Are pre-nuptial agreements worth signing? | 22 June 09
Sarah Crilly, Associate and Family Law expert at law firm Ward Hadaway, examines the strength of pre-nuptial agreements in the light of the recent separation of Katie Price and Peter Andre.
The recent high profile separation of celebrity couple Jordan and Peter Andre has once again brought into question the worth of pre-nuptial agreements.
It is widely reported that Andre signed a pre-nuptial agreement waiving any claim he may have in Jordan’s reported £40m fortune should they divorce.
While some areas of the press say he will stand by that agreement, the fact of the matter is that he can still challenge the agreement as pre-nuptial agreements (or ‘pre-nups’) are not binding in English Law as they are in the United States.
In recent years there has been a spate of cases involving the effectiveness of these agreements. Judges are enforcing pre-nups more regularly and courts are taking them more seriously.
Where parties have entered into pre-nuptial agreements and later divorce, then it is up to the party seeking to get out of the agreement to apply for financial relief.
The court will let the process run and will only assess the agreement at any final hearing if the parties have been unable to reach a compromise in the meantime.
The court will simply consider the pre-nup as one of the factors it has to take into account in all the circumstances of the case.
In short, childless marriages, the courts have allowed such agreements to stand but in Katie and Peter’s case they have had two children together. Peter also appears to have taken on Katie’s first child, Harvey, from a previous relationship and treats this child as his own.
Although no one knows the true legal issues that are being raised between them, it does seem certain that Andre will want to share Residence of the children and certainly will have contact.
This will provide him with a very strong position with which to challenge the pre-nup as he will have to provide a similar standard of living for the children to that of his wife.
The courts may decide that if Katie is to be the main carer of the children and their care is not to be shared then the pre-nup should stand.
If both of them received independent legal advice and there was full disclosure as to their respective worth at the time of the agreement then a court is more likely to enforce it.
A couple embarking on marriage may wish to consider entering into a pre-nuptial agreement in the following circumstances:
- Where there is a significant disparity in the extent of the assets that each of the parties is bringing to the marriage;
- Where one of the parties owns or has a share in a family business or a share in a family trust and is anxious to ensure that control remains within the family;
- Where one of the parties has acquired or expects to acquire significant assets in the future by way of inheritance or distribution from a trust;
- Where there are substantial assets overseas;
- Older couples who are not going to have children
For a couple embarking on marriage, a meeting with separate lawyers to negotiate what beloongs to each party is hardly romantic but the potential benefit to the parties in protecting their assets is too important to ignore.
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