Husband successfully challenges prenuptial agreement as Court of Appeal criticises wife for failing to disclose 73% of her assets
The Court of Appeal has published a significant judgment recently, where the wife was seeking to rely on the terms of a prenuptial agreement despite failing to disclose a large proportion of her assets during negotiations.
The parties were former couple, Simon Entwistle and Jenny Helliwell, and they entered into a ‘drop hands’ prenuptial agreement before they married. Ms Helliwell was from a very wealthy family, and Mr Entwistle was a city trader. They separated 3 years later.
The agreement said that, on divorce, they would both keep their own property, and anything which was jointly owned would be split equally between them. During negotiations, the parties provided each other with their financial information, in a process known as disclosure. At this point, the wife claimed that she had assets of £18 million. This wasn’t in fact true, and she actually had assets of nearly £48 million. This means she had hidden her true wealth when they entered into the agreement.
The prenup was initially upheld by the High Court, where the husband was given £400,000 based on an assessment of his needs. He appealed this decision, and claimed that the prenup should not be upheld because the wife hadn’t been truthful about her wealth. Mr Entwistle said that the previous judge had been guilty of gender discrimination, having awarded him substantially less than if he had been the wife in similar circumstances.
The Court of Appeal found that the wife had fraudulently failed to disclose 73% of her wealth, and this meant that the agreement was not valid. Lady Justice King said ‘Since the husband in the instant case was deliberately deprived of information which it had been agreed that he should have, in my judgment, the agreement cannot stand.’
The judgment is critical of the wife’s actions, as Lady Justice King says that her non-disclosure of the majority of her assets was ‘undoubtedly deliberate’, and that it is ‘inescapable that her decision not to disclose those assets was fraudulent’.
The judgment makes it clear that when parties have agreed to provide financial disclosure to each other when entering into a prenuptial agreement, that information must be correct. A ‘wilful or fraudulent breach of that agreement’ to provide disclosure on agreed terms means that there will have been a ‘material nondisclosure’ and the party receiving the false information won’t have the necessary information to decide whether they want to agree to the terms. This is crucial because it risks invalidating the whole agreement.
The court has once again underscored the critical importance of honesty in family law. It is well established that if a party conceals or misrepresents their assets during divorce proceedings, the court can set aside the original settlement to ensure fairness. This latest decision confirms that the same principle applies to prenuptial agreement - dishonesty will not be tolerated.
If you're considering a pre- or post-nuptial agreement, it’s essential to approach it properly and avoid shortcuts. Agreements where both parties receive robust legal advice and fully understand the terms can be highly effective in reducing future disputes and controlling legal costs. However, where there are flaws, such as misrepresentation of assets, disputes can escalate significantly. In this case, the parties incurred over £1 million in legal fees even before reaching the Court of Appeal.
This case serves as a cautionary tale for parties to be honest when they disclose their assets and not hide their wealth, because it could come back to bite them.
