According to recent press coverage Nigella Lawson and Charles Saatchi will be divorced by the end of this month after agreeing that they will not make any financial claim against each other in their divorce proceedings. This is what is known as a “clean break” order in legal terms. There is speculation that this resolution has been achieved in record time largely because the couple had entered into a prenuptial agreement before they married.
It is increasingly common for people planning to marry or enter into a civil partnership to have an agreement setting out what they intend to happen to their income, property and other assets if the marriage or civil partnership ends. Previously prenuptial agreements had been more prevalent amongst the rich and famous or landed gentry concerned with protecting inherited wealth. This is no longer the case. Many couples are choosing to enter into a prenuptial agreement (or in the case of a civil partnership a “pre-cip”) because they wish to decide for themselves how their financial resources will be divided if they split up, instead of leaving this for a Court to decide (which can be uncertain and costly) or trying to negotiate a settlement in difficult circumstances after the relationship breakdown.
In the 2010 case of Radmacher v Granatino the Supreme Court said that:-
“The Court should give effect to a prenuptial agreement that is freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement.”
Since this decision it is likely the Court will uphold a prenuptial agreement provided:-
- Both people produce information about all aspects of their financial situation.
- They each receive independent legal advice before entering into the agreement.
- There is no duress or pressure exerted on either person to enter into the agreement.
- The agreement is signed at least 21 days before the marriage or civil partnership.
- The provisions of the agreement are fair.
Therefore, if the prenuptial agreement is entered into properly and is not manifestly unfair to either person, it is likely that the Courts will use, or at the very least follow it as a guide to what type of financial settlement to make. However, as the Supreme Court made clear, the Court will always have the final say when deciding what is appropriate financial provision on divorce or dissolution of a civil partnership and it will never be possible to prevent either person from making a financial application to the Court. It is also a key element that a prenuptial agreement cannot prejudice the reasonable requirements of any children of the family.
With a growing number of second marriages and blended families in the UK, prenuptial agreements can also be a useful way of protecting family assets or property acquired before the marriage and providing financial security if there are children from previous relationships.
Prenuptial agreements are very likely to continue to receive press coverage and be the subject of important legal developments in the future. Watch this space!