Is a prenuptial agreement right for you?

Lawpack on May 12, 2020

Talk of the wedding of next year might have been blighted by the question – will William and Kate consider getting a prenuptial agreement?

Since the announcement of the Royal wedding, there has been much speculation about the different backgrounds of the young couple.

Speaking to the Mail newspaper on the Royal marriage announcement, the divorce expert Isabel Thornton told the paper: “In a more typical scenario, where two 28-year-olds are soon to be married and a substantial disparity of wealth exists, one set of parents would undoubtedly be marching their offspring to see the lawyers as soon as possible.”

In October, the Supreme Court ruled in favour of Katrin Radmacher, whose ex-husband Nicholas Granatino sued after he found out she was the heiress to a multimillion pound fortune.

The former couple had signed a prenuptial agreement in 1998 in Germany, in advance of their wedding.

The pre-nuptial agreement stipulated that neither party would seek financial gain if they chose to separate.

Nicholas Granatino, an investment banker turned Oxford academic, decided to instigate legal action following his discovery that Ms Radmancher is reportedly worth £106 million.

He claimed that he had not fully understood the implications of the prenup when he had signed it because it had been written in German.

In addition, Mr Granatino claimed that he had not received any legal advice on the prenup.

However, the Court chose to award Mr Radmacher only £70,000 annually, ruling that he was not entitled to a £9.2 million payout from his ex-wife.

The decision will have resounding implications for future cases, overturning the recent trend for high-profile divorce payments worth millions.

While prenuptial agreements have long been enforced across the US, English courts have largely chosen to ignore them.

It is expected that the decision to rule in favour of Ms Radmancher could mean that fewer couples decide to leave the outcome of a possible divorce to chance.

One of the best ways to approach the issue could be to purchase a prenuptial agreement with Lawpack.

Guaranteeing your pre-nuptial agreement with your partner will be upheld has become easier, but the devil remains in the detail.

Lawpack’s Prenuptial Agreement can tell you what to include and exclude in the prenup – couples attempting to allocate ‘taking out the bin’ days and other domestic duties can “run a very real risk” of making their prenup unenforceable.

A pre-nuptial agreement should primarily focus on what will happen to both your assets and your finances.

It can help people find out what they can do with the contents of their shared home, specific gifts, the overall cost of the prenup and what happens to property they have purchased separately.

While it may seem to interfere with the sacred and romantic notion of marriage, it can actually save much heartbreak and acrimony – whatever your income.

Investing in a Prenuptial Agreement from Lawpack could be an economical, sensible option that could save money in the long run.

Related Articles:

 

Published on: November 30, 2010

Pre-nups ‘on the up’

Lawpack on May 12, 2020

Prenuptial agreements have attracted considerable media attention over the years, particularly during high-profile celebrity divorces, such as that of Katie Price and Peter Andre.

Reports about their financial arrangements highlighted a question that many couples face before getting married: how can they protect their individual assets and agree in advance how their finances should be dealt with if their marriage ends?

A prenuptial agreement, commonly known as a prenup, allows a couple to record their intentions regarding financial matters in the event of separation or divorce. However, in England and Wales, a prenup is not automatically legally binding on a court, and its terms cannot guarantee a particular financial outcome.

Why are more couples considering prenuptial agreements?

Prenuptial agreements can be particularly attractive to couples who bring different levels of wealth into a marriage, own property, have business interests or wish to protect assets acquired before the relationship.

Economic uncertainty and concerns about financial security may also influence couples to consider making an agreement before they marry.

A prenup can help establish expectations about how assets and liabilities should be treated if the relationship ends. However, it is important to recognise that an agreement cannot necessarily prevent a court from making a different financial order if fairness requires it.

Are prenuptial agreements legally binding?

In England and Wales, prenuptial agreements are not automatically binding, but the courts may give them substantial weight.

Following the Supreme Court’s decision in Radmacher v Granatino in 2010, a court will generally give effect to a nuptial agreement freely entered into by both parties, with a full appreciation of its implications, unless it would be unfair to hold them to it.

The circumstances in which the agreement was made matter. Full financial disclosure, independent legal advice and sufficient time to consider the terms can all help demonstrate that both parties understood what they were agreeing to.

