The summer divorce …. and the rise of the pre nup
Posted on 15th August 2017
The summer does not seem to be a good time for celebrity marriages with some very high profile couples splitting up at the start of the autumn. Summer 2016 saw the split of Drew Barrymore from actor husband Will Kopelman as well as Mary J Blige from manager Kendu Isaacs, and who could forget the spectacular break up of Brad Pitt and Angelina Jolie in a plane. The previous summer, 2015, saw the split not only of Ben Affleck and Jennifer Garner but also Kermit the Frog and Miss Piggy (which came as a complete shock for generations of Muppet fans). The summer 2017 celebrity divorce alumnae are starting to make themselves known – Ryan Giggs was granted a divorce from wife Stacey, and the Guardians of the Galaxy star Chris Pratt announced his separation from wife Anna Faris.
Of course it’s not just celebrities that suffer relationship breakdowns. Recent figures show that more than half of marriages in England and Wales end in a divorce. Often the long awaited summer holiday ends up showing couples forced to spend more time together than they have in the last 12 months just where the cracks lie. It is therefore not surprising that after experiencing such a wakeup call couples decide to call it a day, seeking advice from family lawyers about the best way to go about dissolving their relationship.
Roman Abramovich is another nascent 2017 alumnae, issuing a statement last week that he and his wife of 10 years, Dasha Zhukova, would be parting ways. The rumour mill is already in play with the press trying to guess how his £7bn wealth will be shared out following the divorce. Some lawyers say Ms Zhukova will get 50% of the assets, others are being more conservative and proposing that only her needs will be met. Of course in all likelihood we’ll never know as it is almost certain that Abramovich and his 3rd wife entered into a pre-nuptial agreement before the wedding. It is probable that this document will not only decide what sort of settlement Ms Zhukova would receive but also which jurisdiction would implement it (both parties being Russian, Moscow would provide a more favourable outcome for the billionaire than London).
The rise of nuptial agreements
With second and third marriages becoming all the more common it is not surprising that the pre-nuptial agreement (and its sister the post-nuptial agreement) have become tools of good financial planning.
Both pre- and post-nuptial agreements serve to set out what should happen to the assets of the spouses in the event of a divorce. In England and Wales, these sorts of agreements have recently become more acceptable to the Courts but this will depend upon the individual circumstances of the parties such as needs and contribution.
The Courts will try to uphold agreements as long as certain safeguards are put in place, i.e.:
- Financial disclosure is undertaken when negotiating the agreement; and
- Both parties have independent legal advice on the agreement;
- And, in the case of pre-nuptial agreements, that it is signed no later than one month before the wedding.)
Why consider a pre- and post nuptial agreement?
Agreements are worth considering if, for example:
- You are bringing assets into the marriage.
- You have the benefit of a Trust Fund.
- You have significant pension provision now or in the future.
- You are considerably better off than your other half.
- This is your second or third marriage.
- You have children from a previous marriage/relationship and you wish to protect their future.
Other ways to protect your assets
Although pre- and post-nuptial agreements are the most obvious way of trying to protect assets it is not the only way. Husbands and wives should consider all possible options such as trusts, deeds of trust, waivers or simply how they govern their finances during their time together. Our advice to soon to be married couples is to talk through all the options open to them with a solicitor as soon as they book the wedding venue!