Although Scottish family law provides certain protections in relation to assets that are owned before entering into marriage or civil partnership, or which are gifted or inherited during marriage, those protections generally only exist so long as the assets remain in their original form.
During the course of a marriage, assets might be realised or reinvested, or converted in some other way, and, therefore, fall within the definition of "matrimonial property" for division on divorce or dissolution.
Prenuptial and Postnuptial Agreements
We have extensive experience of drafting prenuptial and postnuptial agreements which effectively ring-fence assets which are, or derive from, pre-marital, gifted or inherited assets, as well as making specific financial position in the event of separation or divorce if required. Such agreements are particularly helpful in cases where one or both of the parties are property or business owners, or where there is a wish to protect family wealth which may in due course be passed down the generations. We are frequently instructed to draft prenuptial and postnuptial agreements with an international aspect, including where the couple are from different countries, intend to live outside Scotland or own property that is held in other jurisdictions.
Prospective cohabitants can also enter into a similar arrangement, known as a Cohabitation Agreement, in order to protect their interests from the possibility of a future claim following separation.
Before you begin cohabiting with someone, you might wish to consider protecting your assets and personal wealth using a Cohabitation Agreement. These operate in much the same way as a prenuptial agreement, and give you and your partner the opportunity to think about how you would like your assets to be dealt with in the event of separation. A Cohabitation Agreement can help you both avoid an unnecessary dispute on separation or, in more difficult cases, a costly court action.
Pension sharing arrangements provide a useful vehicle to be used in certain cases to facilitate fair sharing of assets. The method of valuing a pension for this purpose can be controversial. We frequently liaise with Consulting Actuaries with regard to pension valuation issues and pension sharing. Our expertise is complemented by theirs to allow us to achieve practical solutions for our clients.
Share Options, Incentive Plans and Investments
We have extensive experience of assessing the extent to which the value of share options, incentive plans, investments and other such assets fall to be taken into account in a divorce and we frequently liaise with forensic accountants and/or other experts on such valuation issues.