If a couple are to enter into a pre-nuptial agreement it is important that steps are taken at the time it is signed to evidence that they fully understand what they are entering into. They would need to understand the effect of the agreement and what it provides for should the marriage end in divorce. They each need to understand its context – what each party has or are likely to have in the future.
What if one or both of the parties doesn’t have capacity however?
What if their lack of capacity prevents them from understanding the agreement or impedes their ability to appreciate their financial position or that of the other party to the marriage?
This is a question that came up in the case of PBM v TGT [2019] EWCOP 6.
This was the first reported case from the Court of Protection looking at capacity to marry whilst also looking at their capacity to enter into pre-nuptial agreements.
The fiancé in this case (termed PBM) had received a substantial sum from the Criminal Injuries Compensation Authority (CICA) following injuries suffered by him as a baby. He didn’t know the full extent of the award and his property and affairs deputy was concerned that he should not know the extent of it.
The question of whether PBM had the capacity to marry was referred to the Court, along with whether he had capacity to enter into the pre-nup. In the context of the pre-nup, the Court was also asked to consider whether he should know the true extent of his assets.
PBM wrote a letter to the Court and met with the judge, Mr Justice Francis away from the Court setting. Applying the necessary test adopted by the Court, it was clear to the judge and the Consultant Psychiatrist instructed, that PBM didn’t lack the capacity to marry.
The judge went on to consider the need for a pre-nuptial agreement, and commented that the protection of an award of damages was the ‘paradigm case’ where a pre-nuptial agreement might be followed. If he was to marry, it was quite clearly in PBM’s best interests for there to be a pre-nuptial agreement put in place.
The question then arose about the disclosure of the husband’s assets. Both PBM and his fiancée would need legal advice for the agreement to carry the desired weight an the solicitors advising on the agreement couldn’t be expected to provide legal advice without knowing what PBM was worth. Mr Justice Francis found that the pre-nuptial agreement would be less effective without PBM knowing the extent of his wealth. For the agreement to be less effective was clearly not in PBM’s best interests.
PBM was already aware that he was worth a substantial amount. So weighed against the problems arising from financial disclosure not being provided, the judge took the view that it was in POBM’s best interests for him to be provided with the financial information.
These steps very much flowed from the declaration that PDM had the capacity to marry. To not have disclosure was not in PDM’s interests; to not have a pre-nuptial agreement was not in his interests either. Had PDM not had the capacity to marry there would not have been a need for disclosure or the pre-nuptial agreement.
The case provides useful guidance to those considering pre-nuptial agreements where capacity may be in issue.