Friday, March 03, 2006

Pre-Nuptial Agreements

I have just come across an article at icNewcastle that discusses the complexities and cost of sorting out financial settlements on divorce. The main theme of the article is that many of these problems can often be avoided if the parties had entered into a pre-nuptial agreement. Such agreements are becoming a little more common in this country. However, as the article points out, they are not legally binding, although the courts certainly are now giving them more weight.

In November 2004 the Law Reform Committee at Resolution recommended that the law be amended to make pre-nuptial agreements legally binding "unless to do so will cause significant injustice to either party or to any minor child of the family". For further details see here. Such a reform would certainly clarify the law, and may reduce the number of disputed cases. I believe the law in this area will be reformed at some point, but just when is not clear.

Whether there will be a significant increase in the number of couples entering into pre-nuptial agreements, even after reform of the law, is another matter. After all, it's not very romantic to respond to a marriage proposal by saying: "Yes, of course I will marry you darling, provided you sign this first..."

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