Pre-nuptial Agreements in the UK

What is a pre-nuptial agreement?

A pre-nuptial agreement (often known as a pre-nup or pre-marital agreement) is a contract entered into by yourself and your partner prior to getting married. It is made in anticipation of marriage and will become effective once married. It is intended to outline ownership of your respective assets in the unfortunate event that the marriage should fail and end in divorce. It sets out who will get what.

Why sign a pre-nuptial agreement?

Pre-nups commonly appear in the news when business people or famous couples divorce. Pre-nuptial agreements however are not just designed for the rich and famous. They are often seen as a form of insurance. Hopefully they prepare for the never to occur future separation just as insurance policies may deal with the hopefully never to occur fatal accident or fire. Although engaged couples do not wish to focus on what will happen should the marriage breakdown, many are fearful of how expensive and unpleasant a divorce is.

They are seen as particularly useful in the following circumstances: -

• Protecting savings or inheritance for children. It is becoming more common for people to remarry for a second or even third time who wish to protect their assets. They often wish to preserve their wealth for the children from their earlier marriage.
• Expecting future wealth. Another reason that people choose to enter a pre-nup is for when one or both of the couple are expecting a significant increase in earnings through career progression, financial investment or inheritance. A pre-nuptial agreement may be used to ringfence these future earnings and assets in the event of a divorce.
• Existing disparity in wealth. The most common motivation for a pre-nuptial agreement is one spouse has substantially greater capital or income than the other and wishes to protect assets owned prior to the marriage and income streams. Where one spouse has significantly more wealth or assets prior to the marriage they stand to lose a lot more than the other in an equal split divorce settlement. One spouse may wish to protect savings, pensions or other assets which has been built up for years, or even decades, before the marriage.
• Protection of a family business involved. This can be extremely important (not least) because third parties or other family members may be involved in the running of the business. It can help you safeguard control over a personally owned business. In farming cases for example the land usually provides the income and includes the family home. Often the farming business has been in existence for many generations and it is wished to be preserved for future generations. A pre-nuptial agreement could mean the difference between the business continuing or being sold upon divorce.
• Wealth creating parents are now often insisting that their children or grandchildren enter a pre-nuptial agreement (or post-nuptial, i.e., after the couple have married) prior to making gifts.

Should you get a pre-nup even if you are not wealthy?

Not everyone has significant assets who enters into a pre-nuptial agreement. Divorce can be acrimonious and unpredictable. Some people simply wish to avoid the stress, uncertainty and expense of a dispute if the relationship breaks down in the future. Having a pre-nuptial agreement can mean less is left to chance.

Is a pre-nuptial agreement legally binding?

A Judge, when dealing with a financial order on divorce, will still have to approve any financial arrangements and check that the financial requirements of each spouse are met. At the moment pre-nuptial agreements cannot override the Court's ability to decide how your finances should be divided on a divorce. Neither of you will be prevented from applying to the Court for financial provision or divorce. However when deciding an appropriate level of financial provision the Court is likely to give substantial weight to a pre-nuptial agreement if it is entered into in the right way. It is therefore possible that a pre-nuptial agreement could determine the final outcome.

How to make sure your pre-nuptial agreement meets all the requirements

The best way to ensure your pre-nuptial agreement is seen as valid by the Court is to make sure it is fair and written up correctly. Each provision in the agreement must be entirely fair. You must ensure the following conditions are met: -

1. The agreement must be voluntary and entered into freely.
2. You must both understand the agreement and have a full appreciation of the implications of the agreement.
3. You should both provide each other with full financial disclosure setting out your assets, debts, income and other likely resources.
4. You should both receive specialist family law advice on the terms and effect of the agreement.
5. The agreement should be finalised at least 28 days before the wedding, ideally several months before the wedding.
6. The Court will look to see whether there are any examples of an absence of disclosure, fraud or misrepresentation.

Is the agreement fair?

If the agreement is unfair at the start this may reduce the weight of it in the future. The circumstances at the time may be relevant including age, maturity, previous marriages etc.

What can be included in a pre-nup (UK)?

A number of different matters can be included in a pre-nuptial agreement which basically outlines what will happen to assets and belongings if a couple breaks up. These include, but are not limited to, the following: -

• Money. This covers any money held by you in joint accounts or sole accounts including savings and investments.
• The family home. A pre-nuptial agreement should make provision for how the family home will be divided in the event of a divorce.
• Property. This covers property that either of you brought into the relationship and was owned prior to the marriage.
• Inheritance/Trusts. This can cover property that is given to you or inherited during the marriage as well as any assets gained from a Trust.
• Debts. If one of you has debts a pre-nuptial agreement can be used to limit the debt liability of the other.  A pre-nuptial agreement can make it clear how this will be dealt with in the event of a divorce.

Can you prepare a pre-nuptial agreement after getting married?

Pre-nuptial agreements must be signed before the marriage takes place. It is possible however for a married couple to enter into a post-nuptial agreement instead. This is essentially the same as a pre-nuptial agreement but is prepared following marriage. Indeed it is often sensible for any pre-nuptial agreement to be converted into a post-nuptial agreement following the marriage.

Do you need a family lawyer/legal advice?

Yes.  This is a legal document and it is important that it is prepared by a solicitor to ensure that it deals with all matters appropriately. Indeed for a pre-nuptial agreement to be considered valid and binding both of you must seek independent legal advice on the document to ensure it is fair and lawful.

Can you review a pre-nuptial agreement?

A pre-nuptial agreement is a contract; therefore, the length of the agreement can be included in its terms. Some for example include clauses which state it will no longer be valid after a period of time. Others include dates when it will be reviewed or state upon certain changes. Changes which may warrant a pre-nup review include the birth of a new child. Ultimately your pre-nup must remain reasonable and fair whatever happens.

Why choose us as your family solicitor?

We believe that getting the right advice and support from the outset makes a huge difference to you achieving your aims. Sills & Betteridge LLP has a large family law team with experienced family lawyers who specialise in pre-nuptial agreements, post-nuptial agreements, divorce, financial settlements (including those that involve businesses, farms, inherited assets, pensions, public sector pensions, trusts and investments as well as the family home), spousal maintenance and child arrangements (previously known as custody). Our dedicated divorce and family solicitors can deal with both complex and straight-forward pre-nuptial agreements, post-nuptial agreements, divorce and financial settlements and have an outstanding success record.  We are highly regarded by the industry and clients alike.  We will help you understand what you are entitled to and work hard on your behalf to achieve that. We have been recognised in the Legal 500 categories for leading firm, plus many of our lawyers have individual recognition. It is our exceptional level of client satisfaction, achieved by obtaining the right outcomes for our clients, that has seen the Firm go from strength to strength.

A solicitors' office near you

We have offices in Lincolnshire (Lincoln, Gainsborough, Scunthorpe, Boston, Sleaford, Skegness, Spilsby and Grimsby), across the midlands (Northampton, Derby, Nottingham) and South Yorkshire (Sheffield, Wath-upon-Dearne, Thorne, Howden, Bawtry and Doncaster). We will therefore have an office that is near you. We do deal with clients across the Country and indeed internationally and are able to offer either face-to-face, telephone or remote meetings.