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Jun
02

Before You Say, “I Do”

It is no secret that divorces tend to be emotionally painful, protracted, and very expensive. The filing for divorce is only the beginning and these issues are usually brought on when the parties are determining the terms of the divorce who keeps the house, what happens to the money in joint bank accounts, whether there will be spousal support, etc. One way to minimize the difficulty of this process is to have a premarital agreement, colloquially referred to as a “Prenup.”

In situations where one partner expresses any hint of wanting a Prenup to the other, the other’s reaction is usually one of disapproval. Understandably, when we hear the word “Prenup,” negative associations, such as noncommitment, usually come to mind. Another common association with prenups is that only people with significant assets utilize them. The stigma behind premarital agreements must change. They should not be thought of as casting doubt on the strength of the marriage or as something only wealthy people use, but rather as a pragmatic protective measure against the potential emotional chaos and financial disputes inherent in a divorce. Premarital agreements can spell out the terms of a divorce, such as how assets are to be divided, simplifying and speeding up the process, which in turn saves emotional stress and attorneys’ fees. When considering having a premarital agreement, it is important to remember these three important points: (1) you can contract about almost everything; (2) there must be full disclosure; and (3) enforcement is not automatic.

While a premarital agreement can have terms about almost anything, any term addressing the custody of children or child support will be unenforceable. A premarital agreement can help spare heartache and stress of asset division, but cannot address any issues relating to children. If it contains terms surrounding issues relating to children, those portions will be stricken and the rest of the agreement will remain.

Before the parties execute the agreement, they must have fully disclosed all assets to the each other. This helps to ensure that the parties understand the extent of their rights and what it is they are agreeing to. In the event that enforcement of the premarital agreement is necessary, one spouse’s failure to fully disclose all assets can render the agreement unenforceable.

Lastly, before a premarital agreement can be enforced, it must pass two tests; it must be fair and reasonable, (1) at the time of its signing, and (2) at the time of its enforcement. Factors such as one party’s not receiving legal advice, failure to fully disclose assets, or if the agreement is too one-sided can lead a judge to find the agreement not fair and reasonable at its signing. A common concern about prenups is that during the marriage, financial situations can change drastically and the prenup will leave one spouse at a significant disadvantage, but the second test helps to allay this concern. If such was the case, then the premarital agreement would not be considered fair and reasonable at the time of its enforcement.

Prenuptial agreements have slowly started to gain acceptance in the legal system, but for many, the idea of a prenuptial agreement still elicits negative feelings. It is important to remember that a prenuptial agreement may very well never be needed after it is signed, but when faced with the reality that “til death do us part” is sometimes cut short, a prenuptial agreement makes sense to protect both spouses from a lengthy and emotional divorce process.