A prenup should not be viewed as a guarantee that neither party will be entitled to financial provision following divorce. The court retains its powers to consider the circumstances, including each party’s needs and any relevant children’s needs.

Cohabitation agreements: a different set of legal issues

Couples who live together without marrying or entering into a civil partnership face different legal considerations.

In England and Wales, there is no legal status of ‘common-law marriage’. Living together for many years does not automatically give an unmarried couple the same financial rights as married couples or civil partners.

Cohabiting couples should consider the legal arrangements governing their property, finances and inheritance. Depending on their circumstances, a cohabitation agreement may help record their intentions regarding household expenses, ownership interests and what should happen if they separate.

If they own property together, they should also consider how the property is legally and beneficially owned. A declaration of trust may be appropriate where they wish to document their respective shares.

Making Wills is also important because unmarried partners do not automatically inherit from one another under the intestacy rules in England and Wales. The position may differ where assets are jointly owned or other legal rights apply.

Can a DIY agreement provide protection?

A template can provide a useful starting point for couples who want to organise their financial arrangements. However, a DIY prenuptial or cohabitation agreement does not guarantee legal enforceability.

For a prenuptial agreement, both parties should ideally obtain independent legal advice, disclose their finances fully and allow sufficient time to consider the terms before the wedding.

For cohabiting couples, a suitable agreement should reflect their actual ownership arrangements and intentions. Legal advice is particularly important where property, substantial assets or complex financial circumstances are involved.

Although preparing information in advance may help manage legal costs, couples should not assume that an agreement will eliminate the need for legal advice or future court proceedings.

Can a prenuptial agreement make divorce easier?

A carefully prepared prenup may help narrow the financial issues that need to be resolved if a marriage ends. It can provide evidence of the parties’ intentions and potentially reduce disputes about the treatment of particular assets.

However, it does not automatically make a divorce straightforward or remove the need to resolve outstanding financial matters. A court may still need to consider whether the agreement should be upheld in the circumstances.

The same principle applies to cohabitation agreements: planning ahead may reduce uncertainty, but it cannot guarantee an amicable separation.

Planning ahead

Whether you are planning to marry or deciding to live together, discussing financial arrangements before making a long-term commitment can help both partners understand their position.

A prenuptial agreement may be worth considering if you are getting married and want to record your intentions about financial matters. If you are living together without marrying, a cohabitation agreement, appropriate property ownership arrangements and Wills may provide more relevant protection.

The best approach depends on your circumstances. Taking advice before entering into an agreement can help ensure that it reflects your intentions, addresses the right legal issues and gives both parties a clear understanding of their rights and responsibilities.

Related Articles:

 

Prenuptial agreements: All you need to know…

Lawpack on May 12, 2020

Prenuptial agreements are recognised in many countries, but in the UK they have a history of being seen as unromantic by couples about to embark on a life together.

Yet prenuptial agreements are increasingly being taken into consideration by the English courts when they are looking at financial settlements on divorce.

Find out more on when to use a prenuptial agreement, what a prenuptial agreement does and how to make it legally binding.

What is a prenuptial agreement?

A prenuptial agreement sets out the terms upon which you and your partner will separate or divorce. As you make a prenuptial agreement before you marry, the terms are agreed when there is no bitterness between you. So the costs of negotiating a prenuptial agreement are usually far less than the costs of negotiating a divorce settlement, because all the negotiation has already been made.

Want to make a prenuptial agreement? Use our prenuptial agreement download today and save £££s!

What can we include in a prenuptial agreement?

A prenuptial agreement should only deal with financial matters, and not with any personal issues regarding your relationship. If you include personal matters, the court may consider that some of the non-financial clauses render the whole of the agreement void.

What about children?

You should not include arrangements relating to the care of, and contact, with children in the prenuptial agreement. The courts will not bind a child into an agreement entered into by its parents.

A prenuptial agreement, which aims to set in stone arrangements for a child is unlikely to find favour with a judge, especially if it was agreed years before the separation or divorce.

Any agreement you may wish to enter which regulates the arrangements for your children, or other non-financial matters should be put into a separate document and not in the prenuptial agreement itself. This is to protect you from a situation where a judge finds the whole of your agreement unenforceable.

