On 27 February 2014, Ayesha Vardag joined a Radio 5 Live discussion with presenters Sam Walker and Peter Allen on prenuptial agreements, ahead of the Law Commission’s report on the subject. She was also joined by Toronto-based family lawyer Andrew Feldstein.
To get the discussion going, Sam posed the crucial question, often asked in relation to prenups: “When do you bring this up? Is a man down on one knee with a ring in one hand and an agreement in the other?”
Ayesha doesn’t feel that prenups are necessarily such an awkward proposition: “I think that very few people have proposals like that nowadays. Normally, people have got to know each other for a while; they start discussing whether or not they’ll get married; it’s a dialogue that’s much more on an equal footing, and somewhere along the line of that dialogue the question of how you’re going to manage your affairs, in the event that you ever part, is a conversation that’s not as uncomfortable as it used to be”.
Sam was not so easily put off: “So the shock proposal with tears and flowers, that doesn’t happen any more?” Ayesha’s riposte? “I don’t think so –I haven’t had one of those for years. Have you?”
Andrew Feldstein added, “I think you also need to look at when marriage contracts are being discussed, because here in Canada we’ve had them since the 1980s. They’re recognised in the courts; they can be set aside, but the people who typically ask for them are either those who have significant wealth, and have something they want to protect, or people who are entering into a second marriage. When you enter into a second marriage the viewpoints are very different, because you realise that you’ve made a mistake once, and you may want to protect your children or your assets. The vast majority of people here do not have marriage contracts, because when they get married for the first time, they don’t have anything to protect”.
Mr Feldstein explained that these agreements are indeed purely financial: “Here [in Canada] you cannot have an agreement that determines custody of, or access to a child, or even child support; those are specifically prohibited from being included in a marriage contract”.
Ayesha confirmed that the same goes for prenups in England and Wales, and went on to describe the purpose and the typical contents of a prenuptial agreement:
“What you’d really be trying to do is to protect the separate property, the pre-acquired capital, or the big bulk of capital that’s been built up during the marriage, because there are two parts to a financial claim on divorce. One is the ‘needs’ part, that deals with the needs of the weaker party, and that still needs to be dealt with, both under the existing laws, and under these new proposals. But the big chunk that really shocks people – the ‘gasp’ factor of the £48 million payout – that’s under ‘sharing of the marital assets’, and that’s the sort of thing that typically you’d screen out. So: you might have a provision that would say ‘there’s not going to be any payout on either side in the event that we divorce, because we both have our own earning capacity, our own resources, our own capital’, or we might have something that said ‘in the event that we divorce, I’m going to give you £700,000 for a house to set you up, and I’m going to give you three years’ maintenance’ – something like that.
Sam was keen to quiz Mr Feldstein on the reality of the so-called ‘divorce calculators’ that are available online: “They appear very simplistic: you simply put in your name, date of birth, number of years married, date separated and details of incomes and children, then you get a printout saying ‘X has to pay Y this amount of money’. But can these be taken to court?”
Mr Feldstein explained that this was simply a guideline for the public to use: “They’re mainly to help […] people who want to play with it, to get an idea of the range that they’re going to end up in. Like any other software, what you put in is what you get out, and there’s a lot more to it”. A law firm, he explained, can offer something that is “a lot more sophisticated”.
To read about Vardags’ landmark prenups case, click here