Family law: pre-nuptial and post-nuptial agreements

By Sonny Patel "If she loved him she would sign the pre-nup; if he loved her he would tear it up" -- anon.

The legislation governing the distribution of assets upon divorce gives the English family courts a wide and far-reaching discretion to divide and reallocate assets according to the particular circumstances of the case, regardless of the origin and legal ownership of those assets.

The English Legal System traditionally refused to uphold pre-nuptial agreements, however, in 2010 the landmark Supreme Court divorce case between Ms Radmacher and Mr Granatino established that a properly drafted agreement ought to have a decisive influence on the outcome of the financial aspects of a divorce.

We live in an age where there is a greater understanding of the financial implications of marriage, and an appreciation that despite the best intentions of both parties, divorce is always a possibility. Accordingly, pre-nups are now commonplace amongst those on second or third marriages, those marrying later in life after building up independent wealth, and those who have business interests or inherited assets that may be vulnerable in the event of divorce.

Just as pre-nups have become an increasingly common aspect of modern marriages, post-nuptial agreements are now also on the rise. A post-nuptial agreement also deals with the difficult issue of how money and property are to be divided in the event of divorce. The obvious difference is that post-nuptial agreements are entered into after the parties are married.

A post-nuptial agreement might be considered by a couple who did not conclude the practicalities of arranging a pre-nup before marriage, or perhaps by a couple whose relationship is in difficulties and one or the other wishes to establish a degree of certainty as to the financial outcome in the event of permanent breakdown.

Whether any agreement is prepared before or after the date of the marriage, certain requirements must be adhered to if there is any hope of it being considered valid by the courts.

In a recent leading case the former wife of a Russian oligarch won a divorce payout of £12.5 million after the judge ruled that the post-nuptial agreement she had signed was grossly unfair. The judge found that:

  • The wife did not freely enter the agreement with a full appreciation of its implications
  • The agreement was the product of pressure by the husband
  • There was a material absence of legal advice and financial disclosure
  • It would be grossly unfair to deprive the wife of her share of a fortune to which she had, in her role of homemaker and mother, contributed to equally
  • The agreement grossly prejudiced the needs of the children

In the circumstances the agreement was given no weight whatsoever.

It is therefore important that specialist legal advice is sought if there is to be any hope of such an agreement being upheld by the court.

Sonny Patel is a specialist family law solicitor at Seddons, a Central London law firm specialising in property, disputes, people and enterprise. Based on client feedback Seddons are Legal 500 listed for the “first class” service that their family department provides. twitter.com/SeddonsFamily

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