Prenuptial Agreements

Lord Timpson Excerpts

Thursday 27th February 2025 Lords Chamber

[The Minister of State, Ministry of Justice (Lord Timpson) (Lab)]

My Lords, I begin by thanking the noble Baroness, Lady Deech, for securing this important and timely debate about a topic that has a real impact on people’s lives. I also thank the noble Baroness for taking the time to talk to me last week, and I thank noble Lords for the important issues they have raised today and for their kindness to me.

I am participating in this debate on behalf of my noble friend Lord Ponsonby. I must therefore declare at the outset that I am not an expert on these matters, save that my wife and I celebrated our 28th wedding anniversary last week.

As the noble Lord, Lord Farmer, and the right reverend Prelate the Bishop of Southwell and Nottingham set out so clearly in their remarks, marriage is a hugely important institution and the foundation of many happy relationships. That said, marriages and civil partnerships can of course break down. I wish to recognise, as many do, that divorce can be one of the most stressful and difficult times in people’s lives.

I will start with some context. As your Lordships will know, it is almost three years since our divorce law underwent its most significant change in half a century. The introduction of no-fault divorce now allows couples to end their marriage or civil partnership without having to blame each other. No-fault divorce has removed the legal requirement for conflict. As Juliet Harvey, then national chair of Resolution, said, one year after no-fault divorce was introduced:

“This historic change marked the end of the blame game for divorcing couples”.


It is perhaps fitting that the Bill introducing these measures passed with cross-party support both here and in the other place, gaining Royal Assent on 25 June 2020. At this point I must reference the noble and learned Lord, Lord Keen, who played a crucial role in taking the Bill through this House. From speaking with officials in my department, I know how much they enjoyed working with him on this legislation.

I know that the noble Baronesses, Lady Deech and Lady Shackleton, take the view that no-fault divorce is just one part of the divorce reform story and remain concerned about the law that relates to a divorcing couple’s finances. This leads me to the specifics of the Motion tabled by the noble Baroness, Lady Deech, which asks the House to take note of the law relating to prenups. I am aware that many of your Lordships will know the legal background. However, for the benefit of those who may be less familiar, including myself a week ago, I will give an overview of how the law in this area has developed.

In the 19th century, the courts concluded that agreements relating to a couple’s future hypothetical separation were invalid. This was because at the time, it was a public policy concern that these sorts of agreements might encourage separation or divorce. As the noble Baronesses, Lady Deech and Lady Shackleton, mentioned, in the landmark 2010 case of Radmacher v Granatino, the Supreme Court decided that a couple should be held to their prenup and post-nup agreement, if it is freely entered into, with a full appreciation of the circumstances, unless it would be unfair to do so. The current law continues as set out in the Radmacher case.

Central to developing law in this area, the courts have considered how to protect the finances of those who are vulnerable, including children, and how to make sure that vulnerable individuals are not coerced into signing prenups.

Your Lordships will of course be aware that the previous Government asked the Law Commission to conduct a review of the law on prenup and post-nup agreements. Its report was published in 2014 and recommended the introduction of “qualifying nuptial agreements”. These agreements would be enforced by the courts in specific circumstances. However, couples would not be able to use them to prevent each other providing for each other’s financial needs, including those of their children.

We have come back into government just over 10 years after the Law Commission’s report on this subject was published. The report regrettably never received a full response from the previous Government. I know this has been a source of frustration to the noble Baroness, Lady Deech, and the noble Lords, Lord St John and Lord Faulks, and I can assure your Lordships that this Government are looking into the issue with utmost care.

It would be remiss of me not to mention at this stage another report that the previous Government did not respond to, which was the Law Commission’s 2022 report on wedding reform. Again, I assure noble Lords that this Government are looking into this issue, including in relation to humanist weddings, and will provide an update in the coming months.

