The Law Commission’s recent review of the ways finances are dealt with during and after divorce and the dissolution of civil partnerships was published in December 2024. One question the report poses is whether to make prenups legally binding.

The report explores many key issues relating to divorce and separation; it looks at how pensions are dealt with, whether behaviours like domestic abuse should be factored into financial settlements. However, the fact the legal status of prenups has been challenged so openly in the report is not a surprise.

The current laws have been in place for over 50 years and the way in which couples separate, the types of assets accrued and the division of these assets between partners has changed dramatically over this time.

As such, when it comes to divorce the way marital finances and assets are divided should also change if genuinely fair resolutions are to be achieved. At present – and this is echoed in the Law Commission’s report – it is felt the current legal system is too reliant on the discretion of the courts. This causes a higher level of uncertainty for divorcing couples than it should.

One way to alleviate a degree of this uncertainty would be to finally make prenups legally binding.

How could prenups be made legally binding?

If, as is widely expected, prenups are made legally binding, it appears as though the legislative changes will only apply to ‘qualifying nuptial agreements’, i.e. those agreements that meet specific criteria. Given current legal precedent, these criteria are likely to include:

• Being a valid contract
• Being made by deed
• Receiving material financial disclosure about the other’s financial situation
• Receiving independent legal advice at the time of the agreement
• Not being made within 28 days before the marriage
• Being entered into freely and willingly
• Not prejudicing any children

By the same token, agreements that don’t meet these requirements would be exempt.

In this event, it would likely that the acceptance of the agreement would still come down to the court’s assessment of whether the terms of the agreement can be accepted as fair for both parties. For example, they are likely not to support agreements that make insufficient financial provision for children or leave either party at a financial disadvantage.

What could this change mean to divorcing couples moving forward?

Admittedly some of the ideas in the 2024 report aren’t new. In 2014 the Law Commission published a report titled ‘Matrimonial Property, Needs and Agreements Report’. This included a draft Nuptial Agreements Bill which not only recommended prenups should be made legally binding but also tabled the idea of ‘qualifying nuptial agreements’. However, the latest report does seem to move its adoption closer towards becoming a reality.

After the publication of this report in 2014, more and more courts have upheld pre-nuptial agreements if they were entered into freely and were deemed to fairly represent the best interests of both parties and any dependents. However, making agreements legally binding would provide far greater certainty around how assets and finances are divided for those couples who choose to put a prenup in place at the outset of their marriage. It would give the courts a clear and indisputable framework to follow which can only help facilitate the quickest and fairest resolution to a divorce, separation for the dissolution of a civil partnership.

The barristers in our Family Law team specialise in matrimonial finances and financial remedy. If you would like to discuss a case with them, please contact us today.