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Keys To Pre-Nuptial Agreements Being Upheld

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Drafting an enforceable Pre-Nuptial Agreement ("Prenup") requires as many of the following steps as reasonably possible.  Afterall, if you don't do it right, it is not worth the paper it is printed on and certainly does not protect either party.

The basic idea is that prior to marriage the future spouses have jointly decided that they want to have a written document that addresses certain issues that would come up were the marriage to fail and clearly states how those particular issues will be determined.  The fallacy of that statement is that it is usually the more "powerful" person that wants the prenup.  Therefore, what steps should the person who really believes that a prenup is beneficial take so that the agreement if questioned years later will be upheld?

1.  Do not wait until the last moment to raise the issue that a prenup is desired and do not wait until shortly before the wedding to present a draft of the agreement.  A prenup might be determined to be invalid if there was a lack of a proper amount of time to review without being unduly pressured because the wedding is substantially, if not fully paid for, and is not refundable.  I typically will not accept a retainer to prepare a prenup if the wedding date is less than a month away.  It is just not worth the risk that the prenup will either not be signed or is signed under duress.

2.  There must be full and complete financial disclosure of assets and debts of each person best prepared as a schedule for each person attached to the prenup.  The failure to disclose and to value fairly at the time of the disclosure will often lead to a court not enforcing those parts of the prenup that relate to the asset(s) or debt(s) or possibly the entire agreement.  If you want to protect or exclude an asset it must be disclosed and the issue of appreciation (gains/losses) of the asset should also be set forth.  Listing an asset without a reasonable valuation is misleading.

3.  It is highly recommended that both sides have an attorney and that there was freedom of choice in choosing the attorney.  If the "weaker" party does not know of an experienced attorney they can be provided with the local Bar Association name and if they want the recommendation of the future spouse's attorney they should ask in writing for such a referral.  They should then be provided with several names.

4.  The provisions should be fair at the time of drafting.  If an asset is excluded that does not mean the prenup is unfair.  However, if one person has significant assets the other party should not be left unable to support themselves.

5.  Another issue is called "choice of law" which means will the prenup be decided by the laws in the state where the agreement was signed or where they were married instead of the laws of where either or both of them are living at the time of separation or divorce?

6.  To what extent will the presence of unemancipated children and residential custody affect the provisions of spousal support?  Keep in mind that prenups cannot determine custody and child support in advance.

7.  The correspondence should ask that the reviewing party put in writing their requested changes.  Drafts of the prenup should be maintained to show the effect of negotiations and requested changes.  These documents will help show meaningful participation in setting the terms.

Prenups are difficult to discuss, require time to draft properly, as well as time for negotiation.  If one person does not have language fluency then a translation will be necessary as well as bi-lingual counsel.  The time and money spent to do it correctly will be invaluable if there is a later challenge.