Prenuptial Agreements in UK - Essay Example

?Prenuptial agreements in the UK Marriage is an that has been through a lot of scrutiny in the recent days. This has been caused by the messy divorce cases that are in courts every day. It is always hard for courts to determine how assets are going to be shared. When the court or a decree of nullity of marriage grants a decree of divorce or of judicial separation, it has the power to make an order of ancillary relief1. This is the financial arrangements between the couple in case their marriage breaks down. There are times when the couples have already made these arrangements. Couples can make the arrangement after they have decided to get married but they have not solemnized their marriage. The appellant and respondent of this case entered into an ante-nuptial agreement in Germany. The agreement was, therefore, subject to German laws stated that no one was to benefit financially from the other during the marriage or in case of its termination. The husband was a banker, and the wife was a rich heir. The agreement was valid and had enforceability in German and French law. They solemnized their marriage in London in 1998 and lived there. They had two kids but, in 2006, they separated. Their divorce case was held in English courts that held that prenuptial agreements were not enforceable, and they were against public policy. High court held in favor of the husband by granting him 5.5 million pounds. Radmacher appealed to the court of appeal, and it was held in her favor. Judges said the prenuptial should have been given decisive weight. The husband only way to be granted provision was through his role as a father and not in his own capacity. The husband appealed to Supreme Court, which held in favor of the wife. The ruling of this case carries a lot of weight on how decisions on financial relief in case of divorce will be held in the future. Prenuptial agreements are not binding in the UK; however, the courts proved that, in case of Radmacher v Granatiano, circumstances had to be considered. They applied the requirements of the prenuptial leaving out parts that contravened principles of family law. Prenuptial agreements have remained to be a contentious issue since it can leave out fundamental principles. Such principles include being silent about children that may be born in the course of the marriage or insufficient funds or funds being allocated inefficiently leaving kids without being properly provided for. In case of such circumstances, the court has the authority to divide family assets in order to ensure children rule a decision in any other appropriate way. A pre-nap can be used to reduce the court’s authority to divide family money. Radmacher going to court to challenge the prenuptial agreement undermined decision held in Macleod v Macleod2. In this case, it was held that prenuptial agreements could not be binding and made a distinction between prenuptial and post-nuptial agreements. The Privy Council’s decision in this case shed light on how judiciary viewed this issue during that period. In Radmacher’s case judges stated that they did not recognize any difference between pre and post marital agreements. This change of position has been supported by scholars such as Joanna Miles who argues that there is no difference between a spouse and a fiance. This means that whether the agreement is made before or after solemnization of marriage should not matter. An additional effect of this case is that it provides a way that can result into pre-nuptial agreements becoming binding in the UK. This, however, can only happen if it is under the right circumstances. It, therefore, becomes necessary to consider the effects that pre-nuptial agreements will have on marriage after this decision. The first significant effect is that, after this decision, there will be legal certainty. Prenuptial agreements will help couples to know what will happen to their finances in case of a divorce. Courts have been known to be extremely inconsistent in the past and certainty is welcomed. However, these agreements must uphold fairness, and it is not certain to determine what the court will decide to be fair. Fairness is relative and different individuals view it differently. This means that certainty granted by prenuptial agreements can also be undermined. This certainty can only be provided if guidelines are made stating what is supposed to be included in a prenuptial agreement. This case has brought another vital advantage that is a reduction of litigation costs. Divorce cases costs a lot during litigation when couples are fighting over who should have what. With terms already provided in an agreement, there is little importance of litigation. However, for the reality of this to occur, guidelines should be provided to ensure there are no disagreements later about the prenuptial agreement. Personal autonomy is another advantage. If prenuptial agreements will be binding after this case, it gives people to make decisions on how they want their assets to be divided in case of a divorce. This means that couples will have the authority to make terms of their marriage3. This will promote the idea of marriage to those who are divorcees, and have no hope on it due to divorce cases that were messy and unfair. Marriage legally puts people at much better position compared to cohabitation. Therefore, promotion of marriage puts people at a better security level especially where there are children involved. The final advantage of this decision is that, if prenuptial