Pre-nuptial Agreement

What is a pre-nuptial agreement?

A pre-nuptial agreement is an agreement which is made between two parties before they marry or before they enter into a civil partnership. The agreement will set out how the parties would like their assets to be divided between them if they choose to divorce or dissolve their civil partnership in the future. This pre-nuptial agreement is designed for use where the parties live in England and Wales.

What is the difference between a pre-nuptial agreement and a cohabitation agreement?

A pre-nuptial agreement is an agreement that is entered into in contemplation of marriage or civil partnership. This type of agreement will specify what the parties would like to happen with the division of their assets and finances in the event of a divorce or dissolution.

A cohabitation agreement will typically be used by an unmarried couple (who do not intend to marry in the future).

Is it mandatory to have a pre-nuptial agreement?

No. It is not mandatory to have a pre-nuptial agreement before marriage. Some couples choose to have a pre-nuptial agreement, particularly where:

• they have a lot of high-value assets
• one party earns significantly more than the other
• they wish to protect a family business
• they wish to protect an important family asset or heirloom
• the parties have children from previous relationships and wish to reserve assets and funds for them

What are the prerequisites of a pre-nuptial agreement?

The parties must disclose all information about their finances to each other before entering into a pre-nuptial agreement.

The parties to the agreement will receive independent legal and may receive accountancy advice prior to signing the agreement. This ensures that both parties understand the agreement and its consequences.

Each party should receive a copy of the proposed agreement well in advance of the intended marriage or civil partnership ceremony. The agreement should be signed no less than 21 days prior to the date of marriage or civil partnership ceremony (but no more than 1 year prior to the ceremony).

Who can enter into a pre-nuptial agreement?

Any person who intends to enter into a legal marriage or civil partnership can enter into a pre-nuptial agreement. The legal age of marriage/civil partnership is 18.

What will be the duration of a pre-nuptial agreement?

A pre-nuptial agreement is intended to remain in place for the duration of a marriage. The agreement may then be considered as part of any divorce and finance proceedings/settlement.

The parties may wish to prepare wills to provide for the division of their assets in the case of death.

What must be done after the pre-nuptial agreement has been signed?

The agreement such be signed as a deed in advance of the marriage or civil partnership ceremony (a minimum of 21 days in advance of the ceremony, but no more than 1 year in advance of the ceremony). Each party should then retain a signed copy for future reference.

Which documents should be attached to a pre-nuptial agreement?

Each party will provide financial disclosure prior to the signing of the agreement. That disclosure will then be exhibited in the schedules to the agreement. An example of the format of disclosure can be found in the Form E which is used in family proceedings.

Is it necessary for a pre-nuptial agreement to be witnessed?

Yes. The agreement should be signed by each party together with any legal advisors, and each party should be provided with a signed copy. The signatures of each party must be witnessed as the agreement will be executed as a deed.

A witness should

• be over the age of 18
• not be party to the agreement
• have capacity

The agreement will not be reviewed by a lawyer to ensure that the legal content applies to the personal situation of the parties. In order to review the particulars of any final agreement, it will be necessary to instruct a lawyer. For assistance finalising, reviewing and executing a deed, advice should be sought from a lawyer who is regulated by an approved regulator in the legal services sector. It is possible to search for a lawyer using the Law Society – find a solicitor webpage.

What are the costs involved in finalising a pre-nuptial agreement?

In order to receive independent legal advice, it is necessary to instruct a solicitor. The solicitor will advise of their fees in advance.

For assistance finalising, reviewing and executing a deed, advice should be sought from a lawyer who is regulated by an approved regulator in the legal services sector. It is possible to search for a lawyer using the Law Society – find a solicitor webpage.

Is a pre-nuptial agreement legally binding?

Pre-nuptial agreements are not strictly binding in England and Wales. However, it is possible that a pre-nuptial agreement can be considered in any future dispute during financial proceedings should the parties divorce or dissolve their civil partnership. A pre-nuptial agreement should be considered by the Court unless there are circumstances to show it would be unfair to do so.

A Court is more likely to consider a pre-nuptial agreement where:

• the parties have received independent legal advice before signing it
• the parties have provided all of their financial information before signing and have not misrepresented any information to each other
• the terms are fair
• the parties entered into the agreement freely
• the agreement has been properly executed as deed

Can a pre-nuptial agreement be amended?

Yes, a pre-nuptial agreement should be reviewed and amended at appropriate intervals. It is common to do this after the birth of a child, or where there is a significant change in circumstances. The agreement will provide provisions for the agreement to be reviewed and amended, as appropriate.

What must a pre-nuptial agreement contain?

A pre-nuptial agreement should:

• confirm the identity of the parties
• declare that the parties intended to enter into a legal agreement
• set out relevant background details - including any children and the relevant assets
• confirm the date of effect - this will be the date of marriage or civil partnership
• stipulate the intention of the parties regarding assets/property – this will explain how assets should be divided in the event of divorce or dissolution
• refer to any relevant will – the parties will typically execute a will to ensure that the assets can be dealt with accordingly upon death

What laws apply to a pre-nuptial agreement?

The following legal provisions are relevant to pre-nuptial agreements:

• The Matrimonial Causes Act 1973
• The Civil Partnership Act 2004
• The Administration of Estates Act 1925
• The Inheritance (Provision for Family and Dependants) Act 1975
• The case of Radmacher (formerly Granatino) v Granatino [2010] UKSC 42 - this case confirmed that a pre-nuptial agreement which has been freely entered into should be considered by the Court when it is dealing with the division of assets during financial proceedings unless there are circumstances to show it would not be fair to do so.

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