Pre-Nuptial and Post-Nuptial Agreements are becoming increasingly common as couples strive to protect their assets and ensure clarity, especially financially, in the event of a divorce. Here is some key information commonly asked by clients considering entering into a nuptial agreement.
What are Pre-Nuptial and Post-Nuptial Agreements?
There are two types of Nuptial Agreements, Pre-Nuptial and Post-Nuptial.
Pre-Nuptial Agreements are nuptial agreements that have been entered into before your intended wedding date. Typically, Pre-Nuptial Agreements should be entered into no less than 28 days before your intended marriage date.
A Post-Nuptial Agreement is a nuptial agreement that is entered into after the date of your marriage. A Post-Nuptial Agreement can be entered into at any time after your marriage.
Nuptial Agreements set out how a couple agree to separate their finances in the event of a divorce. Couples can protect assets that they may be bringing into the marriage, such as business’ and/or property. Nuptial Agreements can also be useful to protect future inheritance.
Are Nuptial Agreements legally binding?
The Courts have the ultimate jurisdiction about how a couple’s finances are to be divided within divorce proceedings. Nuptial Agreements cannot completely override the Court’s discretion, and therefore cannot be legally binding.
However, should a Nuptial Agreement follow a proper process, which includes couples providing full financial disclosure, they each obtain separate and independent legal advice regarding the agreement, and that the couple have fairly negotiated the agreement, then the Court are likely to uphold (follow) the contents of the Nuptial Agreement.
Nuptial Agreements typically provide a strong framework for how assets should be divided on divorce. Therefore, the Courts are more inclined to respect choices couples have made, as long as the criteria has been met by the couples entering into Nuptial Agreements.
What type of assets are typically protected in a Nuptial Agreement?
The most common assets that are often protected in Nuptial Agreements include family business, commercial or agricultural, inherited wealth, property, and trust funds. As an example, a family business can be protected for future generations by ensuring that it is not diluted within a potential divorce.
A Nuptial Agreement can also be used to ringfence any personal injury settlements received to safeguard an individual’s future lifelong care and any associated living expenses against a divorce.
Nuptial Agreements, more specifically Post-Nuptial Agreements, can also be used to record a couple’s financial settlement at the point of separation, especially if a couple do not wish to divorce immediately. This can provide couples with financial certainty moving forward before commencing with divorce proceedings in the future. This can certainly be beneficial when settling disputes regarding pensions.
When might someone consider a Nuptial Agreements?
There are typically two scenarios that result in couples wishing to enter into a nuptial agreement. The first being that someone wishes to safeguard their assets in which they are bringing to the marriage. The other is someone who has typically been married before and has learnt that it may be prudent to have an agreement that outlines what is to happen in the event of a relationship breakdown.
By ensuring that a Nuptial Agreement is in place, you avoid the unwanted litigation that could result when negotiating a financial settlement with your partner/spouse. In the long-term, a nuptial agreement can prevent an individual incurring unnecessary legal costs by ensuring that “pre-marital” assets are protected and free from dilution.
It is important to note that nuptial agreements are living documents that should be kept under periodical review. Typically, there are provisions that state that nuptial agreements should be reviewed every five years, or after a significant life event such as the birth of a child, or a significant period of unemployment.
If you are looking for further information about a Nuptial Agreement, or you would like to make an appointment to discuss matters further with one of our friendly family solicitors, please do not hesitate to contact us on 01245 228116, or by email at [email protected].
