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Pre-nuptial agreements: where we stand post Radmacher

The decision of the Supreme Court in the recent case of Radmacher v Granatino [2010] UKSC 42 has been eagerly awaited by not only ancillary relief practitioners but the general public at large. Upon publication of the judgment, widespread reports appeared online that this decision heralds the beginning of a new era in the UK, bringing the legal status of pre-nuptial agreements in line with their status in many foreign jurisdictions, most notably in the United States of America.

This commentary intends to clarify the position following Radmacher and highlight some of the key points of the judgment.

There is little doubt that the reasoning behind the decision to uphold a pre-nuptial agreement goes some way to enhancing the status of such documents than hitherto was the position. That aside, it is apt to make it clear that the Supreme Court was not concerned with the question as to whether pre-nuptial agreements are contractually binding, this being expressly reiterated by Lady Hale in her dissenting judgment. That is a matter for the Law Commission to consider in due course.

Some may say, however, that the majority judgment in Radmacher leads the way for future progression in this regard. Following this decision there is now an inference to be drawn by the Court that parties entering into such agreements governed by English law intend that effect be given to them. Previously, the existence of a pre-nuptial agreement was merely a factor to consider when carrying out the statutory exercise in accordance with section 25 Matrimonial Causes Act 1973.

In effect the decision seems to introduce a presumption of enforceability. Importance is attached of our legal system having respect for individual autonomy. However, the decision makes clear there will be circumstances in which the weight attached to such an agreement should be eliminated or reduced. Specific reference is made to the following:

a) Where the agreement fails to make reasonable requirements for children;

b) The need for the parties to have entered into the agreement voluntarily, without undue pressure or influence and to have been fully informed as to its implications. The emotional state of the parties can be considered but not in isolation i.e. one must ask the question 'what would have happened if the parties had not been under such pressures?' This inevitably poses issues as to age, maturity and the individual's previous relationship experience (as to how it may have influenced terms reached).

One can foresee the phrase "being fully informed as to implications" being open to interpretation and potentially ripe for litigation. However the judgment makes clear that it is not a pre-requisite for the parties to have obtained independent legal advice (however desirable this may be) or full detailed disclosure as to each of their respective assets. The judgment then goes onto state that the agreement will not be upheld if to do so would be 'unfair'.

Consideration of fairness will obviously be dependent upon the facts in question. It is made clear, however, that in determining fairness in accordance with the three strands outlined in Miller v Miller [2006] UKHL 24 and White v White [2000] UKHL 54 namely needs, compensation and sharing; it is most readily envisaged the two former considerations could render an agreement unfair.

It is interesting to note a reference to length of marriage in the judgment and one questions whether this paragraph almost encourages litigation against enforceability on this basis: "Where the ante-nuptial agreement attempts to address the contingencies, unknown and often unforeseen, of the couple's future relationship there is more scope for what happens to them over the years to make it unfair to hold them to their agreement. The circumstances of the parties often change over time in ways or to an extent which either cannot be or simply was not envisaged." [para 80] It is of further interest to note that the dissenting judgment was that of Lady Hale, the judge with the most family law experience.

She referred to marriage as involving an 'irreducible minimum duty to support one another' and found the majority decision to be an impermissible gloss on the Court's statutory duties. Lady Hale quite bluntly described the law in this area as being 'a mess'. It has to be said, that despite Radmacher introducing a degree of clarity, intervention by the Law Commission would be welcomed.

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