Postnuptial Agreements UK: How and why get one after marriage?
Last Updated:June 17th 2024 Table Of Contents
What is a Postnuptial Agreement?
A postnuptial agreement, or “postnup,” is a UK legal contract made after marriage to outline asset division, spousal support, and financial responsibilities if separation occurs. UK courts consider postnups legally binding if they are fair, offering clarity and security for both spouses.
Postnuptial agreements can be used when a couple has previously entered into a prenuptial agreement before marriage and wants to confirm that the choices they made still stand after getting married.
The aim of the postnup agreement is to keep individual assets separate rather than allowing them to become marital property within the ‘matrimonial pot’.
Thereby minimising the possibility of divorce-related financial disputes ending up at the mercy of divorce proceedings in court following a breakup.
It is strongly recommended that the agreement be reviewed and updated periodically, especially after the children are born, as the court will always consider the children’s needs such as child custody and support when deciding on a divorce settlement.
Are UK post-nuptial agreements legally binding?
In the UK, postnuptial agreements are not automatically legally binding; however, they are increasingly recognised by the courts, provided they meet specific criteria..
Courts in the UK have increasingly recognised the validity of postnuptial agreements, provided they meet specific criteria.
For instance, in the landmark case of MacLeod v MacLeod [2008], the court upheld the postnuptial agreement because it was entered into freely and met the necessary standards of fairness
The importance of legal advice was highlighted in the case of Radmacher v Granatino [2010], where the court emphasised that an agreement is more likely to be upheld if both parties were fully informed and advised. In the same case, a Judge ruled:
“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 prevailing it would not be fair to hold the parties to their agreement.”
What this essentially means is that:
- Each party should take independent legal advice before entering into a postnup and they should not feel under duress to sign.
- Both parties should understand the full extent of any financial claims they might be giving up by signing a postnup (eg any hidden wealth can reduce the effect of an agreement).
- There is an overriding duty of the court to ensure that the needs of both parties – in particular where children are involved – are met.
Hypothetical scenarios of why couples might consider a postnup
Scenario 1: Significant Inheritance
Sarah and Mark have been married for five years when Sarah receives a substantial inheritance from her late grandmother. Sarah wishes to ensure that this inheritance remains in her family and is not subject to division if she and Mark were to divorce.
How a Postnuptial Agreement Helps: a specific clause outlining that the inheritance will remain Sarah’s separate property can be drafted into the agreement. This clause protects the inheritance, ensuring it is not included in the marital assets subject to division upon divorce.
This agreement can also stipulate how any income or assets derived from the inheritance (such as interest or investment returns) will be treated.
Scenario 2: Second Marriage with Children from a Previous Marriage
John has recently married Emma, and it is a second marriage for both of them. John has two children from his previous marriage and wants to ensure that specific assets, including his house and a significant pension fund, are preserved for his children.
How a Postnuptial Agreement Helps: A postnuptial agreement can clearly define which assets are intended for John’s children and should not be divided in the event of a divorce.
This can include provisions ensuring that the house remains in John’s family and that the pension fund is designated for his children’s future. The agreement provides clarity and security for both parties, reducing potential conflicts.
Scenario 3: Business Ownership
Emily owns a successful business she started before marrying Tom. As the business grows, Emily becomes concerned about protecting her company in case of a divorce, particularly as Tom has no involvement in the business.
How a Postnuptial Agreement Helps: Emily and Tom can use a postnuptial agreement to protect the business. The agreement can specify that the business, its assets, and any profits generated are Emily’s separate property.
Additionally, the agreement can address how the business would be valued if it were ever included in a divorce settlement and stipulate that Tom will not have any claims to the business’s ownership or future profits.
Scenario 4: Change in Financial Circumstances
After several years of marriage, Lisa receives a significant promotion, resulting in a substantial increase in her income. At the same time, her husband, David, decides to leave his job to pursue further education. Both are concerned about how these changes will affect their financial dynamics.
How a Postnuptial Agreement Helps: Lisa and David can draft a postnuptial agreement that accounts for their new financial situation. This might include provisions on how Lisa’s increased income will be handled, how the couple will manage finances while David is not working, and how future assets or debts will be divided.
This agreement can help manage expectations and provide security for both parties.
Scenario 5: Protecting Future Financial Interests
Rachel and Steve have been married for several years and are considering starting a family. Rachel has substantial savings and wants to ensure that, if she steps back from her career to raise their children, her financial interests are protected.
