What are they?
A legal Agreement made between a couple before or during marriage or civil partnership stating how they intend their financial matters to be dealt with during the relationship but also in the event of divorce, dissolution or separation.
How can they help?
Having such an Agreement in place can give partners, and their families, peace of mind and are particularly useful for example in determining what the parties would intend to be regarded as matrimonial and non-matrimonial property and how inherited assets should be treated between them.
The obvious circumstance in which a pre or post-nuptial Agreement would be beneficial would be where a party has accumulated assets outside of the marriage/civil partnership. They are, however, also frequently used where parties have children from other relationships and would want to secure their future inheritance or where there is established family wealth for one of the parties which they are wishing to exclude from the matrimonial asset “pot”.
Whilst it may be a little difficult to have the initial conversation, doing so and putting the agreement in place can save a lot of the expense, stress and ill feeling that can arise if a relationship breaks down.
It is a form of financial planning which enables the couple to decide how they want their financial matters sorted and will give them clarity, certainty and protection for the future.
What happens if there is no Nuptial Agreement in place?
On the breakdown of a marriage/civil partnership, if the couple cannot reach agreement as to how their finances are to be divided then ultimately the decision would be made by the court. There is a wide discretion for the court in determining such issues and essentially the basic start point would be a 50/50 split of all assets whether in joint or sole names or any other assets in which one or other party may have an interest. In any particular case however, there may be circumstances which persuade the court to move away from this presumption of equality.
Are Nuptial Agreements binding?
The parties to the Agreement cannot bind the court’s discretion in deciding how to distribute assets but the court must give appropriate consideration to the existence of a Nuptial Agreement as a relevant circumstance of the case and provided the Agreement has been validly entered into and would establish a split of assets that would achieve fairness for each of the parties, it is highly likely the Agreement would be upheld by the court.
Important Safeguards for a Qualifying Nuptial Agreement
- The overall effect of the Agreement on the parties must be one of fairness.
- The Agreement must be freely entered into. Neither party should feel under any undue pressure or influence to sign and there needs to be time given to each to reflect on the paperwork to ensure full understanding. It is important therefore to ensure that the Agreement is validly drawn up and executed not less than 28 days before the ceremony.
- Both parties must have separate independent legal advice and have a full understanding of the implications of the Agreement and in forming that understanding each should be in possession of all the information material to that decision-making process.
The circumstances in which a a Pre or Post Nuptial Agreement will be of assistance may vary from family to family and is wide ranging. To speak to one of our family specialists at Fraser Brown Solicitors to see if such an Agreement could be useful to you.
If you're interested in any of the topics raised in this article, or further information, please contact Julie McCrery. Alternatively, you can call to speak to one of the team on 0115 9888 777.