A pre-nuptial agreement (or premarital agreement) is a written agreement entered into by a couple who intend to get married, or form a civil partnership. It sets out how their financial affairs should be dealt with in the event of divorce or dissolution. The agreement is signed by the couple before the marriage or civil partnership takes place.
A post nuptial agreement is similar in nature to a pre-nuptial agreement, but is entered into after the marriage or civil partnership has taken place. It records how the couple intend their financial arrangements to be managed if the relationship later breaks down. Post-nuptial agreements can be entered into at any stage, and couples may choose to update them during the course of the marriage or civil partnership to reflect changes in the couple’s circumstances.
Pre-nuptial agreements are commonly used in many jurisdictions, where they may be fully legally binding.
In England and Wales, pre-nuptial agreements are not automatically legally binding on the court. However, the courts will generally uphold such agreements provided they have been freely entered into, with a full understanding of their implications and where it would be fair to do so in the circumstances.
Although not strictly binding, a properly prepared pre-nuptial agreement can carry significant weight and is an important factor the court will take into account when determining a financial settlement on divorce.
For many couples, a pre-nuptial agreement provides clarity and certainty, helps to manage expectations, and can protect pre-acquired or family wealth. As a result, increasing numbers of couples are choosing to enter into such agreements.
What to do if you are considering a pre-nuptial agreement
An important aspect of entering into a pre-nuptial agreement, is that each party should have received independent legal advice from separate solicitors, before entering into the agreement.
It is also advisable that the pre-nuptial agreement is signed well in advance, generally not less than 21 days before the wedding or civil partnership to ensure that neither party is under pressure and that there has been sufficient time for proper consideration. In addition, there should be full and frank financial disclosure by each party.
If you are considering a pre-nuptial agreement, you should consult a specialist solicitor as early as possible after becoming engaged. This will allow sufficient time to discuss and agree terms with your partner and for you both to take advice in good time before the wedding or civil partnership.
A pre-nuptial agreement isn’t a standard document. While certain provisions are commonly used, each agreement is bespoke and tailored to the specific circumstances of the couple.
A key part of the process is full, formal financial disclosure by both parties, so that each has a clear understanding of each other’s financial position. The complexity of the agreement will depend on the extent of the assets and the parties intentions, meaning some agreements are relatively straightforward, while others are much more detailed and complex.
A pre-nuptial agreement will typically set out the assets owned by each party and how those assets should be treated in the event of a divorce or dissolution of a civil partnership. It may address matters such as:
– the treatment of the family home
– division of savings and investments
– ownership of personal belongings (chattels)
– whether pension sharing should take place
– whether spousal maintenance should be paid, if so, how much and for how long.
Agreements may also provide for different outcomes depending on future events, such as the length of the marriage or the birth of any children.
While the parties have freedom to decide the terms, the court always retains the ability to depart from the agreement if it would be unfair to uphold it, particularly where needs (especially of children) are not adequately met.
Why Dawson Cornwell?
Our firm has been drafting pre-nuptial agreements for many years. With departments specialising in children and financial issues, we are able to make sure that any pre-nuptial agreement is personalised to meet your needs and those of any children.
The negotiation of the terms of a pre-nuptial agreement needs particularly sensitive handling. We are highly experienced in doing this, including offering this by the collaborative process.
