Article | Funding Your Divorce: Costs Explained

Written by Sarah Walker, Partner, Edwards Family Law. Edwards Family Law is authorised and regulated by the Solicitors Regulation Authority (SRA number: 658249).

Discovering a spouse’s affair can be deeply painful, and it is very common to wonder whether their cheating means you will receive a larger divorce settlement or a different outcome on child arrangements in England and Wales. In most cases, adultery itself does not change the financial settlement or child arrangements. Still, there are important exceptions.

This guide explains what the law actually says, when an affair might matter, and what practical steps you can take to protect yourself and your family.

1. Does adultery matter legally in the UK?

Since April 2022, you no longer need to prove adultery, unreasonable behaviour, or any other reason to get divorced. The Divorce, Dissolution and Separation Act 2020 introduced “no-fault divorce” to England and Wales, meaning you simply provide a statement that the marriage has irretrievably broken down.

The court does not investigate who is “to blame” for the breakdown. While the emotional impact of an affair is vast, the legal process itself is not about punishing an unfaithful spouse. Previously, adultery was one of five “facts” you could use to prove irretrievable breakdown, but this system no longer exists.

Key point: Whether or not your spouse had an affair, the divorce process is the same. You cannot mention the affair in your application.

2. Does cheating affect your divorce settlement?

In most cases, no. English courts do not punish infidelity in the division of assets. The family court’s primary focus is on fairness and on meeting both parties’ needs, not on moral judgment.

When deciding how to divide assets, the court considers the factors set out in section 25 of the Matrimonial Causes Act 1973:

The income, earning capacity, property and other financial resources each spouse has or is likely to have

The financial needs, obligations and responsibilities of each party, including housing needs

The standard of living during the marriage

The age of each party and the duration of the marriage

Any physical or mental disability

Contributions made by each party, including non-financial donations such as caring for children

The needs and welfare of any children of the family are a first consideration.

“Conduct” is only taken into account in rare cases where it would be inequitable for the court to ignore it. That threshold is very high and typically involves serious financial or personal misconduct rather than the fact of an affair alone.

A recent reported case which dealt with the issue of “conduct” is the case of Loh v Loh-Gronager [2025] EWFC 483. In this case Cusworth J determined a heavily contested financial remedy dispute arising from a short, childless marriage governed by a pre-nuptial agreement, in which the husband engaged in serious litigation misconduct. The court found that the husband had fabricated or doctored key emails and made systematic unauthorised withdrawals of substantial sums, most of which were treated as advances on his entitlement pursuant to a pre-nuptial agreement. Applying s.25(2)(g) MCA 1973 and Radmacher v Granatino [2010] UKSC 42, the court held that the husband’s conduct crossed the high threshold at which it would be inequitable to disregard it. The court found that fairness required a sanction beyond costs, resulting in significant deductions from the husband’s entitlement under the pre-nuptial agreement and a substantially reduced final award.

Notably, while the husband made some suspicious bank transfers that could suggest personal relationships, it was not any alleged affairs that constituted serious litigation misconduct. He was sanctioned for misappropriation of funds and egregious litigation misconduct, as well as an overall pattern of behaviour that undermined the integrity of the proceedings, for example, posting personal photographs of the wife on Instagram and instructing a private investigator to loiter outside her home. These actions, not marital infidelity, contributed to the court’s finding that his conduct crossed the s.25(2)(g) threshold.

At Edwards Family Law, we frequently act for clients who raise conduct issues within their financial proceedings, and we are able to advise on the merits and prospects of any potential conduct claim. We can guide you on whether such arguments are likely to be relevant, proportionate, and effective in the context of your case.

In a recent matter we acted for a husband whose wife made serious but ultimately false allegations of abuse in Children Act and Family Law Act proceedings. She incurred disproportionately high legal costs pursuing these claims compared with the husband, and the court ultimately penalised her litigation conduct in the financial settlement.

3. When an affair can affect your settlement: financial misconduct

Although adultery itself almost never changes the outcome, how your spouse spent money during the affair can sometimes be relevant. This is often described as “dissipation of assets” or “financial misconduct”.

The amount of money that is dissipated has to be significant and cannot just comprise of gifts or holidays, examples of “financial misconduct” might include:

Significant monetary transfers to an affair partner

Using marital funds to purchase a property in the affair partner’s sole name without the other spouse’s consent

Setting up the affair partner in a business using marital funds

Where one spouse has used marital funds in this way, the court can take the dissipation into account when deciding a fair settlement. This might mean “adding back” the sums that have been spent so the innocent spouse is not unfairly disadvantaged.

For higher-value or more complex cases, forensic accountants, careful analysis of Form E financial disclosure, and targeted questionnaires can be used to unpick unusual spending patterns and uncover hidden assets or accounts.

Our lawyers have acted in a case where a husband deliberately made himself bankrupt in an attempt to frustrate his wife’s financial claim and spending lavishly (amounting to hundreds of thousands of pounds) on his affair partner. This was a rare instance in which the husband’s financial misconduct, linked to his affair, was relevant to the overall outcome of the case.

4. Does an emotional affair count as adultery?

Legally, no. Under the old divorce law, adultery was defined as voluntary sexual intercourse between a man and a woman. A close relationship involving messages, emotional intimacy, or even kissing, but without sexual intercourse, was not considered adultery.

However, this distinction no longer has a practical effect. Since no-fault divorce was introduced in April 2022, you do not need to prove adultery or categorise your spouse’s behaviour at all. You simply state that the marriage has irretrievably broken down. If an emotional affair has led to serious financial misconduct (described above), that spending can still be relevant to the monetary settlement, regardless of whether it was a physical or emotional relationship.

5. Will an affair affect child arrangements?

An affair alone will not affect custody or contact arrangements. The court’s priority is always the child’s welfare under the Children Act 1989, and having an affair does not make someone an unfit parent.

However, the circumstances around the affair can be important:

If the new partner presents a safeguarding risk because of their behaviour, substance misuse, or history

If the home environment has become unstable, with frequent arguments, moves, or emotional distress affecting the children

If a parent is prioritising the new relationship over their caring responsibilities, leading to neglect or unreliability

In such situations, the court may consider adjusting living arrangements and contact patterns, or imposing safeguards to protect the children’s well-being. The focus remains on stability, safety, and the children’s long-term emotional health, not on punishing a parent for having an affair.

Our team includes specialists in complex children’s matters. Our lawyers have recently acted in a matter where child arrangements and safeguarding had to be considered in light of the fact that a new partner was charged for a serious criminal offence. For more information, see our guide to child arrangements.

6. Can I sue my spouse for having an affair?

No. There is no legal claim for adultery in England and Wales. Unlike some US states, which allow claims for “alienation of affection”, the UK has no equivalent. You cannot sue your spouse or the affair partner for damages.

The only legal avenue is through divorce proceedings and the financial settlement process. If your spouse has misappropriated marital funds in the context of an affair, you can raise this as financial misconduct, but there is no separate claim for the emotional harm caused by infidelity.

7. The emotional reality versus the legal reality

There is often a painful gap between how betrayed spouses understandably feel and what the law can actually do about that betrayal. Many people expect the court to “compensate” them financially for the affair. Still, the legal focus is on meeting needs and achieving a fair, workable outcome for both parties and the children.

That does not mean your emotions are not valid. Feelings of anger, shock, grief, and confusion are widespread. Seeking therapeutic support alongside legal advice can help you process what has happened and make clear, informed decisions about your future.

“Some clients come to us expecting the court to financially penalise their ex-spouse for their behaviour during the marriage. We help them understand that the legal system focuses on practical outcomes, not moral judgements. That said, we fight hard to ensure any financial misconduct is fully accounted for.”

8. Practical steps if you have discovered an affair

Once the initial shock subsides, it can help to take some calm, practical steps:

1. Prioritise your wellbeing

Ensure you are eating, resting, and relying on trusted friends, family, or a counsellor. You do not have to make every decision immediately.

2. Gather key financial information

Gather all relevant financial documents that are readily accessible, such as bank statements, mortgage records, investment and pension information, and any business accounts that can reasonably be produced. This should be done in line with the principle from Imerman v Imerman, which provides that disclosure should generally be limited to documents that can be “found on the kitchen table,” without breaching your ex-spouse’s confidentiality or going beyond what is proportionate.

An “Imerman document” refers to a document in divorce or financial proceedings that is confidential and personal to one spouse, often business, personal, or financial records, which the other spouse cannot access without consent or a court order.

This is a complex area of law, and you should seek specialist legal advice regarding which documents you are entitled to access. At Edwards Family Law, we have extensive experience advising clients on the management and disclosure of “Imerman” documents.

3. Document any suspected financial misconduct

Keep a record of unusual withdrawals and transactions. However, avoid any unlawful access to accounts or devices.

4. Avoid retaliatory action

Try not to make significant financial decisions, move money, or confront the affair partner in a way that could escalate conflict or risk allegations against you.

5. Seek early legal advice from a specialist

Speaking to an experienced family solicitor at an early stage can help you understand your options, timelines, and likely outcomes before you decide whether to separate or divorce.

6. Consider emotional and relationship support

Whether you are considering reconciliation or separation, professional counselling can support you in processing the betrayal and thinking clearly about the future.

9. Frequently asked questions

Does cheating affect divorce settlements in the UK?

Generally, no. The court is not there to punish a spouse for infidelity, and adultery alone does not usually entitle the other spouse to a larger share of the assets. However, if the cheating spouse has engaged in serious financial misconduct related to the affair, this may be taken into account when dividing assets.

Can I get more money because my spouse cheated?

You are unlikely to receive more money just because of the affair, but you can raise concerns about assets that have been spent or hidden as part of the relationship. The court will still base its decision on needs, resources, and fairness overall, not on moral blame.

Is adultery still grounds for divorce in England and Wales?

No. Since the introduction of no-fault divorce in April 2022, you no longer need to prove adultery or unreasonable behaviour to obtain a divorce. A simple statement of irretrievable breakdown is enough, whether or not an affair has occurred.

How does an affair affect child custody?

An affair on its own does not usually affect child arrangements. The court will consider the children’s best interests, including whether the new relationship presents any safeguarding issues or instability that might affect the children’s welfare.

Can I claim compensation for emotional distress caused by the affair?

No. There is currently no separate claim in English family law for damages for emotional distress caused by adultery. While the emotional impact is very real, the financial settlement is based on needs, resources, and fairness rather than compensation for hurt feelings.

What if my spouse denies the affair?

It does not matter for the divorce itself, as you no longer need to prove adultery. However, if you are claiming financial misconduct, you will need evidence of the misappropriation of funds. This can often be discovered through the financial disclosure process by way of exchange of Forms E.

Does it matter if my spouse is now living with the affair partner?

This can be relevant to the financial settlement. If your spouse is now co-habiting, their housing costs may be shared, which could affect the court’s assessment of their needs. It does not, however, mean you are automatically entitled to more.

How Edwards Family Law can help

If you have discovered your spouse is having an affair and are unsure what to do next, our team can guide you through your options, from initial advice and financial disclosure through to negotiated settlements or court proceedings where necessary.

