Protecting Wealth with a Postnuptial Agreement

A strong marriage will have to withstand ‘for better and for worse’ if it is to last, and after the honeymoon is over the relationship will have to ride numerous ups and downs and changes in circumstances. Sometimes such challenges to a relationship might jeopardise current or future wealth and it may be advisable to consider a post-nuptial agreement.

This is a formalised legal contract between spouses or civil partners to deal with how assets and liabilities would be divided in a financial settlement should a future divorce or separation occur. Unlike a prenuptial agreement, this agreement is entered into during the course of your marriage or civil partnership.

The main benefit of a post-nuptial agreement is that it provides a couple with certainty and clarity on what would happen if their relationship breaks down, saving costs and time in court proceedings. An agreement can be used to stipulate not only what will happen to assets, but also liabilities.

A postnuptial agreement can be very flexible in the issues it covers. We have experience in securing privacy for our high-profile clients by including non-disclosure clauses. Additionally, if there is the possibility of an international divorce, which may be due to one or both of you previously having lived abroad or being foreign nationals that re-located to the UK, then we can specify that you intend for any divorce proceedings that may arise to be taken in the UK. This may shield you from harsh foreign laws over division of assets and save any lengthy legal battles over which country a divorce should occur in. This will be subject to you meeting the jurisdiction requirements in the UK which are discussed further here international divorce.

When might a post-nuptial agreement be beneficial?

A postnuptial agreement may be beneficial whenever there is a significant change in circumstances within a marriage or civil partnership which has potentially risky financial consequences. For example:

a married couple might wish to move to London for work or business purposes, and there may be concerns over the impact of an English divorce settlement compared to their home country;
the parents of one spouse may wish to transfer wealth to the next generation as part of their succession planning but wish to safeguard the gift in the event of a future divorce;
similarly, parents or grandparents may insist on an agreement before gifting money to help purchase property;
a high-earning spouse may decide to give up or reduce their earning potential to look after children and wish this to be recognised in any future financial settlement;

• where joint assets are put forward as security when one partner wishes to borrow money to invest in a business or venture;
• when gambling or excessive spending has become a problem for one person and is creating conflict in a relationship;
• when one person wishes to get divorced, but the other wants to negotiate a second chance;
• when making arrangements for a formal separation prior to divorce; or
• where you want to make arrangements for children from previous relationships by leaving assets to them, a post nuptial agreement can safeguard those assets from a divorce.

With more than forty per cent of marriages ending in divorce in the UK, while it is hoped that you will not have to refer to a post-nuptial agreement, having one in place can provide peace of mind.

When is a post-nup a good idea?

A post nuptial agreement can be used at any point during a marriage or civil partnership. If you are considering one, we recommend you seek early expert advice so that if your circumstances should suddenly change you will be protected.

How to ensure your post-nup is valid

• Post-nuptial agreements are not yet legally binding in England. However, the courts have shown that they will enforce the terms if the agreement has been entered into freely and is fair. To ensure that is the case there are a number of requirements that must be met, which are:
• you have each taken independent legal advice on your rights and the implications of the agreement;
• there has been a full disclosure of all assets and liabilities;
• the agreement allows for future family changes, such as what will happen if/when the family expands, or if
• someone becomes seriously ill and unable to work; and
• neither of you have been unduly pressurised into signing

The agreement also needs to reflect a fair outcome given the circumstances and duration of the marriage or civil partnership. Our team of expert lawyers has vast experience in this area of law and can advise you on the technical requirements needed to enable your agreement to be upheld by a court

What to expect from our lawyers

We are conscious that this can be a delicate subject for many couples. We have expert matrimonial solicitors in London who will handle your case sensitively.

One of our expert lawyers will talk to you about your circumstances and your objectives, and will advise you on the steps needed, including what financial disclosure you will have to make. Getting this information together quickly will help expediate your case.

We will then liaise with your partner’s lawyer and draft an agreement reflecting what you both agree, ensuring all formalities are followed. Our team of expert lawyers has vast experience in helping wealthy individuals, including expats, elite athletes and celebrities, to reach an agreement which provides peace of mind in regard to the financial implications of a divorce.

We will advise you on the technical requirements needed to enable your agreement to be upheld by a court, and we will deal with your case sensitively to ensure no ill feelings.

Your next step

Obtaining early legal advice is vital when entering a post-nuptial agreement, as delay could mean you are vulnerable if circumstances should change suddenly. We will usually be able to offer a fixed fee quotation, so there would be no hidden costs or nasty surprises.