Since 2014, the Law Commission has however done further work on the law relating to financial settlements following divorce. In December last year, it published an important scoping paper, which outlined its assessment that there are problems with the current law, and possible ways the law could be fundamentally reformed. The Law Commission further outlined how changing the law on prenups and post-nups could form part of wider financial remedies reform. I know that my noble friend Lord Ponsonby has been reviewing the recent report and will be setting out next steps in due course.

I also wish to assure your Lordships that the Government have an ambitious reform agenda for unmarried couples. This includes delivering our manifesto commitment to strengthen rights and protections for cohabitants. We are working on delivering this manifesto commitment, and plan to launch a consultation later in the year.

The noble Baroness, Lady Berridge, will see that cohabitation reform will address some of the issues raised in respect of religious-only marriage. I am afraid that, on the subject of pets in the family, it is not my pet subject.

The noble Lord, Lord St John, was right to express the importance of mediation, and may be pleased to hear that we have also committed to funding the mediation voucher scheme until at least March 2026. This scheme has helped over 37,000 families to date. Mediation helps couples take a less adversarial approach to making agreements following separation.

I have heard the calls in this debate, including from the noble Baronesses, Lady Deech and Lady Shackleton, and the noble Lord, Lord Faulks, that prenups be dealt with separately from wider reform and that we legislate for them now. The Law Commission does not see prenups as a discrete issue, but, as I have heard today, some noble Lords disagree. The Government will take all these views in the round before setting out their position.

It may be helpful if I set out for your Lordships what the Law Commission says in its 2024 report. It says that any reform on the basis of its 2014 prenup and post-nup proposals would depend on the type of wider financial reforms that could be put in place. The Law Commission takes this view for a couple of reasons. First, it is of the view that it would be unnecessarily complicated to enact its 2014 proposals now, if future reforms would apply different rules for prenups and post-nups that would come into being at a later date. This would result in different law applying to different agreements, depending on the timing of those agreements being put in place.

Secondly, the 2014 proposals for prenups and post-nups were based on the central role of financial needs in the current law. The Law Commission said that any legislation is likely to need to be unpicked if there is future wider reform of financial remedies. I absolutely assure your Lordships that the Government are considering the Law Commission’s 2024 report and the issue of prenups in this context.

This debate is invaluable and timely. I know that my noble friend Lord Ponsonby and his team of officials will take on board the range of perspectives heard today in the Chamber when considering next steps. In fact, I am looking forward to meeting him on Monday, and I reassure the noble Lord, Lord Faulks, that I will take his comments back to the department, and maybe to the colleagues he knew very well when he was there.

I thank the noble and learned Baroness, Lady Butler-Sloss for her contribution to this debate. Given her lifetime of service to family justice, including as President of the Family Division, it is important to have her careful and considered input on this topic today. I am grateful to the noble and learned Baroness for highlighting the need for fairness and transparency for prenups. The Law Commission’s 2014 report recommended that a couple must have received important information about each other’s finances when making a prenup. We will certainly be looking into this recommendation in depth.

The Law Commission’s 2014 report addressed the issue of the family court having the discretion to intervene if there has been a major change in circumstances, by recommending that a couple would not be able to contract out of providing for each other’s needs on divorce. This is a very important issue, one that I assure noble Lords that my noble friend Lord Ponsonby will think very carefully about.

I thank the noble Lord, Lord Meston, for raising important questions about the formation of prenups. In particular, there is the question that the noble and learned Baroness, Lady Butler-Sloss, also raised about fairness for a spouse who may have signed a prenup without anticipating what the future might hold. No young couple getting married can precisely predict the future. They may win the lottery, or their health may deteriorate to a point where they can no longer work. No one can be certain about how life will pan out.

The Law Commission’s 2014 report considered this issue and recommended qualifying nuptial agreements. These types of prenups would not allow a couple to contract out of meeting each other’s financial needs on divorce. The Law Commission recommended this type of prenup to ensure that needs that have arisen because of unforeseen circumstances are not ignored by the court just because there is a prenup in place.

As the noble and learned Lord, Lord Keen, is aware, the definition of “needs” in financial cases on divorce has been the subject of much case law. As I previously stated, the Law Commission does not see prenups as a discrete issue. However, the Government will take on board all the views your Lordships have raised today in considering next steps.

