Prenuptial agreements, the Church and the Law

On Thursday 27 February, the Law Commission is to publish its report on matrimonial property, needs and agreements which is based upon a project and an associated consultation initiated in October 2009 with the objective of examining the status and enforceability of marital property agreements.  In February 2012, the project was extended to address the financial provision arising on divorce and the dissolution of a civil partnership. This was accompanied by a supplementary consultation in September 2012.

The project examined the extent to which one spouse or civil partner should be required to meet the other’s needs following divorce or dissolution.  It also considered “non-matrimonial property”, a concept used by the courts to describe property that was acquired by either party prior to the marriage or civil partnership, or received by gift or inheritance at any time.  The background to the project and the issues considered is reported in an article by Law Commissioner, Professor Elizabeth Cooke, the Law Commissioner, [2012] Fam Law 323.

Although the work has prompted media speculation that “Prenup deals could be given legal status”, here, and religious concerns that “Prenup laws ‘would hit marriage’”, here, it is important that the proposals are considered in relation to: the likelihood of them becoming law; and the present status of the law in this area following the Supreme Court judgement in Radmacher (formerly Granatino) v Granatino [2010] UKSC 42, a useful summary of which is given in the Supreme Court Press Summary.  There has also been a timely, but unconnected, post from canon lawyer Dr Ed Peters, A Catholic look at pre-nuptial agreements, who suggests: “the Church’s opposition to divorce is more nuanced than most people realize; the Church herself has made and still makes use of pre-nuptial agreements (though under different titles); and, like any contract ,the morality of a pre-nuptial agreement eventually comes down to its terms, not its literary form”.

The Law Commission and the development of the law

Established by section 1 of the Law Commissions Act 1965 for the purpose of promoting the reform of the law[1], the Law Commission is an advisory non-departmental public body, (NDPB) of the Ministry of Justice.  The Commission’s powers include advising the Minister, who is required to lay its reports before Parliament. However, more than two-thirds of its law reform recommendations have been implemented, and a number await the Government’s decision or Parliamentary time, here.

Against this background, tomorrow’s report is only a preliminary step towards changing the law in this area.  Another area related to the financial consequences is the Commission’s Report Cohabitation: The Financial Consequences of Relationship Breakdown (Cm 7182), on which we commented here, which although published in 2007 is still classified as “pending”.

Radmacher (formerly Granatino) v Granatino

In Radmacher Lord Philips considered the development of three types of “nuptial agreement”: agreements made before the marriage, (“ante-nuptial ” or “pre-nuptial agreements”); those made after the marriage had taken place where the husband and wife intended to remain together, (“post-nuptial agreements”); and post-nuptial agreements made when the couple was on the point of separating or had already separated, (“separation agreements”).  Until the introduction of the Maintenance Agreements Act 1957, it was regarded as contrary to public policy for a couple to enter into a ante- or post-nuptial agreement relating to a potential separation, since “this might encourage them to do so”, and as a consequenc the court paid no regard to them. However, in contrast to ante-nuptial agreements, the 1957 Act gave considerable weight to separation agreements and postnuptial agreements.

Lord Philips noted that the reasons for sweeping away the old rule for separation agreements applied equally to ante-nuptial agreements [52] as there was not necessarily a material difference between the two [57] and the court was entitled to overrule the agreement in either case [63]. The question before the court, therefore, was how it should approach the task of deciding what weight should be given to an ante-nuptial agreement.  In the instant cases there were three issues to consider:

– were there circumstances attending the making of the agreement which should detract from the weight which should be accorded to it?

– did the foreign elements of the case [i.e. although the marriage took place in London, the ante-nuptial agreement was signed before a notary in Germany, where such agreements are binding] where enhance the weight that should be accorded to the agreement? and

– did the circumstances prevailing at the time the court made its order make it fair or just to depart from the agreement?

Applying these principles to the facts, the Supreme Court held that the Court of Appeal was correct to conclude that there were no factors which rendered it unfair to hold the husband to the agreement.

In a dissenting judgement, Lady Hale stated that modern marriage still possesses an irreducible minimum, which includes a couple’s mutual duty to support one another and their children. The issue in this case was how far individuals should be free to rewrite that essential feature of the marital relationship as they chose [132]. In her view, there remained important policy considerations justifying a different approach for agreements made before and after a marriage [162]. The test to be applied by the court when considering an ante-nuptial agreement should not introduce a presumption or starting point in favour of holding the parties to it: the guiding principle should be fairness in the light of the actual and foreseeable circumstances at the time when the court comes to make its order [169].

Following Radmacher there have been a number of cases in which its principles have been applied to the individual facts of the cases, including: Z v Z (No2) [2011] EWHC 2878 (Fam); V v V [2011] EWHC 3230 (Fam); Kremen v Agrest (No.11) (Financial Remedy: Non-Disclosure: Post-Nuptial Agreement) [2012] EWHC 45 (Fam); B v S (Financial Remedy: Marital Property Regime) [2012] EWHC 265 (Fam); GS v L [2011] EWHC 1759 (Fam). However, it has been suggested that greater legal certainty is required; “by bringing quasi-contractual concepts into this area of the law but not applying the law of contract itself, and in referring to concepts such as ‘real need’ and ‘full appreciation’ the Supreme Court has set lower courts something of an interpretative challenge for a number of years hence”.

Churches and prenuptial agreements

The Church of England’s statement Pre-nuptial and post-nuptial agreements acknowledges that “relationship breakdown remains a significant phenomenon and that financial and property disputes between separating couples can lead to distress and expense for all involved and that clarification is needed about the place and legal status of marital agreements”. However, “although [i]t will study the Law Commission’s proposals carefully and issue a fuller response in due course, [it is] concerned about the principle of marital agreements and the implications for marriage should they be more widely accepted. In a Christian understanding of marriage agreements of this kind would weaken and dilute our marriage vows of lifelong commitment”.

The Roman Catholic Bishop of Shrewsbury, Rt Rev Mark Davies, is quoted as saying that actively encouraging couples to prepare for the possibility of separation before they are even married would turn promises at the altar into little more than a “provisional” agreement. “It is a legal provision which would surely empty the words of the marriage promise for “better for worse … to love and to cherish till death do we part” of all meaning.

Comment

There is a clear divergence of opinion between the churches’ view of ante- and post-nuptial agreements and that of the courts, but the issue now appears to be whether the principles set down in Radmacher should be further developed and enshrined in statutory legislation. Perhaps the last word should go to the Court’s Press Summary of Radmacher in which it observes “[t]he law of marital agreements is in a mess and ripe for systematic review and reform”, on which there would appear to be general agreement.


[1] This does not include the law of Scotland, for which there is a separate Commission, or any law of Northern Ireland which the Parliament of Northern Ireland has power to amend.

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