Prenuptial and Postuptial Agreements

A postnuptial agreement (or postnup) is similar to a prenup, but it is made after a couple is already married.    

Postnups often serve the same purposes as prenups, but they can also be used to update or create a financial arrangement in response to changes in the couple’s financial situation, such as the birth of a child, an inheritance, or changes in business interests.

In English law, prenups and postnups are not automatically legally binding. However, since the landmark case of Radmacher v Granatino (2010), the courts have increasingly upheld these agreements, provided certain conditions are met.  The court will consider a nuptial agreement as part of the overall financial settlement, especially if it is fair and both parties fully understood its implications

The court will look at several factors to determine whether a prenup or postnup should be enforced. The agreement will be more likely to be upheld if:    

Voluntary agreement: Both parties entered into the agreement freely and voluntarily, without pressure or coercion.  
 
Full financial disclosure: Both parties provided full and frank disclosure of their financial situation (including assets, income, debts, and liabilities) before signing the agreement.    
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Independent legal advice: Both parties received independent legal advice about the agreement’s implications before signing it.    

Fairness: The agreement must be fair and not leave one party in a position of serious financial need, especially concerning children’s welfare.    

Timing: For prenups, it is important that the agreement was signed well before the wedding (to avoid claims of pressure). However, it is not critical to the process so long as all of the other conditions are met. For postnups, the court will consider when and why the agreement was made.

The court considers all assets when making financial orders, including:

Protecting pre-marital assets:
‍To ring-fence assets owned before the marriage, such as family businesses, property, or savings.
 
Inheritance protection:
‍To protect family wealth and ensure that certain assets remain within a family, particularly in second marriages.  
 
Business protection: To safeguard business interests and ensure that one spouse cannot make claims on the other’s business assets in the event of divorce.  

Clarifying financial expectations: To avoid disputes over financial settlements if the marriage ends, especially if one party has significantly more wealth than the other.

The courts place a strong emphasis on fairness in financial settlements. A prenup or postnup that unfairly disadvantages one party, particularly in terms of meeting basic financial needs (e.g., housing, living expenses), may be disregarded by the court.

The welfare of any children of the marriage is paramount. A prenup or postnup that fails to make adequate provision for children will not be upheld.

The 2010 Supreme Court case Radmacher v Granatino was a turning point for nuptial agreements in England and Wales.

The court held that “the court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications unless, in the circumstances prevailing, it would not be fair to hold the parties to the agreement.”    
Since then, courts have shown a willingness to uphold prenups and postnups, provided they meet the criteria of fairness, full disclosure, and voluntary agreement.
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While nuptial agreements can address a range of financial matters, they cannot address issues outside the financial realm, such as:    

Child custody or visitation arrangements: These decisions are always made in the child’s best interests and cannot be pre-determined by an agreement between parents.    

Child maintenance: The amount of child maintenance cannot be settled in a prenup or postnup, as this is determined by statutory guidelines and is subject to review based on changing circumstances.

Prenuptial and postnuptial agreements should account for the possibility of changes in circumstances over time. For example, an agreement that is fair at the time of marriage may become outdated due to factors like the birth of children, a significant increase or decrease in wealth, or health issues.  In such cases, the courts may adjust the terms of a nuptial agreement to reflect these changes.

A prenup or postnup can be challenged in court if:     

One party was pressured into signing the agreement
One party did not fully disclose their financial situation.    
The agreement is unfair or does not meet one party’s needs or the needs of any children.    
Circumstances have changed significantly since the agreement was made.

To maximise the likelihood that a prenup or postnup will be upheld by the court, it’s important to follow certain best practices:    

Ensure that both parties have had independent legal advice before signing.    
Allow sufficient time before the wedding (for prenups) to avoid the appearance of pressure or haste.    
Ensure full financial disclosure from both parties.    
Review and update the agreement as circumstances change (e.g., birth of children or significant financial changes).

The cost of drafting a prenup or postnup can vary depending on the complexity of the couple’s financial situation and the level of negotiation involved.

Typically, each party will need their own solicitor, and the fees can range from £1,000 to £5,000 or more.    

While this cost may seem high, it can provide long-term savings by reducing the risk of protracted litigation in the event of divorce.