Pre-wedding checklist: should I get a pre-nup?

Pre-nuptial agreements (“pre-nups”) are agreements entered into by parties, prior to marriage, that are designed to govern their financial arrangements (to include, principally, asset division, lump sum payments and maintenance) in the event there is a permanent breakdown of the relationship. Their rationale? To avoid costly and acrimonious litigation in the future and, thus, an insurance policy of sorts. They are becoming increasingly popular and are no longer considered the preserve of the rich, with research from early 2023 showing that people are more likely to see pre-nups as a good idea (42%) rather than a bad one (13%).

Often, a pre-nup is an automatic consideration for those entering into a marriage with considerably greater wealth (or wealth potential, i.e. through prospective familial gifting and/or inheritance) than their spouse-to-be. For instance, pre-nups are regularly instigated following discussions with family members who are keen to protect inherited and gifted monies.

A common misconception, which still remains, is that pre-nups are contractually binding and that is not presently the case. However, there has been a developing body of case law over the last 13 years which has provided welcome clarity on pre-nups, principally that, properly entered into, they are very likely to be upheld.

The ground-breaking Supreme Court case of Radmacher v Granatino [2010] marked a turning point with pre-nups, in that they were formally recognised as a means by which parties could address their finances on divorce. Radmacher focused on autonomy and moving with the times, the Supreme Court ultimately concluding that it should give effect to pre-nups that are freely entered into by each party with a full appreciation of its implication unless, in the circumstances prevailing, it would not be fair to hold the parties to their agreement.

In 2014, the Law Commission, largely echoing (and building upon) the core principles espoused in Radmacher, recommended legislative reform to make pre-nuptial agreements that are in a prescribed form, and adhere to certain safeguards, legally binding. The key criteria can be summarised as follows:

1. Pre-nups must be contractually valid.
2. Pre-nups must be entered into no less than 28 days prior to the wedding or civil partnership ceremony.
3. Both parties must provide to the other full disclosure of their financial situation.
4. Both parties must have received independent legal advice at the time they entered into the pre-nuptial agreement.
5. The pre-nuptial agreement cannot prejudice the needs of any child of the family.

Whilst the Law Commission’s recommendations have not yet become law, it is accepted that, provided any pre-nuptial agreement complies with the key criteria above, it is almost certain that the parties will be bound by the pre-nup on a subsequent breakdown of the relationship.

The recent case of MN and AN [2023] EWHC 613 (Fam) simply cements the importance of pre-nups further. Within his judgment, Mr Justice Moor emphasises that pre-nups are not to be ignored if entered into correctly, which is welcome news to the increasing number of those who have entered into an Agreement before marriage.  

MN v AN centred on a wife’s challenge to a pre-nuptial agreement in that she did not want to be held to the level of provision it provided and was essentially seeking more money. She argued, amongst other things, that (i) the husband had pressured her to enter into the pre-nup as he made it clear that there would be no wedding unless she signed; and (ii) the pre-nup was entered into prior to the decision in Radmacher.  The wife also argued that the Agreement was not fair as it did not meet her reasonable needs (a concept that, frankly, lacks clarity/certainty).

In finding that the wife should be bound by the pre-nuptial agreement, the key takeaways are thus:

1. It is not unfair or undue pressure to state that the marriage would not have taken place in the absence of a pre-nup, as the husband asserted.
2. A judge will still need to perform a review against the factors which the court would be compelled to consider in the absence of a pre-nup upon divorce (known as ‘the section 25 factors’) to see whether there is anything in the Agreement which leads them to decide it should be varied or amended. Usually, the key question here is: does the provision in the pre-nup meet the weaker financial party’s needs?
3. It was of no consequence that the pre-nup was signed (long) before the decision in Radmacher. This principle will apply to any pre-Radmacher pre-nuptial agreement.
4. Whilst a judge must give first consideration to the welfare of any children of the family, those children’s needs are not necessarily paramount.

The judgment in MN v AN has given family lawyers further clarity on this topic so they can advise clients with more certainty of outcomes; it recognises that pre-nups are on the rise, and it is positive to see that they continue to be respected and upheld by the courts with increasing clarity of guidance.

If you are interested in a pre-nuptial agreement or have any further questions regarding the above, please contact Tom Quinn, Jennifer Headon or Lauren Guiler for an initial call who would be very happy to assist with your query.