It has been announced that Rupert Murdoch is divorcing Jerry Hall.
This is the second high-profile divorce this year after Sergey Brin, Google co-founder, filed for divorce from Nicole Shanahan. This is Brin’s second marriage and Murdoch’s fourth.
Given Brin and Murdoch’s respective substantial net worth, and the fact they have both been married before and married at a later stage of their lives, it is highly likely both will have entered into a prenup.
Both divorces will be dealt with in American states, where the law differs from the laws in England and Wales.
However, even with a prenup, the agreement reached must be fair given the parties’ circumstances at the time of the divorce. Any award made must meet the parties’ needs.
Murdoch and Hall don’t have any children but Brin and Shanahan did and so the prenuptial agreement must also meet the child’s needs. Both husbands have significantly more wealth than the wives and so both wives stand to receive a significant award but unfortunately, the details of both are likely to be kept private, Shanahan’s divorce settlement has the potential to be the largest award ever made.
Prenuptial agreements can limit one party’s exposure in a divorce and have the ability to ring-fence certain assets, but the provision made in the agreement must still be considered fair at the time of the divorce.
There are rumours that the agreement ensured Murdoch’s business operations were left untouched, but he would have to offset that against other assets, such as giving Hall a large share of the jointly owned property.
The prenup, in both cases, will probably limit the wife’s claims to less than 50% but they will still receive a substantial award in order to meet their respective needs. Murdoch’s third wife, Wendi Deng, reportedly received cash and property pursuant to her prenuptial agreement with Murdoch.
When entering into a prenuptial agreement in England and Wales, both parties must ensure that the provision made meets both parties’ current needs and any anticipated needs (for instance if they intend to have children).
Prenuptial agreements should be reviewed regularly to ensure they remain fair and it is advised they are reviewed after any significant life event (such as the birth of a child, bankruptcy, any serious condition that would prevent one party from working, etc) and every 5-10 years.
Whilst both parties may have entered into the prenuptial agreement with eyes wide open and with the benefit of extensive legal advice, if the agreement is not fair at the time of the divorce, it can be contested.
The Court retains discretion and upon reviewing the agreement, if the Judge does not think the provision is fair at the time, the agreement will not be upheld. This is why it is crucial that it is reviewed regularly and with the benefit of independent legal advice.
About Sarah Norman-Scott
Sarah specialises in all aspects of family law. She has a broad caseload consisting of divorce, financial matters for married and unmarried couples (under the Trusts of Land and Appointment of Trustees Act 1996) and private law children matters (domestic and international) including where one parent wishes to relocate with the child/ren.
Sarah is also experienced in dealing with financial claims on behalf of the children of unmarried parents under Schedule 1 of the Children Act and drafting Pre-nuptial and Post-nuptial agreements.