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The recent court proceedings between Paul McCartney and Heather Mills have filled a vast number of column inches and fuelled endless speculation. Unless the case goes to the Court of Appeal we may never reliably know the outcome. However one thing is abundantly clear – the last 5 or 6 years have seen ever increasing payments being ordered by the divorce courts for the benefit of the less well off spouse – usually but not invariably the wife. Increasingly England is seen as the divorce forum of choice for those married to the wealthy. Inevitably this has led many people who are embarking on marriage to consider the extent to which they can regulate their own affairs by entering into a prenuptial agreement.
English law does not treat prenuptial agreements as legally enforceable in the way that other contracts between individuals are – the court always retains the discretion to order the financial settlement they believe to be fair and appropriate. However the Courts now place increasing weight on such agreements. In the recent widely reported case of Crossley V Crossley the Court of Appeal upheld the decision of the Judge that the first step in the proceedings was for Mrs. Crossley to show why the prenuptial agreement she had entered into with her husband, in which they had both agreed not to make financial claims against the other, should not be enforced by the Court.
Whilst prenuptial agreements are not a universal panacea for resolving the problems that may arise on a future divorce, they are likely to play an increasingly important role in assisting couples to make their own decisions and to lessen the costs, both emotional and financial, of resolving issues if the marriage breaks down.
Such agreements may be of particular benefit where: –
- Either one of the couple is entering into a second marriage;
- Either person has significant assets at the date of the marriage;
- Either person has significant inheritance prospects;
- Either of the couple have connections with a country where prenuptial agreements carry significant weight;
- A couple have lived together for a significant period prior to marriage;
- The couple are both working professionals;
- A couple wish to achieve a degree of future certainty for themselves.
If a prenuptial agreement is to carry any weight it must be based on full financial disclosure with each party having had the benefit of independent legal advice. Without those essential elements it will almost certainly fail. The Courts take the view that someone cannot fairly sign up to the terms of a future financial settlement if they do not know the extent of the claims that they are potentially relinquishing.
If you wish to discuss any issue relating to a prenuptial agreement, please do not hesitate to contact me.
Howard Stacey
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