We provide discreet, strategic advice tailored to your personal and financial circumstances, with a particular focus on protecting children’s welfare and long-term financial security.

“For a confidential discussion about your situation, contact one of our partners Kelly Edwards, Daniel Chalmers or Sarah Walker, who specialise in complex financial remedy and high net worth divorce cases. Call [020 3983 1818] or email [contact@edwardsfamilylaw.co.uk] to arrange an initial consultation.” Edwards Family Law is authorised and regulated by the Solicitors Regulation Authority (SRA number: 658249).

Overview

In Loh v Ardal Loh-Gronager (following earlier reported judgments in Loh v Ardal Loh-Gronager [2024] EWFC 241 and Y v Z [2025] EWFC 221), Cusworth J heard a heavily contested final financial remedy hearing arising from a short childless marriage.

Cusworth J described the husband’s actions as amounting to “the most serious level of litigation misconduct that may be seen in these courts”. While the judge was swiftly able to conclude that the husband’s deplorable conduct merited significant sanction, he had to contend with whether this should solely be addressed in the arena of costs or also in the substance of the award made.

Background

The wife was extremely wealthy, with substantial business assets and trust interests. The husband, a former investment banker, entered the marriage with comparatively modest assets. The parties entered into a comprehensive pre-nuptial agreement in March 2019, expressly disapplying the sharing and compensation principles and defining “Separate Property”, “Joint Property”, and a limited “exceptional one-off fund” of £100,000 intended to provide short-term security on separation.

Although the parties had been living together for a few years before their marriage the marriage lasted approximately four years, and they had no children.

Under the pre-nuptial agreement, the husband’s accrued entitlement at separation was agreed to be £6,449,802, subject to accounting for sums already received.

Disputed Issues

The court was required to determine whether several substantial payments taken by the husband during the marriage were:

Gifts or Separate Property, as the husband contended; or
Unauthorised withdrawals, to be treated as advances against his entitlement under the pre-nuptial agreement.

The disputed sums comprised:

£655,000 withdrawn from joint accounts (2020–2021);

£750,000 withdrawn later to fund the running costs of the husband’s investment business;

£2.05m taken from mortgage funds under a power of attorney (November 2022); and

£1m transferred shortly before separation (April 2023).

Central to the husband’s case was his reliance on three emails said to evidence the wife’s knowledge and consent.

Key Findings

Creation and/or doctoring of emails: Cusworth J found that on the balance of probabilities, that the husband had created and/or doctored three emails relied upon to support his case. The originals had been deliberately destroyed, and the PDFs produced were found to be unreliable. This was described as serious litigation misconduct, undermining the integrity of the court process.

Joint Accounts and Separate Property: Cusworth J stated that even if the husband had understood that the money in the joint account was now joint property, he could not have sensibly thought that by taking it for himself it would become his Separate Property. The judge also rejected the husband’s case that those funds had been converted from joint to Separate Property by the husband taking them. He stated “the wife had made them available to meet joint expenses. If they were not so employed, but were removed from the joint accounts, then they would revert to being notionally hers in the absence of any different express agreement”.

Individual sums: In relation to the individual sums the judge found the following:

The £655,000 was systematically removed and invested by the husband without consent. The judge therefore treated this as sums taken on account of his pre-nuptial agreement entitlement.

The £2.05m that the husband was taken from the mortgage account was found not to be a gift. They were funds that were intended to continue to service the mortgage account. This was also treated as an advance on his entitlement.

The £1m that the husband took during the marital breakdown was found to be done under false pretences and again treated as an advance on his entitlement under the pre-nuptial agreement.

In relation to the £750,000 that was transferred for business running costs, although unauthorised, the court accepted that had the wife known that they were being used for this purpose she would probably have approved of that use.

Conduct and Fairness

Applying s.25(2)(g) MCA 1973 alongside the fairness test in Radmacher v Granatino [2010] UKSC 42, the court held that the husband’s conduct plainly crossed the threshold at which it would be inequitable to disregard it.

The conduct included systematic unauthorised withdrawals, concealment of financial activity, attempts to intimidate and distress the wife (including posting personal photographs of the wife on Instagram and instructing a private investigator to loiter outside of the wife’s London home on her birthday and pose as a member of the press).

While the judge declined to extinguish the husband’s entitlement to a settlement entirely, he found that fairness did require a partial substantive sanction beyond costs alone.

Outcome

Starting from the PNA entitlement of £6.45m, the court deducted:

£655,000

£2,050,417

£1,000,000

plus 50% of the £750,000 business costs (£375,000) to penalise the husband for his conduct.

This resulted in a final award of £2,369,385 to the husband.

The court indicated that there would be an indemnity costs order made against the husband, to be determined separately.

Key Takeaways

Conduct is rarely taken into account in financial remedy proceedings, reflecting the court’s consistent reluctance to allow litigation to descend into moral judgment or satellite disputes about behaviour.

Section 25(2)(g) MCA 1973 sets a deliberately high threshold, providing that conduct will only be taken into account if it is so serious that it would be inequitable to disregard it. This case is a striking example of that threshold being met.

The court found that the husband had engaged in egregious litigation misconduct, including the fabrication of evidence and deliberate attempts to intimidate and distress the wife during the proceedings. In those exceptional circumstances, the judge held that fairness required the husband’s entitlement under an otherwise valid pre-nuptial agreement to be adjusted, demonstrating that while conduct arguments will usually fail, they will succeed where behaviour fundamentally undermines the integrity of the process and the court’s confidence in the party advancing them.

Every case is different and will turn on its own specific facts. There is a question over whether a judge would take the same approach to this conduct if there was no pre-nuptial agreement or if the funds in the joint account had not all so clearly emanated from one party, in this case the wife. At Edwards Family Law we frequently act for clients who raise conduct issues within their financial proceedings, and we are able to advise you on the merits and prospects of any potential conduct claim. We can guide you as to whether such arguments are likely to be relevant, proportionate, and effective in the context of your case.

You’ve just received a substantial inheritance from a deceased parent or relative. It may represent family legacy, financial security, or funds intended for your children’s future. Then your marriage deteriorates, and you’re facing divorce. Here’s the critical question: Will you have to share your inheritance with your spouse?

The answer isn’t simple. Whether inherited money remains yours, is partially divided, or is fully divided depends on multiple factors, such as when you inherited it, how you used it, whether you mixed/mingled it with marital assets, and what the court decides is “fair.” This complexity makes inheritance one of the most contested issues in d ivorce settlements in family law.

This comprehensive guide explains how inheritance is treated in divorce, how to protect inherited wealth, and what to do if inheritance issues arise in your settlement negotiations/court proceedings.

The Basic Legal Principle: Is Inherited Money Separate Property?

The Starting Position

In English law, inheritance is considered non-matrimonial property. This means:

Money inherited during marriage remains, in principle, separate property. It’s not automatically shared equally with your spouse on divorce. However, the English court has substantial discretion to override this presumption if they believe fairness requires it. In some cases, inherited assets may be included in the division of assets, with the court making an unequal division if the circumstances or needs of the parties justify a departure from an equal split.

Robson v Robson (2010)

The landmark case of Robson v Robson confirmed that inherited property is not treated as matrimonial property, even if received during the marriage. However, the court also confirmed that:

Inherited property can be considered as an available resource. If it is necessary to meet a spouse’s financial needs, courts may make claims against inherited wealth. The weight given to inherited property depends on its use and the circumstances.

Bottom line: Inherited money is protected but not absolutely insulated from division in divorce.

How the English Family Court Treats Inherited Money: Key Factors

The court considers various factors when deciding whether inherited money remains yours or is divided:

1. When the Inheritance Was Received

During the marriage: The longer the marriage continues, the more likely inherited assets become intermingled with marital assets. If inherited assets are mingled then they will likely be available for division on divorce.

After separation: If you receive your inheritance after separation, it generally will remain separate unless one spouse cannot meet their needs from their share of the existing assets.

Once a “clean break” order has been made: Once a final financial order has been made with a clean break, all future financial claims between spouses are dismissed. Any inheritance received after that point is a post-order asset, and your ex-spouse has no entitlement to it. (Although this assumes that full and drank disclosure wad made at the time the order was approved).

2. How You Used the Inherited Money

This is critical. The court will distinguish between:

Money or assets that are “ring-fenced” (i.e. kept completely separate): This includes where funds are held in a separate bank account in your sole name and have not been mixed with marital assets and has not been used for the family’s benefit (for example payment of a mortgage secured against the family home).

Partially Mixed: An example of partial mixing is where you used some of the inheritance for a down payment on a family home and/or contributed to the payment of the mortgage from your separate inherited assets.

Fully Integrated: This would include a situation in which your entire inheritance was used to pay for a family home and/or used to meet family living expenses. You may also have spent your inherited funds on joint family projects or investments, thereby co-mingling them with marital assets. If you placed inherited money into a joint account and used it for shared expenses, the court may also find it more difficult to exclude it from consideration.

3. The Length of the Marriage

Short Marriage (1-5 years): If you divorce after a short marriage, the court will be more reluctant to divide assets not acquired during the marriage (unless there are children and it is necessary to invade inherited assets to meet needs).

Medium Marriage (5-15 years): How your inheritance has been deployed will be critical. The court may invade inherited assets to meet needs, especially if there are children of the marriage.

Long Marriage (15 or more years): The longer the marital partnership, the more likely the inherited assets will have been mingled and therefore treated as marital. It is also more likely that inherited assets will need to be invaded to meet a needs claim.

4. The Financial Needs of Your Spouse

This is crucial. Even if inheritance is technically separate property, if one party’s financial needs cannot be met from their own resources combined with their share of the matrimonial pot, the court may order that assets be divided equitably to prevent hardship.

This is divided into housing and income needs. If there is not enough money in the matrimonial pot and there are inherited assets, the court may order that a portion of the inherited property be used to meet needs. The inherited property will be divided to ensure your spouse is not left in financial hardship. If your spouse is financially independent or has adequate resources, inherited property is much more likely to remain untouched.

5. Whether You Have Other Matrimonial Assets to Meet Needs

If you have sufficient other matrimonial assets (marital property, retirement savings, other investments), the court is more likely to protect inherited property. If inherited wealth is your only significant asset, the court may be more willing to divide it (although depending on the value of your inheritance they will not necessarily divide it equally).

Civil Partnership and Divorce: How Inheritance Is Treated

The principles governing civil partnerships are the same as those for married couples. Still, there are important nuances to consider, especially when dividing matrimonial assets and inherited wealth.

When determining how to divide assets in a dissolution of a civil partnership or divorce, the court will consider the same factors as they would upon a dissolution of a marriage. As in divorce arising from marriage, the overriding principle is fairness, and the court’s primary aim is always to ensure that the financial settlement meets the needs of both parties and any children.

