Analysis of the post-2010 published judgements coming out of the High Court and the Court of Appeal involving nuptial agreements (pre and post nuptial: “PNAs”) shows worrying trends.
The use of pre-nuptial agreements in the UK, and around the world, is increasing as couples entering a marriage or civil partnership attempt to protect their interests and provide certainty to their lives. Statistically, more than half of people who get married or obtain a civil partnership will seek a divorce or dissolution of the marriage, so it shouldn’t be surprising that demand for a pre-nup is increasing. Whilst a pre-nuptial agreement in England and Wales can be used to guide the courts, it should be noted that they are not legally binding.
Maria Scotland, Counsel, reviewed 29 recent judgements published between 2010 – January 2024 of the High Court and Court of Appeal where a nuptial agreement (pre and post nuptial) was present). In 20 cases the court departed from the terms of the nuptial agreement [1]. That said, whilst the court did not hold the parties to the agreement in most of these cases, the courts nonetheless clearly placed weight on them impacting the final order such that the assets were divided unequally and not anywhere near sharing. Ultimately any nuptial agreement will be tested against case law and previously published recommendations from the Law Commission.
Setting the standard - Radmacher v Granatino
One of the most important cases in this area took place in 2010 and saw a French husband and a German wife in dispute following their divorce. A pre-nup was produced in Germany, where agreements are fully enforceable, before the couple’s marriage in England. The two continued to live in England until their separation and the divorce was dealt with via the English court system. The husband had been awarded approximately £5.8 million by the lower court, despite a prenuptial agreement being in place. However, the wife successfully appealed this decision in the Court of Appeal, a verdict that was later upheld by the Supreme Court. The Court of Appeal determined that the PNA hadn't been accorded enough significance. In his key judgment, the judge stated his belief that it was becoming 'increasingly unrealistic' for the courts to ignore pre-nups given the changing dynamics in most marriages and that while the courts should add weight to agreements various points must be considered, specifically:
1. The parties must enter the agreement voluntarily, without undue pressure,
2. The parties must be informed of its implications,
3. Material disclosure and information must be provided,
4. Independent legal advice must have been undertaken,
5. Ultimately fairness must be considered – whether the agreement meets the needs of the parties and any children of the family.
Post-Radmacher v Granatino
The Law Commission recommendations of 2014 supported this decision. In this report, it found that a pre-nup would only qualify for consideration if it met the following criteria:
1. Freely entered,
2. Contained in a Deed,
3. Signed by both parties,
4. Made at least 28 days before the wedding/ civil partnership,
5. Full disclosure of the other party’s financial situation,
6. Both parties must have received legal advice.
The only element not reflected in previous case law was the issue of fairness. However, in 18 cases recently reviewed by Maria Scotland, fairness was the primary reason for a judge to depart from an agreement. (In two the proximity to the nuptials was the reason for departure from the terms of the agreement).
What we learn from this:
Whilst pre-nups aren’t legally binding in England and Wales they can offer a degree of certainty should a divorce take place and are not only therefore useful but also increasingly common, particularly amongst same sex couples and members of the LGBTQ+ community. They remain an effective means of protecting assets acquired before the marriage or where there are anticipated assets, through inheritance and family wealth. As long as they are entered into with the knowledge that the court may make a different order than that in their agreement, they can still provide some sense of security, especially where they are regularly reviewed and amended to reflect changed circumstance and therefore (potentially) changed fairness.Once a pre-nup is created, it should be regularly reviewed and updated. As noted, fairness is a key consideration during divorce proceedings and so this agreement should reflect the current financial position within a marriage or civil partnership prior to divorce.
If you are considering a pre-nuptial agreement it is important you seek independent legal advice from someone with expertise in nuptial agreements.
[1] The nine cases where the court upheld the agreements were –
(1) Radmacher v Granatino [2010] UKSC 42 (2) Z v Z (No 2) (Financial Remedies: Marriage Contract) [2011] EWHC 2878 (Fam) (3) V v V (Pre-nuptial agreement) [2011] EWHC 3230 (4) L v M [2014] EWHC 2220 (Fam) (5) WW v HW (PNA: Needs: Conduct) [2015] EWHC 1844 (Fam) (6) DB v PB ((PNA: Jurisdiction) [2016] EWHC 3431 (Fam) (7) CMX v EJX (French Marriage Contract) [2022] (8) M v A (also MN v AN) (Prenuptial agreement) [2023] All ER (D) 14 (Apr) (9) MV v MW [2023] EWFC 79