Pre-nuptial or pre-marital agreements provide a measure of financial certainty should an intended marriage not work out. Once married the assets of both parties become matrimonial assets which fall into the one pot for division on divorce with a starting point of an equal split. Entering into an agreement before the marriage is therefore a particularly important safeguard where the assets being brought into the marriage are unequal and for a spouse with property from a previous marriage or one who wishes to protect an inheritance to benefit their children.
The Family Court has an absolute discretion in financial claims on divorce and the division of assets which cannot be fettered by an agreement between the parties prior to the marriage. However, there is a strong movement towards making pre-nuptial agreements binding and they will be highly persuasive to a court asked to decide financial issues.
The law relating to pre-nups is developing. At present says a pre-nup will only be enforced if the parties entered into it voluntarily and fully understood what they agreed. Even then it may not be followed if at the time of the divorce it would not be fair to hold them to the agreement. The courts will not hold an agreement made before a marriage as fair if it does not meet their needs and the needs of the children on divorce.An exception to this can be an agreement that in the event of divorce a particular heirloom or treasured item should be retained. Such is likely to be respected so long as the court does not have to use that asset in order to meet the other spouse’s reasonable needs.
A judge is therefore likely to enforce a pre-marital agreement where:
• The parties understood the nature of what was being agreed.
• They took or had the opportunity to take professional advice before entering into the agreement.
• There was full financial disclosure before agreement.
• There was no pressure to agree and there would be no injustice in enforcing the agreement.
Our pre-nuptial agreement contains terms dealing with all the requirements needed to make it legally enforceable. It contains the intended spouse’s personal information and ownership of property prior to the marriage. Agreed arrangements for living expense and financial support are included. Optional clauses deal with issues such as:
• Bank accounts
• Business ownership.
• Prohibition on gifting assets
and other terms to protect the parties interests.