So you think you know about prenuptial agreements?
22nd October 2010
The Radmacher case is all over the media. Basically, a German heiress has succeeded in defending a claim by her husband that a pre-nuptial agreement signed prior to their marriage in 1998 should be set aside. Accordingly, the pre-nuptial agreement was allowed to stand.
The Supreme Court ruling upholding a pre-nuptial agreement is newsworthy because English courts have always been very suspicious of them. Indeed, many people think of them as an American concept, or at the very least unromantic. Because so many people think that English Law applies to the whole of the UK (and the media doesn’t help that assumption), even many Scots believe that pre-nuptial agreements are not binding in Scotland. Whilst this may have been the case in England at one time, it is not the case here!
Pre-nuptial agreements have often been described here as “ante-nuptial” agreements or “marriage contracts”. Scottish courts have traditionally often treated them like most other contracts. One argument is that if you entered into it freely and it was fair and reasonable, then why shouldn’t the Court enforce it?
A party can challenge the agreement, but they would ordinarily need to prove, for example, under s16 of the Family Law (Scotland) Act that it was “not fair and reasonable at the time it was entered into”.
Even when people realise that pre-nuptial agreements can be used in this country, they still often do not think of them as something relevant to them. Katrin Radmacher was a millionairess many times over with a substantial income and many consider these agreements to be for people like her; the super-rich. However, people are marrying later than they ever have before meaning they have more complex property arrangements in place already. A simple example would be where the wife already has a property before marriage. If this property is sold during the marriage and used to buy another property, the husband would have a claim on divorce despite the fact that the wife contributed most of the funds from something she had bought before they even met. They could have contracted prior to marriage that the matrimonial assets were to be split but that the value of this property was to remain outside the negotiations.
Having said that, there are pros and cons to pre-nuptial agreements and they have to be carefully drafted by a solicitor with family law experience.
If you wish to contact me to discuss this area or any other aspect of family law, please feel free to e-mail me or call me on 0141 229 0880.
One last point - even if you are not thinking about pre-nuptial agreements, and whether or not you have any family issues, one way to plan for the future and give you peace of mind is by making a Will. Even if you already have a Will, it is best to review and update your Will from time to time. Feel free to contact me to discuss a Will with you.
Gus Macaulay,
Inksters.
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