Pre and Post-nuptial agreements

Pre-nuptial and post-nuptial agreements can play a crucial role in protecting inherited assets in both marriages and civil partnerships. While such agreements are not binding in England and Wales, they are being given increasingly significant weight. Such agreements can clarify how inherited and other assets will be divided upon separation, providing greater certainty and protection for inherited wealth.

Protecting Inherited Wealth in Divorce

1. Keep Inheritance Completely Separate

If you’re anticipating or have received an inheritance it is important to try and “ring fence” your inheritance by keeping it entirely separate.

Bank Accounts: It is advisable to open a separate account in your sole name. You should not deposit marital funds into this account or allow your spouse to access the funds in that account. You should keep all your transaction records so that in the event of a divorce you can evidence that the funds have been ring fenced.

Investments: Invest inherited funds in separate investment accounts in your sole name. It may be sensible to invest via a different financial institution from the one used for marital investment accounts, although that is not essential provided your inheritance is clearly kept in a separate account. You should maintain clear records of the source of the investments.

Property: If you own real estate separately, it is advisable to keep or purchase the property in your sole name and it is essential that you do not include your spouse’s name on the title. Do not use inherited property as a marital residence (if possible).

Documentation: Keep copies of inheritance documents (will extracts, tax documents, transfer documents). Maintain records showing the source of the inheritance and document date of receipt and fund movements.

2. Create a Will or Trust Protecting Inherited Wealth

Before marriage or early in marriage:

Update your will to protect inherited assets for your children or heirs. Consider trust structures that protect inherited family wealth.

3. Enter into a Post-nuptial Agreement

If you’ve already received an inheritance (or expect one) and want clear protection it is advisable to enter into a post-nuptial agreement (agreement signed during marriage). This will document that inherited wealth remains separate property. The agreement should specify how inherited property is treated if the marriage ends. Both parties must receive independent legal advice for enforceability.

4. Avoid Co-mingling Inherited Funds

You should try and keep your inherited property separate from marital property by avoiding co-mingling. This means there will be less ambiguity as to the source of the funds in the event of a divorce and can lead to fewer disputes and lower legal costs in the long-run.

5. Full Financial Disclosure

Full and frank disclosure of inherited property is essential. If inherited assets are not disclosed and your spouse later becomes aware of this, they may make an application to the court to set aside the financial order.

If you are found to have been dishonest in your disclosure, there may be adverse costs consequences. In addition, it is likely to damage your credibility before the court and may result in you losing the judge’s confidence and sympathy over the longer term and you may get a worse result than if you had just been full and frank from the outset.

6. Obtain Legal Advice Early

If you are considering a divorce and you have inherited assets you should consult a family law solicitor early so that you can discuss with them how best to protect your inherited wealth and understand what is at risk.

The Role of Your Solicitor in Inheritance Matters

A specialist family law solicitor helps by:

Evaluating whether your inherited property is protected or at risk.

Gathering evidence showing the inheritance source and how funds were used.

Negotiating with your spouse’s solicitor to exclude or limit claims on inherited property.

Drafting agreements that protect inherited wealth.

If the spouse has received an inheritance, investigate and recover it.

Presenting evidence effectively if inheritance disputes go to court.

Why Choose Edwards Family Law for Inheritance Matters?

At Edwards Family Law, we have extensive experience protecting inherited wealth in divorce and family law proceedings.

Edwards Family Law specialises in protecting the interests of high net worth clients in family law matters, including inheritance protection, asset division, and pre-nuptial and post-nuptial agreements. Our team combines family law expertise with forensic financial analysis to protect clients’ interests and assets.

This article is for general information purposes only and does not constitute legal advice. Family law continues to evolve, and each situation is unique. For advice specific to your situation, contact Edwards Family Law.

You’ve built your business from the ground up. It’s your life’s work, your income source, and the biggest asset you own. Then comes divorce, and suddenly your business becomes contested territory. Divorce is often a highly stressful experience for all involved, especially when it comes to splitting assets. The process of dividing assets can be legally and emotionally complex, particularly when a business is involved.

For business owners divorcing, the stakes are high. How your business is valued, divided, and addressed in a divorce settlement can affect not just your personal finances but also your company’s viability, your employees’ livelihoods, and your professional reputation.

This comprehensive guide explains how businesses are treated in divorce, how they are valued, what options exist for protecting or dividing your company, and most importantly, how to preserve both your business interests and your financial security.

How Are Businesses Treated in Divorce?

The way a business is treated in divorce proceedings depends on when it was acquired, how it’s structured, and the degree of growth during the marriage. During the divorce process, business interests must be disclosed, valued, and considered in the overall asset division in accordance with family law principles.

Business Acquired Before Marriage

Generally, a business owned before marriage is considered non-matrimonial property. However, this classification does not automatically preclude the company from consideration in divorce settlements.

A business that was set up before the marriage is typically treated as follows:

Starting point: Non-matrimonial property, meaning it is not automatically subject to division.

Growth consideration: Any significant growth in value during the marriage may be considered matrimonial property and subject to division, notably if the other spouse contributed indirectly (for example, by supporting the household whilst the business owner focused on the company) or directly (for instance, by working in the business or contributing skills).

Income assessment: The business can be valued and included in the asset pool for settlement purposes if it is a primary income source, as courts assess financial resources available for maintenance obligations.

Partial consideration: The business may be partially considered as matrimonial property if the value of the business grew during the marriage.

The key distinction is between pre-marriage value (non-matrimonial) and growth during marriage (matrimonial). Courts carefully analyse the extent and type of growth (i.e. passive growth vs active growth) and the contributions that facilitated that growth to determine how much of the current value is subject to division.

Business Acquired During Marriage

A business started during marriage is typically matrimonial property. Both spouses have potential claims against it, regardless of who is the active owner or manager. This classification reflects the principle that marital assets are acquired through the efforts and resources of both parties, even if only one spouse is directly involved in business operations.

Courts recognise that marriages are economic partnerships. If a business is created during the marriage, whether using marital funds, marital effort, or both, it is generally treated as a marital asset available for division.

Businesses Built by Both Spouses

If both spouses contributed to business growth, one managing operations whilst the other manages finances and administration, or both are working in the business, both have claims. This is common in family businesses where different spouses bring different skills.

Businesses built by both spouses are generally considered matrimonial assets and are included in the pool of assets to be divided during divorce. The extent of each spouses’ claim depends on the nature and value of their respective contributions.

How Are Businesses Valued in Divorce?

Business valuation is a critical and often contentious issue in divorce. The goal is to establish a fair market value that reflects what a hypothetical buyer would pay for the business. Multiple valuation approaches exist, and courts are keen to see that the most appropriate method is used for the given circumstances of the case.

1. Income Approach (Earnings Based Valuation)

This approach values the business based on the profit or cash flow it generates.

Advantages:

Reflects actual earning potential
Used effectively for businesses that generate income
Captures future viability

Disadvantages:

Requires agreement on the appropriate multiple
Sensitive to profit fluctuations
Can potentially be manipulated (owners may reduce reported profit to reduce valuation)

Courts may also consider the business’ projected future income when determining its value and the financial resources available for settlement.

2. Asset Approach (Balance Sheet Valuation)

This measures the business’ value as the net value of its assets minus liabilities.

Advantages:

Objective, based on the balance sheet
Clear and verifiable
Useful for asset-heavy businesses (manufacturing, property investment)

Disadvantages:

Ignores earning potential
Ignores brand value or reputation
May significantly undervalue service businesses with few physical assets

3. Market Approach (Comparable Sales)

This values the business based on recent sales of comparable businesses. Financial experts examine transactions in which similar companies, or even the business in question, have been sold or acquired.

Advantages:

Market-based; reflects absolute transaction values
Provides external validation
Rooted in actual sales data

Disadvantages:

Few comparable sales may be available
Every business is different
Comparable sales may be old or in different markets
Market conditions can significantly vary

4. Hybrid Approaches

Most professional valuations use combinations of the above methods, which provide a more comprehensive picture.

Key Issues in Business Valuation for Divorce

1. The Valuation Date

Businesses are valued at a specific point in time, and the choice of date significantly affects the value:

Options for valuation date:

Date of separation (business may have grown or declined since)
Date of settlement negotiation (may be 2-3 years after separation)
Date of trial (may be 3-4 or more years after separation)

Impact: A growing business valued on the separation date versus the settlement date can differ by hundreds of thousands of pounds.

Court practice: There is no fixed rule. Courts consider the fairness and practicality of each case. Whilst some cases use the separation date, others use the settlement date or the date of trial. The valuation date is determined through negotiation or, if necessary, by court order, and is not fixed by default.

Important: Don’t assume the valuation date is the settlement or trial. This must be explicitly agreed to or determined by the court.

2. Discounting for Lack of Control and/or Risk

If the spouse receiving the business interest isn’t an active manager or a majority shareholder, courts typically apply a discount for lack of control because the shareholder cannot direct management decisions, control distributions or influence strategic direction.

In certain cases, a business valuation may include a discount to reflect commercial risk and uncertainty. This can arise where a business is dependent on a small number of clients, has volatile or unpredictable earnings, relies heavily on key individuals, or is exposed to market or regulatory change. Any adjustment for risk must be supported by expert evidence and will depend on the specific characteristics of the business and the overall fairness of the outcome.

3. Synergy and Goodwill

Goodwill is the value of the business reputation, customer relationships, and brand. Courts must carefully distinguish between the two types:

Personal Goodwill: Value based on the owner’s personal reputation, skills, or relationships. This does not transfer to a buyer and therefore does not constitute a divisible marital asset. If a veterinary practice is valued partly because of the specific veterinarian’s reputation, that portion of value remains with the veterinarian post-divorce.

Business Goodwill: Value transferable to a buyer; this belongs to the business asset itself and is potentially subject to division.

Adjustment for passive growth: Courts also consider whether value growth was passive (e.g., due to general market inflation) or active (resulting from one or both spouses’ efforts). Passive growth is typically treated differently from active growth.

Options for Dealing with the Business in Divorce

Once a business is valued, the parties must decide how to address it. Several options exist, each with distinct implications.

Option 1: One Spouse Buys Out the Other

How it works: The business owner retains the company. The other spouse receives cash (or other assets) as their share. The business owner must finance the buyout.

Financing methods:

Personal savings
Business loan
Instalment payments over time
Trading off other marital assets of equivalent value

Advantages:

Business continuity (no disruption to operations)
Owner remains in control
Clear, clean division of interests
The other spouse receives a definite settlement

Disadvantages:

Requires significant cash or financing capacity
Takes the owner’s capital (may strain business or personal finances)
May require business restructuring to facilitate buyout
Risk of future disputes if the business value increases significantly after the buyout
May be difficult to agree on discounts to be applied for risk

Option 2: Sale of the Business

How it works: The business is sold to a third party. Proceeds are divided between spouses pursuant to a court order. Both spouses exit the business entirely.

This is one of the most straightforward ways to achieve a clean break in divorce, as it removes ongoing financial ties.

