Case illustrates how courts approach nuptial agreements

As is widely known, nuptial agreements (i.e. agreements between husband and wife, whether made before or after the marriage) are not binding upon the family courts of England and Wales.

However, 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 it would not be fair to hold the parties to the agreement.

Exactly how the courts approach nuptial agreements was neatly illustrated by a case that took place in the Family Court at Birmingham last July (the judgment in the case has just been published).

The case concerned a marriage that took place in 2013. At that time, the husband had quite substantial assets, and the wife had none. The husband wished to protect his assets, and a nuptial agreement was therefore entered into just after the marriage, providing that in the event of a divorce each party would retain their separate property.

The agreement also stated that if the parties were to separate after five years of marriage the husband would provide ‘modest freehold accommodation’ for the wife, and in the event that the wife should remarry, cohabit, or when any child of family reaches the age of 18 years or ceases full-time secondary education, the property should be sold and any surplus funds in the property shared between the parties equally in lieu of any maintenance provision for the wife.

The marriage broke down, and divorce proceedings were issued in 2022. The husband then issued a financial remedies application, claiming that the agreement was binding upon the parties. At this time the husband’s assets amounted to some £1.6 million.

The wife initially claimed that the nuptial agreement was invalid, as she had signed it under pressure. The judge found that the agreement was valid, as the wife was not forced to sign it, and did have the benefit of independent legal advice upon its terms.

The next question, therefore, was: was the agreement fair?

The judge found that some of the provisions of the agreement were fair, for example those relating to the husband retaining his premarital assets. However, the provision relating to separation after five years was not fair.

The final question, therefore, was: what was fair provision for the wife?

The judge based this primarily upon the wife’s needs, both in respect of housing and income.

As for housing, the judge found that the wife needed £350,000 to accommodate herself and the child of the marriage, plus £20,000 for furnishings.

As for income, the judge assessed that the wife needed £1,500 per month (in addition to her own income and child maintenance) for 4 years, which capitalised came to the sum of £72,000.

So it will be seen that, whilst the nuptial agreement was not binding, it did have the effect of ensuring that the husband retained most of his assets.

You can read the full report of the case here.

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