Why Every Couple Should Consider a Nuptial Agreement – Not Just the Ultra-Wealthy

The Standish Case: A Cautionary Tale

There have been many articles written recently concerning the case of Mr and Mrs Standish. They were a wealthy couple with assets totaling £130 million. Just prior to their divorce, Mr Standish transferred £80 million to his wife for tax planning purposes. It was this £80 million that led to significant, costly and lengthy legal proceedings.

Whilst the court ultimately decided that the £80 million was ‘non matrimonial property’ and should not be shared with Mrs Standish, it took 3 years of litigation and no doubt hundreds of thousands of pounds, to establish that fact. Indeed, Mr Standish’s lawyers subsequently stated that the amount that Mrs Standish received (£25 million) was in fact the amount that Mr Standish had offered right at the beginning of the proceedings.

What Went Wrong: The Cost of No Nuptial Agreement

Whilst this couple had what most would consider to be eye watering sums of money, the fact is that, had they signed a nuptial agreement at the time setting out the purpose of these funds, the heartache and costs of these proceedings could have been avoided.

Are Nuptial Agreements Only for the Wealthy?

But are nuptial agreements just for the very wealthy? The answer is no. Nuptial agreements are commonly entered into when one party has brought significant wealth to the marriage, including gifts or inheritance received from family members. They are also common in second marriages where spouses want to ensure that their children’s future inheritance is protected in the event of a divorce.

When Should You Consider a Nuptial Agreement?

Signing a nuptial agreement does not mean you do not want the marriage to last, in fact the agreement itself records the fact that you want the marriage to continue. It is just a safety net in case it doesn’t. Much like holiday insurance, you do not purchase with the intention that something bad should happen on holiday, but because you accept that sometimes these things do happen.

Are Nuptial Agreements Legally Binding in England and Wales?

Whilst nuptial agreements are not currently legally binding in England & Wales. There has, for many years, been a campaign to make them so but for now, they are simply one of the factors that a court must take into consideration when deciding financial claims when spouses divorce.

That said, there have been numerous cases where the court have upheld the terms of a pre nuptial agreement and sometimes even in circumstances where they were signed on the day of the wedding!

It’s Not Romantic – But It Is Smart

But surely, it’s not very romantic to go into a wedding thinking about what would happen if we get divorced, many ask. The reality however is that sadly, 1 in 2 marriages end in divorce and it is often better to agree on what should happen with your finances in advance when you are not dealing with the emotional turmoil of a marriage breakdown.

Creating a Fair and Effective Nuptial Agreement

Whilst it may not be as exciting as planning the wedding day itself, it doesn’t have to be a painful experience. Sometimes it is as simple as saying you would like a specific sum to be protected from claims, and you may be able to agree that between you. But we also have to make sure the agreement, provides for reasonable needs, something the court has to consider in the event of separation and we can work with you and your future spouse’s lawyer to discuss and agree what provisions you  would like included in your nuptial agreement, to make sure that it is fair and likely to be upheld by the court if that becomes necessary.

Conclusion: Hope for the Best, Plan for the Worst

As cynical as us family lawyers may be, we always hope your marriage lasts but equally we want to help you to reduce the heartache of costly and lengthy proceedings if it doesn’t.

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Prettys’ Family Team are multi-skilled in their approaches to family matters.  The team consists of trained mediators, collaborative lawyers with years of experience in round table working, and experienced litigators.  We have a thriving mediation practice and are creative and tailored in our approach to finding resolution.  You can contact me in confidence at dbutler@prettys.co.uk and for more information on the services our practice offers you click here to find out more.