A Legacy Intact: safeguarding your family business in the event of divorce - Book - Page 69
This has the added advantage of
For
have
where proceedings might be issued
state that he/she should be entitled
heightening the bar in the Family
connections to multiple countries
in the future and thereby ensuring
to a greater share of the assets
Court’s mind, in the sense that the
either as a result of their asset base,
that they take place in a jurisdiction
on the breakdown of the marriage
Family Court will know that each
their domicile, habitual residence
where the PNA would be respected.
to reflect the inequality of earning
party had the very best of advice
or future plans to live abroad,
when exercising their autonomy in
advice may need to be sought
In summary, the advantages of
entering into the PNA.
from specialist lawyers in those
entering into a PNA in the context
It is often difficult to convince
jurisdictions when entering a PNA.
of a family business are as follows:
the Court that a party has a valid
those
couples
who
PNAs also have advantages in that
they
can
incorporate
confidentiality
and
extensive
The enforceability and validity of
privacy
PNAs varies from country to country
in
and it is vital, particularly if one of
the event of family breakdown, the
the key assets is shares in a family
exclusion of the media. This cannot
business, that it is established in
be guaranteed to work but it is likely
advance of any marriage how a
to be persuasive. Moreover, the
foreign Court would approach a
parties can include provisions for
PNA and the powers that Court has
settlement of disputes arising out
to disregard it and make orders
of a PNA by specifying that they
in relation to shares held in a
commit to resolving such disputes
business. By way of example, even
using mediation, informal dispute
close to home, the law in relation
resolution and/or arbitration rather
to financial provision on divorce
than issuing proceedings via the
differs substantially in Scotland
Court. This ought to assist in
compared to England. PNAs will
ensuring that any such disputes are
ordinarily
dealt with out of the spotlight and in
clause stating the parties’ intention
complete privacy.
as to the jurisdiction in which any
provisions
including
seeking,
include
a
jurisdiction
divorce would take place in order
to seek to retain some control over
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power in the future.
compensation claim, but a nuptial
(1) CERTAINTY:
agreement may clarify the parties’
The parties can agree at the outset
intentions about this.
of their marriage how their finances
will be divided if they later separate
(4)
PROTECTION OF
or divorce to save the uncertainty,
FA M I LY M E M B E R S :
time and stress of later contested
A nuptial agreement can protect
financial proceedings.
the financial interests of family
members such as children from
(2) TRANSPARENCY:
a previous marriage by ensuring
A properly negotiated nuptial
certain assets are ring-fenced in
agreement should contain financial
the agreement. This will be key
disclosure, so both parties
in this instance where all family
know at the outset the value (or
members are intrinsically linked to
approximate value) of each other’s
the business.
assets.
(5)
PROTECTION OF
(3) COMPENSATION
BUSINESS PARTNERS:
FOR LOSS OF CAREER:
Following on from the point above,
If one party gives up a potentially
a nuptial agreement can protect
lucrative career to care for the
that interest and prevent disruption
family, a nuptial agreement could
to the business on the future
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