The Dangers of Extreme Pre Nups – Key Learnings

The recent case of ND v KD [2024] EWFC 188 alerts us to the care that must be taken when preparing Pre-Nuptial Agreements (Pre-Nups).

The case involved a Pre Nup, signed shortly before the marriage, which sought to protect most of the husband’s wealth. Fast forward to the end of the couple’s ten-year marriage which had produced one child and the Pre Nup gave little provision to the wife. Some might think of it as “an extreme Pre-Nup.”

The judgment in the case might also be illustrative of the principle that the family courts will not uphold prenuptial agreements that fail to provide at least in some reasonable measure for the applicant’s needs: in short, you cannot prevent the financially weaker party from being given some start on the road to independent living simply by having a tight and mean prenuptial agreement.

• These agreements have far more to do with excluding from consideration assets surplus to needs (remembering that ‘needs’ is a relative concept);
• Although these agreements can also have some influence on the pitch of the level at which needs are met; but
• Go too far, and they are likely to be swiped off the table of considerations.

But this case is also a clarion call and warning for something else. Prenups which are extreme in their impact, also polarise. What so often happens is that:

• The spouse who benefits from the Pre-Nup clings to it;
• Whilst the other spouse insists that full and fair provision is made; and
• The gap then established between the parties is so much bigger than in the situations where there is no Pre-Nup, making it all the harder to bridge the gulf and reach an agreement. It is as if litigation, with all of its expense, becomes inevitable. This was certainly the case in ND v KD [2024], where two and a half years of court process followed, first involving the child and then the finances, and the case ran over its four day time estimate.

Paragraph 68 of the judgment highlights some of the errors of the Pre-Nup and the process by which it was brought to a conclusion. We have broken down the paragraphs into numbering to highlight the separate failings:

68. I am satisfied that:

• 1. the wife entered into the PNA as a result of undue pressure.
      a. The timing of the negotiations,
      b. the timing of the signing itself,
      c. as well as the husband’s clear position that he would not marry her without it all point to that conclusion.
      d. I accept that the wife was a mature intelligent person at the time of the signing of the PNA but find that there was an imbalance of power in the relationship and that the husband, even then, was a controlling force within it. I find that the wife felt that she had no alternative, even in the face of the misgivings of her solicitor.
  2. I further find that the terms of the agreement itself were unfair and did not provide for the wife’s needs.
      a. There was no obligation in the agreement as drafted that any marital assets acquired by either party should be shared equally or at all …
  3. … The only clause related to income and capital provision for a child referred to mediation.
  4. There was a trigger event provided to review after the birth of the child but this was not acted upon.
  5. The agreement gave the husband full licence to conduct himself financially as he did and the upshot was that there would be wholly inadequate provision for the wife and child if the agreement were upheld. This is well evidenced by the husband’s offer based upon the PNA.
  6. Finally, there is the husband’s own concession in his narrative statement that the agreement did not provide for the wife’s and child’s reasonable needs.

Key Learnings:

What does this case tell us about the Pre-Nups that we prepare going forward?

• Start early so that you have enough time to think through what is needed (the more time the better so even if you are not engaged yet, there is always a benefit to meet with your lawyer to discuss even just how to bring up the topic). Avoid the situation here where the pre-nup is signed in a rush 3 days before the wedding when your focus cannot possibly be upon it;
• Ideally involve our in-house therapists to support respectful discussions, and financial planners to think through how each of you can, during the marriage, move forward with your lives and maintain financial security.
• Be careful about trying to use the Pre-Nup solely as a means of protecting wealth: where this is done regardless of the needs of the other spouse, you are not likely to generate a solution that will stand up in an English court and you therefore risk undermining your own key objective.
• Recognise that “stuff happens” and reviews are needed. If reviews are provided for make sure that you carry them out.
• Consider the process carefully: almost always we recommend couples sitting down together to talk about concepts. Building on this can be discussions between lawyers working collaboratively, roundtable meetings with solicitors and clients present, or lawyer led negotiations.
• Communication is key and if speaking together at home feels too hard, we may recommend that you meet with a mediator to support your conversation.

At FLiP our expertise in negotiating and delivering pre nups and post nuptial agreements and relationship agreements is second to none. We combine the first-class knowledge of our lawyers with the support of our counsellors to offer an unrivalled service, delivered with insight and understanding.

Knowledge of the international rules applying to pre and post marriage agreements is a key aspect of our international family law work and we have close contacts with expert family lawyers across the globe who can assist when required. More information on foreign marital agreements can be found here.

Whatever your personal circumstances, our talented team of family lawyers has the experience and technical skill to work with you to deliver a pre nup or post nuptial agreement or relationship agreement which gives you peace of mind.