How can I persuade my future spouse to enter into a pre-nuptial agreement?
A pre-nuptial agreement is, generally, used by the party bringing the greater share of the assets to the marriage. If this is family wealth then it may be the parents who are putting pressure on their child to have such an agreement. Most partners will be prepared to sign a pre-nuptial agreement but what can be done where the partner, very often the one with the lesser wealth, is reluctant to do so.
This is a difficult issue and, ultimately, the partner cannot be forced to enter into an agreement, leaving the party who seeks the agreement with the unenviable dilemma as to whether they are willing to proceed with the marriage in the absence of such an agreement.
As a starting point, it is important to emphasis that the discussions concerning the agreement should be commenced at an early stage and not left to the last minute when considerable funds may have already been spent on the big day, making the decision even harder for the partner who finds that their future spouse does not wish to sign. In any event the agreement must not be signed within the 28 day period before the date of the wedding and, bearing in mind how long it can take to draft/agree the terms of an agreement it is sensible to start discussions as to the terms at least six months before the date of the wedding in order to avoid any last minute difficulties.
If the reluctant partner refuses to sign then there is not a great deal that can be done about it but very often any reluctance is based upon lack of knowledge and appreciation of the benefits of having an agreement. If the reluctant partner falls within the latter category then an explanation as to the benefits may well prompt them to change their mind.
The particular benefits will depend upon the circumstances of the case but will generally include, at the top of the list, that such an agreement will go some way to providing clarity and certainty as to how the assets are to be divided in the event that the marriage ends in divorce.
The process of divorce can be fairly traumatic for many people for a variety of reasons including uncertainty as to the division of the assets and other financial matters. If an appropriately drafted pre-nuptial agreement is in place then this can provide some peace of mind as to this important aspect of the separation.
Please contact Benjamin Carter (on 01892 506081 or email@example.com) if you would like to discuss any issue arising out of the above.
When should you review or vary a nuptial agreement?
The fundamental requirement of a good nuptial agreement, which is likely to be upheld by the court in the event of divorce, is for it to be fair and to meet the needs of you and your spouse. Terms that were fair according to the circumstances when the agreement was drafted, may not be over the course of your marriage. It is therefore important to review the agreement when major life events occur that make the agreement unfair on one of you. You can’t predict what the future holds, but a review clause can try to identify any potential changes in circumstances that may make the original agreement unfair.
Potential trigger events for a review include:
- The birth of a child
- Moving the matrimonial home out of the jurisdiction
- You or your spouse becoming bankrupt, incapacitated or losing your job
- An asset of the marriage appreciating or depreciating significantly
Without a review on one of the above life events, there is a risk that the court on divorce could determine that the nuptial agreement does not meet each party’s needs and it will not be upheld.
The longer the marriage, the more likely it is that your circumstances will have changed and the more likely it is that it will be unfair to uphold the terms of the nuptial agreement. Often a review clause will provide that the agreement will be reviewed every 5 years to avoid this issue. You and your spouse can consider the changes in circumstances that have occurred in the previous 5 years and evaluate whether they require that the agreement be varied.
Any variation of the terms of the nuptial agreement should be formalised, and there are a number of criteria which should be complied with in order to make sure that the agreement has the best possible opportunity of being binding in the future.
Please contact Claire Tollefson on 01892 506191 or Claire.firstname.lastname@example.org for a free, no obligation telephone call to discuss variations to a nuptial agreement.
Which is better – a pre-nup or a post-nup?
Whether you decide to enter into a pre-nuptial agreement (before you marry) or a post-nuptial agreement (after you marry), depends very much on your circumstances.
The key benefit of a pre-nuptial agreement is that it avoids any accumulation of joint assets before there is an agreement in place as to how they are to be dealt with if the relationship were to break down. It means that you enter into the marriage knowing exactly how all your assets, joint or otherwise, are to be divided.
However, in the lead up to your wedding entering into an agreement may be an additional pressure which you may not be able to give your full attention to. You should expect to be held to a pre-nuptial agreement which complies with prescribed criteria. There is a risk that one party after the wedding could try to argue that they signed the agreement under duress, because it was the only way to get married. This argument of course works both ways, and the person with the wealth could of course argue that they wouldn’t have got married if the pre-nuptial agreement had not been signed. A post-nuptial agreement can avoid the pressure of the wedding day being a factor in the negotiations and subsequent signing of the agreement.
A post-nuptial agreement can be useful where there has been a change in circumstances following the marriage, or where you are experiencing relationship difficulties. The agreement would set out how your assets were to be divided if you divorced, leaving you and your partner able to focus your efforts on repairing your relationship rather than the financial uncertainty of its breakdown.
Please contact Claire Tollefson on 01892 506191 or Claire.email@example.com for a free, no obligation telephone call to discuss whether a pre-nuptial or post-nuptial agreement is appropriate for you.
In what circumstances would I need a pre-nup?
When planning a wedding, often the last thing on your mind will be what would happen to your assets in the event that you were to divorce. There are protective measures that can be put in place, however, and although not legally binding, significant weight will be attached to a pre-nuptial agreement as one of the relevant factors which a judge will consider when determining an appropriate financial settlement on divorce. Ultimately it will be considered as persuasive evidence of the party’s intentions, so long as it is satisfies prescribed guidelines set out in case law.
The most common reason for individuals to enter into a pre-nuptial agreement is to protect assets that they have acquired prior to the marriage. This could be an inheritance, whether large or small, or an interest in a long running family business. Alternatively or additionally, it could be wealth or investments that have been built up as a result of an individual’s business endeavours or property ownership. In the event of a second marriage, it may be that an individual has received the family home as part of their previous divorce settlement or even a specific asset or family heirloom that they wish to ring-fence for their children.
If you have assets that you wish to protect it is prudent to take advice prior to your marriage as to how best that can be achieved. Please contact Claire Tollefson on 01892 506191 or Claire.firstname.lastname@example.org for a free, no obligation telephone call to discuss whether a pre-nuptial agreement is appropriate for you.
Local fruit farmer appeals for a discount to be applied on his £12m divorce pay-out because of Brexit uncertainty
A fruit farmer from Kent, with a family fortune of approximately £30 million, appealed against an award that he pay his wife of 26 years £12.2 million by way of divorce settlement. He appealed on the basis that the award did not take account of the impact that Brexit will have on his farming business and on the ground that his ex-wife should not benefit from any of his wealth generated by virtue of inheritance or gifts.
The court at first instance ordered that £5 million be paid by June and that a further £7.7 million be paid by March 2018. However, counsel for Mr Mansfield argued that this award was “too much too soon” and that it did not take account of the impact on the UK of leaving the EU which could “potentially undermine” the value of the business.
Regarding the gifts and inheritance Mr Mansfield received from his father, Mr Mansfield Snr built up his farming business in the sixties which, by the time of his death in 2011, was being managed by his son and was worth millions. Counsel for Mr Mansfield argued that the award of £12.2 million failed to take into account Mr Mansfield’s “very great input” while counsel for Mrs Mansfield contended that the couple had worked hard over the course of their 26 year marriage to build up the business.
In his judgement a Court of Appeal judge found that the argument about Brexit was unlikely to succeed and refused permission for the appeal to move forward. However, the appeal in relation to the impact of inheritance on the value of the business was “arguable” and was granted permission to continue.
If you could like further information in relation to this the contents of this post, or any aspect of family law, contact Alex Davies on 01892 506326 or at email@example.com.