UK: Pre-Nuptial Victory For German Heiress

Last Updated: 7 July 2009
Article by Michael Gouriet, Claire Blakemore, Brett Frankle and Mark Harper

The Court of Appeal has confirmed in a landmark decision on 2 July 2009 that, although a pre-nuptial agreement is not contractually binding under English law, it can be given decisive weight in divorce cases.

Facts

German paper heiress Katrin Radmacher has successfully overturned a High Court ruling which provided her former French husband, Nicòlas Granatino with £5.56m of her £100m+ fortune.
The parties married on 28 November 1998. At the time, Ms Radmacher ran a boutique in Beauchamp Place, London and Mr Granatino worked for JP Morgan where at the height of his career he was earning as much as £325,000 a year.
Prior to their marriage, the parties had signed a German style pre-nuptial agreement (otherwise known as a Marriage Contract), which barred Mr Granatino's financial claims against his wife.
At the time of their separation in 2006 Mr Granatino was studying for a D. Phil in biotechnology at Hertford College, Oxford and Ms Radmacher had amassed a personal fortune of over £100m from her family's paper company.

First instance

Although pre-nuptial agreements are not binding under English law, in the High Court, Mrs Justice Baron considered that Mr Granatino's award should be "circumscribed to a degree" to reflect the fact that he had signed a marriage contract. Mr Granatino was awarded £2.5m for a home, £700,000 to pay off his debts and £2.335m which he could draw on for the rest of his life to provide him with an income. Ms Radmacher was also ordered to pay Mr Granatino £25,000 for a new car and fund the costs of a furnished house in Germany for her former husband, to enable him to visit their children at the weekends.

Court of Appeal decision

  • The Court of Appeal unanimously agreed that the issue of the validity and effect of pre-nuptial agreements "is more appropriate to legislative rather than judicial development". However, they considered that the position that pre-nuptial agreements are void for public policy reasons was increasingly unrealistic in modern times, particularly so in a case involving international parties where the type of agreement they had entered into was commonplace and binding in their respective homelands.
  • Mr Granatino fully understood the terms he was agreeing to when he signed the marriage contract. He had had the opportunity to avail himself of the conventional safeguards of taking independent legal advice and requiring financial disclosure from the spouse, but had chosen not to.
  • The Court of Appeal reduced Mr Granatino's award by holding that his £2.5m home which Ms Radmacher should provide for him as father to their children should revert to her once their youngest daughter (who is 7 now) turns 22 (i.e. in 15 years time) and that the £2.335 lump sum he had been given to provide him with an income for life should be reduced to such amount as would provide him with an income for 15 years, when his financial responsibilities in providing for his daughters' as a home-maker will come to an end. This is the same approach as the English Court's adopt for unmarried parents.

Implications

  • Whilst European developments on international divorce law have, to some degree, floundered, the Court of Appeal were keen to emphasise in their judgment the judiciary's desire to reduce and not maintain rules of law that divide us from the majority of the Member States of the EU and beyond.
  • Questions will be asked as to whether the outcome of this case would have been different had the parties not had "all the hallmarks of internationality". One can speculate but ultimately, as with many family law decisions, this case turns on its facts.
  • This decision will give food for thought to those who wish to forum-shop and who may seek to file for divorce in England to take advantage of the English's Court generous approach to financial awards. The Court of Appeal has gone some way to address claims that the English Courts are overly paternalistic and the likely upshot of this judgment will be a greater incentive to the financially stronger party to enter marriage with a pre-nuptial agreements.
  • This is strong judicial encouragement for legislative reform. However the Law Commission are not due to produce a draft Bill on this issue until 2012.

Global trends

  • In support of reform of the law on pre-nuptial agreements, Thorpe LJ said that "we are in danger of isolation...if we do not give greater force and effect to ante-nuptial contracts."
  • Interestingly, the Court of Appeal's decision is consistent with a recent case in Singapore (TX v TR 2009 (SGCA) 6), where historically the Courts have followed the English rule that pre-nuptial agreements are unenforceable, the Singapore Court of Appeal in February 2009 upheld a Netherlands pre-nuptial agreements (entered into between a Dutch husband and a Swedish wife) which provided that each party to the marriage walk away with their own assets on divorce.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions