Check your prenuptial agreement

Such a deed often ends up in a drawer and, as long as the marriage is going well, it stays there. But when dark clouds begin to gather over the marriage, the prenuptial agreement is taken out again and read carefully.

When one of the spouses then comes to us, we often hear remarks such as: “I didn’t know that”, “That’s not how I understood it at the time”, and “If only I had known”. It is indeed a strange moment, just before getting married, to talk about what might happen if the marriage were to end. Yet that is precisely the moment to pay close attention and not to think, through rose-coloured glasses: “That won’t happen to me”.

Judgment of the Court of Appeal of The Hague

A judgment of the Court of Appeal of The Hague illustrates this point. The husband and wife were married and had prenuptial agreements drawn up. These agreements included a periodic settlement clause. They also contained a specific provision stating that if the spouse obliged to settle operated a business, settlement vis-à-vis the other spouse would not take place. The term “business” was defined to include a business operated in the form of a private limited company or other legal entity in which the relevant spouse held control, either directly or indirectly.

The parties were not aware of the prenuptial agreement

The wife argued that the prenuptial agreement was invalid. According to her, the parties were not aware of the existence of the prenuptial agreement and she did not know what it contained. The parties’ intentions did not correspond with the content of the agreement, she claimed. She also stated that the parties had always lived as if the prenuptial agreement did not exist and, finally, that applying the agreement would be unacceptable according to standards of reasonableness and fairness.

The Court of Appeal did not follow the wife in her arguments. It appeared that the prenuptial agreement had been drawn up on the advice and at the request of the father of the wife, who had been alerted to the issue by his accountant. At the time of the marriage, it was intended that the father might at some point transfer the shares in his business to his daughter. The prenuptial agreement had therefore been drawn up with the aim of protecting the wife in the event of a divorce.

Life took a different turn

At the time of the marriage, both the husband and the wife were employed and there was no business involvement yet. The notary, the Court assumed, was aware of the father’s financial position when the prenuptial agreement was concluded.

But, as so often happens in life, things turned out differently. The parties remained married and never looked at the prenuptial agreement again. The father did not transfer the shares in his business to his daughter, but to her husband and her brother-in-law. In that transfer, the husband and wife did not take their prenuptial agreement into account.

According to the Court, however, this omission could not be attributed to the husband alone. It should have been up to both the husband and the wife to critically review their prenuptial agreement in the context of the transfer of the business by the father to the husband. Their failure to do so was therefore at their own risk and expense.

Advice: review your prenuptial agreement from time to time

So even if you are still happily married and entered into a prenuptial agreement at the time of marriage, ask yourself the following questions from time to time:

1. Do the prenuptial agreements still reflect our situation at the time we got married?
2. Do they still correspond with the intentions we had back then?
3. If our marriage were to end, what would the consequences be?

In short, even if there is no storm on the horizon, it is wise to review your prenuptial agreement periodically. It may be time to adjust it to your current situation. At that stage, there is still time to do something about it. Once divorce is imminent, the chances that your partner will still be willing to visit the notary are often slim.

Contact & advice

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