Author: Sean O'Dwyer

You may have heard of a pre-nuptial agreement, or “pre-nup”, but you might not have heard of a post-nuptial agreementor “post-nup”. These agreements seek to do the same thing that a pre-nup does – to agree the financial outcome of any future divorce between you and your spouse – but the difference is that the agreement is entered into after marriage rather than before it.

A post-nuptial agreement has the same legal effect as a pre-nuptial agreement: provided that it has been done properly (both parties have had independent legal advice, they are entering into it freely, and are fully aware of its implications), and it would not be unduly unfair to apply its terms at the time of divorce, then it will be upheld in the event of any future divorce. The court tend to give them more weight than a pre-nup because the fact they have been entered into demonstrates an even clearer intention to be held to it (i.e. there is no impending wedding day which does place pressure on parties to sign pre-nups)

Some post-nuptial agreements are entered into very soon after the marriage, because the couple had been engaged in discussions regarding a pre-nup but had not managed to sign the pre-nup before the wedding.  If a pre-nup is signed very close in time to the wedding, it is best practice to reinforce and confirm the parties’ agreement with a brief post-nup in exactly the same terms, so that neither party can claim later that the pre-nup should not be relied upon due to it being signed late.

If you already have a pre-nup, you might choose to review the terms of your pre-nup years into the marriage, and your revised agreement would be a post-nuptial agreement. A review might be conducted to ensure that the terms of your pre-nup are still appropriate and fair, in the context of your married life now. If your financial or personal circumstances change considerably, for example you have moved country, or your health or your children’s health has become a factor to consider, you should take legal advice to “sense-check” the terms of your pre-nup.

Many couples enter into a post-nuptial agreement without ever having had a pre-nup. Scenarios in which a post-nup might be the best approach include:

  • you are due to receive a large inheritance or gift, and you want to make sure that it would remain ring-fenced in the event of your divorce in future;
  • you have set up a business during the marriage, or a business that you already owned prior to the marriage has increased significantly in value, and you do not want the future and continuity of that business to be affected by any divorce;
  • you are about to buy a property, and you and your spouse are contributing unevenly to its purchase price, and you wish to record that in a divorce your respective interests in that property would be reflective of your contributions rather than 50% each; or
  • you are being named as the beneficiary of a trust, or you intend to set up a trust, and you want to be clear about how that trust (or your beneficial interest in that trust) should be treated in the event of a divorce.  

The only difficulty with post-nuptial agreements is that there can be limited incentive for the financially weaker party to enter into them. Therefore their negotiation needs to be handled sensitively. Of course, in order for the post-nup to be fair at the time of the divorce, and therefore for it to be upheld, it will need to ensure that the fundamental financial needs of the financially weaker party are met. You can therefore assure your spouse that the agreement will not leave them “high and dry” and instead it is being entered into for a specific reason. Your lawyers can guide you through how best to discuss the post-nup with your spouse and will ensure that the messaging between solicitors aligns with that.