COLLYE R BRISTOW
June 2021
PRE-NUPTIAL AGREEMENTS: WHY THEY’RE NOT JUST FOR CELEBRITIES
Following last month’s news that Bill and Melinda Gates are set to divorce after 27 years of marriage, with no reported nuptial agreements in place (neither pre nor post-nup). Leading private client lawyer, Tanya Roberts of Collyer Bristow offers advice to advisers working with entrepreneurs and HNWIs on why pre-nuptial agreements should be an essential part of marriage planning in 2021.
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s we emerge from the pandemic, pre-nuptual agreements (pre-nups) are certainly a timely topic: postponed weddings have meant that there has been an increased demand for venues and, with this, has come an increased desire for prenups between pre-marital couples. When a high profile divorce hits the press, a renewed interest in the subject is always sparked. The Gates’ divorce begs the question as to whether the couple actually had a pre-nup in place. Recent speculation indicates that they did not. WHAT ARE THEY? Pre-nups are often entered into when there is a disparity of wealth between couples. This may be because there is a pre-existing disparity in wealth between the two parties or, alternatively, because one of the parties is likely to inherit significant wealth in the future. For high-net-
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worth (HNW) individuals pre-nuptial agreements are now much more commonplace. A key requirement of a pre-nup is that it must be fair. By nature, pre-nups are complicated to draft as the whole purpose of the agreement is to restrict the terms of settlement but the agreement must also be considered “fair” enough to have weight. This is the balancing act that experienced family lawyers have to master when advising and drafting these documents. Pre-nuptial agreements are especially common in a second marriage. This is often because both parties may have wealth they want to earmark for their children from previous marriages. Some parties may want a pre-nup in place to provide a safety net in case the marriage is short and ultimately goes wrong. Parties may be less concerned if the marriage is to last longer. Others want to provide for different scenarios. For instance, a short marriage with no children, a short marriage with children, a longer marriage with no children and so
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