New legislation which enables couples to decide how their finances are divided after the breakdown in their marriage or civil partnership could lead to a surge in interest in pre-nuptial agreements, according to a leading Swindon-based family lawyer.
Plans to enshrine pre-nuptial agreements in law took a step closer today after the Law Commission – the independent body responsible for reviewing and recommending legal reforms in England and Wales – submitted its report on matrimonial property, needs and agreements.
Under the terms of the report, which ‘considers the treatment of pre-nuptial, post-nuptial and separation agreements’, couples could effectively set the terms of a divorce before they get married.
Adoption of the Law Commission’s proposals by the Government could see assets that are brought into a marriage by either spouse being ring fenced to avoid them being shared in the event of the couple divorcing. The area of spousal maintenance could also undergo a considerable shake up.
Fiona Kellow, Partner and Head of Private Client at Thrings, whose offices in Swindon are on Drakes Meadow, believes the introduction of legally-binding pre-nuptial agreements will not only provide greater clarity for both parties, but should also lead to a reduction in the number of protracted litigation cases.
Fiona said: “Pre-nuptial agreements have increased in popularity recently, but as they have not been legally-binding, courts have still had the power to intervene and make orders if they consider the agreement to be unfair.
“Legally-binding pre-nuptial agreements, which will be known as Qualifying Nuptial Agreements, would give clarity and certainty to married couples about what will happen to their finances if the relationship does not turn out to be ‘happily ever after’. The court would be bound to uphold agreements, provided they meet specific requirements. The Law Commission has itself also stated that qualifying agreements could not be used by the parties to contract out of meeting the financial needs of each other and of any children.
“Court battles arguing about who should get what may very well become a thing of the past as a result of couples having already agreed on those arrangements before they marry.”
Fiona believes people who are about to enter a marriage or civil partnership for the second time should also consider the possible implications the Law Commission’s report.
She added: “Statistically, second marriages are less likely to end in divorce than first-time marriages. But last year, second marriages accounted for 15 per cent of the 247,890 marriages in the UK, an overall increase of 1.7 per cent, including a noticeable rise in the number of couples in their late fifties and sixties marrying for the second time. With one or both spouses often having significant assets from their previous relationship, pre-nuptial agreements could prove particularly useful.”