News and Insights
27 February 2018
There is a new trend of post-nuptial contract percolating through the United States’ legal system, which is making headway in the UK as well. This is called a reconciliation contract and it seeks to try and make a last attempt at keeping the parties together.
What is a reconciliation contract?
A reconciliation contract is a contract made after marriage and is usually made where a marriage is “on the rocks” and the parties want to try and get the relationship back on track. The parties seek to address the concerns that they may have with each other’s behaviour (e.g. adulterous or addictive behaviour) and set out how each of them are going to address those behaviours and try to make things better for their relationship. The contract will also set out what will happen if those parties fail in their efforts and what the split of the assets will be upon separation if the reconciliation fails.
The contract can include a myriad of promises between the parties such as an agreement to curb adulterous or addictive behaviour, or an agreement to work less and focus more on family life or a promise to spend more time with the children during the week.
What are the advantages of a reconciliation contract?
A reconciliation contract allows the parties to reset and take stock of their marriage and to establish what is important and what is causing the problems that they are experiencing. It allows the parties to be open and frank with each other perhaps in a way that they did not feel able to before. The financial consequences of not abiding by the terms of the reconciliation contract are clearly set out and can often be a good incentive to abide by its terms. Additionally, it also will make the process of any future separation easier to implement as the details will have been worked out and the parties will be aware of the terms of the separation. This often makes it easier to palate as the terms would have been agreed when the parties were being constructive in working towards finding a solution to make their marriage work. This should hopefully avoid the unknowns and the expense of divorce proceedings, as well as reducing acrimony.
Another benefit to these contracts is that they are “post-nuptial” agreements (as opposed to pre-nuptial agreements) and as such it is more likely that the Court will hold the parties to its terms if one party tried to back out of it. However, there have not been any decided cases in Jersey where the court has been asked to enforce these types of agreements.
What should you consider as part of a reconciliation contract?
You will need to think about the key areas that your contract should be covering in terms of what you want the other spouse to work on to make the marriage work (and what you are willing to offer in return). It is likely that this will have to be reciprocal or at least an obligation on you of a similar nature or level of onerousness. So be careful what you wish for! You will also need to consider what constitutes “success” or “failure” of those particular obligations. How are those going to be measured (if they are going to be measured)? Will there be some sort of penalty for not completing those obligations (e.g. some sort of financial penalty in the subsequent division of the assets)? You will also need to consider what the division of the assets will look like and things such as your income and capital needs going forward. Also what will happen with the children in terms of where they will live and how their needs are going to be met? What will happen if you have another child in the interim? Will there be a point at which the agreement may become outdated and need to be reviewed?
If you want the best chance of this contract being enforced by the court, in the event that it is disputed by the other side, then it is always a good idea to stick to your side of the bargain as much as you can. If the two of you do not abide by the terms of it, the court may form the view that you have both disregarded its terms and therefore it is not binding upon you.
Why should you instruct Viberts to draft your reconciliation contract?
Every case is unique and will face its own challenges. The distinctive characteristic of a reconciliation contract is that it will likely require some imaginative and pragmatic solutions.