There is no special form for such a document; any simple written agreement setting out your arrangements will be sufficient for the court as evidence of your intentions, should you divorce or separate.

Want to make a prenuptial agreement? Use our prenuptial agreement download today and save £££s!

Is a prenuptial agreement legally binding?

As yet, not in every case, but they do hold great sway with the courts. A ruling by the Supreme Court over the German paper industry heiress Katrin Radmacher and her husband has given greater legal status to prenuptial agreements in divorce cases.

Since this judgment, it’s likely that a prenup will be binding providing that both parties have enough information about the other’s finances, and that they both fully understand what they are entering into and what the implications are.

Do we need to take legal advice when making a prenuptial agreement?

You both should ideally receive independent legal advice from a separate solicitor, and both should make full and frank financial disclosure, as it will be easier to persuade a judge to take the prenuptial agreement into account in any divorce proceedings.

When should we make the prenuptial agreement?

It is recommended that the marriage ceremony should take place at least 28 days after you both sign the prenuptial agreement. If you enter into the prenuptial agreement less than 28 days before the marriage, it is less likely to be persuasive on a judge, should you get divorced. A short time period between the making of the agreement and the ceremony can be construed as evidence of duress. This can invalidate the agreement.

Ideally, give your partner several months to consider and discuss the agreement with you. If you don’t get married within six to 12 months of signing the prenuptial agreement, you should draw up and sign another one

Want to make a prenuptial agreement? Use our prenuptial agreement download today and save £££s!

Does the prenuptial agreement need updating?

It’s recommended that you revise any prenuptial agreement at certain key points in your relationship to ensure that it’s up to date. You should revise it:

  • At regular intervals, for example, every five years.
  • If children are born.
  • If one of you becomes disabled or unable to work.
  • If one of you becomes redundant or unable to find work.
  • If one of you retires.
  • If one of you inherits any valuable assets.

This means that when one of the above events occurs, you and your partner should renegotiate the relevant terms of the agreement and enter into a new one (i.e. a postnuptial agreement). It doesn’t need to be a complete re-draft , but it should refer to your original prenuptial agreement.

Do you want to protect your assets? Find out if a making a prenuptial agreement is right for you…

Want to make a prenuptial agreement? Use our prenuptial agreement download today and save £££s!

With Lawpack’s prenuptial agreement you can complete the legal form yourself before taking legal advice and save £££s in solicitor’s fees.

Related Articles:

 

Do I really need a prenup?

Lawpack on May 12, 2020

Are you getting married and have assets you want to protect? Or have you been married before and are worried about going down the aisle again? Then have you thought about making a prenup?

More and more couples are making prenups before entering into marriage. Recently there has been a dramatic rise in the demand for prenups and, particularly, for second marriages. Recent research, carried out for the law firm Mishcon de Reya, found that 17% of men under 45 now have a prenuptial agreement.

Why are prenups becoming so popular?

High-profile divorces, such as McCartney and Mills, have brought prenups to the fore as now ordinary people are concerned about losing a large part of their assets in a settlement.

Partly this is because divorcees are more wary of getting married for a second time, plus they’re better off so they feel that they have more to lose. Adult children also suggest a prenup to protect their inheritance from their new step-parent.

Often couples use prenups if there is a disparity in wealth, say, if one partner earns a lot more than the other, or one partner has a house and the other doesn’t, or one partner has received an inheritance that they want to protect.

Want to make a prenup? Use our prenup download today and save £££s!

Will a prenup protect your assets if your marriage gets into trouble?

Many people view making prenups as a waste of time and an unromantic thing to do, but although they are not officially legally binding, at present, they are a persuading factor if a case goes to court.

If both parties have taken legal advice, the prenup has been signed at least a month before the wedding, the finances have been disclosed and the contract is deemed fair by the judge, the prenup is likely to be seen as legally binding.

In America and most of Europe, prenups are legally binding, but in the UK we’re playing catch up. However, a recent ruling by the Supreme Court over the German paper industry heiress Katrin Radmacher and her husband has given greater legal status to prenuptial agreements in divorce cases.

Plus the Law Commission, the government’s law reform watchdog, is looking at the circumstances in which courts should uphold prenups between those planning to marry or become civil partners.