How a Postnuptial Agreement Helps: A postnuptial agreement can include provisions that protect Rachel’s savings and ensure she is fairly compensated if the couple divorces after she has reduced her work hours or stopped working altogether.
This might include terms for spousal maintenance, ensuring Rachel’s financial security while she is not earning an income.
What is the Difference Between Prenuptial and Postnuptial Agreements?
| Aspect | Postnuptial Agreements | Prenuptial Agreements |
|---|---|---|
| Timing | Signed before marriage or civil partnership | Signed after marriage or civil partnership has already taken place. |
| Purpose | Updates or establishes financial arrangements after the marriage has begun | Sets out the financial arrangements in the event of a future divorce |
| Legal Standing | Similar legal standing to prenups; not automatically binding but can be upheld | Not automatically legally binding but can be upheld if fair and voluntary |
| Motivation | Typically used when financial circumstances change during marriage or to address unforeseen issues | Often used when one or both parties have significant assets, or in second marriages |
| Independent Legal Advice | Independent legal advice is also necessary to avoid claims of coercion or misunderstanding | Both parties must seek independent legal advice to ensure enforceability |
| Perception | Seen as a way to address and rectify issues or changes that arise during marriage. | Viewed as a precautionary measure to protect assets before marriage. Often seen as unromantic |
| Common Scenarios | Often used after significant life events like the birth of a child, inheritance, or business changes | Commonly used when entering a marriage with significant assets or children from previous relationships |
| Court Scrutiny | Courts apply similar scrutiny as with prenups but they also consider changes since the marriage | Courts consider prenups in the context of fairness and voluntariness at the time of signing and divorce |
| Amendments | Can be amended during marriage if both parties agree, reflecting current circumstances | Can be amended before marriage if both parties agree |
How do I create a postnuptial agreement?
Here is the exact process to obtain a post-nup agreement after marriage with our service:
1. Initial Discussion
First and foremost, it’s crucial for you and your spouse to have an open and honest conversation about why you’re considering a postnuptial agreement.
This isn’t always an easy discussion, but it’s important that both of you are on the same page regarding your financial goals and the reasons behind this decision. Whether it’s to protect assets, provide for children from a previous marriage, or address a change in financial circumstances, understanding each other’s perspectives is the key starting point.
2. Consultation with Independent Legal Advice
Each of you should have independent legal advice. This ensures that both parties fully understand the agreement’s implications and that it’s fair and balanced. As your solicitor, I would review your financial situation, discuss your objectives, and advise you on what should be included in the agreement.
Your spouse’s solicitor will do the same. Independent advice is crucial because it not only protects your interests but also strengthens the enforceability of the agreement in court.
3. Full Financial Disclosure
For the agreement to hold up in court, complete transparency is required. You and your spouse need to give full disclosure of your financial assets, liabilities, income, and expenses. This step is non-negotiable. You’ll need everything from bank statements and property valuations to any business interests.
The idea here is to lay all the cards on the table so that the agreement can be made with all the facts in front of you both.
4. Drafting the Agreement
Once we have all the necessary information, we’ll start drafting the agreement. This document will be tailored to your specific circumstances and future expectations.
It might include provisions on how assets will be divided, spousal maintenance, and the treatment of any inheritance or future income. During this stage, there may be some back-and-forth with your spouse’s solicitor to fine-tune the details, which is entirely normal.
5. Reviewing and Finalising the Agreement
After we’ve drafted the agreement, you and your spouse will need to review it carefully. I’ll walk you through each clause, explaining the implications and ensuring you’re comfortable with what’s been agreed upon.
If any changes are needed, we can make those adjustments before finalising. It’s important that both of you feel that the agreement is fair and that it protects your respective interests.
6. Signing the Agreement
Once everything is in order, both you and your spouse will sign the agreement, ideally in the presence of witnesses. This step formalises the agreement and makes it legally binding, provided it meets the necessary criteria.
It’s also a good idea to keep multiple copies—one with each of your solicitors and one for each of you, securely stored for future reference.
7. Periodic Review
Finally, it’s worth considering a periodic review of your postnuptial agreement, especially if there are significant changes in your circumstances—such as a change in income, the birth of children, or a major financial decision.
Keeping the agreement up-to-date ensures that the agreement remains relevant and continues to reflect your intentions.
How much does it cost to create a postnuptial agreement?
