A study last year by the University of Washington found that divorces peak in March and August, just after the winter and summer holidays come to an end. With this in mind, Paul Lancaster, a family law expert from Blacks Solicitors, answers the important questions you need to know about pre- and postnuptial agreements.
What is a prenuptial agreement?
In essence, a prenuptial agreement (pre-nup) is a way for couples to agree to the terms of their divorce, even before they get married. A pre-nup can set out exactly what the divorce settlement would be should the marriage break down or, in many cases, simply protect an individual’s assets. Commonly these assets can include: property, businesses, vehicles, gifts or even inheritances received from other family members. Some couples even go a stage further and seek to include provisions in their pre-nups as to how they will conduct their married lives.
Why do couples get a prenuptial agreement?
A pre-nup can carry decisive weight when determining financial settlements upon a divorce. In turn, this can provide preservation of wealth, should this be of interest to one or both of the people involved.
So what is a postnuptial agreement?
Simply, a postnuptial agreement (post-nup) is the same as a pre-nup in that it sets out the terms of settlement of a divorce but is entered into during a marriage rather than before.
Why would you get a postnuptial agreement?
A post-nup can be a good thing to consider if you’ve previously separated but are now in a relationship with the same person again. It provides you with a certain insurance if things were to go wrong again.
We’ve also seen a significant increase in the number of people who are reviewing the initial prenuptial agreement they might have made before they married and are now updating the terms with a post-nup. Having children or growing a successful business are common reasons for people wanting to review the terms laid out in the original agreement. We feel that this is often a better approach than trying to prepare a pre-nup covering all eventualities as it is impossible to predict what the future holds for any of us.
How do you go about getting a pre or postnuptial?
Firstly, seeking legal advice is essential to ensure it is likely to be upheld. For a prenuptial agreement, we normally recommend taking legal advice six months before the wedding and trying to get it signed at least three months before the big day to reduce any risk of it being made void. For a postnuptial, you can arrange this anytime during the period you are married.
Are prenuptial and postnuptial agreements legally binding?
There is no current legislation that makes pre or postnuptial agreements legally binding in the UK. However it fair to say that if proper formalities are followed then it is arguably now harder to go back on the terms and seek a better financial settlement after a divorce than it is to enforce the terms of these types of agreements.
What we have seen, probably in the last ten years or so, has been a gradual and growing recognition of pre and post-nups in the eyes of the courts. It was not that long ago when the courts would pay no serious attention at all to the existence of a pre-nup. That is no longer the case
Can they be easily changed?
You are able to void these agreements yourself by writing and signing a superseding agreement that both parties agree to. This will be the primary document a court would then use should you end up divorcing.
Do they need to be fair?
The overall fairness of the agreement ought to be considered before holding a pre-nup to be binding.
For example, a couple who marry in their 60s having previously both been through a divorce. They have similar earnings, assets and pensions. In this case, a pre-nup that states they would each simply retain their own assets in the event of divorce, most people would agree that their pre-nup should stand.
However, consider a young couple who marry in their 20s who have the same agreement. The husband goes on to become a successful businessman and make several million pounds which he decides to hold in his name. The wife gives up her own career prospects and stays at home to look after their three children, one of whom has serious disabilities and will require ongoing 24-hour care for the rest of their life. The wife has no assets at all in her name and when they split up after 20 years of marriage, should she really receive nothing in accordance with the pre-nup they signed 20 years earlier?
In this scenario the Court would be unlikely to consider the pre-nup binding.
How much does it cost?
The cost of arranging a pre or postnuptial and drawing up all the paperwork depends on complexity but typically the costs involved are around £1,000 to £1,500 plus VAT.
If you are considering taking out a pre or postnuptial agreement and need further advice or have any questions; please email Paul Lancaster at PLancaster@LawBlacks.com or call 0113 227 9233. Alternatively visit www.LawBlacks.com for more information.