In England and Wales, a pre-nuptial or post-nuptial agreement is not automatically binding, but it is often decisive. Since the Supreme Court's decision in Radmacher v Granatino in 2010, courts give effect to an agreement that both people entered freely, with a full understanding of what it means, unless holding them to it would be unfair in the circumstances.
So a well-made agreement is likely to be followed. A badly made one may be ignored.
What makes an agreement stand up
- Independent legal advice for each of you, from separate advisers.
- Full financial disclosure by both of you, so each knows what the other has.
- No pressure. Signed freely, without one person being pushed.
- Signed well before the wedding. At least 28 days is the usual guide.
- Fair terms that still meet needs, particularly the needs of any children. An agreement that would leave one person unable to meet their basic needs is unlikely to be followed.
- Reviewed when life changes, such as the birth of children or a significant change in wealth.
A post-nuptial agreement, made after the wedding, is treated in much the same way.
Where the law stands
In 2014 the Law Commission recommended making qualifying agreements binding, provided certain safeguards were met. That recommendation has not been put into law, so the courts still decide case by case. The rules in Scotland are different, and this page covers England and Wales.
Where trusts come in
An agreement is not the only way to protect family wealth in a marriage. On divorce, a court can vary a "nuptial settlement", which can include a trust set up for a married couple. How a family trust is set up, who it is for and how it is run, can make a real difference if a child's marriage later breaks down. Parents passing wealth to a child before or during a marriage often use the two together: a trust to hold the family's money, and an agreement recording what each partner brought in.
A situation we see
Tom inherited a share of his parents' business shortly before he married Sophie. They signed a pre-nuptial agreement two weeks before the wedding. Neither had separate advice, and Tom had not disclosed the value of the shares.
When the marriage ended, the court gave the agreement little weight: it was signed late, without advice or disclosure. A properly made agreement, signed months earlier, and the shares held in a family trust, would have put Tom in a far stronger position.
This is an illustration. The people and figures are invented, but the situation is one we see.
Where to start
The Wealth R.I.S.C.™ Assessment looks at how family wealth passing to a child can be protected, alongside the advice each partner takes on the agreement itself.
Questions people ask about this
Are prenups legally binding in the UK?
In England and Wales they are not automatically binding, but courts usually follow an agreement made freely, with full understanding, independent advice and full disclosure, unless it would be unfair.
How long before the wedding should a prenup be signed?
At least 28 days is the usual guide. Signing in the last few days before a wedding weakens it.
Can a trust protect family money in a divorce?
It can help, depending on how it is set up and run. A court can vary a trust treated as a nuptial settlement, so the structure matters.
Related
Helping a child buy a home, with protection.
Myths worth checking.
Why family wealth disappears, and how to keep it.
Three steps, with room to stop
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1. Start with five questions and a short call
Answer five questions and choose a time for a 20-minute video call with Richard. Your answers are read beforehand, so the conversation starts with your situation.
The call goes over everything first: what your situation needs, whether the assessment is worth having for you, and the fee.
Where a straightforward piece of work would cover it, or nothing needs doing at present, you will be told so.
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2. The assessment: one hour, four steps
An hour on video, worked through the four R.I.S.C.™ steps, then a written report explaining your position, the options and the reasoning behind the recommendations.
Once it is booked and paid for, you complete a short questionnaire and an identity check, so the hour is spent on your position rather than on collecting facts.
The assessment looks at the relevant legal and tax questions together, so you can understand what is necessary, what may help and why.
We aim to send your written summary of the findings and recommendations within three working days of the assessment meeting.
The report is yours to keep. The assessment is paid work in its own right; its fee is not deducted from subsequent work. Fees for this and all other work are set out in the price guide.
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3. Decide what happens next
Take time to consider the recommendations.
You can act on the report yourself, ask Richard to carry out further work, or stop there.
If you proceed, the scope and fixed fee are agreed in writing before work begins.
You deal with Richard throughout
You should be able to ask why something is recommended and receive an explanation you understand.
You work directly with Richard Ansah TEP, from the first conversation through to the completed documents.
Richard is a full member of STEP and a member of the Society of Will Writers.
ONCE is an independent estate planning practice, not a firm of solicitors. Where your circumstances require another professional, Richard will explain why.
Ready to get this sorted?
Five questions, then a twenty minute call that goes over everything first: what your situation needs, what the assessment involves, the fee, and whether you need us at all.
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