A prenuptial agreement is a legal agreement that sets out how assets should be divided between a couple in the event of a divorce.
This legal contract is entered into before marriage, and sets out a couple’s rights regarding property, income, debt and other assets acquired individually (such as inheritance) or together (such as joint purchases).
The intention of a prenuptial agreement is to provide clarity and certainty around the arrangements in the event of a breakdown of a marriage, to save the uncertainty, time and stress of arguing about the finances at a later stage. Most commonly a prenuptial agreement is used to protect particular assets so that they can be ring-fenced and prevented from being shared.
A prenuptial agreement will be upheld by a court so long as it meets the qualifying criteria, which have been set by the Supreme Court and further reviewed by the Law Commission:
- The agreement must be freely entered into.
- Both parties must understand the implications of the agreement.
- The agreement must be fair.
- The agreement must be contractually valid.
- The agreement must have been made at least 28 days before the wedding.
- There should be disclosure about the wider financial circumstances.
- Both parties must have received legal advice.
- It should not prejudice any children
- Both parties’ needs must be met