agreements will be binding from it means putting UK at par with other jurisdiction as far as this matter is concerned4. A large part of Europe and USA already regards prenuptial agreements as binding. UK following this route will ensure that many problems are avoided. This includes problems that occur when people who made the prenuptial in a country where they are binding cannot enforce it in the UK. This, on the other hand, can lead to pressure from people calling reforms to be made, so that they can comply with other jurisdictions. There are, however, limitations of this ruling, especially the fact that the decision has not made any formal change on the legal position to prenuptial agreements. The Supreme Court stated that the decision had the potential of making prenuptial agreement binding but they did not elaborate on this. There was a lack of unanimity in Supreme Court’s decision, which indicated that there were doubts whether the decision was binding. Parliament too, seems a bit hesitant to legislate on this issue. This means that UK’s position on this issue is still uncertain. There are opinions that this decision was reached by courts as a way of promoting marriage institution. In today’s world, prenuptial agreement is a convenient way to encourage marriage due to the dreadful experiences people have experienced. It is, however, until guidelines are put in place on how these agreements are supposed to be prepared will they be effective. In the mean time, judicial discretion will be retained and observed. Another limitation that was experienced in this case was the fact that one of the juries in Supreme Court was a family specialist, and she did not agree with the ruling. She truly clearly stated that prenuptial agreements should not be binding since they can cause many problems. Taking into account her expertise in the family unit, explains why there are doubts in the decision. Her stand can be regarded to be superior and that it may be the reason the decision has not been made binding in the UK legal system. While advantages of this decision may be turned around, strengths of this decision outweigh its limitations. Strengths bring out concepts that legal systems considers as crucial while making a decision binding. These concepts are autonomy and certainty5. In addition, this case was a revolutionary as it brought a positive change in the family law. This means that prenuptial agreements have the chance of becoming binding in the UK. Guidelines, however, have to be drafted and implemented as a law. Firstly, there should be a prenuptial case, which was upheld full in the UK. Supreme Court impliedly highlighted three points that are likely to be put into consideration in future prenuptial agreements decisions about in the UK. One point that is likely to be considered is whether the agreement was entered into with the parties’ free will. This includes proving that there was no undue pressure, and no information was withheld. The parties should also know the implications of the agreements when agreeing into it. The court held that, in this case, both parties knew the legal implications of the agreement in Germany where they signed it. This, however, does not mean the ruling is binding, but there are chances that courts will be willing to consider these agreements and their legality6. The institution of marriage has changed and even if many people feel that prenuptial agreements are unromantic, it is a necessary thing today7. In case of divorce most of the time the person who loses most is the one with more money. Prenuptial makes certain justice is attained. They ensure that people do not get for wealth. Many countries in Europe as well as US recognize prenuptial agreements as binding. In the past prenuptial agreements have not been enforceable in the UK law. Many people often ask this question to their lawyer before getting married. The reason why people opt to get a prenuptial agreement before getting married is that they want to preserve their previously acquired wealth. However, most people do not get any help since, for a long time, courts in the UK have held prenuptial agreements as against public policy. Courts in the pasts have not been influenced into giving weight to such agreements. This, however, has changed with time, and they now seem to consider some factors before ruling. This may become common with the ruling of Radmacher vs. Granatino by Supreme Court. If this ruling becomes binding, it will give spouses financial security they need. It will also redeem confidence to people who no longer believe in marriages due to complications that come because of a divorce. Bibliography MONTAGUE, J. Radmacher v Granatino. LAW JOURNAL. 15, 2010 pg. 53-54. MILES, J. Marriage and Divorce in the Supreme Court and the Law Commission: for Love or Money? The Modern Law Review. 74. 2011. PRIVATE AUTONOMY AND MARITAL PROPERTY AGREEMENTS. International and Comparative Law Quarterly. 59, 2010, pg. 571-603. SCHERPE, J. Fairness, freedom and foreign elements - marital agreements in England and Wales after Radmacher v Granatino. CHILD AND FAMILY LAW QUARTERLY. 23, 2010, pg. 513-527. JOHNSON, S. Pre-Nuptial Agreements after Radmacher v Granatino. Family Law.2009. pg. 718-721. HARRIS, J. (2011). Granatino v Radmacher and its implications for cross-border trusts disputes. Trusts & Trustees. 17, 2011. pg112-123. SANDERS, C. whether Radmacher v Granatino is a turning point for the enforceability of pre-nuptial agreements. The New Law Journal. 159, 2009. pg. 1028-1029. Read More