Nuptial agreements have gained significant popularity since a landmark Supreme Court case in 2010, which led to these agreements being given much greater consideration by English courts. They can offer a practical, fair, and transparent way to openly discuss finances both before and during marriage, and outline what should happen if the relationship ends. For anyone considering a nuptial agreement, B P Collins’ family team is here to guide you on the best time to get one, debunk common misconceptions that they are one-sided, unromantic, or only for the wealthy, and highlight why they can be an incredibly useful tool for peace of mind.
When to consider a nuptial agreement
If you’re thinking about a prenuptial agreement, it’s best to start the process as soon as you’ve decided to get married. Waiting until a few months before the wedding can create unnecessary pressure and stress, and for legal reasons, we aim to finalise any agreement at least one month before your big day.
If you’re already married, you might decide a nuptial agreement is needed when receiving from family substantial inheritance or gifted assets as part of tax planning, or to protect a business (particularly if there are third parties involved in it).
A nuptial agreement should be a mutual understanding between both partners, not something imposed by one person on the other. It’s meant to help prevent or at least reduce the possibility of costly and emotionally draining legal battles in the future. It also provides reassurance to third parties, including family members and business partners.
Common misconceptions
Despite their growing popularity, many people (even lawyers in other fields) still believe common misconceptions about nuptial agreements that are easily debunked.
Myth 1: They are not recognised in this country
In 2010, the Supreme Court decided that if a nuptial agreement meets the needs of the parties, was freely entered into and by them both and they understood the implications of signing, and the terms remain fair at the time of the divorce, then the agreement will be upheld. Experienced family lawyers will keep in mind both case law and draft legislation involving nuptial agreements, to best ensure yours will be upheld. They remain the best form of wealth protection on divorce, and are particularly helpful to keep intact hereditary wealth (including farms and estates) and company assets. People often believe that placing their assets in a trust or corporate structure will provide sufficient protection on divorce – this is wrong.
Myth 2: They are only for the rich and famous
Nuptial agreements are increasingly common, and not just amongst the super-rich, because they offer protection and certainty. However, it is worth bearing in mind that when deciding if it is fair to uphold an agreement, one of the key factors is whether it meets both of your needs. If the effect of the agreement would be to leave one of you unable to meet your reasonable needs for housing and income, then it might only be partially upheld (if at all).
Myth 3: They can’t be changed
Nuptial agreements can always be changed, as long as you both approve. In fact, a well drafted nuptial agreement will include a review clause, encouraging you and your spouse to make appropriate changes to the agreement when significant events occur, such as the birth of a child or if one of you is out of work for several years, to ensure the agreement remains fair.
Myth 4: They show a lack of trust between couples
Entering into a nuptial agreement is more likely to show that the opposite is true. Having an open discussion, at a time when you love and respect each other most, about your expectations on divorce such as what will be ring fenced and what will be shared; how the financially stronger party is going to help meet the needs of the other; or how the spouse that is most likely to make career sacrifices for the family will be compensated, can build a very strong and healthy relationship. A prenup is really no different to putting in place a will or an insurance policy.
Myth 5: They can only be signed before a marriage
A prenuptial agreement (‘prenup’) is a nuptial agreement signed before the wedding. To ensure there is no inference of duress, a pre-nup should be signed at least one month beforehand. If it is signed less than one month before, or you’re already married and want to have a nuptial agreement, you and your spouse can sign one any time after the wedding and it will have the same effect. This is known as a ‘post-nuptial’ agreement or ‘postnup’.
Nuptial agreements can help to resolve matters amicably
While a nuptial agreement doesn’t offer a guaranteed outcome, it steers negotiations and ultimately if needed, a judge’s decision. It also makes clear the assets that are going to be marital and therefore shareable, those that will be non-marital and therefore ringfenced, and what the parties’ reasonable needs will be on divorce (factors which without a nuptial agreement can significantly increase the chance and cost of litigation). Most importantly, if the provisions are fair, it fosters a sense of security and understanding between you and your partner, making it easier to resolve any issues amicably, as you’ve already had important conversations and agreed on how you’d like things to be handled in the event of separation or divorce.
For further advice and information on nuptial agreements, please contact B P Collins’ family team at enquiries@bpcollins.co.uk or call 01753 889995.
