Creating a ‘fair’ pre-nuptial agreement for engaged business owner

Our family law team advised a business owner — who was engaged to be married to her partner — to create a pre-nuptial agreement (prenup) that would protect her business in the unlikely event of a future divorce.

Here, Amy Harris reveals how we helped to implement an agreement that would be likely to be upheld in court.

Protecting business owners’ interests

Our client had recently overseen a restructure of her recruitment business following a period of rapid growth. An existing client of our corporate and employment law teams before instructing our family team, we had already helped to ensure that her business was in the best shape possible during its expansion. 

With the business doing extremely well and having detailed plans for future growth, our client wanted to protect the wealth that she had accrued in her business.

Constructing a ‘fair’ agreement

Our family team held a detailed meeting with our client to discuss her long-term objectives. Following this, we recommended that a prenuptial agreement — which sought to protect her shareholding in the business — was advisable. Further, it was sensible to ensure that the other assets she and her partner had — including a jointly-owned home — would be shared equally in the event of a divorce.

We advised our client that while prenups aren’t 100% legally binding in England and Wales, ‘fair’ agreements are more likely to be upheld than not. By signing a prenup, you should expect to be held to its terms. As our client and her partner were both largely self sufficient in terms of their income and pensions, there was no detriment to her partner at this time to agree that the shareholding in the business could be ringfenced. 

As an existing client, we already knew about the business and its plans for the future. This meant that our client didn’t need to go into full details about the business and its structure with us, saving time and cost.

Safeguarding the shareholding

Successful business owners work hard to build, maintain and grow their businesses. It’s therefore understandable that they may want to protect such interests in the event of a divorce. 

Our client is now reassured that her shareholding in the business is protected in the event of a divorce. As the family court in England and Wales has extremely wide discretion to take into account all “financial resources” that either person may have on divorce, the certainty of a prenup is extremely valuable. 

Any good prenup should be updated to account for significant developments and life events — so we also advised our client to keep us updated in case the agreement needs to be reviewed. 

Talk to us

Both pre- and post-nuptial agreements can be incredibly valuable tools for business owners to protect their pre-marital wealth and act as sensible ‘insurance’ policies in the event of relationship breakdown. 

If you’re thinking about whether a prenup is right for you, talk to our team by completing our contact form below.

Find out more about pre- and post-nuptial agreements and read our FAQs.

Please note that we've altered some details within this case study to respect our client’s confidentiality.