Court upholds pre-nup despite wife’s ‘lack of understanding’
The Court of Appeal says a pre-nup agreement between a divorcing couple should be upheld even though the wife claimed she had not been properly advised about its implications when it was drawn up.
The case involved a husband and wife who were both Swedish but spent most of their 21-year marriage living in England. They had three adult children. The husband came from a very affluent family. Before they married, he had inherited shares in family companies.
The day before their wedding, they signed a pre-nuptial agreement stating how their assets should be divided if they separated. Certain parts of the husband’s inherited and future wealth were to be excluded from any settlement.
During the divorce proceedings, the wife asserted that the matrimonial assets amounted to about £275m, and that she should receive 42.5% and the husband 57.5%.
The judge rejected her contention that she had not read or understood the effect of the pre-nup and that it should not apply.
He ordered that the settlement should broadly follow the provisions of the pre-nup, which meant that the wife should receive about half of the non-business assets (£51.4m) together with a 23.41% interest in the husband’s business.
The wife appealed saying the judge had not taken into account that she had not received legal advice before signing the pre-nup.
The Court of Appeal upheld the judge’s decision. It held that his finding was clear that the wife had understood at the time she signed the pre-nup that certain parts of her husband’s wealth would be excluded by it. Where a party had a full appreciation of the implications of a pre-nup, the court should give effect to such an agreement unless it would be unfair to do so.
The case shows the increasing readiness of courts to accept pre-nup agreements if they are properly drawn up, fair to both sides and each party understands all the implications.
Please contact Natalie Nero or Shelley Rolfe if you would like more information about pre-nups or any aspect of family law.
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