Advantages:

Clean break; both parties receive cash
No ongoing entanglement or business conflict
Proceeds are verifiable and clear
Eliminates future disputes about business direction

Disadvantages:

The business may sell for less than its valuation (buyer will negotiate)
Can experience operational disruption during the sale process
Employees may be affected
The sale process may take months or years
May not sell if the market is unfavourable
Loss of income source for the selling spouse

Option 3: Both Spouses Remain in the Business

How it works: Both spouses remain co-owners or managing partners. Financial arrangements are formalised (e.g. profit allocation, decision-making rights, management roles).

Advantages:

Neither party is forced to sell or exit
Business continuity maintained
Both retain investment upside

Disadvantages:

Ongoing entanglement and potential conflict
Difficult to maintain a professional relationship post-divorce
May poison business relationships or culture
One spouse may feel trapped in a partnership with an ex
High risk of disputes over business decisions
Only viable if spouses maintain respectful, professional relationships

Option 4: Structured Settlement (Offset Against Other Assets)

How it works: One of the spouses may receive alternative assets (property, pension, investments, cash) in lieu of giving up their interest in the business. The business owner retains full control and ownership.

Advantages:

Owner retains business control
No buyout required immediately (avoids cash flow problems)
Clean break from spouse’s perspective
Spouse’s entitlement is satisfied from other assets

Disadvantages:

Requires sufficient other assets to offset business value
May strip the owner of other valuable assets
Spouse may receive unfavourable asset mix (e.g., illiquid assets)

Structured settlements like this can help both parties reach a fair agreement that reflects their respective interests and needs.

Option 5: Court Order for Specific Division

How it works: The court orders specific terms for business treatment. This may include a phased buyout, earn out provisions, or other structures. The court may also issue a property order to specify how business assets or other property should be managed or divided.

Protecting Your Business Interests in Divorce

1. Obtain an Independent Valuation Early

Don’t wait until divorce settlement negotiations. Early in the process:

Commission a professional business valuation
Understand the value of your business
Know your financial position
Assess what buyout or settlement is affordable
Identify which valuation methodology is most favourable to your position

2. Separate Business and Personal Assets

The cleaner your business finances are, the easier it is to value the business, and the stronger your position.

Actions:

Use separate business bank accounts (not personal)
Maintain clean, detailed business records
Avoid personal loans from the business
Segregate personal and business property
Document all business transactions

A clear separation of business and personal finances may also assist in clarifying which assets are matrimonial and therefore subject to division in divorce.

3. Document Business Growth Timing

If the business was started before marriage or grew dramatically after separation:

Maintain evidence of the value of the business at key dates
Document when the business was acquired
Show growth trajectory (before versus during versus after marriage)
Keep records demonstrating what value is pre-marriage (non-matrimonial) versus growth during marriage (matrimonial)

This affects whether the business is classified as separate or matrimonial property. Documenting business growth is important because the court will consider each party’s personal circumstances and the source of growth when determining the division of assets.

4. Protect Business Secrets and Confidential Information

In settlement negotiations or court proceedings sensitive business information (customer lists, pricing, technology) may be exposed. It may be prudent therefore to request confidentiality undertakings/orders to protect sensitive information and to work closely with your solicitor to minimise exposure whilst meeting any court ordered disclosure obligations.

5. Consider Pre-nuptial or Post-nuptial Agreements

For business owners:

Pre-nuptial agreements signed before marriage can provide valuable protection for your business by establishing clear terms about how it will be treated in divorce. However, it is essential to understand that, in English law, pre-nuptial agreements are persuasive rather than automatically binding.

How courts treat prenuptial agreements: Under the landmark Supreme Court decision in Radmacher v Granatino (2010), English courts will consider pre-nuptial agreements as an important factor, but they are not binding. Courts retain discretion to depart from the terms if they believe doing so is fair in all the circumstances, particularly if:

There has been a significant change in circumstances since the agreement was signed;
One party lacks financial needs;
There are children whose welfare must be considered;
The agreement was not entered into freely and with full disclosure.

Post-nuptial agreements (made during marriage) can be adjusted if business circumstances change significantly. These agreements clearly establish that the business is separate property or clarify how it would be divided.

What a good agreement should include:

Clear identification of the business and its value at the time of the agreement
Statement of intent regarding treatment of business in divorce
Provision for how business growth will be treated
Details of how the business is to be valued if needed
Clarity on whether the non-owning spouse has any claim to future growth

Red Flags: Protecting Yourself If Your Spouse Owns the Business

If your spouse owns the business, protect yourself from:

Undisclosed Value

The business may be undervalued to reduce your entitlement. Take these steps:

Commission an independent valuation
Review business records thoroughly
Look for hidden profits or concealed assets
Check tax filings versus actual business records
Engage forensic accounting if needed

Both parties must ensure full disclosure of business assets to achieve a fair settlement. Non-disclosure can result in sanctions and the reopening of the settlement.

Diverted Income

A spouse may divert business profits to other entities:

Look for loans to family members or related companies
Check for unusual business transactions
Review tax filings versus actual business records
Examine the director’s loan accounts
Assess whether income matches lifestyle

Hidden or diverted income can affect the court’s assessment of each party’s earning capacity, which in turn impacts the financial settlement in divorce proceedings.

Lifestyle Concealment

Spouse may live extravagantly whilst claiming business is struggling:

Document lifestyle expenditures
Use forensic accounting if needed
Gather evidence of actual spending patterns

The Role of Your Solicitor in Business Divorce Issues

A specialist family law solicitor helps by:

Valuation Guidance: Understanding how courts value businesses; advising on appropriate methodology and negotiating fair valuations

Expert Instruction: Knowing which valuers, accountants, and forensic experts to engage

Negotiation Strategy: Developing a settlement strategy that protects your business interests

Court Presentation: Presenting business evidence effectively if a trial is needed

Tax Considerations: Understanding the tax implications of business transfer or division (tax advice from an accountant is essential)

Documentation: Drafting orders that properly document how the business is handled

Full Disclosure: Ensuring compliance with court obligations for full disclosure of business assets and information

A specialist family law solicitor can help you achieve a fair financial settlement that addresses all aspects of asset division and ongoing financial obligations.

Why Choose Edwards Family Law for Business Divorce Matters?

At Edwards Family Law, we have extensive experience advising business owners through divorce. We understand:

1. Business Complexities: We understand business structures (sole proprietorships, partnerships, limited companies), valuation methodologies, and how courts assess business interests.

2. Strategic Approach: We develop settlement strategies that prioritise business continuity whilst protecting your financial interests.

3. Advocacy: When disputes arise about business valuation or division, we advocate robustly for your position.

4. Practical Solutions: We understand the real-world implications of divorce orders on business operations and help craft solutions that work.

If you are a business owner facing divorce, professional legal guidance is essential.

This article is for general information purposes only and does not constitute legal advice or business advice. Each business situation is unique. For advice specific to your situation, contact Edwards Family Law and consult your company accountant.

The first working Monday in January – today – is often labelled “Divorce Day”. But much like “Blue Monday”, the origins of which are a PR campaign to encourage Brits to purchase holidays, “Divorce Day” has little basis in fact in our experience as family lawyers.

We are therefore re-thinking Divorce Day today.

There is a moment in every divorce journey that clients remember clearly. It’s not always the day the divorce application is filed or the day a court order is finalised. Often, it’s the day the reality of divorce sets in; the day when the uncertainty of the future overwhelms. To us, this is that client’s Divorce Day.

Divorce Day looks different for everyone. For some, it comes with grief. For others, it brings relief mixed with fear. For almost everyone it gives pause for thought and in some cases may give rise to panic or a real sense of urgency. Many query at this stage how best to progress towards a constructive outcome, which step comes next and how best to protect their position and that of their children.

This is where experienced legal guidance makes a meaningful difference.

Feelings and concerns that may set in on Divorce Day

The stability and well-being of a client’s children
Housing, assets, and financial security in the long term
Communication with a spouse who may be angry, distant, or uncooperative
Making decisions under emotional stress that could have lasting consequences

Without proper support, this moment can feel isolating.

How Edwards Family Law supports clients through Divorce Day

At Edwards Family Law, the goal is not just to manage court applications, but to guide people through one of the most challenging transitions of their lives with clarity.

Questions answered

Divorce Day often brings urgent questions. Edwards Family Law helps clients understand their rights, options, and obligations so they can make informed decisions as opposed to fear-driven ones.

Protection of children

Edwards Family Law recognises that for parents, nothing is more important than their children. We work hard to formalise child arrangements and parenting plans that prioritise the child’s well-being, while advocating firmly for a client’s parental rights.

Financial strategy and long-term planning

From property division to spousal maintenance, child maintenance and pensions, Edwards Family Law focuses not just on the immediate settlement but on the long-term projected impact of a financial settlement on a client, well into retirement. We work with wealth advisers to run cash-flow modelling and ensure that you have financial confidence coming out of the divorce process.

Calm, strategic representation

High-conflict divorces can move quickly. Edwards Family Law provides proactive, strategic representation that reduces unnecessary conflict while remaining prepared to litigate when needed.

Compassion

Divorce Day is not a failure; it’s a transition. Edwards Family Law’s clients are met with respect, confidentiality, and understanding, regardless of how they arrived at this point.

Moving forward after Divorce Day

Divorce Day is the beginning of a new chapter and therefore deserves careful planning and strong legal support.

With Edwards Family Law, clients do not face this moment alone. They gain a representative who will tackle any complexities in the case, forge a path forward and make their best case on their behalf.

On your Divorce Day, Edwards Family Law is here to help you take the next step with all the support you need.

Planning your wedding should be one of life’s most exciting experiences, yet discussing a pre-nuptial agreement can feel uncomfortable or even unromantic. However, for couples entering marriage in 2026, particularly those with significant assets, business interests, or children from previous relationships, a well-drafted prenuptial agreement is a practical financial planning tool rather than a pessimistic view of your future together.

As England and Wales continue to see a rise in pre-nuptial agreements across all wealth levels, understanding how these legal documents work has never been more critical. This comprehensive guide explains everything you need to know about pre-nuptial agreements in 2026, from legal enforceability to practical drafting considerations and enforcement mechanisms.

What is a Pre-nuptial Agreement?

A pre-nuptial agreement is a legally significant document signed by a couple before they marry (or enter into a civil partnership) that sets out how their property, assets, income, and financial arrangements will be handled if their marriage ends in divorce or dissolution. The primary purpose of a pre-nuptial agreement is to provide clarity and certainty about how assets and income will be distributed if the relationship ends, allowing couples to make informed decisions together during happier times rather than during the emotional turmoil of separation.

A pre-nup is often used as a way to safeguard or ringfence certain assets to protect them from future claims if there were a divorce. Pre-nups are therefore commonly used if there is a wealth imbalance between the parties.

The Legal Framework: Are Pre-nuptial Agreements Binding?

Pre-nuptial agreements are not legally binding by statute in England and Wales. However, the courts have developed a substantial body of case law that treats properly executed pre-nups with considerable deference.

The Radmacher v Granatino Landmark Decision

The 2010 Supreme Court case of Radmacher v Granatino fundamentally changed the legal landscape for pre-nuptial agreements. Prior to this judgment, pre-nuptial agreements were viewed with suspicion by English courts and were often discounted as contrary to public policy.

