Partner Article

New legal recommendations on prenups could reduce conflict and costs

New recommendations which will allow couples to set the terms of a divorce before they marry will give greater certainty for partners entering into a long-term commitment, according to a leading Midlands lawyer.

Anne Thomson, Partner and Head of the award-winning Family Law team at FBC Manby Bowdler, has welcomed a report from the Law Commission which recommends prenuptial agreements, and those made after a marriage takes place, should be legally binding in divorce settlements.

Mrs Thomson warned the needs of the separating couple and any children will still need to be met, with each case very different to the next.

“The commission’s recommendations will help reduce conflict and cost for couples ending a marriage or a civil partnership. But any resulting legislation must still factor in the complexity of family law and the individual nature of each case. The matters under consideration may be very different for a childless couple compared to a divorce where there are children involved.”

Prenuptial agreements are already enforceable under British divorce law following the case in 2013 involving German heiress Katrin Radmacher. Judges ruled in favour of the 40-year-old who was protecting her £106m fortune from her ex-husband. The couple had signed a prenuptial agreement before their wedding in London in 1998 which stipulated neither party would benefit financially if the marriage ended.

The commission, a statutory independent body that advises on law reform, recommends that prenuptial should become legally binding subject to stringent qualifications. One requirement is that at the time of signing both parties must disclose material information about their financial situation and have received legal advice.

Mrs Thomson added: “The case law of Radmacher is being given legislative force by these recommendations, giving agreements more chance of being upheld. The requirements will lessen the uncertainty about what happens to assets, property and earnings, giving pre-agreed financial terms ahead of a walk down the aisle. Getting married is a happy time, and a potential break-up is certainly not top of the agenda, but making an agreement like this makes sense.

A further restriction, under the commission’s proposals, is that agreements would only be enforceable “after both partner’s financial needs, and any financial responsibilities towards children, have been met”.

The report states: “It will remain open to spouses to make agreements about financial needs, but such terms will not be contractually enforceable and will be subject to the courts’ scrutiny for fairness as they are at present. A qualifying nuptial agreement will not remove the parties’ ability to apply for, and the courts’ jurisdiction to make, financial orders to meet their financial needs.”

The Law Commission’s proposals will be sent to the Ministry of Justice, which will examine whether it wishes to draw up legislation on the basis of the suggestions.

This was posted in Bdaily's Members' News section by FBC Manby Bowdler .