Does a declaration of trust survive a marriage or civil partnership?

Pre & Post Nuptial Agreements - 2 minutes read

If you own property with someone but are not married or in a civil partnership then having a declaration of trust over the property you own setting out the terms of your ownership is critical. But, what happens to these documents if you later choose to marry or enter a civil partnership? Are they still binding and determinative?

In short, no.

When a couple marries or enters into a civil partnership, the legal rights and obligations they have towards each other change. This is because these unions bring with them the idea of mutual entitlement which includes assets acquired during before the marriage or civil partnership if these are necessary to ensure everyone’s needs can be met. Once married or in a civil partnership in England and Wales, couples are subject to the provisions of the Matrimonial Causes Act 1973.

This law gives powers to the Court to redistribute assets owned by the couple if they were to divorce or dissolve their civil partnership. In deciding how to divide everything up, the Court will take into account various factors, including contributions of each person, the fair division of assets, but ultimately what everyone needs moving forward. This means that the declaration of trust can be entirely disregarded by the Family Court. This often happens where these documents are in place in respect of the family home, which holds special significance.

So can anything be done about this?

Yes, if a couple wishes to protect their interests in a property and are contemplating marriage or civil partnership, they can enter into a prenuptial agreement before their intended ceremony (or a postnuptial agreement after it). Whilst not strictly speaking legally binding, these documents are generally upheld by the Family Court where it can be shown that each person can still meet their needs and the document has been prepared with all of the appropriate safeguards (e.g. legal advice for both, no undue pressure, in a timely manner, etc.). It is, therefore, much more likely that a couple who enter into a nuptial agreement will have their autonomy respected and the division of assets will be aligned to those wishes.

Talk to us

If you need any advice on declarations of trust, prenuptial agreements, or want to understand more about protecting yourself or a financial investment, then do not hesitate to get in touch with our highly experienced family law team.

We are dedicated to resolving matters as amicably as possible and every solicitor in our family team are members of Resolution which means we have a duty to reduce conflict wherever possible.