The Supreme Court’s key principle established that: “The court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications, unless in the circumstances prevailing it would not be fair to hold the parties to their agreement.”

This judgment has been consistently followed and reinforced over the past 15 years. Family lawyers across England and Wales have reported a significant increase in the number of people seeking advice and entering into prenuptial agreements since this decision.

Current Judicial Approach

While courts are not obliged to give effect to the agreement and parties cannot oust the jurisdiction of the court to determine a reasonable and fair settlement, the court must give a pre-nuptial agreement appropriate weight when exercising its discretion, should there be a divorce or dissolution. If safeguards are adhered to, the advice given to parties is that they can (and should) expect to be held to the terms of any pre-nuptial agreement entered into on a future relationship breakdown.

Essential Requirements for Enforceability

For a pre-nuptial agreement to carry significant weight in divorce proceedings, it must satisfy several critical criteria:

1. Voluntary Entry Without Duress

Both parties must enter the agreement voluntarily without any coercion, intimidation, or undue pressure. The courts have confirmed that simply stating “I won’t marry you without a pre-nup” is not considered undue pressure; courts have confirmed this is a reasonable position.

2. Full Appreciation of Implications

Each party must understand what they’re agreeing to, with implications and consequences explained clearly. Both parties should comprehend how the agreement affects their legal rights and what financial claims they may be giving up.

3. Independent Legal Advice

The parties should not be advised by the same solicitor and ideally would both have their own independent legal advice. Using the same solicitor raises conflict of interest concerns and significantly weakens the agreement in court.

Each solicitor should:

Explain the legal principles governing pre-nups
Advise on whether the proposed terms are fair and enforceable
Ensure you understand what rights you’re agreeing to relinquish or modify

4. Complete Financial Disclosure

Complete transparency about all assets, liabilities, income, and prospects is non-negotiable for enforceable pre-nups. This includes:

A comprehensive schedule of all assets and liabilities
Income from all sources
Business interests and valuations
Trust interests and expected inheritances
Honest answers to reasonable financial questions

Failure to provide full disclosure could result in a pre-nup being challenged in court.

5. Appropriate Timing

The agreement should be signed well in advance of the wedding. Courts may have concerns about agreements signed less than 21-28 days before marriage. Ideally, finalise your pre-nup several months before your wedding date. The process should never be rushed, and the agreement should never be presented as a last-minute requirement.

6. Fair and Reasonable Terms

The agreement must not leave either party in genuine financial need. It should make adequate provision for any children, and terms should be fair, given the parties’ circumstances.

7. Fairness

The agreement shouldn’t produce grossly unfair outcomes. Changed circumstances since signing may affect enforceability, and courts retain discretion to depart from unconscionable terms.

What Should Be Included in a Pre-nuptial Agreement?

The contents of your pre-nuptial agreement will depend on your specific financial circumstances and objectives. Well-drafted agreements typically address multiple categories of assets and arrangements:

Asset Division and Protection

Non-Matrimonial Property:

Pre-nups frequently protect assets owned before marriage, including:

Property, savings, and investments held before the marriage
Inherited wealth from family members
Gifts received before or during the marriage
Business interests and shareholdings were established pre-marriage
Interests in family trusts

Matrimonial Property Definition: The agreement should clarify:

What will be considered jointly owned marital assets
How property acquired during marriage will be treated
Rules for future property purchases
Division of personal possessions and valuable collections

Housing and Accommodation

Pre-nups frequently include clauses about property, especially regarding:

How the family home will be treated on divorce
Whether one party will receive the property transfer or housing funds
Provisions for children’s accommodation needs

Income and Maintenance Provisions

Couples can address spousal and child maintenance in a pre-nup, including:

Whether maintenance will be paid, and the amount
Maintenance arrangements (or waiver thereof)
Lump sum payments on divorce
Periodical payments for ongoing support
Duration and review mechanisms for financial support

Pensions

The pre-nup can define how pension pots will be divided upon separation. This includes:

How pensions accumulated before marriage will be treated
Division of pension rights earned during marriage
Pension sharing, offsetting, or attachment orders

Business Interests

For entrepreneurs and business owners, pre-nuptial agreements can:

Ring-fence business assets from matrimonial claims
Prevent disruption to business operations during divorce
Safeguard family businesses passed through generations
Define how business growth during marriage will be treated

Inheritance and Gifts

Clauses can be added to ensure that:

Inheritances remain separate property
Inherited wealth is passed down to children from previous relationships
Future bequests are protected from matrimonial claims

Debts and Liabilities

Pre-nups can clarify responsibility for debts by:

Outlining who is responsible for pre-marital debts, such as credit card debt or student loans
Clarifying responsibility for debts accrued during the marriage
Protecting one spouse from inheriting the debts of the other

What Cannot Be Included in a Pre-nuptial Agreement?

Pre-nuptial agreements are designed to cover issues relating to finances and property. However, certain matters are explicitly excluded:

Child Custody and Arrangements

Pre-nups cannot determine:

Where children will live after divorce
Contact and visitation arrangements
Child custody or residence decisions
Parenting time or schedules

Why? Courts retain ultimate authority over child related matters and must assess arrangements based on the child’s best interests at the time of divorce, not what parents agreed years earlier. Family courts prioritise the best interests of the child, which may change over time.

Financial Support for Children

Pre-nups cannot waive or limit:

School fees and education costs
Medical/health costs for children
Children’s financial needs
Maintenance obligations to dependent children

Why? Public policy prevents parents from contracting away children’s rights to financial support. The family court retains the jurisdiction to modify any aspect of a pre-nuptial agreement that relates to the financial support of children to ensure their needs are met.

Personal and Lifestyle Matters

Pre-nuptial agreements should not extend to personal aspects of the relationship. Provisions about the following will not be enforceable:

Personal appearance or weight requirements
Religious practices or observances
Social activities or friendships
Household chores or responsibilities
Sexual relations
Restrictions on social media usage (although confidentiality clauses may be considered)
Fidelity or infidelity consequences

English courts don’t enforce personal lifestyle restrictions. While pre-nups in some US states may include “lifestyle clauses,” these have no legal standing in England and Wales.

Illegal or Against Public Policy

Pre-nups cannot contain:

Provisions that violate criminal law
Terms contrary to public policy
Terms that encourage a future divorce, such as promising excessive assets to one party if the marriage ends
Agreements to defraud creditors or tax authorities
Provisions that attempt to completely eliminate or severely limit one spouse’s right to financial support in circumstances where doing so is unfair or fails to meet their needs.

Terms Leaving a Spouse in Need

Pre-nups cannot exclude provisions for:

Reasonable housing needs
Reasonable income for living expenses
Essential financial security
Protection from destitution

Who Benefits Most from Pre-nuptial Agreements?

While anyone can benefit from the clarity a prenuptial agreement provides, they are particularly valuable in specific circumstances:

Business Owners and Entrepreneurs

If you’ve built a substantial business before marriage:

Protect company equity and shareholdings
Prevent business disruption during divorce proceedings
Maintain operational control and decision-making authority
Shield intellectual property and business goodwill
Protect future shareholdings or future windfalls

Second Marriages and Blended Families

If you’re remarrying and have children from a previous relationship, a pre-nup can:

Protect assets you wish to preserve for your children
Ensure inheritance plans aren’t disrupted by divorce
Provide clarity about step-children’s financial provisions
Ring-fence property you’re bringing into the new marriage

Those with Substantial Pre-Marital Wealth

For those with significant pre-marital assets:

Protect family money and inherited assets
Maintain control over trust interests
Safeguard property portfolios and investment accounts
Preserve wealth for future generations

Individuals Expecting Future Inheritance

When family wealth is involved:

A pre-nuptial agreement doesn’t only protect existing wealth
If one spouse expects to earn more in the future or is expecting a significant inheritance, a prenup can also protect it
Honour the family’s wishes about dynastic asset preservation
Protect inheritance from matrimonial claims
Maintain family farms, estates, or businesses intact

High-Earning Professionals

For those with significant income potential:

Define expectations about the future earnings division
Clarify maintenance obligations
Protect professional practices and partnerships
Address income derived from pre-marital qualifications

Couples with Wealth Disparity

When one partner has significantly more assets:

Provide financial protection for the wealthier spouse
Create fairness by acknowledging pre-marital contributions
Avoid assumptions about wealth-sharing expectations
Define what happens to separately-managed assets

Important Context: Pre-nuptial agreements are growing in popularity with entrepreneurs, people with shares in a limited company, or those with a stake in a family business. Equally, people who have received an inheritance (be it large or small) may feel that this money should be considered separately from matrimonial assets.

The Concept of “Need” in Family Law

What Does “Need” Mean?

The concept of need broadly covers:

Income needs: Sufficient funds to meet reasonable living expenses
Housing needs: Appropriate accommodation for the individual and any children
Capital needs: Retirement provision and financial security
Children’s needs: Education, housing, and support for dependent children

How Need Affects Pre-nup Enforceability

Courts will not uphold pre-nuptial agreements that leave one party unable to meet their basic needs, even if the contract was executed correctly. The standard of living led during the marriage will influence the level of provision considered necessary.

Key principle: A pre-nup can limit claims beyond needs, but it cannot eliminate provision for genuine needs, particularly where children are involved.

The Law Commission has recommended that pre-nups should only be enforceable after the financial ‘needs’ of both parties, and any children, have been met.

The Practical Steps to Creating an Enforceable Prenup

Planning and Timeline

Begin early and give the process adequate time:

Begin discussions with your partner several months before the wedding
Engage solicitors at least 3-4 months before your wedding date
Allow time for negotiations, revisions, and consideration
Sign the final agreement at least 28 days (ideally 2-3 months) before the ceremony
Never rush the process or present it as a last minute requirement

Working with Solicitors

Both parties ideally need independent legal representation from solicitors experienced in pre-nuptial agreements. Your solicitors should:

Explain the legal principles governing pre-nups
Advise on whether the proposed terms are fair and enforceable
Ensure you understand what rights you’re agreeing to relinquish or modify
Draft or review the agreement to maximise enforceability

Financial Disclosure Process

Complete financial transparency is non-negotiable for enforceable prenups:

Prepare a comprehensive schedule of all assets and liabilities
Disclose income from all sources
Reveal business interests and valuations
Declare trust interests and expected inheritances
Answer any reasonable questions about your finances honestly
Update disclosure if circumstances change before signing

Consideration of Future Scenarios

Effective pre-nups will ideally anticipate how life may change:

Children: How will the agreement adapt if you have children?
Career changes: What if one spouse becomes a primary carer?
Inheritance: How will future gifts or inheritances be treated?
Health issues: What provisions are in place if someone becomes unable to work?
Business growth: How will increased wealth during marriage be divided?

