By Gabriella Chan
Hong Kong, 30 December 2022: It seemed a heavenly marriage but it is ending in hellish divorce. When Italy’s most glamorous couple, ex-footballer Francesco Totti and actress-model Ilary Blasi, split earlier this year, matters soon became messy. Claim and counter-claim of cheating, arguments over a pet cat and stories about hiding each other’s luxury possessions were fodder for gossip columnists. Soon enough, they were facing each other in court, each flanked by teams of high-profile lawyers.
Hindsight is a wonderful thing, but would a “prenup” have spared Totti and Blasi much of their grief? It’s pure speculation, of course, but prenuptial agreements are designed to avoid this kind of acrimonious fallout.
Hence the safety net put in place before David and Victoria Beckham’s son, Brooklyn, tied the knot last April with American billionaire Nelson Peltz’s daughter, Nicola. The celebrity couple reportedly signed what the tabloids termed “the mother and father of all prenups” to protect their respective family fortunes, in this case the bride’s net worth being three times that of her husband.
The key point is you don’t have to be rich or famous to have a prenup, they are just as relevant to citizens of more modest means. Such arrangements are becoming increasingly popular in Hong Kong, where couples are going their separate ways in greater numbers. Government statistics show the crude divorce rate (that is, per 1,000 population) has increased from 1.1 some 30 years ago to around 2.8 these days.
Prenups and their less common cousin, postnuptial agreements (that is, signed after marriage but before separation), are contracts entered into by couples which determine their respective rights and obligations in the event the marriage fails. Typically, a prenup includes full disclosure of each person’s assets, liabilities and income; details about how they wish to conduct their affairs during the marriage; and division of property and possessions, plus any financial maintenance, should the marriage end.
A prenup is especially useful when each party brings business assets into the marriage. The agreement might include how they should share future income from a business, or what to do with assets accrued during the marriage.
In Hong Kong, a prenup is not legally binding. However, it will be taken into account by the court in assessing all the facts of the case and may be upheld if the court considers the agreement to be fair and does not leave one party in dire circumstances. The court also needs to be satisfied that both parties signed the prenup of their own free will and without pressure, that they had all necessary information, obtained independent legal advice, and fully understood the implications. It is worth noting the prenup does not have to have been signed in Hong Kong.
A prenup has numerous benefits. It can help couples be open and honest about their possessions, it may facilitate better communication and it assists in managing expectations. Most obviously, such an agreement greatly reduces the chances of acrimonious and costly divorce proceedings.
How to proceed in obtaining a prenup? Usually, the biggest obstacle is raising the idea in the first place. It is a sensitive subject, one which could cause negative reaction, so timing and circumstance are important. Ideally, it should be done as early as possible once it is clear the relationship is serious. But if it is later, do not wait until just before the wedding, which is usually a stressful time for both parties and could, in the event of separation, lead to accusations of that the agreement was signed under duress. Sometimes, it can be easier to approach the topic like an insurance policy, or frame it as a lifestyle choice.
Next, speak with an experienced Family Law practitioner. Obtaining independent, unemotional advice is essential. Such a lawyer will most likely raise points the couple have not considered and will, if requested, draw up the draft agreement.
Prenups are not for everyone. Some couples simply don’t want to “go there”, others worry the topic will kill their romance. However, on balance, the positives outweigh the negatives. Such agreements are particularly useful when two people are marrying later in life and are each bringing assets into the partnership, or where one stands to inherit wealth.
Here at Boase Cohen & Collins, our renowned Family Law team have experience of advising on, and drafting, prenuptial and postnuptial agreements. We are ready to have that conversation and assist in any way we can. Feel free to contact us!
Gabriella Chan is an Associate with BC&C. She focuses her practice on Family Law, being proficient in a wide range of matters arising from the matrimonial context, and is also active in the Hong Kong Family Law Association. She can be contacted at Gabriella@boasecohencollins.com.