The Law Commission aims to draw up a draft Bill by 2012, so prenups should be legally binding within the next couple of years.

Find out more about prenups becoming legally binding here.

Mike Hamlin, partner at law firm Slater Heelis Collier Littler, based in Sale, Greater Manchester, says that although prenups can be criticised for going against the traditional values of marriage, he believes that they simply address issues and protect the interests of both parties:

“Should the marriage end, there would be no need for bitter legal disputes over the dividing of assets” he said.

Assets that are acquired before the marriage and which have been disclosed have an increased chance of being protected if the marriage ends in divorce.

Want to make a prenup? Use our prenup download today and save £££s!

What terms should you include in a prenup?

If you’re making a prenup, it’s advisable that you don’t hold assets in joint names. If you’re going to purchase property in joint names, it’s wise that you register the property as ‘tenants in common’ and that you specify each party’s entitlement.

Find out more about how you should be buying property together here.

Remember that if you are planning to have children, it’s important that this is mentioned in the prenup because a child can change the parameters upon which the prenup was entered into. In fact, it’s always wise to revise your prenup, should you have any children since the making of the prenup.

Read more on when you should revise your prenup here.

Want to make a prenup? Use our prenup download today and save £££s!

With Lawpack’s prenup you can complete the legal form yourself before taking legal advice and save £££s in solicitor’s fees.

Related Articles:

 

Published on: October 25, 2010

What is a deed poll?

Lawpack on May 12, 2020

A Deed Poll is a legal form. Nothing more, nothing less. It is a legal form that binds you to a defined course of action. And that is to change your name.

That is all a Deed Poll is. A legal form to officially change your name.

Technically speaking ‘Deed Polls’ can be used for other purposes. But in popular usage a Deed Poll simply means a legal form that is used to officially change your name.

If you want to get really ‘legal’ you can say that a Deed Poll used to change your name should be called a ‘Deed of Change of Name’. But we’ll just call it a Deed Poll (it makes things simple).

  • Use our Deed Poll Kit to officially change your name right now!

 

What is on a Deed Poll?

A Deed Poll must contain just three statements. And you must ‘commit’ to these.

  1. To stop using your former name
  2. To use only your new name and to use your new name at all times
  3. To request that all persons use your new name only

You need to sign the Deed Poll. You need to date the Deed Poll. And you need to have your signature on the Deed Poll witnessed.

And that’s it! You have changed your name officially by Deed Poll.

  • Use our Deed Poll Kit to officially change your name right now!

 

Related Articles:

 

Published on: October 4, 2010

Cohabitation and your lack of legal rights

Lawpack on March 27, 2020

In today’s modern society marriage isn’t for everyone, and some couples prefer not to tie the knot. But marriage and civil partnership provides certain legal rights that cohabitation does not, even though figures show there are more than four million unmarried people living with a partner in England and Wales.

Calls for equality

Lord Justice Sir Nicholas Wall recently called for greater rights for cohabiting couples, claiming that under current laws unmarried men and women are at risk of losing their homes and their incomes in the event of a break-up.

As the president of the Family Division of the High Court, his demands have commanded attention, and the issue of equality for cohabiting couples has been thrust firmly back into the spotlight.

Specifically, he advocated the creation of a cohabitation law, which would give unmarried couples who live together the same legal rights as those who are married when it comes to division of property and other assets.

“I am in favour of cohabitees having rights because of the injustice of the present situation,” he told The Times newspaper.

“Women cohabitees in particular are severely disadvantaged by being unable to claim maintenance and having their property rights determined by the conventional laws of trusts,” Sir Nicholas remarked.

He claimed that courts are already being more sympathetic towards people who have lived with their partners for many years before their relationships come to an end.

And equally, he explained: “If cohabitation has been short and the contribution minimal, judges would not be sympathetic to a claim.”

Understanding your rights

Despite these changes in attitude, it could be some time before a cohabitation law is introduced. It is therefore important that those who choose not to marry, for whatever reason, understand what they are and are not entitled to.

Many cohabitees wrongly believe that they have the legal protection of common law marriage and that the longer they live with their partner, the more rights they have.

