Pre-nuptial agreements – a good investment
Jennifer Broatch from Thorntons Law tells us why pre-nuptial agreements are not just for the super-rich and may be advisable for many, including dentists
Pre-nuptial agreements or pre-nups, as they’ve become known, aren’t just for celebrities and are gaining popularity in Scotland. When most people think of pre-nups, they often envisage the very wealthy protecting their millions from their future spouse. However, they’re not just for the super-rich and may be advisable for many, including dentists.
Why would you want a pre-nuptial agreement?
When entering into marriage, no one expects things not to work out. Unfortunately, marital stability isn’t a given, and when relationships do come to an end, practical issues often come to the fore, including the ownership of matrimonial assets.
For dentists who have built up value in their assets over time, whether as practice owners or as associates in a practice, the value can be significant, and hence the implications of a relationship ending can similarly be great. A pre-nup can formalise intentions if the marriage does break down, thus saving a potential disagreement in the future – which can be costly.
What can be included in a pre-nup?
A pre-nup can include almost anything as long as it’s fair and reasonable. It’s common to ring-fence pre-marriage assets, protect interests in a business (such as a dental practice) and take account of differing financial contributions to the marital home, allowing individuals to take out what they put in with any additional value then split, but even care of the family dog or cat can be covered.
Will a pre-nup be binding?
There has been debate about whether pre-nups are legally enforceable, but in Scotland the position has always been that they are valid, if properly prepared. Scotland is one step ahead of England on this; down south it’s not always a given that a pre-nup will be legally binding. By contrast, a Scottish pre-nup will be enforced, provided that it was fair and reasonable when it was signed, that both parties had the chance to take legal advice and that neither of them was put under any pressure to sign it.
A difficult conversation?
When couples are caught up in the excitement of preparing to commit to a life together, a pre-nup is probably the last thing on their minds – but this is precisely the time they should be considering one. While no one goes into a marriage thinking that they might split up, a pre-nup can minimise dispute if the worst does happen.
When to do it?
It’s advisable to start the process at least three to four months before the wedding in the hope of having it signed at least two months before the big day. If that’s not possible, you can consider a “post-nup” after the wedding. Considering matters early also allows both parties to carefully consider their position, taking into account their respective assets, without feeling unduly pressured. It also allows them time to discuss it with a family lawyer properly.
Post-nups can also be appropriate when one spouse receives a large gift or inheritance during the marriage and they want to make sure that the assets they have acquired are passed down through the family and won’t be the subject of any divorce action.
Value for money?
Organising a pre-nup is money well spent if a marriage doesn’t work out, avoiding contested divorce proceedings costing many thousands of pounds. Sometimes it’s recommended that the spouse seeking the pre-nup pays for the other party’s legal fees.
Legal advice?
It might be tempting to save money by downloading a DIY document from the internet, but involving a family lawyer will ensure your agreement is tailored to your needs and, crucially, can be enforced.
Thorntons Family Law Team are specialists who are experienced in advising on pre-nups, and we would be happy to discuss them with any of our dental clients who want more information. Get in contact with one of the team today on 03330 430150 or visit our website at www.thorntons-law.co.uk
Author
Jennifer Broatch
Associate, Thorntons Law LLP
Email: jbroatch@thorntons-law.co.uk