Building in Review Mechanisms

Many solicitors recommend periodic reviews triggered by:

Birth or adoption of children
Significant inheritance received by either party
Major career changes or retirement
Relocation to another country
Set time periods (e.g. every 5 or 10 years)

Ensuring Fair Terms

Courts closely scrutinise whether agreements are fair:

Avoid heavily one-sided terms that benefit only one spouse
Make reasonable provision for the financially weaker party’s needs
Consider the likely standard of living during the marriage
Account for sacrifices one party may make (career breaks, childcare)
Include appropriate provisions if children are born

Common Pitfalls That Weaken Prenups

Understanding what can invalidate or weaken a prenuptial agreement helps you avoid costly errors:

Timing Problems

Signing too close to the wedding raises concerns about duress and insufficient time to consider
Presenting the agreement as a surprise shortly before marriage undermines free consent.
Rushing through negotiations prevents proper understanding and consideration.

Procedural Failures

Using the same solicitor eliminates independent advice and raises conflict of interest concerns.
Failing to obtain legal advice or waiving the right to advice weakens enforceability.
Incomplete financial disclosure allows challenges based on a lack of transparency.

Substantive Weaknesses

Unfair or one-sided terms that heavily favour one party face judicial scrutiny
Failing to address needs adequately, especially for children or financially weaker spouses
Unrealistic provisions that don’t account for changed circumstances
Trying to control lifestyle or behaviour through unenforceable personal terms

Documentation Defects

Using template or boilerplate agreements that don’t reflect your specific circumstances
Failing to have the agreement properly executed with appropriate signatures and witnesses

Modifying Pre-nuptial Agreements

Pre-nuptial agreements can be amended, updated, or replaced entirely if both parties consent. Many well-drafted agreements include review mechanisms to address changed circumstances.

Post-nuptial Amendments

If circumstances change after your marriage, you can modify your pre-nuptial agreement through a post-nuptial agreement (or “post-nup”). Post-nups work essentially the same way as pre-nups under English law, but are executed after marriage rather than before.

Common reasons for amending pre-nups:

Birth or adoption of children
Significant inheritance received by either spouse
Major career changes or one partner becoming a primary caregiver
Starting or selling a business
Relocation to another country
Substantial changes in either partner’s financial circumstances
Property purchases or major investment decisions
Approaching retirement age

The Amendment Process

To modify an existing pre-nuptial agreement:

Both parties must agree to the changes (one spouse cannot unilaterally alter terms)
Obtain independent legal advice about the proposed amendments
Document the changes in a properly executed post-nuptial agreement
Ensure full disclosure of any changed financial circumstances
Execute the amendment with the same formalities as the original

Court Ordered Variations

Even without mutual agreement to amend, courts retain discretion to depart from or vary pre-nuptial agreement terms if:

Circumstances have changed so substantially that enforcing original terms would be manifestly unfair.
One party would be left in genuine financial need
Children’s interests require different provision
The agreement has become practically unworkable

Cost Considerations

The cost of preparing a pre-nuptial agreement varies considerably depending on several factors:

Factors Affecting Cost

Complexity of the agreement and financial circumstances
Amount and complexity of financial disclosure required
Number of negotiation rounds and revisions required
Whether international assets or mirror agreements are involved
Level of cooperation between the parties
Need for barrister involvement in complex cases

Important Context: The cost of a pre-nup is a fraction of the cost of the average wedding. It’s also a fraction of what you could stand to lose if you enter into a marriage with significant assets and no protection in place.

International Pre-nuptial Agreements

For couples with international connections, additional complexities arise:

Multi-Jurisdictional Considerations

If you or your partner:

Hold assets in multiple countries
Have different nationalities
May relocate to another jurisdiction
Own property abroad

You may need:

Mirror agreements in different jurisdictions
Advice from foreign lawyers about enforceability
Coordination between legal systems
Specific clauses addressing international assets

Jurisdictional Challenges

Pre-nuptial agreements that are enforceable in England and Wales may not automatically carry weight in other countries. If international elements are present in your relationship, seek specialist advice about:

Which jurisdiction(s) would have authority over your divorce
How different legal systems treat pre-nups
Whether separate agreements are needed in each relevant country

In England and Wales, nuptial agreements are not strictly binding by statute, regardless of where they are executed, but may be given significant weight. In some other jurisdictions, nuptial agreements might be binding.

Contesting a Pre-nuptial Agreement

Both pre-nups and post-nups can be challenged in certain circumstances. Legitimate reasons for contesting a pre-nuptial agreement may include:

Lack of full financial disclosure
Duress or coercion during signing
Significant changes in circumstances since the pre-nup was signed, such as the birth of children, render the agreement unfair
One spouse was pressured into signing the agreement, or they signed it without the mental capacity to do so
It can be proved that one party didn’t fully understand the implications of the agreement
If a spouse signed the document without proper legal representation
If the agreement contains requirements that are used to control or demean a spouse

Pre-nups Compared to Cohabitation Agreements

While this guide focuses on prenuptial agreements for marriage, unmarried couples should understand the distinction:

Cohabitation agreements serve a similar protective function for couples who live together without marrying. English law provides far fewer protections for cohabitants than married couples, making written contracts even more important.

If you’re living together without plans to marry, consider a cohabitation agreement to:

Define property ownership and shares
Clarify financial contributions and expectations
Protect assets brought into the relationship
Address what happens if you separate

Both pre-nups and cohabitation agreements are legally binding when properly executed with independent legal advice, full financial disclosure, and fair terms.

Frequently Asked Questions

Q: Are pre-nuptial agreements legally binding in England and Wales?
A: While not legally binding by statute, courts accord prenuptial agreements significant weight when properly drafted. Following the case of Radmacher v Granatino, well-executed pre-nups carry “decisive weight” in divorce proceedings and are treated as carrying substantial enforceability in most circumstances.

Q: What is the minimum timeline for a pre-nup before the wedding?
A: Courts prefer prenups to be signed at least 28 days (ideally 2-3 months) before the wedding. Agreements signed less than 21-28 days before marriage may face challenges regarding whether there was sufficient time for consideration.

Q: Must both parties have separate solicitors?
A: Yes. Independent legal advice from separate solicitors is critical for enforceability. Using the same solicitor raises conflict of interest concerns and weakens the agreement’s enforceability significantly.

Q: What constitutes full financial disclosure?
A: A complete and honest account of all income, debts, assets, and any potential inheritances. Failure to provide full disclosure allows the agreement to be challenged in court.

Q: Can a pre-nup protect inherited assets?
A: Yes. Pre-nups can include clauses to ensure that inheritances remain separate property or are passed down to children from previous relationships.

Q: Can we include child maintenance provisions in a pre-nup?
A: Yes but The Child Maintenance Service retains jurisdiction in all matters regarding child maintenance and cannot be ousted by agreement (pre-nuptial or otherwise). In the event that your gross earnings are under £156,000, there is a formula that calculates how much the non-resident parent is required to pay per child. This is also based upon the number of nights that the child(ren) spend with each parent per week. If one party’s annual gross income is higher than this, the court can make a top up order that exceeds the amount specified by the formula.

The court can deal with school fees, top up orders and lump sums for one off expenses for children. Provisions for these items can be included in a pre-nuptial agreement irrespective of the parties’ inability to oust the jurisdiction of the Child Maintenance Service.

Q: What happens if circumstances change dramatically after signing?
A: Courts retain discretion to depart from or vary pre-nuptial agreement terms if circumstances have changed so substantially that enforcing original terms would be manifestly unfair, or if one party would be left in genuine financial need.

Q: Is a cohabitation agreement different from a pre-nuptial agreement?
A: Yes. A cohabitation agreement is for unmarried couples and addresses the entire cohabiting relationship. A pre-nuptial agreement is specifically for couples about to marry.

Q: Can we amend our pre-nuptial agreement after marriage?
A: Yes, through a post-nuptial agreement (“post-nup”). Both parties must agree, and the same legal formalities apply as for pre-nups.

Q: What if we don’t have a pre-nup?
A: Without a pre-nup, matrimonial assets are divided according to English law. The court will consider: how long you’ve been married, the needs of each spouse and any children, and what each spouse contributed to the marriage.

Q: When should we start thinking about a pre-nup?
A: Begin discussions several months before the wedding. Engage solicitors at least 3-4 months before your wedding date to allow adequate time for drafting, negotiation, and legal review.

Why Consider a Pre-nuptial Agreement?

Planning your financial future together is one of the most practical and responsible things you can do before marriage. A well-drafted pre-nuptial agreement provides clarity, reduces uncertainty, and can save enormous stress and expense if your relationship ever faces difficulties.

Whether you’re a business owner protecting your company, someone with substantial family wealth, remarrying with children from a previous relationship, or simply a couple who values financial clarity, a pre-nuptial agreement represents another aspect of responsible planning for a shared future, similar to planning a wedding reception, selecting life insurance, or preparing a will.

By addressing financial matters transparently before marriage, you can focus on the emotional and relational aspects of your partnership with confidence and security.

Why Choose Edwards Family Law for Your Pre-nuptial Agreement?

At Edwards Family Law, we understand that discussing pre-nuptial agreements requires sensitivity, discretion, and expert legal knowledge. Our dedicated family law team has extensive experience drafting pre-nups for clients at all wealth levels, from young professionals protecting their first property purchase to high-net-worth individuals with complex international estates.

Contact Edwards Family Law

For expert advice on prenuptial agreements tailored to your specific circumstances, contact Edwards Family Law:

Phone: 020 3983 1818
Email: contact@edwardsfamilylaw.co.uk
Address: 44 Southampton Buildings, London, WC2A 1AP

Book a Confidential Consultation

Edwards Family Law’s experienced family law solicitors are ready to discuss your specific circumstances and explain how a prenuptial agreement can protect your financial future.

Changing family law solicitor is a crucial decision. It can influence the direction, pace and ultimately the outcome of your case. Whether you are involved in financial proceedings arising from a divorce or separation, proceedings concerning child arrangements or an international or expatriate divorce, the relationship with your solicitor must be built on trust, clarity and confidence. If any of these are lacking, a change in representation may be necessary.

Many clients worry that switching lawyers mid proceedings will slow the case down, increase costs, or even harm their position.

In reality, if the process is managed properly, changing solicitor can improve the progress of a case, sharpen strategy and reduce stress. At Edwards Family Law we regularly assist clients who instruct us mid way through proceedings. Such clients may feel unheard, unsupported or uncertain about the strategy being taken by their former solicitors.

Below are five common fears clients have about changing lawyers and how these can be easily addressed.

1. Delays

Clients often worry that switching solicitors will delay their case, put them at risk of missing deadlines of cause a loss of momentum especially if court proceedings are underway and there is a court hearing or an urgent deadline (such as the filing of witness evidence) coming up.

Our team is experienced at stepping in mid proceedings without disrupting timelines. We can conduct a rapid assessment of the file immediately after instruction and work swiftly to meet urgent deadlines. Now that court administration is dealt with via the online HMCTS portal, we can take over communication with the court and the other side straight away.

Often the case will actually move forward more quicky once a more focused and proactive approach is in place.

