Prenup? Forget it for now in Britain.
A court ruling has made it worthwhile to wait at least until the honeymoon to thrash out the details of a separation.
In the case of two Americans who live in the British territory of the Isle of Man, judges on Wednesday affirmed the validity of arrangements made after the wedding, rebuffing the ex-wife's attempt to gain a larger share of her former husband's fortune than the pair had agreed to.
But the Judicial Committee of the Privy Council — the highest appeal court for British territories — also said it would keep to its rule that agreements made before a marriage are contrary to public policy, leaving it up to British lawmakers whether to follow the United States, Australia, Russia, Germany and others in recognizing prenuptial agreements.
Lawyers said the ruling was a disappointment for wealthy clients who are turning to such agreements to secure their fortunes in case of divorce.
Increasing numbers are looking to pre-nuptial contracts, but the legal uncertainty surrounding their validity means clients have a "slight skepticism" about whether they can be enforced, according to divorce lawyer Sharon Eden.
Although the case was not specifically about pre-nuptial agreements — which the couple also entered into — the court nevertheless endorsed the view that they were not binding contracts. The husband's lawyer, Martin Pointer, had argued that all divorce agreements — whether pre- or post-nuptial — were valid. The court rejected half that argument.
"There is an enormous difference in principle and in practice between an agreement providing for a present state of affairs which has developed between a married couple and an agreement made before the parties have committed themselves to the rights and responsibilities of the married state," the court said in its written judgment.
Attorney Meredith Thompson told the Financial Times that the privy council's decision was "a shame" but added she was pleased that the court had endorsed post-nups, something she said could become more popular "with couples trying to regulate what happens on divorce mid-marriage."
Vanessa Lloyd, another divorce lawyer, agreed, predicting that the ruling would first grab the attention of wealthy couples, especially with a recession eating away at assets.
"Sometimes out of these bad recessions comes new law," Lloyd said.
The Americans in the case, Roderick and Marcia Macleod, live on the Isle of Man, a territory in the Irish Sea. They were married in Florida in 1994, the second marriage for each.
The ruling endorsed the terms they had agreed eight years after the wedding, leaving Mrs. Macleod with a settlement worth 2.2 million pounds ($3.4 million) instead of the 5 million pounds she had sought.
Wednesday's ruling described prenuptial agreements as "the price which one party may extract for his or her willingness to marry." The court said it was not possible for it "to reverse the long-standing rule that ante-nuptial agreements are contrary to public policy and thus not valid or binding in the contractual sense."
Legal experts believe Britain is moving gradually toward accepting pre-nuptial agreements. Ruling in a high-profile case last year, the Court of Appeal expressed some support for the idea, saying: "Should not the parties to the marriage, or the projected marriage, have at the least the opportunity to order their own affairs otherwise by a nuptial contract?"
However Wednesday's ruling means Britain's Parliament will have to step in to legislate the country's way toward U.S.-style pre-marital deals, Eden said.
While the Judicial Committee handles appeals from the British territories, its rulings are recognized by English and Welsh courts.
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Privy Council judgments, http://www.privy-council.org.uk/output/Page537.asp
Copyright 2008 AP News
