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Is history repeating itself? The importance of prenuptial agreements
Article date: 14/02/2011
A leading West Midlands law firm is urging individuals with assets to enter into prenuptial agreements to protect their wealth before entering into marriage.
The warning from Waterfront-based Higgs & Sons comes after American actor Kelsey Grammer announced plans to enter into his fourth marriage with 29-year-old airhostess Kayte Walsh, without a pre nuptial agreement.
The 55 year old Frasier star and his fiancé have known each other for just over a year, with the engagement being announced just months after his third wife started divorce proceedings. The divorce has recently been finalised.
Partner Philip Barnsley, head of Higgs' family department and chairman of the West Midlands group of Resolution, is surprised at the star's laissez-faire attitude to protecting his remaining wealth given his marriage history: "A pre nuptial agreement could help to ensure that Grammer's remaining wealth is protected.
"This is a classic example of where a pre nuptial agreement should be considered. There is clearly going to be a disparity of wealth between the couple, and the risk is that Grammer could find himself arguing over his remaining assets and incurring further legal costs in the process.
"Whenever the financial position of a couple is unequal, where there are assets to protect, or where there are children whose financial future needs protecting after first (or subsequent) marriages, it is common sense to consider a pre nuptial agreement."
Pre nuptial agreements are used to record what a couple wants to happen with the finances in the event that their marriage breaks down, including provision for children. Philip says: "Pre nuptial agreements are being increasingly entered into in order to protect family wealth, inheritance prospects and as in this case, where there is a disparity in the parties' wealth. More than ever, people want to protect what assets they have built up during their lifetime."
Over recent years, pre nuptial agreements have become more accepted, and as marriages are generally happening later in life, with more second or subsequent marriages becoming common, individuals are finding that they have wealth to protect.
Philip concluded: "Considering recent case law and the Law Commission consultation paper published on 11 January 2011, Grammer's reluctance to try to protect what assets he may have left is surprising. Pre nuptial agreements are becoming more relevant to more of the marrying population and should be viewed as insurance policies rather than trying to undermine romance. Where a fair agreement can be reached and relied on, pre nuptial agreements can remove the need for court proceedings, and the associated distress of losing wealth."
Interest in pre nuptial agreements is gathering pace in the Midlands. Last week Philip held a seminar for professionals working in finance including accountants, bankers and fund managers. The breakfast event was attended by 80 Midlands professionals and looked at the impact of both pre and post nuptial agreements.