Post-Nuptial Agreements: What They Cover and Whether They Are Legally Binding

Everyone has heard of a pre-nuptial agreement, but what about a post-nuptial agreement?

It is possible to try and regulate what would happen in the event of a separation when you are already married, and have no intention of the relationship ending. A postnuptial agreement, sometimes shortened to a post nup, is the way to do it.

Why make a post-nuptial agreement?

• Perhaps one party’s parents are estate planning and wish to make a lifetime gift to try and save inheritance tax. Before they give such a gift they might want the recipient to take steps to protect that inheritance.
• Sometimes a couple manages to reconcile after a short separation. They will already have had a chance to consider the realities of a divorce, and as they are getting back together, they want to put in place a sensible and fair agreement while they are on good terms, in case the marriage does not work out, however much they want it to.
• A final example is where a prenuptial agreement has been signed but for one reason or another it was not completed at least 28 days before the wedding, which is sometimes considered best practice. To avoid any suggestion that one party was pressurised at the last minute, a post-nuptial agreement (in the same terms) is signed within, for example, 3 months of the marriage, when the parties are on more of an equal footing.

What can a post-nuptial agreement cover?

A post-nuptial agreement can set out which assets the parties consider to be marital and which they consider to be separate. Perhaps the family home might be treated as marital but their late grandmother’s bungalow might be kept separate. The parties can decide for themselves. They can also make provision for spousal maintenance, pension sharing or deal with issues such as which of them will remain in the family home. Some couples even use the same approach to agree what happens to the family pet.

Are post-nuptial agreements legally binding?

Much like other ‘nuptial’ agreements, they are not technically legally binding but can be very persuasive to the court as long as they are not unfair. The parties are already married and any existing entitlements would need to be taken into account when drafting the agreement. In order to try and persuade the court to place as much weight as possible on the agreement the following steps can be taken:

• There should be full and frank financial disclosure. Very recent case-law has confirmed this in the case of pre-nuptial agreements. This means each party confirming their assets, liabilities, pensions and income in full.
• The parties should take separate and independent legal advice to ensure that they understand the terms, and the legal implications of putting these into a post-nuptial agreement.
• As above, the agreement needs to be fair. Once there has been financial disclosure and legal advice, the parties can work with their solicitors to ensure that what is agreed is within the reasonable range of orders a family court could make.
• As with any contract, there must not be undue pressure to sign. For example, if a reconciliation is conditional on one person signing a post-nuptial agreement, this could be raised to demonstrate the pressure that person was under to save their marriage.

What if the parties separate after signing a post-nuptial agreement?

If one party wants to depart from what has been agreed, then either can still apply to the court for a financial order. If the post-nuptial agreement is fair and the circumstances in which it was signed are reasonable, with disclosure and legal advice, it is likely the court will uphold it in full or in part.

If an agreement is unfair and does not meet the parties’ needs, then in proceedings, the court is more likely to intervene to assist a party who might suffer undue hardship.

The family court retains jurisdiction, meaning it is not possible to tie the court’s hands, or stop the court from making any order it sees fit, in line with the law.

How we can help

If you need advice about how to protect assets by agreement in the event of a future separation, our family law solicitors can help. As experienced post nuptial agreement solicitors we will talk you through the options and draft an agreement that is fair, properly disclosed and built to carry weight with the court. Contact us to arrange a conversation with the family team.

Tel: 02920 291 704

Email: WiddowsMason@hcbgroup.com