On 20th October The Supreme Court gave the green light to pre-nuptial agreements. They ruled that the marriage contract made between Ms Radmacher and her ex-husband should be recognised and rejected his claim to a larger slice of her wealth. The couple had been married for 8 years and had two children together.
Miss Radmacher came from a very wealthy German family and had personal wealth of around £100m. She said, ‘We made a promise that if anything went wrong, both of us would walk away without making financial claims.’Simon Bruce, her solicitor remarked; 'Pre-nups are binding, so long as they are fair. Couples can now decide in the best of times what the outcome should be in the worst of times.'
The Supreme Court’s ruling potentially brings England into line with most of Europe and the US where pre-nups are legally binding. To dateEnglish law has not formally recognised pre-nuptial agreements in the way that some other countries do. This has been changing and in recent years, English Courts have given pre-nuptial agreements weight in a number of cases and treated them as being of significance. The reason the Radmacher case breaks new ground is because the pre-nuptial agreement was upheld in its entirety. The signs are that this is going to be increasingly the position. However, for it to be the position in all cases Parliament would need to bring in new legislation. There are signs that this will happen in the near future.
Who should consider a pre-nuptial agreement?
Anyone who wants to protect their assets in a marriage may be tempted to use one, in order to control their own financial affairs and avoid or minimise the risk of an expensive settlement if their marriage ends in divorce. In addition, people with children from a previous relationship, may want a pre-nuptial agreement to ensure that their children inherit their property and not their new spouse or spouse’s family.
Considerations
It is imperative that certain minimum safeguards are met to give a pre-nuptial agreement the best possible chance of success. Those guidelines include:
- Provision must be made for children
- Both parties should have taken independent legal advice
- Neither party should feel pressurized into entering into the agreement
- The agreement must be fair
- Full financial disclosure must have been made
- The agreement must have been drawn up at least 21 days prior to the marriage
Valerie Cooper, Head of Family Law at Crellins Carter Solicitors commented; “I think this ruling should be welcomed. It goes some way to removing the uncertainty over the ability to enforce pre-nuptial agreements and paves the way for legislation. This in turn will help to remove the financial uncertainty associated with divorce.”
If you are interested in discussing pre or post-nuptial agreements further, please contact Valerie Cooper on 01932 858833 or e-mail her at vcooper@crellinscarter.co.uk.
