Prenuptial agreements are increasingly being used by couples across the UK who wish to protect their assets against any future claims from their spouse or civil partner. Essentially, they act as insurance policies that protect parties interests, and can be particularly useful for second or subsequent marriages and civil partnerships. But what are the conditions that are required to make a prenup valid? Can it be successfully contested in the future, and if so, under what circumstances? This article aims to provide all the answers.
What makes a valid prenup?
If you want to ensure your prenup is valid, the best possible way to do this is to guard against any challenges by following the criteria below:
- There has been full and frank disclosure between you and the other party before entering into the terms of the agreement
- Each party has taken independent legal advice before entering into the agreement
- The prenup was entered into no later than 28 days before the date of the marriage/civil partnership
- The agreement must be fair and contractually valid
- The prenup should not prejudice any children
- Both parties needs must be met
The prenup should include the provision for review at certain future events. This could be the birth of a child; if one party becomes seriously ill, you move into a larger or smaller property, or purchase additional property, for example. Although this term is not necessarily required to make a prenup valid, it is considered as being the gold standard.
If a prenup is not updated periodically, the original terms will stand. This means that it will not take account of any changes in the couple’s financial circumstances, assets, or family structure and could result in complications in the event of a divorce or dissolution. This could lead to an argument as to how relevant the prenup is, although it will be less of an issue if the divorce or dissolution is within a short time of the agreement being entered into, or the parties are older.
How long does a prenup last?
It is up to the couple in question to decide how long the prenuptial agreement will last. There tends to be two basic methods most commonly used:
- The prenup lasts indefinitely; or
- The prenup lasts for an agreed set period of time
Most couples decide to make their prenup last indefinitely, but if it better suits your circumstances to have a designated timeframe, this is just as acceptable. The only downside is if the period has ended, and the marriage subsequently breaks down. Here, neither party could rely on the terms of an expired prenup, although the court may view its terms to be advisory if there has been no material change in circumstances since its expiry date.
Can a prenup be successfully contested?
Prenuptial agreements are not automatically legal binding in the UK, but case law has shown that where a prenup meets the qualifying criteria, as set out above, if challenged, a judge is likely to uphold the terms. However, the court can reject a term within the prenup if any part of it is deemed unfair or prejudicial to any children.
The court is also extremely wary of prenups being forced upon partners who were not happy with the implications, but didn’t feel they could object. If it becomes clear that a prenup was signed under duress, there was coercion involved, or one party was suffering from poor mental health at the time of signing, it can sometimes raise enough doubt for a judge to question its validity.
Notwithstanding the above comments, it is possible to contest a prenuptial agreement. However, the person wishing to do so must demonstrate they have legitimate reasons. For example, agreements which may be contested could fall into one of the following areas:
- Children of the marriage are treated unfairly
- Any agreement that was signed when one party was mentally unwell, or being coerced (as mentioned above)
- If it can be evidenced that one or both parties didn’t completely understand the legal implications of the agreement
- An agreement with faked signatures or changes to the text after signing
Can a prenup be amended/updated?
It is possible to amend a prenup during the marriage or civil partnership. In fact, it should be encouraged, especially if financial circumstances change. However, just as the original prenup had to be signed and comply with certain criteria, so too will the newly amended/updated agreement. Hastily scribbled changes to the text simply won’t cut any ice with a judge.
What can be included in a prenuptial agreement?
A couple has very broad discretion to agree on the scope of their prenuptial agreement. You can include or exclude whatever financial assets you wish:
- Land or property, whether this is held in someone’s sole name or in joint names
- Savings held either jointly or individually
- Investments such as bonds, stocks, shares
- Inheritance, whether already received or expected in the future
- Pensions
- Income or earnings
- Business interests or ownership
- Debts, such as whether or not to share any debts you have
Anything you leave out of the prenuptial agreement will be shared as part of the divorce settlement in the usual way, with the starting point being 50:50. It is a good exercise, before entering into a prenup, to create an inventory of all the assets and debts you and your partner have, although in order for it to be valid, you will have to provide financial disclosure, anyway. It might be helpful to use the court’s Form E (used during divorce proceedings for full and frank financial disclosure) as a template, because this covers everything.
What cannot be included in a prenup?
While the court is happy to let couples include whatever they like when it comes to their finances, there are some things that are not allowed. For example, a prenup is unlikely to be upheld if it:
- Tries to allocate child arrangements, such as where the child will live, who they live with, and the level of contact with the non-resident parent
- Deprives a partner of their legal right to receive child maintenance
- Dictates someone’s lifestyle or other personal matters
- Contains any illegal or unfair clauses
- Contradicts a previous court order, such as an occupation order.
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