Prior to 2010, pre nuptial agreements were not recognised as being enforceable under UK law. Nor were there many clear rules on how much weight should be attached to them in court, and often they were completely dismissed in court.
However, there has been a recent change to how the courts handle pre nups and their significance in a divorce settlement. Courts are becoming increasingly likely to consider the agreements as relevant to the division of matrimonial wealth, and enforce them, unless they see any fair reason to do otherwise.
The catalyst of this change was the divorce case of Radmacher v Granatino [2010] UKSC 42.
The heiress and the banker turned academic
The case had several key facts that would later have an important bearing on the outcome. Katrin Radmacher, the wealthy German heiress of a hugely successful paper manufacturing business, and Nicholas Granatino, a French banker, married in 1998. At Radmacher’s request, the couple entered into a pre nuptial agreement, which was drawn up in Germany (where pre nuptial agreements are legally binding), stating that neither spouse would make a claim on the other’s assets in the event of a separation.
Radmacher had inherited a large amount of wealth from her family – around £50 million – that she wanted to protect, and she would gain a further substantial sum if the agreement was signed. Mr. Granatino had waived the right to seek all-important independent legal advice before signing the agreement. The couple had two children, and, meanwhile, Mr. Granatino quit his high-paying job as an investment banker for a much lower paid research post at Oxford University. The couple separated in October 2006 after eight years of marriage. Ms Radmacher filed for divorce in 2007 and, as the family was living in London at the time, the case was brought in a UK court (as opposed to a court in Germany, where the agreement was made).
In 2008, the High Court ordered Granatino to be paid a sum of £5.85 million in respect of ancillary relief. Dissatisfied with the verdict, Ms Radmacher took her argument to the Court of Appeal, saying that the pre nuptial agreement should be taken into consideration. The appeal court judges agreed, and Granatino’s settlement was reduced to just £1 million. However, the Supreme Court’s judgement held that Radmacher was still required to provide for her ex-husband in his role “as a father rather than his role of a husband”. As a result, it was ruled that Granatino should receive £2.5 million for housing, but this sum would only be applicable while bringing up the children. The court ordered that the money should return to his former wife on his youngest daughter’s 22nd birthday.
Granatino appealed to the Supreme Court to reverse the decision, but in October 2010 the Court ruled in favour of Radmacher, finding that the agreement was indeed binding.
What does this mean for pre nuptial agreements in court?
The case redefined how a pre nup is implemented under UK law, demonstrating to family lawyers and future married couples that such an agreement does carry its own legal weight if it is drawn up in a way that is fair to both parties. While pre nuptial agreements are not the defining factor in how a financial settlement on divorce will be decided, they are now far more likely to be taken into full consideration by the court, and there are clearer guidelines for what will be deemed a fair agreement.
The Supreme Court’s judgement of the Radmacher v Granatino case helped lay out the template for what courts will look for when determining whether it’s fair to enforce a pre nuptial agreement. Among the most important of these factors are (1) that any children affected by the divorce are provided for and their overall welfare is maintained, and (2) ensuring that both parties received independent legal advice prior to signing the agreement and was afforded sufficient time to consider and discuss the agreement.. For a more detailed look at these factors, see our advice on setting up a pre nup.
The Radmacher v Granatino case became a main point of reference for consultations and guidance programmes on pre nuptial agreements over the following few years. In 2014, the Law Commission released a report entitled Matrimonal Property, Needs and Agreements”, which prominently featured the case. The report recommended that “qualifying nuptial agreements” should be legally binding as long as certain safeguards were met, such as the ones discussed above.
Simply.Law’s solicitors – staying on top of pre nuptial agreements
A reliable pre nuptial agreement solicitor can make sure that any contract with your fiancée or spouse has the best possible chance of holding up in court – just in case your relationship doesn’t turn out how you hoped. Get in touch with an Simply.Law member family lawyer today to discuss your needs.
