A “prenup” (also known as a pre-nuptial agreement or pre-marital contract) is an agreement entered in to by a couple prior to their marriage to set out the arrangements as to what is to happen should their marriage end in a divorce.
Prenups are not currently legally binding in England and Wales.
However, a judge is likely to take a prenuptial agreement into account when considering a divorce case and is likely to uphold it, as long as certain safeguards have been met.
Suzanne Todd is the head of the family team at Withers WorldWide. She specialises in high net worth divorce cases and has a wealth of experience in cases with an international element, Children Act applications as well as pre and post nup agreements. Here, Suzanne answers some commonly asked questions about prenups…
Why do people have a prenup?
“Often the reason our clients want a prenup is because there are assets which have been created outside the marriage – like a family business, inherited wealth, or maybe one of the parties is already wealthy
When that’s the case, the couple will usually agree that if there’s a divorce, it would be fair for those assets to be left off the table.
Similarly, some see it akin to insurance – it’s about peace of mind, and you don’t need to think about it unless something goes wrong.
But sometimes a couple just want to have a document that clearly sets out what should happen if they were to separate.
A bit like entering into an agreement for a joint venture, a prenup sets out the arrangements for the joint venture of marriage.”
Do prenups actually work?
“Prenups do work. They are one of the most useful wealth planning tools there is.
But the Court needs to make sure the agreement is fair. So long as it meets the requirement of fairness, the couple who signed it are likely to be held to it.”
Can you tell me what you mean by fairness?
“The financial arrangements in the document should be fair which means, as a baseline, the prenup should make sure that reasonable needs are always met and that each party is properly provided for.
For the prenup to have the best chance of being upheld you need independent legal advice on both sides, each party needs to know the other’s financial position, and there needs to be no pressure on either party to sign –it’s a good idea to sign the prenup at least a month before the wedding.”
What makes a good prenup?
“Talking about a prenup can be difficult for a couple and sometimes emotional. Communication is key. The best prenup is one that we lawyers help the couple discuss and agree together, and which is signed in plenty of time before the wedding.
I have frequently used the collaborative law process to negotiate pre –nups. It works well as the aim with this process is to make sure that the couple walk down the aisle together and this process avoids the potential for ‘my lawyer said this/my lawyer said that’ as everyone is in the room together.
Ideally it should be in the bottom drawer, gathering dust, long before the bride and groom are having a crisis about the flowers and the photographer for their big day.”
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