Prenuptial and Postnuptial Agreements
This is contract drawn up between you and your future spouse / civil partner which sets out the agreement about how you would resolve financial / children matters in the event that you separate and decide to live apart. It is drafted, agreed and signed before you move in together.
Having such an agreement in place gives you peace of mind and is particularly useful in determining what you would intend to be treated as matrimonial and non-matrimonial assets, and how inherited assets should be treated between you.
The agreements are useful where one party brings to the marriage / civil partnership a higher level of financial wealth which has been accumulated outside of the marriage and which you want to protect from becoming a “matrimonial asset”. They are also useful where parties have children from other relationships and want to secure their children’s future inheritance.
Without such an agreement in place, if the relationship were to break down in the future, and an agreement could not be reached about how your finances should be separated, the Court would be asked to make the decision. There is a wide discretion for the court in determining such issues and the basic starting point would be a 50/50 split of all assets whether in joint or sole names. There are then other circumstances which the Court have to consider which may mean the Court will move away from this presumption of equality.
A lot of couples find that agreeing these issues are the start of a relationship is easier than trying to agree the issues at a stage when emotions are running high, such as at the time of separation. Whilst it is not the easiest thing to discuss either shortly before or immediately after a marriage or civil partnership, there is a growing trend for such agreements. It is a form of financial planning which enables you to decide how you want future financial matters sorted and will give you clarity, certainty and protection for the future.
Are prenuptial / postnuptial agreements binding?
The agreements are not binding on the Court and can therefore be overturned as the Court holds the discretion in deciding how to distribute assets. However as long as both parties have had independent legal advice, there has been full and frank financial disclosure and both parties have entered into the agreement freely and voluntarily, the Court would view the agreement as an important statement of evidence about a couple’s mutual intentions provided the agreement would achieve fairness for each of the parties.
What factors are considered when looking at the validity of an agreement?
- The overall effect of the agreement must be one of fairness.
- The agreement must be freely entered into. Neither party should feel any pressure to sign an agreement, and time needs to be given to reflect on the paperwork to ensure full understanding.
- Both parties must have separate independent legal advice and have a full understanding of the terms and implications of the agreement. Both parties have to give the other full disclosure of their financial position.
- Significant events may occur after an agreement has been agreed and signed such as the birth of children. It is important that a review clause is inserted into the agreement so the parties can from time to time, review the agreement to ensure that it reflects their wishes and is relevant to their circumstances.
Living Together Agreement/ Cohabitation Agreement
Living together agreements are not prenuptial agreements and will not be valid if you later decide to marry of form a civil partnership.
A living together agreement is a contract drawn up between you and your future cohabiting partner which sets out the arrangements about how you would resolve financial / children matters in the event that you separate and decide to live apart. It is drafted, agreed and signed before you move in together.
Despite a common misconception, the law does not recognise the term “common law wife or husband”. You will not have the same rights as if you were married or entered into a civil partnership. If a marriage or civil partnership ends and there is a disagreement about how the joint assets are to be divided, you can ask the Court to make a decision. The Court bases this decision of the presumption of fairness for each party. However, if you are living together and not married or in a civil partnership you do not have these rights, you only own something if you paid for it or if you received it as a gift or via inheritance.
The agreement will say that you intend to live together, and that you intend to share the responsibility for the children, confirm ownership or the tenancy of the property where you will live and who owns your possessions. It can also set out how you intend to meet your day to day living expenses and bills. It will set out your intentions if one of you dies, or if you later separate. The agreement may also contain provision for it to be varied at a later stage and under what circumstances it will be varied.
These agreements are not binding on the Courts and can be overturned, but on the basis that both parties have had independent legal advice, there has been full and frank disclosure and both parties have entered into the agreement freely and voluntarily, the Court would view the agreement as an important statement of evidence about your mutual intentions.
Living Together agreements are chargeable at hourly rates and a quotation will be provided to you at the outset. The current hourly rates charged by our fee earners are detailed on the main family page.
NOTE: The above is intended as a general overview for your information. It is NOT intended to replace proper legal advice. Each case is different and advice cannot be given without a proper analysis of your own circumstances.
THE FAMILY LAW TEAM
- Rebecca Sykes – firstname.lastname@example.org
Rebecca is assisted by Emma Anstey and Karen Lobley-Holland
- Leanne Gwinneth – email@example.com
Leanne is assisted by Kerry Welsh
- Hayley Jervis – Hayley.Jervis@dicksonssolicitors.co.uk
Hayley is assisted by Amy Williams and Karen Lobley-Holland
Please telephone 01782 26 24 24 for an appointment or alternatively email our team.