Most of us are familiar with the phrases ‘whirlwind romance’ and ‘wedded bliss’ but I wonder how many couples discuss their financial position before marrying and agree what a financial settlement may look like on divorce?
There has been a lot in the press over recent weeks about Pre-nuptial Agreements and the role they may have to play in any future divorce settlement. At present these documents are not legally enforceable in a court. That is, however, only an issue if one or other party chooses not to follow the terms upon any future separation. The Family Courts are able to ‘have regard’ to any agreement in place on the basis that the document ‘goes to show the positions and intentions of the parties at the start of the marriage’
Any Pre-nuptial Agreement drawn up by a couple has two purposes: the first part will detail the individual assets and liabilities of each of the couple at the time immediately prior to the marriage. The second part will set out the intentions of the couple if they were to separate and divorce in terms of who takes what in terms of assets, monies and liabilities on any financial settlement.
An agreement may identify a number of different outcomes dependent upon various scenarios such as ‘if a marriage lasts more than 5 years …’ or ‘if the couple have children …’, or any other situation which may be relevant to the couple involved. Matters can become complicated when businesses or investments owned prior to the marriage grow in value during the marriage. What these agreements do not usually include is an intention as to assets wholly acquired during the marriage - in family law terms these are usually viewed as being in joint ownership – although there are many factors taken into account on agreement of a financial settlement.
Pre-nuptial agreements have often in the past been viewed as only being relevant for wealthy couples but I would say ‘not so’. Couples may not need to go so far as to execute an agreement , but I feel that it would be beneficial for many couples marrying these days to take the time to consider their individual circumstances and take some legal advice from a Family lawyer.
Examples of common circumstances which I see where a discussion prior to a marriage may be beneficial include such matters as where one of the couple is either part of a family business or has their own business, where one set of parents have provided monies for a deposit on a house, where one of the couple has an existing interest in another property, where there are already young children involved or where parents have made provision to avoid inheritance tax/care home costs by transferring their home to one of the couple.
A full Pre-nuptial Agreement may not be needed but many couples would benefit from understanding their position prior to marrying. For further information contact Angela Moores.
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