Planning a Valentine's Proposal? Say Yes to a Prenup
Jennifer Macdonald wrote for ThoughtLeaders4 High Net Worth Divorce magazine.
We have come a long way in society since the days of Saint Valentine, the third century priest who was sentenced to death for marrying couples in secret against the orders of Emperor Claudius II. According to popular belief, Claudius had banned people from marrying, believing that married men made poor soldiers. When he was discovered, Valentine was swiftly jailed and sentenced to death. The legend suggests that whilst Valentine was awaiting his fate, he fell in love with his jailer’s daughter and when he was taken to be killed on 14 February, he sent her a love letter signed “from your Valentine”.
In the United Kingdom today, couples are, generally, free to get married, and priests and other celebrants can conduct their roles in public without fear of incarceration or death. In both Scotland and England, two individuals can legally get married if they are of legal age (which is 16 and over in Scotland or 18 and over in England), so long as they satisfy the following requirements:-
- They are not already married or in a civil partnership with someone else;
- They are not closely related to each another; and
- They are capable of understanding what marriage means and of consenting to marriage.
And thanks to Saint Valentine, on 14th February this year, many of the more romantically disposed among us will be going down on bended knee (whether literally or metaphorically – one wonders how many might pop the question over WhatsApp this year with side by side emojis of a ring and a question mark…)
Newly engaged couples will soon be immersed in the depths of wedding planning and preparations for their big day. Amidst the joyful planning, however, it is also worthwhile taking a moment to pause and consider the significant legal consequences of marriage. Marriage bestows a range of rights and obligations on individuals which can have significant financial implications, particularly if the marriage breaks down or on death of one of the parties.
For example, in Scotland, on divorce both parties will be entitled to share fairly in the net value of “matrimonial property”, which includes all assets (and debts) held by the couple in either joint names or their sole names at the date on which they separated. Assets held by them before the marriage do not form part of the matrimonial property (except a family home that was bought prior to the marriage), and assets acquired by way of gift from a third party or inheritance are also excluded. Excluded assets can be “converted” during the course of the marriage so that they do fall within the matrimonial pot (e.g. where inherited funds are used to purchase a new property or a car). Disputes about the conversion of assets and how to divide the net value of matrimonial property fairly can be extremely difficult to resolve.
In England and Wales, all of the parties’ assets (even those acquired before the marriage) are taken into account for division. There is no specific framework regulating the division of assets on divorce, and the courts have extremely broad powers to make any financial orders they consider to be fair. Whilst the courts in England and Wales can recognise the non-matrimonial source of an asset, such protection is by no means guaranteed.
Prenuptial agreements are becoming an increasingly popular tool for couples who wish to record the arrangements they wish to apply either during the marriage or following separation and/or death. Often, they are used to specify that certain assets (for example, those which a person has acquired before the marriage, or which are received during the marriage by way of inheritance or gift) will be excluded from the matrimonial pot, regardless of changes to such assets during the marriage. In particular, individuals with existing business, financial or property interests, those who stand to inherit assets or money in the future, or those who have children from previous relationships, are well placed to think about the benefits of having a prenuptial agreement in place.
Prenuptial agreements can also set out specific arrangements which will apply in the event of separation, such as the provision of housing.
Whilst it may no longer be necessary for a benevolent priest to conduct wedding ceremonies in secret, prenuptial agreements are one aspect of wedding preparation which individuals often prefer to keep private. Whilst such desire for privacy is entirely understandable, it must also be borne in mind that the disclosure of financial information is an important aspect in ensuring the enforceability of prenuptial agreements both north and south of the border. Individuals will be expected to disclose the full extent of their wealth and assets to each other (and to their solicitors) during the process. That can sometimes cause a degree of discomfort, especially in situations where significant family wealth exists for the benefit of multiple generations. Having an experienced lawyer who can guide their client through the process can be especially valuable for those who are sensitive about the confidentiality of their financial affairs.
The enforceability of prenuptial agreements in Scotland has yet to be fully tested by the courts, but it is generally accepted that they will be upheld provided that certain safeguards are met. In England, whilst the courts will retain ultimate control over financial arrangements, prenuptial agreements can be given decisive weight, again subject to safeguards being met. It is important for a prenuptial agreement to be signed as far in advance of a marriage as possible, and also for both individuals to receive well-qualified independent legal advice.
While it may be difficult (and would certainly be unwise) to bring up the idea of a prenuptial agreement in a love letter signed “from your Valentine” this 14th February, early consideration of the legal implications of marriage and the financial options available can provide much needed comfort and protection for couples choosing to get married.