2. Costs

Clients often assume that a new solicitor will need hours of time at significant expense to understand a case from scratch. Our team prioritise key documents so that we can get up to speed efficiently and not waste time on reading unnecessary documents. Any work undertaken will be linked to a strategic benefit not box ticking or duplication of work. In some cases we can also offer a fixed fee for reading in.

Clients often find that having a fresh pair of eyes review the strategy can in fact save them legal costs in the long run by avoiding missteps or wasted work.

3. Concerns about the current solicitor refusing to transfer the file

Some clients are concerned that if they switch solicitors their current lawyer might refuse to release their file. While solicitors do have certain rights over a file which are linked to the recovery of unpaid fees, a solicitor may exercise a lien over a client’s file only if they have not paid fees owed for work already done. Once a bill is fully paid the solicitor cannot legally withhold the file and solicitors are bound by professional rules to cooperate with the transfer of a client’s papers once the outstanding fees are settled. This includes correspondence, court documents, financial disclosure and witness statements.

4. Concerns that the case may look disorganised/ chaotic

Clients sometimes worry that switching lawyers might make them appear disorganised or difficult in the eyes of the court. In reality, judges are accustomed to parties changing representation during proceedings. It is not unusual, and the court understands that clients are entitled to choose the solicitor who best represents their interests.

Ultimately, the case will be assessed on its merits, not on whether a party has changed solicitors. A well managed transition, handled professionally, will have no negative impact on how the case is viewed by the court.

5. Disruption to working relationship with a barrister

Clients sometimes worry that switching solicitors will disrupt their working relationship with a barrister already instructed on a case, but this is rarely a problem. Barristers are independent practitioners; a change of solicitor does not affect their ability to continue representing the client. Barristers are accustomed to receiving new instructions from a replacement solicitor and can continue their work without interruption. A new solicitor will bring fresh oversight and ensure that the barrister’s work aligns closely with the client’s update strategy and objectives.

How the partners at Edwards Family Law can assist

At Edwards Family Law, our clients benefit from the experience and expertise of our partners, who have strong track records at leading family law firms. Kelly Edwards, formerly of Sears Tooth, brings extensive experience in complex financial and high net worth divorce cases. Dan Chalmers, formerly of Clintons, has specialist expertise in financial remedy proceedings as well as children and family disputes, ensuring sensitive matters are handled with care and strategy. Sarah Walker, formerly of Hughes Fowler Carruthers, offers deep knowledge in financial remedy and ancillary relief proceedings, providing pragmatic solutions and clear guidance. Together with the associates, they ensure a smooth transition for clients changing solicitors, protecting deadlines, maintaining continuity, and delivering the high quality, tailored advice that family law matters require.

In recent years, financial disputes arising from divorce or separation have continued to be dominated by Baby Boomers, many of whom hold substantial wealth in traditional assets such as property and equities. By contrast, younger adults typically hold a more varied and less conventional mix of assets. They may marry later or not at all and they frequently co-habit and have children without getting married. The evolution of this carries significant implications for modern family law.

A common theme among younger generations is the changing pattern of relationships, with shifting societal expectations and evolving gender roles, particularly for women. While fewer people marry at a young age, divorce remains common and reflects broader changes in how relationships are formed, maintained and dissolved.

At Edwards Family Law, we are increasingly advising younger clients whose financial circumstances differ markedly from those of their parents at the same age. Almost half of divorces happen in the first 10 years of marriage, and the average age at divorce is 45 for men and 42 for women. This shift is reshaping the issues that emerge during divorce and separation and heightening the need for tailored, nuanced legal guidance.

Younger people hold more diverse and non-traditional assets

Younger generations often possess a wider range of assets from their parents, including cryptocurrency portfolios, digital businesses, intellectual property, overseas holdings, stock options, and interests in early stage or high-risk private companies. Many also generate income from multiple sources, such as freelance work, online businesses, content creation, or influencer activity.

This diversification of assets and income streams can complicate the financial disclosure and negotiation process during divorce or separation, requiring careful analysis and a more bespoke approach to valuation and division. Money plays a central role in these proceedings, as English law has developed a strong emphasis on fairness in the division of assets on divorce. The Court recognises that non-financial contributions such as caring for children or running the household are important factors when determining a fair division of assets, alongside financial contributions.

Cohabitation without marriage

It is now common for younger couples to cohabit for many years and to have children together without marrying. During their relationship they may purchase property together, renovate or invest in one another’s homes, or establish joint business ventures.

However, because the Matrimonial Causes Act 1973 does not apply to unmarried couples, they cannot rely on the same legal framework as married couples when disputes arise. When unmarried couples split or separate, they cannot apply to the Court for spousal maintenance, lump sums or pension sharing for their own benefit. However, they can bring claims relating to their interest in a property and/or a claim for the benefit of children.

Where a dispute concerns property or land following the separation of an unmarried couple, a claim may be brought under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA), enabling the Court to determine the parties’ respective interests or order the sale of the property.

Additionally, Schedule 1 of the Children Act 1989 (“Schedule 1”) empowers the Court to make financial provision for the benefit of a child or children of unmarried parents who have separated, ensuring that suitable arrangements can be made even in the absence of marriage.

Applications made pursuant to TOLATA and Schedule 1 are becoming more and more frequent. However, these applications present a distinct set of challenges. They often require careful analysis of property rights, contributions, and intentions. Unlike matrimonial proceedings, the Court’s powers pursuant to TOLATA and Schedule 1 are more limited, making expert advice essential to achieving a fair outcome.

Pre-nuptial agreements

Since the landmark Supreme Court decision in Radmacher v Granatino (2010), pre-nuptial agreements have gained greater recognition and weight within English family law. The ruling established that, provided certain safeguards are met (including that both parties have entered the agreement freely, with a full appreciation of its implications, and without undue pressure), the Court should give effect to a pre-nuptial agreement unless it would be unfair to do so. Following this judgment, there has been a notable rise in the popularity of prenuptial agreements as couples seek to protect their interests from the very beginning of their marriage.

Now that it is commonplace for young people to live together and raise children without getting married, many younger people take a more pragmatic approach to marriage and are cognisant of the financial implications of taking this step. The idea of marriage and weddings has evolved, with many recognising that how couples begin their partnership, whether through a wedding ceremony or cohabitation, can set the tone for their future together. Younger people are also getting married later by which time they may have built up more non-matrimonial wealth. Many individuals feel they lack the self-knowledge necessary for a successful marriage in their 20s, and education gained from past relationships or experiences can inform better financial decisions and healthier partnerships moving forward.

The anticipated “Great Wealth Transfer” (the transfer of assets from Baby Boomers to younger generations) has also contributed to the growing number of younger couples entering into pre-nuptial agreements, who feel an obligation to protect the wealth that was not built up by them but by their parents. Many Millennials and Gen Z adults expect to inherit substantial assets during their lifetime, often in the form of property, investments, business interests, or family trusts. In anticipation of this, parents and grandparents are increasingly encouraging or requiring pre-nuptial agreements as a condition for preserving family wealth.

As a result, younger people are now approaching marriage with greater financial awareness and a desire to protect future inheritances or gifts that may otherwise become vulnerable on divorce. Pre-nuptial agreements provide a clear, legally recognised framework for safeguarding non-matrimonial assets, managing expectations, and reducing conflict should the relationship break down. For many, experiences from the past, such as previous relationships or divorce, have changed their expectations, leading to more realistic views in new partnerships. This shift reflects not only changing economic realities, but also a growing acceptance of pre-nuptial agreements as a sensible and responsible part of modern financial planning.

Clean break vs. Ongoing Spousal Maintenance

Younger divorcing or separating couples have many more years ahead of them to accumulate and build up wealth. Younger couples in their twenties, thirties and forties may well have high incomes but a lower asset base than their parents. They may also have young children and the legal issues arising from this can be challenging. When going through divorce, individuals must deal with: the initial shock and the adjustment to new circumstances. Although the court has a statutory duty to consider if a clean break is appropriate under Section 25 of the Matrimonial Causes Act where there is a low asset base and a significant disparity in a divorcing or separating couple’s income the court may order ongoing spousal maintenance.

However, if the parties divorcing or separating are young it is likely to be for a relatively short term. A short period of spousal maintenance can provide necessary security while the financially weaker party adjusts, returns to work, or takes on childcare responsibilities. The Court will still aim to move towards a clean break when it becomes fair to do so, but in the short to medium term, maintenance may be essential to meeting needs and ensuring a just outcome.

Why specialist legal guidance matters for younger couples who are divorcing and separating

Younger couples face unique financial and legal challenges in divorce and separation, from diverse assets to childcare responsibilities. Emotions can run high during these moments, making it crucial to have a supportive team by your side. Specialist legal guidance is essential to ensure fair outcomes, protect future wealth, and navigate the complexities of modern family life. At your lowest point, maintaining hope and resilience is vital, and having friends and professionals who understand what you are going through can make all the difference.

At Edwards Family Law, we support younger clients by helping them:

Understand their rights regarding pre-marital and marital assets
Deal with issues surrounding business interests or equity packages, addressing both the practical and emotional aspects that matter
Navigate issues around short or medium length marriages
Ensure long-term financial stability after divorce or separation
Negotiate fair settlements arising from divorce or separation without unnecessary conflict

The legal system now actively encourages separating couples to use mediation and collaborative law to resolve matters outside of court, helping families deal with conflict more amicably. Additionally, the family court system has moved towards digitisation, with online application portals and virtual hearings becoming increasingly common, making the process more accessible.

If you are a younger professional or entrepreneur navigating divorce, or if you want to protect your assets before marriage, Edwards Family Law is here to provide clear, expert guidance tailored to your circumstances. Our dedicated team of professionals is committed to helping you make positive things happen, with friendship, hope, and support at the heart of everything we do.

Spouses who are seeking a divorce outside of England and Wales need to be aware of the potential pitfalls associated with Part III of the Matrimonial and Family Proceedings Act 1984 or “Part III”.

Even if you live abroad, if you do retain connections to England or Wales you should still take specialist family law advice in this jurisdiction to assess your position.

You should instruct a family lawyer who is experienced in dealing with the complexities of international divorce, including jurisdictional issues and financial claims.

Part III applications are a potential route for individuals who have been divorced overseas to seek financial provision in England and Wales.

What is Part III of the Matrimonial and Family Proceedings Act 1984?

The purpose of Part III is to help a party who has received no or inadequate financial provision in a foreign court where there are substantial connections to the UK.

Part III also applies to those who have obtained a legal separation abroad, allowing them to seek financial relief in England and Wales.

An applicant who has an overseas decree for divorce, annulment or legal separation can make an application if they can prove one of the jurisdictional requirements.

The jurisdictional requirements for a Part III claim are set out in section 15(1) of the MFPA 1984.

The two stages of a Part III application

The Permission Stage

The court’s permission is required to make an application under Part III. In order to grant permission, the court will need to consider that there is a “substantial ground” for making an application. “Substantial ground” is not defined within the statute and so we have to look to the case law to interpret this.

