It is not just a romantic streak, or our famous English reserve, that discourages English couples from entering into pre-nuptial agreements. The reality is that pre-nuptial agreements are not currently legally binding in this country. Neither are the equivalent for civil partners, sometimes known as pre-cips

Our European counterparts are not necessarily less romantic. The situation is different across the Channel, as is the whole basis of their legal system. As a result their pre-nuptial agreements tend to be more limited in scope, but they do have the force of law behind them.

Pre-nuptial agreements are part of the cultural and legal landscape in the rest of Europe, unlike in England. However, the English Courts do support proper and fair agreements that have been reached by adults with competent legal advice providing that they do not result in injustice. This has been the case since the early 1980s, but it is only since the divorce landscape changed dramatically in 2000, following the case of Mr and Mrs White, and again in 2006, following the case of Mr and Mrs Miller that they have become more influential and also more popular. However, it is the more recent experience of one couple, late last year, which may encourage a real shift in the popularity of pre-nuptial and pre-cip agreements in the UK, as the courts give increasing weight to pre-marital intentions.

The "Magnetic" pre-nuptial agreement

In their pre-nuptial agreement the couple agreed to keep their own fortunes if they separated: hers of £18 million, his of £45million. When their marriage foundered the wife challenged the pre-nuptial agreement on the basis that her husband had withheld relevant financial information, usually a key element in ensuring a pre-nup has any validity. Her lawyers argued that he should provide the detailed financial information usually required in a divorce case. The Judge disagreed. He ordered the couple to provide only summary financial information and decided that the wife had to show why the pre-nuptial agreement she had agreed in November 2005 was not a "knockout blow".

'The QC disagreed. He ordered the couple to provide only summary financial information and decided that the wife had to show why the pre-nuptial agreement she had agreed in November 2005 was not a "knockout blow".'

She tried unsuccessfully to appeal the Judge’s decision. The Court of Appeal Judges decided that the combination of the pre-nuptial agreement, the shortness of their childless marriage, and their substantial independent wealth meant there was a very strong case that she should receive no financial settlement from her now ex-husband. The Court of Appeal described this as "a paradigm case in which….the prenuptial agreement (is) not simply one of the peripheral factors… but a factor of magnetic importance".

This groundbreaking experience is proof that, in the right circumstances, the English courts will be strongly influenced by pre-nuptial agreements despite them not being legally binding. In this case it also resulted in the court process being streamlined, and so cut short what otherwise might have been a lengthy and costly legal battle.

What makes for a persuasive pre-nuptial or pre-cip agreement?

1. The agreement is completed after the couple has each received independent legal advice, so it is clear that they understand what they are signing up to and the long-term implications.
2. They disclose their financial situation so that both of them know what they may be giving up, or sharing with each other, in the future.
3. Neither is put under undue pressure to sign the agreement.
4. The details of the agreement should not be obviously unfair or contrary to public policy.
5. The agreement should be finalised 21 days before the marriage or civil partnership agreement, but post-nuptial or post-cip agreements can be agreed after the ceremony has taken place.

When should you consider a prenuptial or pre-cip agreement ?

There may be specific issues to consider :

• Assets to be ring fenced, such as inheritances or business interests,
• Children from a previous relationship to be provided for separately.

The process may help to focus a couple’s mind on important issues for their future lives together such as whether they both wish to have children.

'This groundbreaking experience is proof that, in the right circumstances, the English courts will be strongly influenced by pre-nuptial agreements despite the fact they are not legally binding.'

It may also allow couples to take more responsibility for ordering their own lives and allow them to "tailor make" their own law. England is currently seen as the divorce capital of the world with financial settlements often more generous then elsewhere. Some claim that the current law does little to encourage those with significant assets to marry or enter into civil partnerships. However, a pre-nuptial or pre-cip agreement allows couples to agree to on what they believe is a fair settlement if they go their separate ways.

For some couples there may be a choice as to which country’s laws decide their financial settlement if they separate. A pre-nuptial or pre-cip agreement can set out which law the couple feel is most appropriate.

Why you should still beware of a pre-nuptial or pre-cip agreement?

1. They are still not legally binding here.
2. It may be a difficult issue to discuss.
3. If a couple have interests abroad the situation is more complex.

How much will a pre-nuptial or pre-cip agreement cost?

It will be different in each case and depends on the assets involved. In the aforementioned case, the husband allegedly spent £20,000 on the prenuptial agreement that protected the assets that he had built up in the region of £45 million.

Will the law change on pre-nuptial and pre-cip agreements ?

No change in the law is likely at the moment. However, in certain cases pre-nuptial agreements may still be a "knockout blow", even if they are not legally binding.

So does this mean that we will become more like our European neighbours? At the moment the jury is out.

Emma Ries is a Family and Collaborative Lawyer and Partner at Kingsley Napley. For further information please email eries@kingsleynapley.co.uk or call 020 7369 3785