Richard Collins, a family law partner at law firm Charles Russell, discusses recent trends in the use of prenuptial agreements, in particular the application of other country’s laws in UK courts.

Richard Collins, a family law partner at law firm Charles Russell, discusses recent trends in the use of prenuptial agreements, in particular the application of other country’s laws in UK courts.

The recent change in European law and the increasing number of European couples living in the UK after marriage is causing controversy in view of potential divorce proceedings associated with a number of these marriages.

Couples of different nationalities often agree to enter into prenuptial agreements (especially if they are wealthy); in many European countries, such agreements are the cultural norm.

Take up of prenuptial agreements has become greater in recent years; formerly such agreements were entered into by people marrying for a second or third time to attempt to safeguard wealth for their own children or in cases involving a disparity between the respective wealth of two individuals intending to marry. Now, young couples starting off with relatively little are considering such agreements, especially where there is an international element. The change in EU law has not made agreeing these contracts at the point of marriage any easier.

Controversy has arisen in England because now EU nationals, if eligible, can agree in an English prenuptial agreement that any future spousal maintenance awards can be dealt with by a selected European court adopting their own national law even if the divorce is dealt with in England. In brief, the divorce would be dealt with by the English court but spousal maintenance would be dealt with by a different European country.

Crucial differences

Many wealthy or potentially wealthy European nationals are keen to take advantage of this change in European law because different European courts routinely make significantly different spousal maintenance awards to the type of award made in England - both in relation to the amount and the period of spousal maintenance payment.

Clients are often surprised to learn the wide variations in approach to spousal maintenance taken by different European countries.

In England, it is common to award open-ended spousal maintenance to a wife with young children even after a relatively short marriage. If the payer is wealthy, English spousal maintenance is often at a significant level.

In France, spousal maintenance orders do not commonly exceed a period of seven years and the amount of the awards are less than in England.

In North European countries, spousal maintenance is for an even shorter duration and the expectation is that on divorce women seek financial independence as soon as possible. North German courts and Holland for instance are often of the opinion that after divorce both parties should be working again within a relatively short time with no spousal financial support.  Therefore the requirement for the payer to provide spousal maintenance payments is less than in England. This change in European law could therefore greatly benefit the wealthier paying party. The question is whether the financially weaker partner, on the cusp of marriage, would agree such a request knowing that in England a wife would be treated much more generously on divorce.

As this law is so new, there is no indication yet about how this will work in practice.

For the time being, the question for European nationals is whether they deem it a fair request to ask a future wife, at the point of marriage, who may abandon a career, to forego a large sum of financial support for an extended period. Furthermore, whether it is reasonable to ask her to agree that the law of another country, with which she has no connection, will be applied in the knowledge that these jurisdictions treat wives much less generously than England.