Q. What is a Pre-Nuptial Agreement?
A. A written agreement made and executed before a couple marries outlining support and/or asset distribution in the event of divorce or death. The agreement must be in writing, with a statement of assets for each party attached, and it must be signed by both parties.
Q. I’m not wealthy, why do I need a Pre-Nuptial Agreement?
A. Even if you are not wealthy, a Pre-Nuptial Agreement may be right for you if you have children from a prior relationship and want to protect assets for them or if you own a business or have an ownership interest in a family owned business. You should also consider entering a Pre-Nuptial Agreement if you have received an inheritance or may receive an inheritance in the future, if you have a net worth that is much higher than your partner’s, if you support other dependents, such as elderly parents or if you or your partner have significant pre-marital debt.
Q. What kind of issues should I address in a Pre-Nuptial Agreement?
A. Parties to a Pre-Nuptial Agreement may contract with respect to:
a. The rights and obligations of each of the parties in any of the property of either or both of them whenever and wherever acquired or located;
b. The right to buy, sell, use, transfer, exchange, abandon, lease, consume, expend, assign, create a security interest in, mortgage, encumber, dispose of, or otherwise manage and control property;
c. The disposition of property upon separation, marital dissolution, death, or the occurrence or nonoccurrence of any other event;
d. The modification or elimination of spousal support;
e. The making of a will, trust, or other arrangement to carry out the provisions of the agreement;
f. The ownership rights in and disposition of the death benefit from a life insurance policy;
g. The choice of law governing the construction of the agreement; and
h. Any other matter, including their personal rights and obligations, not in violation of public policy.
Q. Can I address child support in a Pre-Nuptial Agreement?
A. Yes, but the agreement cannot adversely affect the right of a child to support.
Q. When does a Pre-Nuptial Agreement go into effect?
A. The agreement becomes effective upon marriage.
Q. Can we change or terminate the Pre-Nuptial Agreement after we get married?
A. Yes, however, the agreement may be amended or revoked only by a written agreement signed by the parties.
Q. Can I challenge a Pre-Nuptial Agreement?
A. Yes. The party challenging the agreement has the burden of establishing that the agreement is unenforceable. A Pre-Nuptial Agreement shall not be enforceable if the party seeking to set aside the agreement proves, by clear and convincing evidence, that he or she executed the agreement involuntarily or that the agreement was unconscionable at the time it was executed.
Q. What makes a Pre-Nuptial Agreement “unconscionable”?
A. An agreement will be found unconscionable if a Court determines that a party:
(a) Was not provided full and fair disclosure of the earnings, property and financial obligations of the other party;
(b) Did not voluntarily and expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided;
(c) Did not have, or reasonably could not have had, an adequate knowledge of the property or financial obligations of the other party; or
(d) Did not consult with independent legal counsel and did not voluntarily and expressly waive, in writing, the opportunity to consult with independent legal counsel.
Q. Do both parties need a lawyer for a Pre-Nuptial Agreement?A. While not legally required, it is highly recommended that each party have his or her own attorney. A party should not waive the right to full disclosure of assets and liabilities and should not waive the right to have the Pre-Nuptial Agreement reviewed by an attorney of his or her choosing.