Prenups: Don’t leave it to the last minute
If you are thinking about getting a prenup, don’t leave it to the last minute. Any prenuptial agreement should be signed at least 28 days before the wedding. So, you should be thinking about sorting the prenup months before the wedding. The same principle applies to getting a ‘pre-cip’ before a civil partnership ceremony.
Prenups have been seen traditionally as something only for the rich and famous. However, this has changed significantly in recent years.
Why are prenuptial agreements now more common?
One reason could be that more people are marrying in later life. As such, they may already have built up their own wealth or property and wish to protect those assets. Alternatively, it could be a second marriage where there are children from the previous relationship, and the person wishes to ringfence certain assets for their inheritance.
Another reason could be because there is a significant imbalance in assets between the parties. Perhaps one party has inherited wealth that they again wish to protect. Business owners will also often look to safeguard their business by placing it outside the pot of marital assets.
Are prenups legally binding?
A common misconception surrounding prenups is that they are not worth doing as they are not legally enforceable. However, a landmark ruling in 2010 declared that courts should abide by the terms of a prenup that has been ‘freely entered into by each party, with a full appreciation of its implications’. The only exception is where specific circumstances would make it unfair to hold the parties to the agreement. As such, although prenups are not legally binding in the UK, the courts do take them into account.
This is especially the case when an agreement has been completed well in advance and both parties have had sufficient time to consider fully the terms and implications, rather than acting in haste. More reason to sort the prenup at an early stage.
Getting it right
The key things to consider when setting up a prenup are:
- The prenup should be completed and signed at least 28 days in advance of the marriage/civil partnership
- Both parties should receive independent legal advice
- There should be full and frank disclosure about all financial circumstances
- The prenup must be entered into freely – ie there should be no coercion by one party over the other
- Both parties must understand the full implications of the agreement
- The prenup must be fair and meet the needs of both parties – in other words, one party must not be left in real need following the marital breakdown
- It must be contractually valid
For further advice and support on preparing a bespoke prenuptial agreement that meets your individual needs, contact one of Bird & Lovibond’s specialist Family Law team: