The criteria for a valid nuptial agreement: ringfencing matrimonial wealth

Ringfencing Matrimonial Wealth in Nuptial Agreements

In UK family law, nuptial agreements must strike a balance between protecting individual assets and ensuring fairness. Courts are cautious about upholding agreements that ringfence wealth accumulated during the marriage, especially when one party’s contributions enabled the other to build that wealth.

What Does “Ringfencing” Mean?

Ringfencing refers to the practice of isolating certain assets - such as business interests, property, or investments - from being shared in a divorce settlement. While this can be legitimate, it may be deemed unfair if the wealth was built with the support of the other spouse.

Key case law

In Radmacher, it was held that similarly to how it would be unfair to uphold a nuptial agreement which renders one party “in a predicament of real need”, it will also be unfair to uphold a nuptial agreement which ringfences what would otherwise be matrimonial wealth, which one party was able to accumulate due to their spouse’s support of them and/or their family: 

“Equally if the devotion of one partner to looking after the family and the home has left the other free to accumulate wealth, it is likely to be unfair to hold the parties to an agreement that entitles the latter to retain all that he or she has earned.” 

However, if both parties can meet their needs, fairness may not necessarily require the court to depart from a nuptial agreement, as confirmed in Luckwell v Limata [2014] EWHC 502 (Fam). This shows that fairness is context-dependent.

When Is Ringfencing Unfair?

A nuptial agreement may be challenged if:

• One party is left in a position of real need
• The other party’s wealth was built with significant non-financial contributions (e.g. childcare, homemaking)
• The agreement fails to provide for basic needs or future care

If you have signed a nuptial agreement which ringfences what would otherwise be matrimonial wealth, we can help you, whether you are seeking to protect your assets or fight for your fair share. Contact Vardags today for a free initial consultation with one of our expert divorce solicitors.  

BOOK FREE CONSULTATION