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Love, Honour and ... Obey the Contract?
With divorce on the increase and over 30,000 millionaires in Ireland,
it's not surprising that more and more people are starting to look
at pre-nuptial agreements as a way of planning for potential marital
breakdown. Rachel
Murphy explains what's involved.
A pre-nuptial agreement is an agreement entered into between engaged
couples, setting out how all assets will be divided should the marriage
subsequently come to an end. The pre-nuptial agreement is fast becoming
a form of divorce planning.
The Irish Constitution recognises the family as the natural and
primary unit of society and pledges to protect the institution of
marriage from unjust attack. In the past, the concept of the pre-nuptial
agreement may have been viewed as an attack on the institution of
marriage by envisaging its dissolution. The introduction of divorce
into Irish law, however, together with the social and economic changes
of recent years, has diminished the likelihood of pre-nuptial agreements
being viewed as unconstitutional and contrary to public policy,
but this has yet to be clarified by the courts and the legislature.
It has also been argued that pre-nuptial agreements may not always
provide a fair solution to marital break up. They may prompt litigation,
with either party choosing to attack the agreement at a later date.
Furthermore, given that no 'clean break' provision is provided
for in family law legislation, the enforceability of pre-nuptial
agreements is questionable. In F v F (Judicial Separation)
([1995] 2 IR 354), Mrs Justice Catherine McGuinness stated: 'The
Oireachtas has made it clear that a 'clean break' situation is not
to be sought and that, if anything, financial certainty is virtually
to be prevented'.
Are They Enforceable?
A study group on pre-nuptial agreements was established by the
then Minister for Justice Michael McDowell in December 2006. The
aim of this group was to study and report on the operation of the
law since the introduction of divorce in 1996 with respect to pre-nuptial
agreements. The group concluded that pre-nuptial agreements do not
offend against the constitutional protection afforded marriage.
However, the constitutional requirement on divorce for proper provision
and the date of assessment of such proper provision prevents pre-nuptial
agreements from being automatically enforceable. The requirement
that proper provision be made for spouses and dependent family members
will be of foremost importance and will outweigh any pre-nuptial
agreement.
The group has recommended that express statutory provision be made
for pre-nuptial agreements which will allow for them to be analysed
by the court in the way that prior separation agreements are currently
dealt with on divorce. There is also a recommendation that the courts
be required to have regard to existing pre-nuptial agreements when
making ancillary relief orders in judicial separation and divorce
proceedings. The group has also recommended that pre-nuptial agreements
be reviewable on death and that a definition of pre-nuptial agreements
be inserted into the Family Law Act 1995 and the Family
Law (Divorce) Act 1996 so that to be enforceable an agreement
must be: in writing; signed and witnessed; made after each party
has obtained independent legal advice; made with full disclosure
of financial information; and made not less than 28 days before
the intended marriage.
The Situation in Other Countries
Pre-nuptial agreements are enforceable in many European countries
to include France, Germany, Italy, Spain, Belgium and Denmark. Pre-nuptial
agreements are also enforceable in many US states. As the law stands,
it is uncertain whether a pre-nuptial agreement validly entered
into in another EU country would be enforceable in Ireland. This
is another issue that needs to be addressed if statutory provisions
are made for pre-nuptial agreements.
As matters stand, there is no Irish legislation preventing parties
from entering into a pre-nuptial agreement. However, the courts
are not obliged to enforce such an agreement in the event of marital
breakdown. While there is no statutory bar to a pre-nuptial agreement
being considered, it will be only one of many factors considered
by the courts to ensure that proper provision is made for the spouses
and any dependent members of the family.
For further information please contact Rachel
Murphy.
Summer 2007.
© 2003-2007 LK Shields Solicitors.
All rights reserved.
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