What are they?
A pre-nuptial agreement is an agreement entered when a couple are preparing to marry. It sets out what they want to happen in relation to their respective and joint financial affairs in the, hopefully unlikely, event that their marriage breaks down.
There is a misconception that a pre-nuptial agreement is only for the rich and famous, but they are open to and commonly used by anyone. Some people want to ring-fence assets that they had prior to the relationship, or money that they bring into the relationship from family. Other people simply want to help make any breakdown in their marriage as amicable, cost-effective, certain and clinical as possible, for the sake of all concerned, and not least the children.
A post-nuptial agreement is just like a pre-nuptial agreement, but entered into once the couple are already married.
A cohabitation agreement is an agreement entered into after when a non-married couple decide to live together, and commonly when one person owns the property they live in, and the other does not.
Are they legally binding?
Pre-Nuptial and Post-Nuptial Agreements do not bind – not yet at least. However, they are something the Court will take into consideration, and increasingly will observe unless they think the agreement is “unfair”.
The landmark case of Radmacher v Granatino (2010) sets out the factors that must be met in order for the Court to consider upholding the agreement, these are as follows –
- The agreement must be freely entered into
- Both parties must have full understanding of the implications of the agreement
- It must be fair to hold the parties to the agreement given all the circumstances prevailing
Each party must have taken independent legal advice to explain to them how the agreement will affect them in the future if they were to have to rely on it, and there should be financial disclosure between the parties. There must be no pressure, from the other party or their family, to enter into the agreement (this is easier to show with a post-nuptial agreement as the parties are already married and so a party has not been forced to enter into an agreement before the wedding can take place). It is generally held, therefore, that a pre-nuptial agreement must be executed no less than a month before the marriage takes place.
When the Court will determine whether or not the agreement is fair ‘given all the circumstances prevailing’ they will consider whether or not the agreement meets the needs of parties. Does it cater for both parties to have somewhere to live if/when they separate? Does the agreement cater for any children of the family? These are issues that should be discussed with a solicitor when considering whether to enter into an agreement and the agreement should be revisited regularly in any event.
Cohabitation Agreements – likely that yes they do.
With non married couples, the Court’s sole concern is what the intention of the parties was, and how that intention has evolved. There can be no clearer statement of intent, than what two people have recoreded in a properly prepared Cohabitation Agreement, and so the couple can expect to be bound by it, unless they go on to marry, or have children together.
If you have any questions regarding the above and require further information in regards pre-nuptial, post-nuptial or separation agreement, or about any aspect of family law, do not hesitate to contact one of our solicitors on 0118 975 6622 (Lower Earley office) or 01491 570900 (Henley-on-Thames office)