Italy v England: What is the difference between an Italian and English prenup?
By:0 commentsAugust 6, 2018
Nearly every nation in the world allows its residents to divorce. The procedure and requirements to obtain a divorce, however, vary greatly between jurisdictions. Some countries allow divorce by consent (also known as no-fault divorce), including the Netherlands, Scotland and France. Others, such as Ireland, do not.
Starting this week, we are running a new series of posts on the blog that will look at the difference between Italian and English divorce law.
Why Italy? Well, Lidia Fili Aicardi, a member of our London team is Italian, obviously fluent and has an interest in international cases.
This week Lidia will be joined by her colleague Sarah Masato, an Italian family law specialist and Partner at MM & Partners to take a look at how the UK law on nuptial agreements compares to Italy’s. The main difference is that the UK will uphold a nuptial agreement under certain conditions, whereas Italian Courts generally will not.
Historically, the idea that parties could redefine the rights and obligations arising from their marriage was “against public policy”, and therefore Courts refused to give significant weight to nuptial agreements in the UK. In 2010 when considering the case of Radmacher v Granatino, the Supreme Court moved away from this idea that many considered to be outdated, and held that although parties cannot oust the Court’s jurisdiction by agreement, a nuptial agreement that has freely been entered into, without external pressures or influences and with a full understanding of its implications, can be upheld unless in the circumstances it would not be fair to do so. The Court went on to say that the existence of the agreement can alter what will otherwise be considered fair.
The question remains: what does this mean in practical terms?
For a start, it should dismantle the myth of the nuptial agreement drafted on a napkin and signed five minutes before walking down the aisle coming back to haunt one of the parties’ years later upon divorce. It has become common practice to take certain steps to ensure a nuptial agreement is validly entered into.
Firstly, both parties should seek and obtain independent legal advice. Although not essential, this will be solid evidence that both parties understood the implications of signing the agreement. Lawyers will ask all the right questions, and ensure that appropriate disclosure is exchanged and parties have all the relevant information before signing. Having their legal team on side will also protect parties from undue external pressures and influences. This will go a long way in persuading a Court that the agreement should be upheld if the couple subsequently separates.
The agreement must also be “fair”. What this means will depend on the individual circumstances of each family but as a general rule of thumb, if the agreement fails to meet everyone’s needs (especially the needs of any children who are still minors), it is likely that a Court will find that it would be unfair to hold the parties to it. A family lawyer will be able to guide as to what a Court might consider fair in your circumstances.
This brings us to the second question: what type of provisions can a nuptial agreement include?
Again, this will depend on the circumstances of the individual family but some of the most common provisions are those that aim to exclude assets acquired by one party in their sole name (including by way of inheritance or gift and either before or during the marriage) from the “matrimonial pot” available for sharing with the other spouse on divorce.Legal advice at this stage is essential, as a specialist family lawyer will be able to guide on the type of provisions and/or appropriate choice of forum one should consider protecting their assets.
Finally, how does the UK compare to other jurisdictions, and will a nuptial agreement entered into in another jurisdiction be upheld in the UK?
Recent cases such as Versteegh v Versteegh and DB v PB suggest that foreign nuptial agreements will be given significant weight as long as they are entered into in accordance with the laws and procedure of the jurisdiction in which they were signed, and parties were fully aware of their implications at the time of signing. It is therefore very important to seek specialist legal advice in every jurisdiction that may be relevant to your family to avoid surprises down the line.
Avvocato Sarah Masato, a partner at MM & Partners will now set out Italy’s approach to nuptial agreements.
Italian Statutory Provisions
Italian nuptial agreements aiming to define the obligations that each party will be expected to honour when the marriage comes to an end are wide-spread in common law jurisdictions and Europe.
Italian nuptial agreements can be useful tools as they curtail or eliminate the need to negotiate these when the relationship has broken down. They also extend the scope of each party’s contractual autonomy to the realm of family relationships and contribute to lightening the judicial load.
Further to article 162 of the Italian Civil Code, spouses can decide the way in which they will own property as spouses, either before or after the wedding. Spouses may choose between the community of property regime or the separation of property (for more information about the different property regimes in Italy please read this article). Spouses cannot however freely and contractually determine or regulate the way in which property is to be dealt with upon divorce.
The prevailing set of authorities has found Italian nuptial agreements to be null and void when they seek to regulate the parties’ financial lives as a whole. Nuptial agreements conflict with the principle that rights and obligations arising from family ties such as marriage cannot be relinquished, disposed of or negotiated away. The nullity of Italian nuptial agreements within the Italian legal system is rooted in the need to protect the financially weaker spouse, whose financial claims upon divorce would be diminished or eliminated by such an agreement.
Nevertheless, the Italian Court of Cassation (this is the highest appeal Court in Italy, save for the Constitutional Court which only deals with matters pursuant to the Italian Constitution) has in several of its judgments chosen to enforce certain agreements seeking to deal with one specific asset, rather than the whole of the parties’ financial claims on divorce, such as an agreement between spouses stipulating that in the event of divorce, a particular property ought to be transferred to one spouse as compensation for expenses incurred by that spouse in relation to that same property throughout the marriage.
The current case law is not entirely consistent, but it would appear that whilst Italian nuptial agreements will not be upheld by an Italian Court, divorce will be recognised as a legitimate triggering event within an agreement between spouses relating to their arrangements in relation to property as determined by or arising from their marriage.
Room for change
On the wave of progress, initiated by the Italian Court of Cassation, draft amendment n. 2669 was presented to the Italian legislative chamber on 15th October 2014 and sought to introduce a clause within the Italian Civil Code aimed to make the nuptial agreements binding.
In particular, article 2 of the draft amendment sought to incorporate an article 162 bis to the Italian code to be entitled “Nuptial Agreements” and stipulating that nuptial agreements may be entered into by spouses before or after the wedding has taken place and must be executed as a public deed or through the assisted negotiation procedure. When the agreement contains provisions relating to children of the family who are minors or not financially independent, the agreement would need to be authorized by a judge. Finally, both financial matters and child arrangements would be capable of being regulated by a nuptial agreement under the draft legislation.
Unfortunately, the legislative term ended before the proposed legislation could be voted on, but it may be reconsidered in the future.
Although spouses cannot validly enter into a nuptial agreement in Italy, nor will the Italian Court uphold a foreign nuptial agreement upon divorce, spouses may protect assets by electing the separation of property regime. As this is not the default statutory property regime, spouses who wish to adopt it must do so in writing by way of a public deed before a notary and two witnesses. This is something to consider if Italy is a relevant jurisdiction for you and your family.
Thank you to Sarah Masato, an Italian family law specialist and Partner at MM & Partners.