Getting disclosure right in prenuptial agreements

Entering into a pre-nuptial agreement can prevent costs being incurred in sorting out financial matters if the marriage comes to an end.

A pre-nuptial agreement is a formal agreement entered into in the months leading up to a marriage. It records what the couple intend to do with their income and assets if they separate. Doing so can avoid the need for expensive negotiations and litigation.

Unfortunately that cost saving intention does not always work. Take the recently reported prenuptial case of WW v HW for example. In this case the couple incurred legal costs of £1.77m.

This case is interesting because the issue in dispute is quite unusual, People do argue about their prenups from time to time but for different reasons than the ones seen in this case.

One reason for arguing that a prenuptial agreement should not be enforced is that the other partner did not disclose enough or had, in other words, hidden income or assets. That could then clear the way for that partner to apply to court for a better settlement.

In this case, however, the husband was applying to court not because his wife had not disclosed assets but because he had disclosed more income and assets than he actually had. Presumably this was done to mislead his then fiancee that he was a successful business person/artist way beyond his true position.

When the divorce came around 11 years later the husband applied for a divorce financial order to meet his housing and living costs. The problem was that he had already agreed to a prenuptial agreement that neither he nor his wife would seek money from the other person.

It is perhaps surprising that the husband was successful but in modest terms.

The courts recognised that he had needs and that they would have to be met somehow. The presence of a prenuptial agreement will not mean that a court cannot intervene to make sure needs are met, especially if there are children of the family.

It is worth noting however that the money that the husband would have been granted was greatly reduced because of the husband’s dishonesty.

His conduct in giving evidence at trial and throughout the marriage and the litigation was very much criticised by the court for being unreliable.

In addition, the fact that he had entered knowingly into a pre-nuptial agreement contributed to the courts giving the husband the very least that they could in the circumstances.

There are lessons for us all in this case, even though this was a multi-million pound case.

Pre-nuptials must be entered into carefully with a full and proper understanding of all of the circumstances. More troubling however is that the wife had to make some financial provision to her husband when she would have expected to make none.

The challenge used to be to make sure that the other partner has disclosed everything they have got. It now appears necessary to also make sure that they have actually got everything they disclose!


If you are thinking about prenuptial agreements or want to know if your agreement is binding then you can get in touch with Diane Genders specialist divorce solicitors in Lincoln. You can call on 01522 561500 or email us in confidentiality by clicking here.