In the ongoing case of Potanina v Potanin, the Supreme Court clarified the threshold for applying for permission to bring proceedings. In this case the parties married in Russia and lived there throughout the marriage. During the marriage, the husband accumulated wealth estimated to amount to in excess of $20 billion. Most of the assets were held in various trusts and corporate vehicles, through which the husband was the beneficial owner. The parties divorced in Russia in 2014. The wife received only a tiny fraction of the overall wealth.

In 2014 the wife obtained a UK investor visa and bought a property in London, shortly thereafter she made London her permanent home. In October 2018, the wife made an application to bring a claim under Part III based on her habitual residence in England. The case eventually made its way to the Supreme Court (and has subsequently been heard again in the Court of Appeal). The Supreme Court confirmed the guidance given in the case of Agbaje v Agbaje [2010] UKSC13 (“Agbaje”) that the word “substantial” means “solid”. However, the Supreme Court clarified that the threshold is higher than merely satisfying the court that the claim is not totally without merit or abusive, but it does not need to be as high as “good arguable case”. The test is more akin to the “real prospect of success” test for resisting summary judgment.

The Supreme Court also found that the previous practice of applying for permission without notice to the other side was procedurally unfair. Given the Supreme Court’s comments about this, going forward all permission hearings are likely to be heard on notice.

The Substantive Stage

Once permission has been granted, the court will rigorously evaluate the merits of the case. Before it makes an order, the court must consider whether in all the circumstances of the case it would be appropriate for the order to be made by a court in this country. In Zimina v Zimin [2017] EWCA Civ 1429, the Court of Appeal emphasised the statutory requirement to consider “all the circumstances of the case”. In deciding what is appropriate the court will approach the matter broadly and have regard to the statutory purpose of Part III to alleviate hardship in cases of foreign divorce.

The court has a broad discretion and may make orders analogous to those available on an English divorce, subject to the purpose and constraints of Part III. However, if the jurisdiction for an application is based solely on the basis of the matrimonial home being in England, the court’s powers are more limited.

The Court’s Approach

In the case of Agbaje the Supreme Court emphasised that Part III must not be abused and that it is not the purpose of the statute to allow a party with some English connections to take advantage of what is perceived to be a more generous approach of the English and Welsh courts to financial provision. Nor should it be used to obtain a “second bite of the cherry”.

However, in a case where the English connections are strong, there may be no reason why the application should not be treated as if it were made in ordinary English financial remedy proceedings. In making an award under Part III the court must consider section 16 of the MFPA 1984 which requires it to have regard to (amongst other things): (i) any financial provision already received pursuant to the foreign divorce: (ii) the connection the parties have to England and to any country outside England and Wales; (iii) the availability in England and Wales of any property in respect of which an order in favour of the application could be made; (iv) the extent to which the order made is likely to be enforceable. The court often draws guidance by analogy from section 25 of the Matrimonial Causes Act 1973 if the English connections are strong.

Practical Considerations

If you do have strong connections to England, it may be worth considering whether it is worth pursuing a foreign divorce given the ability of the English courts to make further financial provision pursuant to Part III. In that situation a family could end up incurring the cost of two sets of legal proceedings. This is something to consider carefully at the outset of a divorce even if you are living abroad. Enforcement options for financial orders under Part III include freezing assets and selling properties to satisfy the court’s decision.

An applicant who has an overseas divorce can make a Part III application if they can evidence a sufficient connection to England and Wales. Part III applications allow individuals who have divorced abroad to seek financial relief in England and Wales if they meet specific jurisdictional criteria. The Potanina v Potanin ruling may impact the frequency and success of Part III applications.

Our Expertise

At Edwards Family Law, we have significant experience advising on complex Part III applications. This includes our Partner, Sarah Walker, who worked on the landmark Supreme Court case of Potanina v Potanin, and including when it was later remitted to the Court of Appeal.

Pension: what happens if my ex removes money from their pension before the order is implemented or does not cooperate with the implementation of a pension sharing order?

Pensions have been a hot topic in recent months, with the long-awaited budget changing the rules for employee contributions. From April 2029, the amount exempt from National Insurance contributions will be capped at £2,000 a year. You or your ex may choose to divert some of your salary over the next three years to make the most of this tax incentive to bolster your pension. In England and Wales, all pension assets that are built up during the marriage are taken into account on divorce.

Pensions are often one of the most significant assets for separating couples, after the family home. In fact, pensions are often amongst the most valuable asset in a divorce or dissolution. Even if pension assets were built up during the marriage, the Court will consider the entirety of the pension assets when assessing a fair distribution of assets to meet needs.

Ensuring your pension rights are secure after your separation is extremely important. Many people do not realise that an ex can technically access or draw down from their pension before a pension sharing order is implemented, and when it happens, the financial consequences can be serious. There are legal routes to address this, and acting quickly can make a huge difference.
A pension sharing order is a formal court order required for the division of pension assets, and it cannot be implemented by pension providers without this court order. All joint assets, including pensions, are considered in the financial settlement as part of the overall divorce settlement involving other assets and other marital assets.

What is a pension sharing order

When you divorce, there are several approaches to dividing pension assets. One of the most common is a pension sharing order. A pension sharing order is a formal court order required to divide pension assets, and it can apply to a range of pension schemes, including registered pension schemes, occupational pension schemes, personal pensions, and retirement annuity contracts. Please see our article here; “How International Pensions Are Divided Upon Divorce” for more information about the other options for dividing pensions.

A pension sharing order provides one spouse with a percentage share (also known as a pension credit) of their ex’s pension pot. The final order should set out:

the percentage of pension to be transferred to you; and

include wording that your ex should not intentionally claim, draw down, transfer or deal with the pension before implementation of the order.

When does the pension sharing order need to be implemented by?

The implementation period for pension sharing orders is up to four months beginning with the later of the day on which the order takes effect (either from the date of final order in divorce proceedings or 28 days from the date of the order) or the first day the pension trustees receive all the necessary documents.

During the implementation period, the pension provider must transfer the pension share into a new or existing pension scheme, which may include the original pension scheme, depending on the recipient’s preference and scheme rules. Most pension schemes charge implementation fees for pension sharing orders, typically ranging from £300 to £1,500. The implementation period is generally four months from the date the order is received by the pension provider, although some providers may complete the process more quickly in straightforward cases.

What if my ex removes money before the order is implemented?

Pensions are a complex area of law. If your ex removes money from their pension before the order takes effect, correcting the issue becomes complicated.

Each case is unique, however one route to rectify the problem is to apply to court to set aside the order pursuant to the “Thwaite” jurisdiction. In exceptional circumstances, the court could exercise this jurisdiction if an order has not yet been implemented or it has only been partly implemented. In the recent case of AP v TP [2025] EWHC 190(b) the court exercised its jurisdiction under Thwaite to set aside a pension sharing order after the final divorce order had been pronounced, in circumstances where the wife refused to cooperate with the pension sharing order’s implementation and the husband could not retire without access to the pension funds.

Alternatively, if the court cannot set aside the order, you may be able to seek a lump sum to compensate you for the loss caused by the withdrawal. Whether this is appropriate will depend on the type of pension involved, the extent of the loss, and the overall financial circumstances of the case. It is also important to note that even if a lump sum is awarded, you may not be able to pay it back into a pension in full without triggering tax charges or breaching pension contribution limits. For this reason, you should seek specialist legal advice before taking any action, to ensure you understand the most effective and tax-efficient way to resolve the issue. For complex pensions, it may be necessary to appoint a Pension on Divorce Expert (PODE) or actuary to assist with valuation to ensure a fair outcome. Legal representation is crucial in navigating the court process and protecting your interests during proceedings related to a pension sharing order.

Why Early Legal Advice Matters

The longer the delay, the more complicated the problem becomes. Pension schemes have different rules, and the financial impact can snowball if not addressed promptly.

How can Edwards Family Law help?

As a boutique family law practice, Edwards Family Law has a lot of experience dealing with complex pension sharing orders, including resolving issues when someone transfers money out before implementation.

1. Does adultery matter legally in the UK?

2. Does cheating affect your divorce settlement?

3. When an affair can affect your settlement: financial misconduct

4. Does an emotional affair count as adultery?

5. Will an affair affect child arrangements?

6. Can I sue my spouse for having an affair?

7. The emotional reality versus the legal reality

8. Practical steps if you have discovered an affair

1. Prioritise your wellbeing

2. Gather key financial information

3. Document any suspected financial misconduct

4. Avoid retaliatory action

5. Seek early legal advice from a specialist

6. Consider emotional and relationship support

9. Frequently asked questions

How Edwards Family Law can help

Overview

Background

Disputed Issues

Key Findings

Conduct and Fairness

Outcome

Key Takeaways

The Basic Legal Principle: Is Inherited Money Separate Property?

The Starting Position

Robson v Robson (2010)

How the English Family Court Treats Inherited Money: Key Factors

1. When the Inheritance Was Received

2. How You Used the Inherited Money

3. The Length of the Marriage

4. The Financial Needs of Your Spouse

5. Whether You Have Other Matrimonial Assets to Meet Needs

Civil Partnership and Divorce: How Inheritance Is Treated

Pre and Post-nuptial agreements

Protecting Inherited Wealth in Divorce

1. Keep Inheritance Completely Separate

2. Create a Will or Trust Protecting Inherited Wealth

3. Enter into a Post-nuptial Agreement

4. Avoid Co-mingling Inherited Funds

5. Full Financial Disclosure

6. Obtain Legal Advice Early

The Role of Your Solicitor in Inheritance Matters

Why Choose Edwards Family Law for Inheritance Matters?

How Are Businesses Treated in Divorce?

Business Acquired Before Marriage

Business Acquired During Marriage

Businesses Built by Both Spouses

How Are Businesses Valued in Divorce?

1. Income Approach (Earnings Based Valuation)

2. Asset Approach (Balance Sheet Valuation)

3. Market Approach (Comparable Sales)

4. Hybrid Approaches

Key Issues in Business Valuation for Divorce

1. The Valuation Date

2. Discounting for Lack of Control and/or Risk

3. Synergy and Goodwill

Options for Dealing with the Business in Divorce

Option 1: One Spouse Buys Out the Other

Option 2: Sale of the Business

Option 3: Both Spouses Remain in the Business

Option 4: Structured Settlement (Offset Against Other Assets)

Option 5: Court Order for Specific Division

Protecting Your Business Interests in Divorce

1. Obtain an Independent Valuation Early

2. Separate Business and Personal Assets

3. Document Business Growth Timing

4. Protect Business Secrets and Confidential Information

5. Consider Pre-nuptial or Post-nuptial Agreements

Red Flags: Protecting Yourself If Your Spouse Owns the Business

Undisclosed Value

Diverted Income

Lifestyle Concealment

The Role of Your Solicitor in Business Divorce Issues

Why Choose Edwards Family Law for Business Divorce Matters?

Feelings and concerns that may set in on Divorce Day

How Edwards Family Law supports clients through Divorce Day

Questions answered

Protection of children

Financial strategy and long-term planning

Calm, strategic representation