The law on nuptial agreements has been clear since 2010: The court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement.

Since the Supreme Court set out that proposition in Radmacher v Granatino there have been numerous reported instances of its application in subsequent financial remedy cases, more often than not resulting in the court giving effect to the agreement, or at least giving it considerable weight, so that it had a substantial effect upon the outcome.

But in the case SC v TC, decided in May last year but only recently reported on Bailii, we had a different result: HHJ Hess found (amongst other things) that it would be wrong to place weight upon a post-marital agreement. An examination of the reasons for this finding is instructive.

2014 post-marital agreement

The history of the marriage and its breakdown is crucial to the finding.

The parties were married in 1994. They had one child, aged 17 at the time of the hearing. The husband was then 58 and the wife was 50.

From about 2003/2004 the husband began to experience the early effects of Parkinson’s disease. His condition was formally diagnosed in 2011, and thereafter progressively deteriorated.

HHJ Hess then takes up the story:

“At least by 2013 (and probably significantly before that) the marriage had become unhappy and turbulent and the absence of sexual intimacy in their relationship was a source of distress to the husband. In late December 2013 matters took a dramatic turn. The husband decided to visit a sex worker. He quickly felt guilty and ashamed about what he had done and regretted his action. In early January 2014 he told the wife what had happened. Very understandably, she was not happy to hear what she was told and my perception is that she acted with a mixture of distress and anger … She was not minded readily to forgive the husband for his transgression … Her initial reaction was, or certainly appeared to the husband to be, to be determined to end the marriage. The husband did not wish this to happen and begged her not to end it. She was persuaded to consider going on with the marriage, but decided to bolster her financial security in the process, as a quid pro quo of not pursuing a divorce.”

As a consequence of these events the wife consulted a solicitor in January 2014. The solicitor drafted a post-marital agreement, which provided for the wife to receive some 80% of the assets (of some £5.8 million), should the marriage break down.

The husband was in a hurry to sign whatever document was put in front of him, but nevertheless consulted a solicitor, understanding that doing so would add greater validity to the document. The solicitor, horrified by the contents of the agreement, advised the husband that its terms were not fair.

The husband, clearly anxious to save the marriage by signing the agreement, chose to ignore the advice.

The agreement was entered into on 4 April 2014.

The marriage thereafter resumed, until it finally broke down in 2020. Divorce proceedings were commenced, and the wife’s solicitors issued a ‘Notice to Show Cause’ as to why the terms of the agreement should not be made an order of the court.

A vulnerable person

Obviously, HHJ Hess had to decide how much weight should be attached to the agreement, and this entailed consideration of the question of fairness, including such questions as: “In the search for fairness, is a person giving away assets to which he has a secure entitlement to secure the resumption of a marriage to be treated any differently from a person (such as Mr Granatino) who gives away the possibility of sharing in pre-marital assets to secure the commencement of a marriage?”

In pondering such questions HHJ Hess gave careful thought to the medical condition of the husband at the time that the agreement was entered into, and to the husband’s needs.

He reached the conclusion that it would be wrong to place weight on the post-marital agreement. Not only was it very much to the husband’s disadvantage in financial terms, at the time that it was signed he was a vulnerable person, and the wife rather took advantage of that vulnerable situation to gain a substantial financial advantage.

In his view this was a case where these words (of Lord Nicholls in Royal Bank of Scotland v. Etridge) resonate: “The relationship between two individuals may be such that, without more, one of them is disposed to agree a course of action proposed by the other. The law has long recognised the need to prevent abuse of influence in these ‘relationship’ cases despite the absence of evidence of overt acts of persuasive conduct.”

Further, HHJ Hess reached the conclusion that to enforce the agreement ran the risk of leaving the husband in a predicament of real need, possibly leaving him in inadequate accommodation and/or running the risk that he would have no option other than to do the one thing he wanted to avoid – going into a care home.

In the circumstances HHJ Hess came to the overall conclusion that the right way to deal with the case was to divide the assets