More often than not we help couples untangle their relationships and face the realities of what being in a marriage/civil partnership means and the legal rights it confers on spouses and civil partners to those unions. The court has wide ranging and discretionary powers as to how assets will be dealt with in the event that their relationship ends. Over the course of a relationship or marriage assets can change significantly and its important that consideration is given to how you both want to safeguard yourselves in the future.
There is an ever-increasing demand for those planning their lives together sensibly discussing how they would wish their financial arrangements to be sorted out, should their relationship not stand the test of time.
What is a pre-nuptial agreement?
A pre-nuptial agreement is made before and in contemplation of marriage. It will detail the ownership of belongings, whether that is money, assets, property, inheritance or trusts and how they will be divided in the event of a breakdown of the marriage.
What is a post-nuptial agreement?
A post-nuptial agreement is entered into after marriage or a civil partnership has taken place and does the same as a pre-nup. A post-nuptial agreement can also be useful if reviewing a pre-nuptial agreement down the line and generally should be considered in the event of a major life events such as the birth of a child, gifts, inheritances, new businesses and trust structures.
Are pre and post nups treated the same way?
Yes, the court has confirmed that the same principles apply to both.
Aren’t pre and post nups only for the wealthy?
In short, no. Whilst historically they were thought to be for those protecting considerable wealth, and for the ‘rich and famous’ more and more we are seeing enquiries across a spectrum of assets and circumstances.
Are they legally binding?
They can be considered an insurance policy. Whilst they not binding by statute, they are now given significant weight by the Court unless considered to be unfair or if there are clear vitiating factors and anyone entering a pre or post nup should do so on the basis they will be held to its terms.
When might you need to consider having a nuptial agreement in place?
Below are some examples when nuptial agreements may be worth considering:
- The decision to marry or enter into a civil partnership is made
- Purchasing a property together or separately
- Business assets
- Owning properties prior to the marriage/civil partnership
- Protecting early inheritance or future inheritance
- If one party is or becomes a beneficiary under a trust
- Protecting third party assets such as gifted family assets, properties, pensions
- Gifts
- Ring-fencing assets
If you think you might need to consider entering into a pre-nup then its really important to take legal advice at the earliest opportunity to ensure that it will meet the requirements
Timing
The earlier the better. These discussions can take time, they are sensitive and should start in good time before an intended wedding. Ideally commencing those discussions 3-6 months before the wedding will allow sufficient time for the terms to be discussed and agreed. A pre-nup should be signed 28 days before you wedding. If time is shorter, exploration will be given timing and so legal advice is crucial to protect your position.
Communication
Have an open and honest dialogue with your partner, these can be sensitive issues to discuss and should be handled gently.
Transparency
It is essential that both parties can make informed decisions, transparency is key and full financial disclosure by both parties is an essential part of the process.
Legal Advice
Be sure to know what you need and why, specialist legal advice and drafting is essential and protects both parties.
We assist high net worth clients and can provide advise on all nuptial agreements.
