Philip Barnsley, head of Higgs & Sons’ family team, explains why when it comes to protecting your client’s wealth, nuptial agreements can offer much more than just a romantic gesture.
It is an old adage that January is one of the busiest months for family lawyers. The strain of being forced to spend extended time together in the pressure cooker of the festive period leading to couples seeing divorce as the only outcome once the decorations have been safely stowed away, is a long held ‘fact’. But in my experience, the truth is somewhat different.
With over 20 years’ experience working in family law, I have never experienced a huge spike in calls on so called ‘divorce Monday’ (the first working Monday of January). There is perhaps a slight, gradual increase in enquiries as the month starts to draw to an end and Spring (a symbol of new beginnings?) starts to become a reality. But family issues are not particularly seasonal or so easily categorised. That is because the reasons behind family problems are so incredibly diverse and multi-faceted.
No two family situations are ever the same, and that is why I, along with like-minded colleagues working in the family arena, have built up a broad base of expertise to meet the needs of this ever changing area of law.
As a family lawyer, you never know what situations you may be facing from day to day and so you need to be able to draw upon expertise in everything from separation, divorce and child arrangements through to family mediation and wealth protection – a growing area of concern for clients seeking our advice at the moment.
A fine romance?
The Daily Mail is full of examples of individuals who find themselves sharing vast sums in huge divorce settlements whilst spending terrifying amounts on legal fees. At the same time pre- nuptial agreements, a vital instrument in any wealth protection strategy, continue to be viewed by large parts of the media as symbols of ‘anti-relationships’ or even worse ‘anti-family’, when in fact the opposite may well be true.
Professionals offering advice on wealth protection strategies need to be aware of the positive potential these agreements offer their clients as part of a comprehensive and effective long term approach. They are not to be feared or seen as damaging to a relationship, but a common sense approach to financial planning for those seeking to spend the rest of their lives together – just as wills or trusts may be seen as key elements in any long term planning.
Growing weight of legislation
In a landmark ruling in 2010 (Radmacher -v- Granatino) the judge held that the court should “… give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implication…”. This seems to suggest a more inclusive attitude towards nuptial agreements may be starting to take hold.
And though there is yet to be binding legislation on nuptial agreements, there is increasing willingness for courts to uphold the contents of properly executed agreements.
We are seeing much more negotiation in the initial preparation of agreements and, given the courts’ willingness to uphold these, we expect there to be an increasing acceptance of nuptial agreements in the near future.
This increased emphasis on wealth protection led me and my colleagues at Higgs & Sons to write a ground breaking White Paper Nuptial Agreements – A Shared Responsibility which addresses key issues for those who advise on wealth protection.
A shared responsibility
Advising clients of the opportunities that entering into a nuptial agreement may offer can result in increased client satisfaction and a feeling that their advisory team is ahead of the game in terms of protecting their assets.
We are finding that increasingly, our clients are seeking advice from professionals, not purely on the mitigation of tax, but on the protection of their wealth for future generations. We believe it is incumbent upon every wealth protection professional to advise their clients to prepare for such an eventuality. That is the essence of our White Paper.
The future for nuptial agreements is changing rapidly and being properly informed is the only way to ensure clients’ needs are continually being met.
Nuptial Agreements – A Shared Responsibility will offer a key tool for all professional advisers working with clients who are looking to protect their wealth, written by Philip Barnsley and with a foreword by leading barrister and Deputy High Court Judge, Nicholas Cusworth QC, the paper was launched in October 2015 and can be downloaded here.