Whilst it may not be the most idealistic or romantic start to married life, prenuptial agreements have become an essential part of preparing for a modern marriage or partnership.
Some people see them as an essential part of getting married and starting a family together in a sensible manner. Others see them as distasteful example of how we have moved away from romantic ideals of love and lifetime commitments towards a more pragmatic approach to relationships.
People often associate prenuptial agreements with the world of celebrity and the lifestyles of the rich and famous but this is no longer the case. More and more, prenuptial agreements are being used by ordinary individuals to help prevent costly, lengthy and hostile battles at court if the relationship comes to an end.
In February of this year the Law Commission made a recommendation that prenuptial agreements should become legally binding if certain requirements are met.
If these proposals are accepted it would mean that couples who plan to marry will be able to create legally binding agreements about precisely how money, property and other assets would be shared in the event of divorce.
Under current legislation, couples can enter into ‘prenups’ but they are not legally binding and whether the divorce courts give them any weight depends on the circumstances of each case. The same applies to postnuptial agreements, made after marriage.
The Law Commission recommends that these agreements will only be deemed to be enforceable after the financial needs of both partners and their responsibilities towards any children have been met. In addition, such agreements would only be legally binding if both partners had disclosed all relevant information about their financial situation and had received legal advice.
While the Law Commission does not recommend radical change, it has recognised that because of the economic situation and the cuts to family law legal aid, fewer people are able to access professional legal advice. As a result, confusion often occurs and it is now necessary to provide additional information to try to simplify things.
Importantly, the Law Commission specifies “financial needs” but not “reasonable needs,” which can be more generous. In other words, if no financial hardship was going to occur then the agreement could be upheld. This would provide scope to depart from current law, provided full and frank disclosure had taken place and proper legal advice had been obtained.
When considering whether or not this path is right for you, it is important that you know your options and speak to an experienced family lawyer for advice. Our team has extensive experience in drafting prenuptial agreements and can advise you on entering into such agreements. For more information, please do not hesitate to contact us.