Pre-nups and the need for proper legal advice
A prenuptial agreement is a means by which parties entering into a marriage can attempt to protect their individual wealth and possessions. If a divorce becomes particularly acrimonious, a pre-nup may demonstrate to a court what the original intention of the parties was for their finances before the breakdown occurred.
While no legislation has yet been passed in England and Wales to make pre-nuptials legally binding or enforceable, a court might be guided by the agreement if it has been drafted correctly, if both parties have taken independent legal advice, if the agreement does not leave one party in financial need, and the court is satisfied that both parties were fully aware of the assets at stake and the ramifications of signing the agreement.
Since Radmacher v Granatino, the landmark Supreme Court case of 2010 in which a prenuptial agreement was upheld despite the husband’s challenge, various divorce financial settlement claims have been ruled upon in light of correctly drafted pre-nups. In WW v HW  EWHC 1844 the court gave considerable weight to the couple’s pre-nup even though the husband’s needs were not provided for. The husband’s exaggeration of his financial circumstances when the agreement was signed became a significant factor for the court.
The following recent judgment in the family court is another good example of the circumstances in which a prenuptial agreement will not be relied upon in court.
The case of Mrs S v Mr H
In S v H  EWFC B16, the parties had both been married and divorced previously; both spouses had children from previous relationships. While abroad, and just prior to their wedding on 8 June 2010, the parties entered into a prenuptial agreement.
It was the couple’s joint intention to conduct their married life in the UK, where Mrs S ran her successful business and her children were at school. Mr H was employed on a part-time basis by the business and he also provided primary care for Mrs S’s twin daughters.
Sadly, the marriage broke down and the Wife applied for a divorce in September 2016. The couple received their Decree Absolute on 9 July 2019.
In Mrs S’s financial settlement application she sought the full range of financial relief and relied upon the prenuptial agreement which provided for a separation of property.
However, Mr H was bankrupt and he sought a sum of £739,000 in order to pay creditors and satisfy his living expenses. The sum would also have allowed him to purchase a home.
A judge’s view of the pre-nup
The pre-nup had been signed just five days before the wedding; it was prepared by a notary under the local law of the jurisdiction in which the couple was married.
His Honour Judge Booth concluded that there was “no value in the prenuptial agreement”, acknowledging that the parties’ accounts of how they entered into the agreement differed greatly. He noted that neither party had received independent legal advice from a solicitor or other qualified person and that disclosure of their respective financial positions had not occurred. It was therefore impossible for either party to have been fully aware of the potential effect of the agreement they were entering into.
Making reference to the way divorce law has developed over the last few decades, and referencing Edgar v Edgar and Radmacher v Granatino, HHJ Booth sought to clarify the court’s position on the implementation of prenuptial agreements and that if enforcement of such an agreement would leave either party in a position of need, this fact would render the court unable to act upon the terms of the agreement. However, he noted, “the other side of the coin could be that where a husband who has nothing enters into an agreement that provides him with nothing that that represents a fair outcome”.
He concluded that if the couple’s prenuptial agreement were to be upheld it would clearly put the Husband in a position of real need and the only way of alleviating this need would be to contravene the terms by taking funds from the Wife.
Section 25 of the Matrimonial Causes Act 1973 requires the court to consider all circumstances of each case in respect of financial need and remedy. HHJ Booth ordered a transfer of 60% of the Wife’s pension sums, plus a lump-sum payment of £270,000 to be made to the Husband so that he could pay his debts.
Mrs S was also ordered to provide a fund for the purchase of a property in which Mr H could live, subject to a trust in favour of Mrs S so she would be able to recover the capital advance at such time that Mr H no longer needed the home.
When divorcing parties rely on a prenuptial agreement in their financial settlement case, a court will seek to determine whether both parties sought independent legal advice and whether that advice was suitable. The importance of instructing a family law specialist is therefore key.
Similarly, ff the court finds that a prenuptial agreement was arranged hastily, with very little time before the marriage occurred, this may be deemed to have resulted in pressure to sign and the court is unlikely to look favourably upon the contents of the agreement.
Lastly, the above case shows us the importance of full financial disclosure. The individual documents Mr H and Mrs S relied upon during their hearing were both rudimentary and contradictory and this was one of the main reasons the court felt the pre-nup had no merit.
Wellers Law Group family law specialists
Drafting a prenuptial agreement is complex and requires knowledge of the law as it applies to family cases. Wellers’ family lawyers offer a fixed fee, no obligation one hour interview so that we may provide you with initial advice and suggest the options for your next course of action.