Terry & Co.

Pre Nuptial Agreements

 


 

 

 

 

 

Despite the fact that pre-nuptial agreements are generally not regarded as binding by the English divorce courts there are some signs of change. One factor behind this is the increasingly international character of people's lives. Pre-nuptial agreements are sometimes recognised in other jurisdictions - notably the United States - and the English courts increasingly take notice of this.

 

Say, for instance, that a couple marry in the United States and enter into a pre-nuptial agreement prior to the marriage. Both parties are legally represented and the negotiations are at arms' length. Such an agreement very likely is legally enforceable in the US. Suppose then that the wife returns to England which is the country of her birth and commences divorce proceedings here. The husband might remain in the US and feel quite aggrieved that his wife is attempting to get around an agreement legally enforceable in the US by the simple expedient of petitioning for her divorce in England.

 

He therefore applies to the English courts for a stay of the divorce proceedings in England and files a divorce petition of his own in the US. In circumstances such as these the English courts have to decide which is "the most convenient forum" for the divorce to take place. In particular, they have to decide whether the divorce should be allowed to proceed in England or whether those proceedings should be stopped so that the divorce can take place in the US. They have to weigh a number of competing matters against others such as where the assets of the marriage are located, where the parties of the marriage are, what advantages and disadvantages attach to the divorce proceeding in one jurisdiction rather than the other etc.

 

The point is, there is at least one case in which the fact that the parties had entered into a pre-nuptial agreement in the other jurisdiction was regarded as one of the factors that should be taken into account in staying the proceedings here in order to enable matters to proceed overseas. The fact that the parties had entered into a binding agreement with independent legal advice was regarded as something the court could legitimately take into account in making its decision as to whether the divorce should proceed here or not. In that particular case the court decided that the case here should be stayed in order that the US courts could take jurisdiction and in those latter proceedings the pre-nuptial agreement would be taken into account and enforced.

 

Indeed, the court went rather further and expressed an opinion (although it was no more than this) that just because the English courts do not in general enforce pre-nuptial agreements it does not mean that other jurisdictions which do enforce them are necessarily wrong. This does indicate perhaps a straw in the wind and there is little doubt that people want to be able to regulate their own affairs. Government is also considering proposals on this subject although no firm conclusions have been reached.

 

Naturally, circumstances such as the above are uncommon and do not affect most marriages which take place between UK citizens and which have no overseas element. Nevertheless, this overseas aspect is becoming more common and affects more and more people as time goes on.

 

The fact that there are such cases may also be expected ultimately to have an effect on purely domestic marriages in certain circumstances. For instance, it has long been the case that the courts could take into account "any other matter ....which in the circumstances of the case the court may consider relevant". In practical terms this provision is almost always overshadowed by the needs of the children, the fact that there are not sufficient assets to make adequate provision for both parties, the income and earning capacity of the parties etc etc but it is not inconceivable that a pre-nuptial agreement might be a relevant circumstance in some cases.

 

This is first likely to arise in a case where both parties have had independent legal advice, entered into an agreement before the marriage and where a childless marriage has broken down within a year or two. Under such circumstances it is quite conceivable that a court might take into account a reasonable pre-nuptial agreement. So it is not quite true that pre-nuptial agreements are quite irrelevant in English divorce law. They may have a certain role under some fairly specific circumstances. They will be irrelevant to most people for the foreseeable future but that is not to say that they may not have some role for a small minority of marriages. The law here is probably in a state of development at the present moment.

 

Please contact David Terry at David_Terry@dterry.demon.co.uk if you need specific further information. Although pre-nuptial agreements are not generally enforceable in the English divorce courts there can be circumstances in which they become relevant particularly if there is an overseas element to the divorce.