If you search for “marriage” on  the internet, you will likely see images of perfect flowers, beautiful ceremonies, big white dresses and other traditional expressions of love.

What you don’t see are legal documents, such as pre-nuptial agreements.

What is a prenuptial agreement?

A prenuptial agreement (or “prenup”) is effectively a contract made between a engaged couple before they wed agreeing the financial division of their assets should they separate or divorce in the future.

They are, unsurprisingly, seen as unromantic and a sign of untrustworthiness in a relationship.

However, they are a practical measure for couples who wish to enshrine some protection into the financial assets they are taking into a marriage. 

Why get a prenuptial agreement?

With an estimated divorce rate of 42% in 2022 and the average cost for divorce being between £14,500 – £30,000; surely couples would rather have one and not need it; than need one and not have it? Especially as prenuptial agreement can cost as little as £1,000 – £2,000 in comparison (depending upon the complexity of terms).

It is not solely about the assets that the individual is taking into the marriage with them. It can also stipulate provisions relating to:

• Debts and liabilities;
• Childcare;
• Housing; and
• Custody of family pets.

The couple’s intentions for the division of assets being recorded in a legal document before the marriage has the potential to save them both time and money in the unfortunate circumstances that they do separate.

Are prenuptial agreements binding?

You may have heard that prenups are unenforceable. Which is true in part. Prenups (as with most agreements) cannot oust the jurisdiction of the court when considering the financial division upon divorce.

This has since been reinforced by the Supreme Court in 2010 in the landmark case of Radmacher v Granatino. (Radmacher v Granatino [2010] UKSC 42)

However, if the financial needs of the parties are easily met and the court is considering how to share the remainder of the matrimonial funds, it might consider the provisions of a prenuptial agreement when determining how to divide the same.

Perhaps the parties agreed to ring-fence inherited property, certain liabilities or stipulate the legal ownership of certain items in the prenup.

If that agreement:

• Was freely entered into;
• Meets certain criteria;
• Has been periodically reviewed by the parties; and
• Is still relevant (i.e. there has been no significant change, such as a child);

The court will give its terms reasonable weight when determining how to divide the assets.

How to ensure that the terms are considered

Criteria

There are certain criteria the agreement must meet to ensure the court consider its terms. It is therefore imperative that both parties seek obtain legal advice.

Update the pre-nup

A prenup should not be considered a one-off agreement. It should be a living document that changes as the couple does. When there is a significant change in circumstances, such as a child being born or adopted, or new job role, the parties should reassess the agreement. This will ensure clarity, protect all parties and increase the possibility that, upon divorce, the parties agree upon the division of assets without having to proceed to court.

Upcoming changes

For pre-nups to be binding, we must first await new legislation. Parties will then have to establish that their pre-nup has observed and met certain criteria and safeguards.

Although, following the Law Commission’s report on “Matrimonial Property, needs and Agreements” (2014) this legislation may not be as far off as one might expect.

What if you’re already married?

It’s not too late. Many couples wish to wait until the stress of planning a wedding has ceased and instead opt for a post-nuptial agreements (“postnup”). A postnup is a document with the same legal status and it is treated no differently so long as it meets the same fairness criteria.

For peace of mind a pre- or postnuptial agreement should be on every couple’s to-do list.

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