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Monday
Nov082010

Are Prenuptial Agreements the new Romance?

 

Courts in England and Wales have for the most part taken prenuptial agreements into account in divorce proceedings, however it has always only been one consideration amongst a number set out in Section 25 of the Matrimonial Causes Act 1973.

However, following a landmark ruling by the Supreme Court on the 20th October 2010 in the case of Nicolas Granatino and German heiress Katrin Radmacher (published on the Supreme Court Website), such agreements are now to have “decisive weight” in English divorce courts.  The court's verdict has set a new precedent on the status of prenuptial agreements in the UK.

The Justices said that following their ruling, “it will be natural to infer that parties entering into agreements will intend that effect be given to them”.  Lord Phillips, president of the Supreme Court, said that courts would still have the discretion to waive any pre-nup or post-nup agreement, especially when it was unfair to any children of the marriage. 

The legal profession remains divided on the issue. Many divorce specialists welcomed the Supreme Court ruling on the basis it will provide greater clarity. Others are critical, pointing out that in the majority of cases the man is financially better off, and that many women who sign prenuptial agreements could be left without a fair share of marital assets.  It is therefore essential that Courts retain their discretion in order to achieve a just result in any financial divorce settlement.

Supreme Justice Hale in her dissenting ruling said: "Above all, perhaps, the court hearing a particular case can all too easily lose sight of the fact that, unlike a separation agreement, the object of an ante-nuptial agreement is to deny the economically weaker spouse the provision to which she - it is usually although by no means invariably she - would otherwise be entitled."

Bareness Hale  goes onto say that 'Marriage still counts for something in the law of this country and long may it continue to do so'.

This case has not only caused uproar amongst the legal profession but in the process of deciding the case, the Supreme Court judges swept away hundreds of years of legal precedent that a married couple should be together for life and their property should be shared - something enshrined in the Church of England's marriage ceremony since 1662 when the groom says: 'With all my worldly goods I thee endow.'  (www.thisismoney.co.uk). 

The Daily Telegraph writes that the Bishop of Blackburn, the Rt Rev Nicholas Reade, warns that prenuptial agreements threaten to ‘cheapen’ the institution of marriage. Bishop Reade suggests that sacred commitments between husband and wife were being reduced to little more than ‘balance sheets’.

However one should consider Britain’s annual divorce rate which stands at around 12 per 1,000 based on current figures, is still one of the world’s highest despite the fact that the rate has dropped over the past ten years (Family Relationships Magazine 4th January 2010). 

A Prenuptial agreement is therefore one way to ensure that your assets are protected.  Men and women alike would benefit significantly from the ability to establish guidelines on how non-communal property and assets will be divided in the event of a divorce.

The Law Commission is due to consider whether a change should be made to the letter of the law, recognizing prenuptial agreements in a more general way; they will report on the matter in 2012. 

It should be remembered that although the ruling in the Radmacher Case gives added weight to a prenuptial agreement/contract, it is by no means incorporated into English law.

 

Christina Brown LLB (Hons) cb@kidwellssolicitors.co.uk

For further information or to speak in confidence on a no-obligation basis to one of our family law expert, please call 01432 278 179

 

 

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