More and more people are now recognising the importance of getting good legal advice before a marriage and this advice will now include the option of a pre-nuptial agreement.
The parents of the happy couple are often the first ones to recognise the benefits of such an agreement, having struggled long and hard to maintain and build up a viable family business that could be passed down through the generations. In the past such an agreement was not going to be discussed as divorce simply was not an option. Since the introduction of divorce the question has been raised about the enforceability of such pre-nuptial agreements and with the government Report of the Study Group on Pre-Nuptial Agreements, Chaired by Inge Clissmann, Senior Counsel, now before the Minister for Justice, Equality and Law Reform for the last year, many in the legal world see changes in the law as inevitable. That Report concluded that pre-nuptial agreements are enforceable and capable of variation under existing Irish statute law and recommended that express statutory provision be made for pre-nuptial agreements by way of introducing a new section 16 (2) A of the Family Law Act 1995 and new section 20 (3) A of the Family Law (Divorce) Act 1996.
These are issues for all business owners and not just Hollywood celebrities and those in the Top 50 richlist. So what is the solution for the concerned parent or the self made soon-to-be spouse who need advice now? Irish business families can no longer afford to miss out on the use of a valid answer to these concerns. An appropriately drafted pre-nuptial agreement can provide the assurance and peace of mind required by those involved with the expectation of changes in the law to copper-fasten arrangements in the near future.
The first, most obvious and most important thing to point out about a valid pre-nuptial agreement is that it is a voluntary arrangement which will only be signed where there is agreement. There is no place for pressure or coercion in drawing up a pre-nuptial agreement. The recommended minimum requirements for a valid pre-nuptial agreement include:
— That the agreement should be in written form, signed by both parties and witnessed;
— That the parties should each have received separate legal advice as to the effect and meaning of the agreement;
— That each of the parties should have made disclosure of all relevant financial information; and
— That the agreement should be executed not less than 28 days before the marriage.
The actual content of the agreement is of course a matter for the parties involved and with proper legal advice any concerns and wishes of the parties can be reflected in the final signed agreement.
Examples of the type of situation where a pre-nuptial agreement might be sought include:
(1) Where there is a large asset imbalance between the engaged couple and they wish to make it clear from the outset how those assets should be divided upon any separation.
(2) A couple entering into a second marriage, whether following widowhood or divorce, and where they each wish to protect those assets held separately before the new marriage.
(3) Where an Irish person is engaged to a foreign national and there is a wish to protect assets already owned in separate countries.
(4) Circumstances where one of the engaged couple has or will have an interest in the family business and they wish to protect that business asset.
With all forms of pre-nuptial agreement it is important to bear in mind that if matters come to a dispute and end up before a Judge for a decision, the Judge will have what is currently a wide discretion to determine what is a fair financial settlement in the particular circumstances of the couple and any children involved. This discretion is an important part of Irish family law and it can allow a Judge to take into account the content and circumstances surrounding a pre-nuptial agreement in such a way as to give effect to the intention of the parties at the time of signing the agreement. According to the Report the weight to be attached to an agreement would be determined by the courts in the light of the legal requirement for proper financial provision. It is vitally important therefore to realise that a pre-nuptial agreement that is too one sided and tries to completely cut out off one spouse from financial provision is likely to fail.
In practice one finds that the inclusion of a clause that allows for the review, redrawing or termination of a pre-nuptial agreement after a set period of time, or following a specified event, can be enough to convince both parties that the agreement is fair. The growth in the take up of pre-nuptial agreements among engaged couples is a reflection of the knowledge among the wider public that there is a wide Judicial discretion when it comes to family finances on a separation and shows an eagerness on the part of the Irish public to order their own financial matters rather than leave it to the future discretion of a Judge unknown to any of the parties.
Ken Heffernan, Family Law and Divorce Solicitor, is experienced in dealing with these issues and can apply the legal requirements set out above to your particular case to advise you appropriately for your circumstances whether you are in Cork or elsewhere in Ireland.