Family Lawyers React To New Law Commission Proposals

Specialist family lawyers say Law Commission proposals for new legislation will make qualifying pre-nuptial agreements legally binding and provide more clarity to couples going through a divorce.

However the expert family law team at Irwin Mitchell says that other elements of the new proposals are still unclear and await the results of further research by the Family Justice Council which has been tasked with giving advice on what is meant by the ‘financial needs’ of each party.

Under the plans, announced today by the Law Commission, a pre-nuptial agreement will “qualify” if it meets the contract law criteria (no fraud, undue influence etc.), the agreement is signed as a deed no less than 28 days before the wedding, and contains a statement that the couple understand that the agreement is a qualifying nuptial agreement that will partially remove the court’s discretion to make financial orders. Both parties must also have had legal advice and full disclosure.

The court will not be able to depart from a qualifying pre-nup unless it does not provide for a party’s needs. So if a qualifying pre-nup meets the needs of the parties and any children it will be binding and the court will have no discretion to make an order that differs from the terms of the pre-agreement.

The report deals with two other hot topics.

One is assets that belong to one party only – such as an inheritance or gift. The report says legislating for these assets to be dealt with in a particular way would be too controversial. Inherited wealth and similar assets will be dealt with just as they are now: the court will have discretion to include them or not, depending on the facts. However, the report does point out that if a couple deals with these types of asset in a Nuptial Agreement that qualifies, the court won’t be able to interfere.

The second hot topic is “needs” and how they can be codified.  The Law Commission proposed the Family Justice Council draft guidance of the meaning of “financial needs”.