The problem with pre-nups – and their benefits

The recent case in the USA of billionaire hedge-fund manager Kenneth Griffin highlights one of the problems with our own UK pre-nuptial agreements – and one of their major benefits too.

US and UK pre-nups

At present, a pre-nuptial agreement is not legally binding in the UK, but they do form a basis for an agreement, and UK courts are taking them into consideration. In the USA, they are considered binding, unless:

Either party did not make truthful financial disclosures
One party did not have a lawyer or sufficient time to consider the agreement or fully understand what it entailed
One party was coerced into signing against their will

Did she jump or was she pushed?

Coercion is at the heart of the contention of a pre-nup made between Griffin and his then wide Anne Dias Griffin. When the couple divorced in 2014, the pre-nup entitled Anne to a lump sum of $22.5 million on their marriage and $1million in cash for every year of their marriage. This has amounted to some $35million during their marriage.

Anne Dias Griffin says she was not given sufficient time to review the pre-nup agreement, and court documents show that the agreement was finally signed on the eve of their wedding. Mr Griffin, however, claims that his wife to be was given the agreement several weeks in advance of the wedding, and had consulted with three law firms, working the agreement through several drafts.

The judge’s final decision may hinge on the substantial amount of money already accepted by Anne Dias Griffin under the agreement, as Griffin’s lawyer attested:

“Based upon the substantial wealth the Agreement provided to Anne immediately upon saying ‘I do,’ and the fact that Anne accepted such payments from Ken . . . throughout the marriage, Anne cannot support her claim that she entered into the Agreement unwillingly.”

The impact on UK pre-nups

While the case is unlikely to affect the status of UK pre-nups at present, it does show that they are potentially more vulnerable than many US lawyers would like to believe. The good news is that while there is no certainty that Anne Dias Griffith will be successful in her case, she cannot be worse off than the terms of the original agreement.

Is it worth drawing up a pre-nup?

Bearing this all in mind, is it worth drawing up a pre-nup? At Leiper Gupta Family Lawyers, we say, absolutely yes.

A pre-nup agreement forms a baseline statement of your individual and mutual net worth at the time of marriage, and also establishes where your priorities lie should the marriage not work out. Written properly, it is as much a full appreciation of each other’s individuality, as a ‘worse case scenario’ document. It promotes discussion about the care and provision for existing or future children, inherited or family assets, and much more. Written in association with wills (also strongly recommended), a pre-nuptial agreement is not so much an insurance policy for failure as a starting point for success.

You need to take legal advice and act early, i.e. not of the eve of your wedding! There should be parity of legal representation, so there is equality of arms, and both parties should give financial disclosure.

Free advice on pre-nups

If you’re not sure is a pre-nup is right for you and your future spouse, why not take advantage of our free 30-minute consultation offer? We can discuss your situation and help you decide what’s best for you, with no obligation. Our offices are set in the heart of the Hampshire countryside, and many couples enjoy the fact they can talk to us in complete confidentiality in a calm and relaxed setting – and then enjoy a country pub lunch!

For more information and to book your appointment, call us today.