TO PRE-NUP OR NOT TO PRE-NUP?
It can be awkward to discuss a pre-nup with the love of your life after you’ve made the decision to spend the rest of your lives together.
There’s no easy way to broach the topic because whichever way you try and look at it, it may be perceived that you think your partner is after your money or that you love your money more than your partner.
That said, one of the few certainties in life is that life is uncertain. A pre nup gives you the opportunity to put a little more certainty into your life. Whilst people do not enter into a marriage thinking it will end, it is unfortunately estimated that between 40% – 50% of marriages end in divorce.
Vaishali Faldu, a solicitor in our Family team says ‘If you’ve got assets to protect, protect them. Don’t bury your head in the sand. Deal with it as early as you can so your intentions are clear from the outset.’ This is not to say that your intentions are that all you care about is money, but rather that you are entering into the relationship for all the right reasons. You are saying that you want to make sure everything is fair.
There has been a rising interest in pre nups in recent years with a desire to protect hard earned assets. Recent research carried out concluded that 62% of people under the age of 35 said that they would not be offended if they were asked to sign a pre nup.
A pre nup can detail every last aspect of how you wish your finances and other matters to be dealt in the unfortunate event that your relationship breaks down. It also allows you and your partner to stipulate how your finances should be treated during the marriage and can give both more control in the event of a divorce.
Here’s a few things to think about if you are considering getting a pre nup:
Independent Legal Advice
Prenuptial agreements should be drafted by solicitors and each party will need to seek independent legal advice. This means that you cannot seek advice from the same solicitor. The solicitor will advise you of the contents of the agreement, its effect and whether the agreement drafted reflects what you are intending it to.
Full & Frank Financial Disclosure
Both parties must exchange financial disclosure prior to entering into the agreement. Being open, honest and upfront with each other is strongly advised. This is crucial if you want to give the agreement a better chance of being upheld later on.
If you cannot agree on the terms of the agreement, these will need to be negotiated by both parties and their legal representatives. If this occurs, it can take some time to finalise the agreement. Pre nups can be complicated documents particularly where varied asset types and multiple jurisdictions are involved. It is therefore important to consider this and allow enough time to negotiate and finalise the agreement.
You may also need to consider any potential future relocation to another jurisdiction as the laws governing pre nups there may differ from the UK.
Pre nups have to be entered into well in advance of the wedding, so if you and your partner are thinking of getting a pre nup it’s best to make sure you go and see your solicitor as early as you can. The courts will more likely enforce an agreement entered into in advance of the marriage as it shows an indication that the agreement was not rushed into and that neither party was pressured to sign the agreement. We would recommend having the agreement executed at least 2 months ahead of your marriage and in any event it must be completed at least 28 days before the wedding.
Are pre nups legally binding?
This remains to be the most asked question. The simple answer is no, pre nups are not legally binding in the UK. However, the Courts are becoming more and more open to holding parties to their pre nups assuming certain conditions are met. This includes material disclosure being provided by the parties and the opportunity to take legal advice at the time of entering into the agreement. Provided the agreement is not manifestly unfair, there has been no significant non-disclosure or change in circumstances between the date of the marriage and the date of separation and both parties have entered into it of their own free will without undue influence or pressure and are informed of the implications, a Court will certainly take into account a pre nup when determining each person’s financial claims against the other and would most likely uphold it. It is certainly the best form of protection that can be offered at the current time and it may be that in the future such agreements become binding.
If you want to protect pre-owned assets or any inheritance or gifts that you may receive during the marriage, then getting a pre nup is certainly worth considering. Our team offer a fixed fee initial consultation for anyone seeking to discuss Pre Nuptial Agreements and to help you understand all the options available to you. If you would like to book an appointment at either our Luton, Tring or Milton Keynes offices, please call the Family team on 0800 302 9448.