The use of pre-nuptial agreements in the UK, and around the world, is increasing as couples entering into 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.
Although it is a myth often repeated that most courts will follow the wishes of each party, evidence gathered by our Consultant Barrister, Maria Scotland, suggests otherwise.
How often do courts uphold a pre-nup?
Having reviewed 18 recent high-profile cases in England, where a pre-nup was present (2010 – 2023), it became clear from this data that in more than two-thirds of cases (76.5 per cent) the courts had decided to depart from what was agreed.
This differs considerably from the reputation of pre-nups, which many people consider watertight based on their portrayal in media and entertainment.
While in many of these cases, the courts departed from the original agreement, evidence suggests that courts do still place weight on them, and they can impact the final settlement reached… and this is especially so in the recent past (2022 – 2023).
However, ultimately any pre-nup 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 spouses had no financial plan in place in case of a divorce.
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.
In reaching its determination, the Supreme Court set out what weight should be given to pre-nuptial agreements, finding that:
Post-Radmacher v Granatino
Subsequent case law has backed up the findings of this earlier case and the Supreme Courts’ decision was, somewhat, reflect in the 2014 Law Commission recommendations.
In this report, it found that a pre-nup would only qualify for consideration if it met the following criteria:
The only element not reflected in previous case law was the issue of fairness. However, in 23.5 per cent of the cases recently reviewed by Maria Scotland, fairness was the primary reason for a judge to depart from an agreement.
What can be learned from this?
For a pre-nup to be effective, or at the very least do the utmost to protect a party’s interests, it must consider these decisions and reports.
This should not seek to prejudice a child in any way, shape or form.
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.
To pre-nup or not to pre-nup?
Given that courts seem likely to depart from pre-nups in many recent cases, is it worth drafting an agreement in the first place? You may wonder.
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.
If you are considering a pre-nuptial agreement it is important you seek independent legal advice from someone with expertise in nuptial agreements. To find out how we can help to advise you on this, and other matters related to divorce and separation, please speak to the Head of our Family and Relationship team, Alison Green, by emailing firstname.lastname@example.org or calling +44 (0) 20 7240 0521.