The typical cost for a solicitor to draft a postnuptial agreement is around £800 to £2,000.
The cost of drafting a postnuptial agreement can vary widely depending on the complexity of your financial situation and the level of legal advice required.
This cost can increase to over £5,000 if the agreement involves complex assets or extensive negotiations are needed.
The legal fees associated with drafting a postnup should be viewed as an investment in protecting your financial future. The cost of going to court for a divorce is five to ten times more expensive, sometimes even more.
Compare our service with other leading family-law providers
| Divorce-Online | Local Divorce Solicitors (UK) | Local Divorce Solicitors (London) | |
|---|---|---|---|
| Price? | £799 | £1800 | £2500 |
| Fixed-Fee? | Yes | Yes | Yes |
| Legal Advice? | Yes | Yes | Yes |
| Asset Limit? | £3M | N/A | N/A |
** Finer details of our service
Many family law solicitors don’t advertise their prices online and only offer fixed service services for the simplest of cases. Our fees are upfront and will save you hundreds compared to local solicitors. You don’t need to visit our offices, everything can be completed remotely from your phone or laptop. Legal advice is provided to one spouse as part of the fixed fee.
What clauses can I include in a postnuptial agreement?
Some of the common elements of postnups include:
- Matrimonial home – a couple may decide in advance who will be entitled to remain, or if the property should be sold if the marriage breaks down.
- Property portfolios and inheritances – note that inheritances or property owned before marriage are sometimes automatically kept out of the matrimonial pot.
- Maintenance – if one partner is in a stronger financial position, they may agree in advance to support the other party in the event of divorce.
- Savings, shares, and pensions – the full extent of these should be stated upfront.
- Businesses – particularly important if one party already has significant business interests before marriage.
Frequently Asked Questions…
Is there a time limit on signing a postnuptial agreement?
No, there is no specific time limit for signing a post-nuptial agreement. Couples can create and sign a postnup at any stage of their marriage, regardless of whether that is 12 months or 15 years.
Can I draft my own postnup without a solicitor?
Yes, you can draft your own postnuptial agreement if you live in England. However, there are important considerations to bear in mind if you choose to go this route.
Drafting your own postnuptial agreement in England can expose you to significant risks, including the possibility that the agreement may not hold up in court. Without professional legal advice, you might overlook essential legal requirements such as full financial disclosure, fairness, and proper legal language, which could render the agreement unenforceable.
Additionally, if the agreement is perceived as unfair or if one party does not fully understand its implications, the court may invalidate it.
The initial savings on legal fees could lead to costly disputes and complications in the future, making professional assistance highly advisable.
See more on this topic: Can You Write Your Postnuptial Agreement?
What if the financial circumstances of one spouse change significantly after the postnuptial agreement is signed?
Significant changes in financial circumstances, such as a job loss, inheritance, or substantial increase in income, may warrant a review and amendment of the postnuptial agreement.
It’s advisable to include a clause in the original agreement that allows for periodic reviews and adjustments in response to such changes. This ensures that the agreement remains fair and reflective of the couple’s current financial situation.
What happens if we don’t have a post-nuptial agreement?
Without a pre or postnuptial agreement, the division of assets and finances will be determined by the courts according to UK law. This process can be lengthy, costly, and uncertain.
Courts have wide discretion when it comes to determining financial settlements. A postnup agreement provides clarity and certainty, potentially avoiding contentious disputes.
What happens if my spouse refuses to sign the postnuptial agreement?
If one spouse refuses to sign, the agreement cannot be enforced. A refusal may stem from concerns about the fairness of the terms or from a lack of understanding.
It’s important to approach the subject with sensitivity and open communication. Consider involving a mediator or legal professionals to facilitate discussions and address concerns.
Ultimately, both parties must sign the agreement voluntarily for it to be valid.
Moving Forward
A post nuptial agreement can provide significant benefits to married couples. While not automatically legally binding, UK courts often uphold postnups if they meet certain criteria.
As a family law solicitor, I advise clients to seek independent legal advice to ensure their post-nuptial agreement is comprehensive, fair, and enforceable. This foresight can save considerable time, stress, and expense, providing both parties peace of mind.
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Author: Lara Jayne Davies
This post was written by Lara Jayne Davies. Lara is a family law solicitor specialising in Matrimonial and Private Children matters. She thinks creatively and cost-effectively to assist clients in achieving the best possible outcome whilst always providing the highest levels of client care.
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