Wedding season is in full swing and so are enquiries to family lawyers for prenuptial agreements. In this blog, Senior Associate Nicole Turner looks at the common mistakes couples make when it comes to prenups, and how to avoid them.
Family law often follows particular patterns. We tend to have people asking about divorce proceedings at the start of the year, or after the school summer holidays. Springtime is one of our busiest times for prenuptial agreement enquiries as wedding season approaches in earnest and couples turn to looking at their shared future and finances.
What is a prenuptial agreement?
Prenuptial agreements (prenups) are increasingly common in the UK, although they are not currently legally binding. They set out in clear terms the ownership of a couple’s assets, including money, property, gifts, and other significant financial pots. Importantly, they also include decisions on what should happen to these assets if the marriage breaks down.
Prenups can hold considerable weight in court if a separating couple dispute ownership, provided they are fair and fit the specific criteria. This criteria includes:
- Should be signed at least 28 days before the wedding
- Both parties must provide full and frank financial disclosure
- Both parties must agree without any coercion or duress
- Both parties must have independent legal advice
However, because they are not official legal documents at the moment in England and Wales, it is possible for the court to deviate from the specifications if they feel it is justified.
They are very useful documents to help you and your spouse-to-be navigate your financial situation and put protective measures in place. Of course, it’s not the most romantic thing to discuss but having solid communication can save a lot of frustration and potential disputes in the future.
Top tips for getting a prenup
Mistake: Leaving it too late – to guard against any claims of coercion, prenups as a general principle should be signed at least 28 days before your wedding date. Some people think that this means you can contact a solicitor only a couple of months before your wedding, or even leave it closer than that. However, drawing up the agreement requires a lot of work as well as in-depth financial disclosure from both you and your partner. This can take longer than a month to do.
Solution: Make sure you contact a solicitor well in advance, if possible, as soon as the wedding date is set, the earlier the better. Try and have as much information about your financial situation together as possible.
If your prenup is signed within 28 days before your wedding, then they may be concerns that either party may have been pressured into it and therefore it would be less likely to be upheld. You can get a postnuptial agreement, which works in the same way as a prenup only it is drawn up after your wedding. However, this comes with its own risks and therefore it is best to be organised!
Mistake: Not understanding criteria – prenuptial agreements in the UK need to adhere to the criteria and will only be upheld by the court if they are fair to both parties.
Solution: Getting legal advice from an expert family lawyer will ensure your prenup is as watertight as possible. A family solicitor can advise as to what would and would not be considered fair. They will also make sure that all the criteria is adhered to, including that your disclosure is done properly.
Mistake: Not getting a prenup – for some people, the key mistake is not getting a prenup at all.
Solution: When it comes to matters of property, inheritance and pensions, prenups can be extremely useful protective tools. For example, those entering second or third marriages should consider a prenuptial agreement to protect inheritance for children from previous relationships. They are also useful if you have a defined benefit scheme pension, for example an NHS or Armed Forced pension.
Speak to a family lawyer and a financial adviser about your unique circumstances.
Mistake: Not updating the prenup.
Solution: Prenups are living documents and need to be regularly reviewed and updated. This is particularly true if you have a change in circumstances for example you receive inheritance or you have a child.
Mistake: Not engaging a second solicitor from the outset in bid to limit costs. Both parties need to obtain independent legal advice and often the parties engage the initial solicitor to prepare the document and only instruct the second solicitor at the last minute. Reviewing the agreement requires a lot of work and can often take longer than anticipated, especially if some negotiation is necessary with regard to the drafting.
Solution: Make sure both parties contact a solicitor well in advance so negotiations can take place as early as possible.
