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I’m getting married this summer. My fiancée and I have been together for five years and we have a three year old daughter. I work for my family’s business, which is run by my father and is very successful. I am not yet part of the Board of Directors, nor am I a shareholder, but my father has told me that he wants me to become a Director of the company within the next five years or so, so that when he chooses to retire later on, I, together with my brother, will succeed him. My parents have expressed some concern about the fact that I am getting married, as they are worried about what would happen if my fiancée and I got divorced, in terms of how this could affect the family business and the shareholding I will eventually receive. My fiancée is not from a particularly wealthy background and our lifestyle is essentially funded by my family’s business, which has been operating for over 100 years now. I have been told that I should get a “pre-nup”, but I don’t know whether this will actually protect my family’s position.
Is this something I should consider?
A pre-nuptial agreement would, in my view, be essential for your circumstances. Pre-nuptial agreements (often referred to as a “pre-nup”) are agreements entered in to by a couple prior to the marriage which are designed to regulate the way in which financial matters on divorce would be settled if the unfortunate occurs. The strict legal position is that they are not, by the very nature, absolutely binding on the couple on divorce, but there are mechanisms utilised by family lawyers by which the enforceability of pre-nuptial agreement becomes sufficiently strong so as to be adopted by a Court if the agreement is otherwise challenged by one or another of a divorcing couple.
In your particular circumstances, I would suggest that if you choose to ask your fiancée to enter into a pre-nuptial agreement, attention should be laced on how you would propose to met her financial needs and those of your child (together with any children you may have with your fiancée in the future), rather than having an agreement which simply confirms what assets are “off limits” in any future financial settlement on divorce. It may be very tempting to simply have your fiancée confirm that she will not seek to include your family business within the assets to which the Court may otherwise have regard on divorce, but in my view, this may not go far enough to provide as much protection for your family that is presently possible within the confines of the current legal position, as the Court has jurisdiction to go behind that agreement if justified by needs , taking account of the standard of living you enjoyed during the marriage. A more considered approach to the situation would protect your family’s position. Therefore, in addition to the agreement covering all of the resources which would fall outside of the definition of “matrimonial assets”, I would suggest that specific detail be included as to the financial provision your finance could expect to receive on divorce (including for the children of the family, particularly if it is intended that your fiancée would be the primary carer for your children).
Ultimately, there is no precise formula that is applied when considering an appropriate outcome for financial matters on divorce; each case that comes before a Court is considered on its own facts. It is for this reason, amongst others, that while a pre-nuptial agreement can be considered persuasive and even conclusive in many circumstances, it is not possible to absolutely oust the jurisdiction of the Court in England and Wales. However, the more consideration that is given to different, reasonably foreseeable scenarios in which your fiancée and you could find yourselves, the more weight the agreement is likely to have on the outcome, if the unfortunate does occur and you have to refer back to the pre-nuptial agreement for application. I would suggest that you make an appointment to see a Solicitor as soon as possible, as you will need to allow yourself some time to negotiate the terms of the pre-nuptial agreement, which should be finalised with at least 28 clear days before your wedding, and with your fiancée having independent legal advice.