Wedding planning – have you remembered the Pre Nuptial Agreement?
Wimbledon and weddings epitomise the British summer and from 1 July couples will have the choice of getting married outside at an approved venue for the first time.
Indoors or out weddings are joyful occasions and often no expense is spared. The wedding is one day - the marriage will hopefully last a lifetime and yet we can find it difficult to talk about what might happen if it doesn't work out or what insurance could be put in place for this eventuality. This less "exciting" part of the planning is equally, if not more important.
What is a Pre Nuptial Agreement?
A Pre-Nuptial Agreement is an agreement a couple enter into prior to marriage to regulate what will happen to their finances if they subsequently divorce.
They are about two people acknowledging their particular circumstances, being open and honest about how they feel about their financial position, taking control of their futures and making their own decisions about what they consider is fair. Whilst couples do not go into marriage expecting it to end, having a Pre Nuptial Agreement can provide a level of certainty by clearly defining the financial arrangements if you separate and thus simplifying the process and making it less costly and less stressful.
Whilst a Pre Nuptial Agreement is not legally binding, for a number of years they have become harder to challenge. Provided they are drafted correctly, are fair and meet both people's needs then it is now established that it difficult to argue that you should not be held to the terms that you previously agreed.
Who are they for?
A Pre Nuptial Agreement can be for anyone. If you do not have any assets when you marry, it is easy to assume that in the event of divorce everything will be straightforward because surely what you have accumulated together will be shared equally? Unfortunately it is rarely that simple, people's circumstances invariably change during a marriage and our legal system is discretionary which means it is possible for one person to argue that they should have more, or less, than the other.
However, there are certain circumstances where a Pre Nuptial Agreement will be more relevant.
- If this is your second of subsequent marriage you may wish to protect assets you have acquired during you previous marriage. Second, third or subsequent marriages often prompt the question of whether a Pre Nuptial Agreement is necessary. Often entered into by older couples, as wealth has already been accumulated by one persons efforts - the sense of fairness in this situation upon a divorce is very different to a young couple starting life together free of any competing obligations.
- If you have children from a previous relationship you may wish to protect certain assets for their benefit.
- Sometimes the couple themselves have not created the wealth. It may have taken generations to accumulate family wealth and for planning reasons assets have been gifted to younger members of the family or have been inherited. They may receive income or assets from a family trust fund. It is prudent "housekeeping" to protect the extended family wealth until the new relationship and therefore trust has developed over time.
- You may want to protect future inheritances or a specific heirloom.
- You may have or be part of a farming or business enterprise and want to consider the protecting these assets if you subsequently divorce.
- If you are already married you can still protect assets acquired in similar circumstances by entering into a Post Nuptial Agreement.
Getting it right
It is important to have the discussion about the need for a Pre Nuptial Agreement sooner rather than later. Producing an agreement the night before the wedding and saying that we are not getting married unless you sign it will not stand up in Court - so make the decision as soon as you make the decision to marry - a Pre Nuptial Agreement needs to be signed at least one month prior to the wedding.
Be prepared to provide full and frank disclosure of your personal and financial circumstances, including documentation. To not do so is likely to jeopardise any agreement.
Both people should take separate, independent legal advice - allow time for this.
Be fair - have terms that will meet needs
Ensure that you have the opportunity to review as the marriage progresses so any changes in personal and financial circumstances can be accommodated
Making discussions about Pre Nuptial Agreements part of wedding planning should be the norm as such discussions usually provide certainty, security and comfort for the families involved. It also avoids misunderstanding and assumptions.
For further advice from our special family lawyers please contact Alison Benson 01482 337363 firstname.lastname@example.org
This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.