Further to our last bulletin where we highlighted the pending appeal of Granatino v Radmacher, involving a signed Pre Nuptial Agreement made in Germany between a German wife and French husband which was deemed unenforceable in English courts, we now bring you our take on the widely reported recent Court of Appeal decision.

The Radmacher v Granatino Appeal:

  • The Court allowed the appeal on the grounds that the initial award gave insufficient weight to the existence of the Pre Nup.
  • However the decision is not as radical as it may first appear.
  • The Claimant husband still did a lot better than provided for in the Pre Nuptial Agreement, but significantly less than the first judge gave.
  • The most significant outcome of the Appeal is all three Appeal Judges highlighted the shift in attitude towards Pre Nuptial Agreements; judges are now more inclined to attribute weight to a Pre Nuptial Agreement as part of "all the circumstances of the case", with particular emphasis on ensuring that financial provision at least covers the claimant's time as homemaker and child carer.
  • The appeal judges expressed their concern regarding the lack of harmony between England and the rest of Europe in terms of Pre Nuptial Agreements.
  • English courts will grant awards and formulate orders with the parties' Pre Nup possibly being one of the compelling factors in the process
  • Significantly, however, for the present, Pre Nuptial Agreements remain unenforceable contracts under English law.

Rationale behind the Court of Appeal decision:

  • The parties entered into the agreement with the help and advice of a German lawyer, under German law, making an agreement which was familiar to the civil law under which both parties had grown up .
  • The husband understood the underlying premise of the agreement, that he was not entitled to anything if the parties divorced.

The Current Status of Pre Nups:

  • Pre Nups are still not binding in a contractual sense in UK courts.
  • However, anomalously, English courts can take them into account and possibly give them decisive weight.

The Future of Pre Nuptial Agreements in the English Courts:

  • Foreign Pre Nups now have a good chance of recognition.
  • English Pre Nups are still worth having though there remains an element of legal uncertainty.
  • The appeal case highlighted that reform of Pre Nups law is the remit of Parliament rather than judges.
  • The Law Commission's investigation into the future validity and effect of Pre Nups is due to commence towards the end of this year, with a report and draft Bill expected in late 2012.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.