I thank the noble Lord, Lord Farmer, for his contribution to this debate. I know how important these issues are to him and acknowledge his continued efforts to make sure that my department works across government to ensure the best outcomes for families who are separating.

As I have already said, and as was raised by the noble Baroness, Lady Shackleton, and the noble Lord, Lord Faulks, marriage is very important in our society and is the foundation of many successful relationships. I listened with interest to the noble Lord’s perspective that prenups would boost the marriage institution, and I am sure that my noble friend Lord Ponsonby will be interested in this point too. I will write to the noble Baroness, Lady Shackleton, on her question about appeals.

I thank the noble Baroness, Lady Featherstone, and the right reverend Prelate for raising the important issue of the impacts of prenups on women. This is an important policy question. I am aware that the Law Commission considered this specific point in its 2014 report and made recommendations in relation to protecting spouses’ financial needs when they divorce. The safeguard recommended was that parties cannot contract out of meeting each other’s needs when they divorce.

I further thank the noble Lord, Lord Farmer, for his suggestion that the prevention of parental breakdown should form part of the Government’s opportunity mission. The Government already do much to support separating couples. The Department for Work and Pensions is delivering the Reducing Parental Conflict programme to reduce parental conflict and improve children’s outcomes. Through this programme, funding is made available to local authorities in England that work in partnership with a range of experts from relationship and family charities. The Government will now consider these recommendations in the context of the Law Commission’s 2024 financial remedies review.

The noble Baronesses, Lady Deech and Lady Shackleton, rightly expressed the need to reduce court delays. These delays have a significant impact on families, and we are committed to improving court timeliness. In 2014, the Law Commission said that its recommendations for prenups and post-nups may reduce the number of financial provision cases going before the courts in general. We will look at this further as part of our consideration of the Law Commission’s 2024 report.

Your Lordships will, I am sure, be pleased to know that the Government are already taking action to reduce delays in financial cases. We are supporting the Family Procedure Rule Committee to launch a new express pilot for financial cases in particular regions. This pilot will reduce the number of court hearings in lower-value financial cases from three to two. As part of this, dispute resolution would be the central focus of the first hearing.

The noble Baroness, Lady Deech, will, I hope, be pleased to know that the Government continue to explore the use of technologies such as AI to improve the efficiency of courts and legal processes. The Ministry of Justice has established a new justice AI unit, led by the department’s first AI officer, to develop a comprehensive AI strategy for the department and its agencies. I confirm that our chief AI officer is a very popular person for everybody to meet.

The Law Commission says, in its 2024 report, that any reform on the basis of its 2014 prenup and post-nup proposals would depend on the types of wider financial reforms. The Law Commission does not, therefore, see prenups as a discrete issue. As I have heard today, some noble Lords, including the noble Lord, Lord Meston, disagree. The Government will take all these views in the round before setting out their position.

Today’s debate serves as a reminder that the law relating to prenups raises complex questions about the role that the courts and couples should take in the division of financial assets when divorcing. I understand the frustrations of the noble Baroness, Lady Deech, that the previous Government had little enthusiasm to address prenups. I hope my repeated assurances in this debate that this Government are carefully considering the Law Commission’s December report have been helpful. As referenced earlier, I know that my noble friend Lord Ponsonby has been reviewing the recent report and will be setting out our views in due course.

It has been extremely helpful to have this debate. In fact, it is the first time that I have heard the words “romance” and “love” in a debate. I have thoroughly enjoyed my time dealing with family justice matters and I will take what I have learned back to my noble friend Lord Ponsonby on Monday. I hope he thinks I have done this topic justice—if noble Lords will excuse the pun.

I hope I have covered all the points raised today and that your Lordships will forgive me if I have not. If anything has been missed, I will write on those issues.

In closing, I reiterate my thanks to the noble Baroness for tabling this Motion. It is because this issue is so important, both for couples and their children, that the Government must take the time to get this right.