In fact, common law marriage is a myth and hasn’t existed in England and Wales since 1753. Legal rights for unmarried couples are minimal, regardless of whether couples have cohabited for one year or several decades.

So what rights don’t you have as an unmarried cohabitee that a husband or wife would have in the event of a break-up?

Maintenance

At the moment, if you have any children with your ex-partner, he or she must pay maintenance in the same way they would if you were married.

However, you are not entitled to any maintenance for your own benefit, even if you have given up work to take care of your offspring.

Property

If you rent your home with your partner and he or she asks you to leave following a split, you will have no rights to stay in the property if the lease is in their name.

Similarly, if your partner owns your home and there is no legal documentation in place to prove that you own any share in it, you will have no rights to remain in the house or reap any rewards from its sale.

Other assets

Partners who live together often have joint savings, investments and personal possessions. If you are married and you divorce, these assets are usually split equally. If you are simply cohabiting, things are much more complicated.

In essence, you have no legal rights to any assets that are not in your name and your ex is likely to walk away with all savings and possessions built up out of their own money.

Death

Although couples don’t like to think about it, the death of a partner is something that should always be taken into consideration when planning for the future.

Indeed, it may not always be a break-up that brings a partnership to an end. If one half of an unmarried couple dies, the surviving partner will again have few legal rights to property and assets.

Unless your partner has made a will, you will not automatically inherit anything from them in the event of their passing, regardless of how long you’ve been together.

You will also receive no state bereavement benefit of a state pension based on a percentage of their National Insurance contributions as a husband or wife would.

Furthermore, anything you do inherit through your partner will is subject to inheritance tax if it totals more than the current £325,000 threshold, as spousal exemption will not apply.

What can you do to protect yourself?

If you and your partner decide not to get married, there are still several ways you can protect yourselves legally.

For example, if you are renting a home together, it makes sense to put both names on the tenancy agreement.

If you are buying a home with your partner, or moving into one he or she already owns, you need to consider whether signing as joint tenants or tenants in common is the best option, as there are different legal rights associated with each.

If you are joint tenants then you jointly own the entire property, whereas if you are tenants in common you each have a distinct share in the property and can decide in advance how you’d like this share to be split.

Drawing up a cohabitation agreement will also enable you and your partner to decide what will happen to your property and any other jointly-owned assets should you separate or suffer a bereavement.

A cohabitation agreement can also contain arrangements for child maintenance and custody if you have children together, as well as details of your responsibilities with regards to debts and everyday outgoings.

While cohabitation agreements are not legally binding, they can often be enforceable in court if a couple sought legal advice before signing it.

A court will take into account whether both parties understood the nature of the agreement, whether they were both fully aware of its contest and whether they intended that it should be legally enforceable.

You should also write a will to make sure yours or your partner’s assets will be distributed in the way you choose, rather than leaving the state to decide.

According to the latest research from Unbiased.co.uk, some 62 per cent of people in the UK have not yet written a will, and this includes married couples.

For cohabitees, will writing is arguably more important, because the laws of intestacy, or dying without a will, do not take cohabitation into account.

Instead of passing to you, as would happen if you were married, your deceased partner’s estate would automatically be passed to their relatives, unless they specify otherwise in their will.

Is the law likely to change?

If Lord Justice Sir Nicholas Wall’s calls are heard by lawmakers, it could be some time before legislation providing equal rights for cohabitees is passed.

New laws take time to pass through parliament and implementation can be a slow process. In addition, there will always be those who oppose such a law on the basis that marriage should not be given equal status as living together.

However, cohabitation remains a hot topic and, in the same way as same-sex couples in civil partnerships fought to gain equal rights with married heterosexual couples, cohabitees are also demanding legal protection.

Related Products:

 

Related Articles:

Cohabitation: how to buy property together

Lawpack on March 27, 2020

When you first decide to live together and buy a property, romance is often at the forefront of your mind. The legal implications of living together may be the last thing you want to think about. You cannot imagine separating and may assume that, if things go wrong, the law will automatically protect you. But will it?

Many people believe that couples who live together have the same legal rights as married couples and that they are protected as a ‘common-law spouse’. In England and Wales, however, there is no legal status of common-law marriage, and living together does not automatically give you the same rights as marriage or a civil partnership.

