As anyone who has ever been through the process will confirm, deciding who will get what is the one of the hardest and most stressful stages of a divorce or the dissolution of a civil partnership. Of course, some couples manage to sort it all out amicably but for many, an already emotionally fraught process becomes especially heated when quantified in pounds and pence. The division of assets is the point at which the family courts may be asked to step in to help soon-to-be-former couples resolve their arguments and produce a binding legal agreement, known as a ‘consent order’.
Premarital and postmarital agreements are an increasingly popular way to try and minimise such problems. But just what are they?
A premarital agreement – also known as a prenuptial agreement – sets out how a couple’s assets will be divided in the event of a divorce or dissolution. Unsurprisingly they are primarily deployed by wealthier individuals, who have more to lose when a relationship ends. Post-marital agreements – also known as “postnuptial” agreements – have the same function, the only difference being that they are signed after the marriage has taken place.
Pre- and postnuptial agreements are signed by both parties and intended to be the last word on the matter, forestalling drawn-out arguments if the relationship breaks down.
Unfortunately, the legal situation is more complicated. If you are concerned about protecting pre-marital wealth, or inherited assets during a marriage, or this is not your first marriage, these agreements can be a sensible precaution and they are given weight by the family courts, often decisive weight. However, it should be noted that in England and Wales the family courts still do not consider them automatically binding. A number of safeguards should be followed to make the agreement as influential as possible. By way of example, the financially weaker party may argue that the agreement should be disregarded because:
*They were pressured into signing by their spouse – or had the terms imposed upon them, with no negotiation allowed.
*They were misled regarding the contents or nature of the agreement or they did not fully understand it.
*They had not received independent legal advice before signing.
*The agreement was not drafted by a solicitor qualified in family law.
*The agreement made no allowance for likely developments in the future, such as the arrival of children.
*The wealthier party did not fully disclose their assets or wealth.
Any one of those factors could lead a court to conclude that the agreement was an unfair one that should be set aside – or at least not strictly adhered to – in order to ensure that the interests of the financially weaker party are protected in the eventual financial settlement. Even signing the agreement less than a month before the wedding or ceremony can be grounds for disregarding an agreement. A pre- or postnuptial agreement must be fair to both parties.
Crucially, if your financial position or future wealth warrants a prenuptial or postnuptial agreement, be sure to seek specialist advice from us at Cambridge Family Law Practice. If you would like to discuss any aspect of these agreements, please give Adam, Tricia, Simon, Gail or Jeremy a call on 01223 443333.