A Pre-nuptial agreement can be entered into by a couple prior to getting married. The agreement sets out certain matters of agreement between the couple about their finances.

1. Pre-nuptial agreements - why consider one?

    Generally speaking, a Pre-nuptial agreement entered in Scotland looks to carve out which assets will or will not, become matrimonial property and subject to sharing if the marriage breaks down.

    To understand how this works, it is helpful to know about matrimonial property.

    Matrimonial property is assets and debts acquired or accumulated during a marriage.   Excluded from this is property which is gifted or inherited from a third party (outside the marriage). A family home purchased before the marriage is also matrimonial property.

    That all seems clear enough. Where things start to become complicated is where pre-marital, gifted or inherited property is moved about during the marriage. In these circumstances it can become converted into matrimonial property.

    A Pre-nuptial agreement seeks to stop the conversion of non-matrimonial property to matrimonial property.

    The beauty of such an agreement is that it can be tailored to the unique circumstances of each individual couple. It is, however, a sophisticated document which needs to be properly understood by both parties entering the agreement.

    2. Are pre-nuptial agreements enforceable in Scotland?

      Pre-nuptial agreements have never been fully tested by the Courts in Scotland, but the general view is that a properly prepared agreement which meets certain requirements when entered, will be upheld. This sits neatly with the ability in Scotland to contract freely on certain matters as a consequence of divorce without interference from a Court.

      To prevent the agreement being set aside at a later stage: -

      1. It must be fair and reasonable at the time it was entered into.

      2. Both parties have had the opportunity to take legal advice before signing.

      3. There must be no pressure to sign.

      The courts have recently decided a case where pressure to sign and fairness were significant factors in an agreement being set aside.

      Couples entering into a Pre-nuptial agreement must be able to have a constructive discussion on what the agreement should provide and what they both consider to be fair.

      There is no time limit in Scotland before the wedding to enter an agreement, but the recommendation is that there is plenty of time for discussion before an agreement is signed so that the Agreement is properly understood.

      3. We're already married – can we still enter an agreement?

        Couples can enter into a post-nuptial agreement if they are already married. The key difference between a pre and post nuptial agreement is simply the timing.

        Post-nuptial agreements are often considered where an individual has received a large inheritance or gift during the marriage and they wish to ensure what they have acquired passes down the family line.

        Some couples enter a post-nuptial agreement if they move countries whilst married. A post-nuptial can be an effective way to ensure that a move does not change how certain assets are treated in the event of divorce.