.
If I want to enter into a civil partnership can I enter into a prenuptial agreement or a post nuptial agreement?
You can enter into a legal agreement before the registration of your civil partnership. These agreements are often referred to as pre-civil partnership agreements or pre-registration agreements. You can also enter into a post-nuptial agreement, usually referred to as a post-civil partnership agreement or a post-registration agreement.
What would my pre-nuptial agreement say?
Normally a pre-nuptial agreement sets out which party owns or will own which things if your marriage breaks down. They are usually divided into “Matrimonial property” otherwise known as “joint property” that usually includes anything acquired during the marriage and assets held in joint names, such as the family home and the contents of any bank accounts or investments made together.
Often, non-matrimonial property (or separate property) is ringfenced and this can include your inheritance, anything you owned before marriage and any gifts given to you by a third party.
Nuptial agreements sometimes deal with financial provision for children in existence at the time of your marriage but they often do not attempt to deal with financial arrangements for any children who are born in the future. Significant changes in circumstances during the marriage, including the birth of children, are usually covered by a clause allowing a review of the terms of the agreement. Such a clause will set out when a review of the pre-nuptial agreement should take place
Will my pre-nuptial agreement be legally binding?
Pre-nuptial agreements are not legally binding in England and Wales at the current time and this is because you cannot override the court’s ability to decide how your finances should be divided on a divorce. However, the court will uphold a pre-nuptial agreement that is “freely entered into by both parties with a full appreciation of its implications, unless in the circumstances it would not be fair to uphold the agreement”. The court must give sufficient weight to a pre-nuptial agreement as a relevant circumstance of your case.
What are the advantages of entering into a prenuptial agreement?
You can protect your assets – You can protect assets you may wish to “ringfence” from one another, such as inherited assets. You can make it clear to one another that certain property belongs to you alone and will not be shared during the marriage or on any future divorce. This is known as “non-matrimonial property” and because the definition of non-matrimonial property is uncertain in law a prenuptial agreement gives you the freedom of being able to define and choose the property that you will not be sharing.
You will have a clear idea of your fiancée’s asserts income and liabilities – As part of the process, both of you engage in financial disclosure with each other and so you will also be aware of any of your fiancée’s property that you will giving up a claim to.
It can save you money and help you avoid the anxiety of later court proceedings- If you have already agreed how you will divide your property if you later separate or divorce you can save the time, stress and cost of court proceedings at a later date. As both parties have already agreed on everything it should also minimise the acrimony of divorce and allow you to remain amicable, making the whole divorce process less pressurising and cheaper.
Flexibility- You will have the freedom to agree your own terms and be creative without the court imposing its own solution on you.
An agreement could protect your children from a previous relationship – by ring fencing certain assets that you own for their benefit.
Are there any disadvantages? One of the disadvantages to pre-nuptial agreements is that they are not currently legally binding. However the court will uphold a pre-nuptial agreement that is freely entered into by each party with a full appreciation of its implications, unless in the circumstances it would not be fair to do so. In addition, if you are the economically weaker party then you should avoid agreeing to clauses limiting your rights simply to get the pre-nuptial agreement over with, so you can concentrate on the wedding. You should avoid agreeing to anything due to pressure or when time is running out before the wedding day and always seek legal advice – if you are unsure you may be able to enter into a post nuptial agreement later. Finally, pre-nuptial agreements are often seen as unromantic at a time when you are in love and planning your wedding and they may antagonise family or friends who may question why a prenuptial agreement should be necessary.
What do I need to do now?
If you want to talk to a solicitor about a pre-nuptial agreement tailored to your own particular circumstances, then please contact us. We offer a no obligation free enquiry if you just require a short chat, or alternatively you can call to arrange a fixed fee initial consultation, which will not be time limited, so you will have enough time to discuss your situation with us in detail. Once we know what your requirements are we will be able to offer you a fixed fee agreement so there will be no unexpected legal costs to face when you instruct us.
