When we hear the term “prenup,” many people think of celebrities going through a divorce. More specifically, we tend to hear about the divorcing celebrity couples who did not have a prenuptial agreement (such as Paul McCartney and Heather Mills). While these stories make for good entertainment – especially when we learn just how much each party walks away with – the reality is that prenuptial agreements are not just for the rich and famous.
In fact, anyone getting married who has any asset(s) that he or she wishes to protect in the event of a divorce needs a prenuptial agreement. These assets may include a home, retirement account, pension, etc.
So, what exactly is a prenup? A prenuptial agreement is a contract:
- Between two people who plan to marry each other;
- That specifically sets forth the division of all (or some) of each person’s property;
- In the event of divorce and/or death.
Prenuptial agreements may also contain provisions governing whether alimony will paid in the event of a divorce, including the amount and duration.
Common reasons for prenuptial agreements
As mentioned, if one or both parties have any assets they wish to protect in the event of a divorce, it is a good idea to enter into a prenuptial agreement with each other. Some common reasons people enter into prenups include the following:
- To protect a party’s interest in a business (especially a family business)
- To protect a party’s inheritance and/or an interest in a trust
- To set forth the method for dividing premarital assets
- To protect assets meant to provide for children from previous relationships
- To set forth if and what a party’s future spouse inherits from the party’s estate
- To set forth the method for dividing premarital debts incurred by each party
Note: One thing you cannot include in a prenuptial agreement is any type of provision that relieves you of the responsibility to care for your children and/or pay for child support in the future. Similarly, you cannot waive your right to receive child support in the event of a divorce.
Requirements of a prenuptial agreement
Just because a document is entitled “Prenuptial Agreement” and is signed by both parties, it is not necessarily valid. In Massachusetts, there are specific requirements for a prenuptial agreement to be legal. First, the agreement must be reasonable and fair – at the time the parties execute the document. Second, the agreement must be reasonable and fair – at the time of the judgment of divorce. Moreover, before a prenuptial agreement is executed, both parties must completely and truthfully disclose to each other all of their respective properties, assets and liabilities. Only then can both parties enter into the agreement with open eyes.
Unfortunately (or maybe fortunately), there is never a 100% guarantee that a court will enforce a prenuptial agreement if the parties dispute its validity. In some cases, one party will claim that he or she was forced or under duress to sign the document. In considering whether a prenup is enforceable, the court examines the exact circumstances surrounding the execution of the agreement, including the proximity in time to the wedding, the financial leverage of one party over the other, and whether one or both parties had legal counsel in drafting the document.
If you are considering presenting your soon-to-be-spouse with a prenuptial agreement OR you are presented with a prenup by your significant other, it is always highly advisable to seek legal counsel before you draft or sign anything.
Contact Attorney Rosanne Klovee today to discuss your specific situation.