While the idea of signing a pre-nuptial agreement before marriage may seem pessimistic, this is far from the truth. These types of agreements are a sensible way of protecting your assets and pre-determining how these assets should be divided should the marriage break down in the future.
Below follows a summary of pre-nuptial agreements and their legal position in Gibraltar.
WHAT IS A PRE-NUPTIAL AGREEMENT?
A pre-nuptial agreement, more commonly referred to as a
'pre-nup', is a legally binding financial agreement made
between two individuals before their marriage. The agreement
usually sets out the details of what will happen to both
spouses' pre-marital and marital finances, assets, debts and
any other belongings, should their marriage break down. It may also
include details of child custody arrangements (although these may
not necessarily be upheld by a court of law).
Pre-nuptial agreements are bespoke contracts, meaning they are
tailored to the client's needs. Any clause may be included in
the agreement, so long as both parties agree to the inclusion and
the clause is both fair and legal.
WHAT IS THE PURPOSE OF A PRE-NUPTIAL AGREEMENT?
The purpose of a pre-nuptial agreement is to protect your assets should your marriage end in separation or divorce. It also sets a legal basis for the division of marital assets upon the dissolution of the marriage that can facilitate matters in divorce proceedings particularly when the relationship has turned sour. Dividing assets on bad terms can put a lot of strain on either party and so by having a pre-nup individuals may be spared this pain given they will already have had a financial agreement which would have been established amicably by both parties at a time when the parties were in agreement.
WHAT ARE THE BENEFITS OF A PRE-NUPTIAL AGREEMENT?
Although, historically, pre-nuptial agreements may carry
negative connotations (particularly as most people tend to
romanticise marriage), they can actually set off a marriage on a
good foot, establishing clear expectations and a healthy framework
to work within, in the event of a breakdown in the relationship.
Some of the benefits in having a prenuptial agreement
include:
– Fostering transparency within the relationship;
– avoiding unnecessary arguments over assets and property
distribution upon divorce;
– protecting your personal property and any
inheritance;
– providing you with control over your property and finances;
and
– allowing for a smoother process should the marriage end in
divorce.
THE LEGAL STATUS OF PRE-NUPTIAL AGREEMENTS IN GIBRALTAR
Pursuant to Gibraltar law, pre-nuptial agreements are binding in
Gibraltar as financial agreements. Although referred to as
pre-nuptial agreements, essentially, they constitute financial
agreements in our legislation. Under the current legislation, an
agreement will be considered a financial agreement if it meets
several specific requirements.
For example, in order for the agreement to be binding it
must:
– Be signed by all the parties involved; and
– include a certificate certifying that each party, prior to
entering into the agreement, has received independent legal
advice.
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.
