postnup

Are pre-nuptial agreements legally binding?

Are pre-nuptial agreements legally binding?

The three stage test used by the court:

1. The agreement must be freely entered into;
2. Both parties must have a full understanding of the terms of the agreement;
3. It must be fair to hold the parties to this agreement.

If you are considering entering into a prenup the following may help with the decision making.

Five Advantages

1. You can make it clear, and agree at the outset of your marriage, as to whether a particular asset is yours alone, or whether you are happy for it to be shared on any future divorce. This provides certainty and avoids lengthy and costly litigation in the future, which in turn saves you in legal fees.

2. You will provide each other with disclosure of your assets before any agreement is reached, allowing you to agree to protect any assets, such as gifts or property received before the marriage. You can also protect your assets from any of your partner’s debts now or in the future.

3. Entering into an agreement should lead to fewer arguments about your finances and will help you communicate about financial matters during the marriage.

4. A prenup will protect any assets ring-fenced for your children and will set out what will happen to your assets on your death, ensuring that your children are taken care of.

5. If you are concerned that your partner wishes to marry you for your money, the prenup should help to put your mind at rest.

Five Disadvantages

1. Prenups are not legally binding, however, following the Supreme Court decision in Radmacher v Granatino [2010] UKSC 42, the court will uphold a prenup if it satisfies the three stage test above.

2. The prenup cannot anticipate what will happen in the future. If there is a significant change of circumstances, it is unlikely that the prenup will be upheld by the family court. In an attempt to ensure that the prenup is upheld by the court, the document should be reviewed on a significant change of circumstances, resulting in further legal fees and potential upset, and puts a strain on your relationship.

3. The court is unlikely to uphold a prenup that is no longer in the best interests of any children of the marriage. Any agreement reached will be dependent on the circumstances of the children at the time of the divorce.

If you would like to know more about prenuptial agreements, or if you are considering entering into one, email me at familylawyerlondon.

Posted by admin in Agreements, Divorce