Your rights to a property will depend on factors such as its ownership, any agreement between you and your partner, and the circumstances. It is therefore important to consider how you will own your home before you buy it.

If you are buying a property with your partner in England and Wales, ask your conveyancing solicitor to explain the difference between owning as joint tenants and tenants in common. The distinction is particularly important for unmarried couples because it affects your beneficial ownership of the property and what happens to your interest if one of you dies.

Joint tenants

If you own a property as beneficial joint tenants, you own the property together with equal beneficial interests. If one of you dies, the right of survivorship generally means that the property passes automatically to the surviving owner.

This happens regardless of whether the deceased partner made a Will leaving their interest in the property to someone else. The property passes to the survivor by survivorship, rather than under the deceased’s Will or the intestacy rules.

If one of you dies without making a Will, the surviving joint owner will generally still receive the property through this right of survivorship. This is not because an unmarried partner automatically inherits under the intestacy rules, but because of the way the property is owned.

You can find out more about intestacy and making a Will in our related guidance.

However, the right of survivorship applies to the property held as beneficial joint tenants, not automatically to all your other assets. An unmarried partner does not automatically inherit the deceased’s other assets under the intestacy rules. Although certain jointly owned assets may pass automatically to the survivor, other assets may pass to relatives or other beneficiaries under the applicable rules.

This is why it is important to make a Will and consider how your property, savings, investments and other assets should be dealt with if you die.

Tenants in common

If you own a property as tenants in common, you each own a separate beneficial share. These shares do not have to be equal. For example, you might own 60% of the property and your partner 40%.

This arrangement may be appropriate if you have contributed different amounts towards the deposit or purchase price and want your respective interests to reflect an agreed division. However, contributing more towards the purchase price does not automatically guarantee a larger share. Your intended ownership arrangements should be properly documented.

Unlike a beneficial joint tenancy, a tenancy in common does not carry an automatic right of survivorship. If one of you dies, their share will generally form part of their estate and pass according to their valid Will or, if they have no valid Will, the intestacy rules.

This means that your share could pass to someone other than your partner. If you want your partner to inherit your share, you should consider making a Will that reflects your wishes.

You can find out more about intestacy and making a Will in our related guidance.

Should you have a declaration of trust?

If you decide to own your property as tenants in common, ask your conveyancing solicitor whether a declaration of trust would be appropriate.

A declaration of trust can record each partner’s beneficial share and may set out how the proceeds should be divided if the property is sold. Depending on its terms, it can also address matters such as contributions to the purchase price, mortgage payments, improvements and arrangements if you separate.

A properly drafted declaration of trust can provide important evidence of your agreed ownership arrangements. However, the extent to which it protects you will depend on its wording and the circumstances. Your solicitor can advise you on how best to document your intentions.

You may also wish to consider a cohabitation agreement covering other financial arrangements if you separate.

Buying a property together in Scotland

Property ownership works differently in Scotland, so the terms ‘joint tenants’ and ‘tenants in common’ are not used in the same way as they are in England and Wales.

When a property is owned jointly in Scotland, the title deeds may include a survivorship destination. This is an arrangement under which a deceased co-owner’s share passes automatically to the surviving owner, rather than under the deceased’s Will or the intestacy rules.

If the property is held jointly without a survivorship destination, the deceased’s share will generally pass under their Will or, if they have no valid Will, the intestacy rules.

A survivorship destination can have significant consequences for both partners and their intended beneficiaries. The circumstances in which it can be varied or brought to an end depend on the title and the applicable law. Do not assume that it can only be changed by mutual agreement, or that it can always be revoked unilaterally.

If you are buying a property in Scotland, discuss your intentions with a Scottish solicitor before deciding how the property should be held. Make sure you understand what will happen if you separate or one of you dies, and whether the ownership arrangements reflect your wishes.

Protect yourself and your partner

Whether you are buying a property in England and Wales or Scotland, it is important to understand your ownership arrangements before you commit to the purchase.

Discuss the available options with your conveyancing solicitor, consider whether a declaration of trust or cohabitation agreement would be appropriate, and make a Will to explain what you want to happen to your estate.

Taking these steps can help you and your partner avoid uncertainty, reduce the risk of disputes and ensure that your wishes are properly documented.