Latest Ruling on Prenuptial Agreements

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A Judge of the Family Division of the High Court decided to give no weight at all to a Prenuptial Agreement, which featured in a divorce case, last week.

The case concerned an heiress of the Avon Cosmetics business. The parties lived together from January 2005 and married in November of the same year. They had two children and separated in 2017.

The Prenuptial Agreement provided that, in the circumstances which prevailed at the time of the divorce, the husband should receive half of the increase in value of three properties which were in the sole name of the wife in Barnes, Hanwell and New York. In fact, by the time of the divorce, the three properties had long since been sold and it was not possible to establish exactly what had happened to the proceeds of sale, but it was assumed that they had been invested in the family home in Barnes. That property was worth less than the combined value of the three properties at the time the parties signed the Prenuptial Agreement in 2005, meaning that the husband would receive nothing if the court upheld the Prenuptial Agreement.

The Prenuptial Agreement also provided that the agreement was deemed to have been made under the laws of New York State and that its validity, effect and construction should be determined in accordance with those laws, regardless of where either party resided or was domiciled at the time of the divorce.

The marriage took place on 26th November 2005 and the husband met the lawyer who advised him regarding the Prenuptial Agreement for the first time on 3rd November 2005. The lawyer was the lawyer who had acted for the wife in connection with her divorce from her first husband.

The Judge heard expert evidence to the effect that the agreement suffered from a fatal defect under the laws of New York State and therefore would not be upheld in that jurisdiction. For that reason and the facts that the husband had not received any advice on the law of New York State; the advice he had received could not be regarded as truly independent and the agreement did not meet the husband’s financial needs, the Judge had no hesitation in deciding to ignore the agreement. Instead, he awarded the husband a total of £1,333,500 – £375,00 of which would have to be repaid to the wife at a later date.

Our Head of Family Law, Joanna Toloczko commented:

“This case does not mean that Prenuptial Agreements are of no effect in English Law. What it means is that there are no short cuts in the preparation of Prenuptial Agreements and they must be prepared in the proper manner.

The provisions of the agreement must be broadly speaking fair and at least sufficient to provide for a party’s needs; both parties should have truly independent legal advice, with sufficient time for negotiation, free of the pressure of an impending wedding”.

For information and advice on all aspects of family law, please contact Joanna on 020 3861 5155 or at jtoloczko@meaby.co.uk.