Prenuptial agreements: Royal and International
The engagement of Prince Harry and Meghan Markle is joyous news. Behind the scenes, however, a royal prenuptial agreement will undoubtedly be being…
Whether caught up in the romance of a Royal wedding, or just secretly hoping for an extra bank holiday, the engagement of Prince Harry to American actress Meghan Markle is news of a joyous occasion to distract from winter blues and the complexity of the Brexit negotiations.
Behind the scenes, however, the merits and content of a royal prenuptial agreement will undoubtedly be being discussed both in England and the U.S. The American public is used to the press reporting or speculating about eccentric or overbearing clauses in celebrity pre-nuptial agreements but in England there is more reticence with the question first being asked; are they even binding?
Following the Supreme Court’s judgment in the case of Radmacher v Granatino, pre nuptial agreements are likely to be upheld if they meet the following criteria:
- The agreement is entered into freely;
- Both parties fully appreciate the implications of the agreement; and
- It is fair to hold the parties to the agreement in the circumstances prevailing.
Following the Supreme Court decision the Law Commission made recommendations as to the safeguards which should be in place if a pre nuptial agreement is to be upheld. These broadly reflect the practical steps that would be required for an agreement to meet the criteria identified by the Supreme Court; the agreement must be contractually valid, it must have been made in a deed, must not have been made within the 28 days immediately before the wedding, both parties must have received disclosure of all material information about the other party’s financial situation and both parties must have received legal advice at the time of the agreement.
Under English law, where the starting point on divorce is the equal sharing of assets, a pre nuptial agreement is a way of making sufficient financial provision for the party with fewer means but then allowing any surplus wealth, whether inherited wealth or wealth tied up in business assets, to be kept separate and unavailable for division.
An approach in the case of Harry and Meghan, both of whom have independent means, might be as simple as they each keep what they have got. Their respective lawyers will also be looking at scenarios where the couple may live in the U.S. and what the position would be if either of them were to bring proceedings in relation to the marriage there rather than in England. Would an English pre nuptial agreement protect them or would they need to have a mirror agreement in the state in which either or both of them lived?
It is impossible to predict at outset everything that could possibly happen within a marriage. For this reason English prenups often provide a list of events that would trigger a review of the agreement, for example, moving to another country or having a child. The opportunity to re-negotiate the agreement so that it remains fair, strengthens the likelihood it will be upheld.
Although perhaps unromantic in comparison to other aspects leading up to a wedding, when it is a marriage that is going to be under constant public and media scrutiny, dealing with financial issues discreetly and in advance is likely to leave the royal couple freer not only to enjoy their wedding but their marriage as well.
Lottie Tyler is an Associate Solicitor in the family law team.