Prenuptial Agreements and UK Family law

The landscape of family and matrimonial law has changed regarding agreements before and in contemplation of marriage (prenuptial agreements), since the Supreme Court ruling in the case of Radmacher v Radmacher [2010] UKSC 42. Such agreements historically have been entered into where there is a financial imbalance between the parties, and one party wishes to protect their premarital assets in the event of a divorce. But such agreements can also be made by parties with approximately equal financial standing, on the bases that they want certainty and cost-effectiveness in the event of a divorce.

The law before Radmacher

Before the Supreme Court decision, whilst in Europe, UK prenuptial agreements were regarded as binding on the parties and the courts, in the UK they were agreements that could be considered and taken into account by the courts, and judges could attach some weight to them, but they were in themselves unenforceable, on public policy grounds, on the old fashioned notion that they undermined the concept of marriage as a life long union.

Where there were such agreements, therefore, they were dealt with on an ad hoc basis if the court thought it was fair in all the circumstances to do so, on the particular facts of the case, but there was never any consensus by the court that they were binding on them. An example is the case of K v K ( ancillary relief:- Prenuptial agreement [2003] 1FLR 120, where the wife was held on the particular facts of that case to the prenuptial agreement’s capital provision of £120,000, in the circumstances where she was seeking an award of £1.6 m from her husband’s wealth of £25m.

The current law

UK law has now been brought into line with its European counterparts, and the ratio of Radmacher is that the court should uphold both prenuptial and postnuptial agreements unless to do so would be unfair or would prejudice the interests of any minor children of the family, or where it is evident that one of the parties had failed to be transparent as to their assets before the executing the agreement by failure to give honest voluntary disclosure on form E for example. In giving legal effect to pre and postnuptial agreements, the court dismissed the public policy argument against ousting the jurisdiction of the courts on an application by one party for a financial remedy order.

Should both parties be independently represented

It is important that if a client approaches a solicitor to draw up a prenuptial agreement to protect say the client’s property and assets before entering into marriage, that the other party is approached and advised of the proposal and asked to seek independent legal advice.

If both parties approach the solicitor it would be better practice for the solicitor to advise one of the parties to seek independent legal advice and explain the reasons for doing so. If that party refuses to say for costs saving purposes, or because he/she feels comfortable with the solicitor, or because there are no solicitors within a reasonable distance of where the party lives, the solicitor can continue to act for both of them where there are no matters in dispute and all seems to be by agreement, but if one party then asks for the solicitor to act in the divorce sometime after the marriage and disputes the validity of the prenuptial agreement, or acts the solicitor to act in a matter in which the parties financial position is a relevant factor, the solicitor may have to consider his/ her position and any conflict of interest that may arise if such fresh work is taken on, where he/she is aware of both parties finances, and in those circumstances should consider his/ her position and refuse to take on the new work recommending the client to go elsewhere.

In any event, it goes without saying that transparency in such agreements is the key. Voluntary disclosure by way of Form E should be undertaken by both parties with statements of truth, and so long as all is transparent and the parties have understood the contents of the agreement and details have been explained to them, there should be no reason why the court would not give effect to it.

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