Radmacher v Granatino (Rev 1)

A pre-nuptial agreement is not enforceable as a contract so as to oust the court’s statutory jurisdiction on divorce. It is, however, a circumstance to which the court must have regard under Matrimonial Causes Act 1973, section 25, and may receive decisive weight. The court should assess whether the agreement was entered into freely and knowingly, while considering fraud, misrepresentation, undue influence or any other defect sufficiently serious to undermine consent. A nuptial agreement cannot determine claims concerning children, but may properly influence provision made for a parent acting as carer and home-maker. In an appropriate case, provision for the former spouse may be limited to the period of parental responsibility rather than reduced under each head of award.

The parties, a French husband and German wife, married in 1998 after entering into a German-law pre-nuptial agreement excluding claims against each other’s property and income on divorce. They lived principally in England, had two children, and later divorced. The wife’s substantial wealth increased during the marriage, while the husband left investment banking to undertake doctoral research.

Baron J treated the agreement as one circumstance under section 25 but awarded the husband £5.56 million, including housing, debt clearance and lifelong capitalised maintenance. The wife appealed, arguing that the agreement had been given insufficient weight. The husband brought a cross-appeal after the wife moved with the children from Düsseldorf to Monaco, affecting the value of accommodation ordered for him abroad. The central issues were the legal effect of pre-nuptial agreements and the proper exercise of the section 25 discretion.

1. Appeal and cross-appeal allowed. The court set aside or varied the order below insofar as it gave the pre-nuptial agreement insufficient weight. Provision for the husband was principally to reflect his role as father, carer and home-maker for the children. The assessment of the foreign accommodation fund was remitted to Baron J because the children had moved from Düsseldorf to Monaco.
2. All three Lords Justice agreed that the agreement was not presumptively dispositive. Section 25 imposed a mandatory duty to consider all the circumstances, so the court retained responsibility for determining the financial outcome. The agreement was nevertheless capable of receiving decisive weight within that discretionary exercise.
3. The agreement had been entered into willingly and knowingly by responsible adults. The absence of independent legal advice, financial disclosure and negotiations did not, on the findings, destroy the husband’s consent. The birth of the children did not invalidate the agreement, since it did not affect the wife’s obligations to provide for them. Provision for the children could include substantial provision for the husband as their home-maker.
4. The foreign elements were relevant circumstances. The parties’ nationalities, choice of German law and the recognition of the agreement in Germany and France strengthened the case for giving it decisive weight, without requiring the English court to apply foreign law or to enforce a contract which ousted its statutory jurisdiction.
5. The judge erred by treating the agreement as flawed or tainted while purporting to give it weight, and by failing to demonstrate any real discount in the calculations. The English home should therefore be held on trust for the husband’s occupation during the period of his home-making responsibilities, with its value thereafter reverting to the wife or her order. The maintenance award required reformulation and further written submissions.
6. The court did not disturb the awards for debt clearance, the car, or periodical payments for the children. Fresh evidence justified reconsideration of the amount required for accommodation abroad.

• Court of Appeal (Civil Division): allowed the wife’s appeal in substance and allowed the husband’s cross-appeal on fresh evidence; varied the structure of the financial provision and remitted the assessment of the foreign accommodation fund.
• High Court, Family Division: Baron J’s judgment, [2008] EWHC 1532, reported as NG v KR (pre-nuptial contract), [2009] 1 FCR 35, ordered the wife to pay a lump sum of £5,560,000, provide accommodation in Düsseldorf and make periodical payments for the children.