Planning a wedding is no easy task. Many brides-to-be rely on a month-by-month checklist starting 12 months in advance of the big day. Such checklists will remind you to book your photographer, wedding cars and honeymoon, and to buy your wedding dress, flowers and wedding rings. However, very few (if any) prompt you to look into getting a pre-nuptial agreement. An agreement drawn up by a solicitor who specialises in family law.
What is a pre-nuptial agreement?
A pre-nuptial agreement is a contract which couples enter into prior to marriage. It ensures that there is a clear plan in place covering what will happen to assets that either person brought into the marriage or future inheritance, in the event of divorce. For example, whether such assets should be treated differently from assets which the parties build up together during their marriage.
Nowadays, pre-nuptial agreements also cover other issues such as debt. It is a sad fact that the majority of younger couples start married life together with a high level of student debt. In such cases, a pre-nuptial agreement can define which party’s income will be used to repay that debt.
Why do I need a pre-nuptial agreement?
Once married, all assets are thrown into a “matrimonial pot” and are up for division between the parties. Maybe you want to protect assets to ensure your financial stability in case things don’t work out. You may also wish to avoid a stressful, lengthy and costly legal battle about who gets what. Such an agreement can also protect the financial stability of any children you may have from a first marriage.
Are they legally binding?
In England and Wales, pre-nuptial agreements are not legally binding. Ultimately, it is the family court that will have the last word when deciding how assets and income ought to be divided in a divorce. For the courts to get involved, one of the parties will have to issue a financial remedy application after filing a divorce petition.
In the case of Radmacher v Granatino the court gave an indication that judges sitting in the family courts should take notice of a pre-nuptial agreement. The agreement must have been freely entered into by each party with a full appreciation of its implications. Unless, in the circumstances prevailing, it would not be fair to hold the parties to their agreement.
If the following circumstances have been met when creating a pre-nuptial agreement, then it is more likely to be upheld by judges in the family court. These circumstances are:
- Where both parties have had separate and independent legal advice
- Where both parties have disclosed their financial positions
- Where both parties have negotiated the terms of the agreement well before the date of marriage. A minimum of 21 days, but ideally much longer.
- Where both parties have agreed to review the terms in the future, as circumstances change
Where all of the above have been complied with it is likely that the pre-nuptial agreement would be considered in the event of marital breakdown.
If I want a pre-nuptial agreement, when do I talk to my partner about getting one?
About 12 months in advance of the big day (or earlier) most newly engaged couples sit down together, some with their parents, in order to get any awkward conversations about setting the wedding budget out of the way. With the average wedding now costing over £30,000*, it is important to work out what to spend and on what. Whilst the idea of having a pre-nuptial agreement isn’t very romantic, it is important that couples think about what they want to happen in the event that they don’t get their happy ever after. After all, is it not better to talk about the “worst case scenario” at a time when you are most in love, not later when there may be bitterness and arguments?
What does it cost?
You are likely to find that the cost of entering into a pre-nuptial agreement is very attractive when taking into consideration the benefits of having the peace of mind in the event of divorce. The cost of a pre-nuptial agreement in comparison to the total cost of the average wedding is likely to be a drop in the ocean. Especially when you consider the fact that the average bride spends £1,378 on her wedding dress!
Each solicitor will charge a different price. It’s vital to make sure that they are a specialist in family law. At SAS Daniels we help our clients determine a pricing structure that suits their needs. We will discuss any costs at the beginning so you don’t receive any unexpected bills.
*Brides Magazine 12 September 2016.