Pre-Marital Agreements: a Simple Tool With Some Important Requirements

Kublan Khan PLC

Posted by J. Garrett Kizer

A Pre-Marital agreement (also called a “prenuptial agreement” or “prenup”) is a useful tool to protect your assets when you’re planning on getting married. A prenup can include many features. Most prenups will define certain pieces of property that the couple owned before they were married as “separate property.” In the event of a divorce, a Court would usually defer to the prenup’s definition as an agreement between the couple, rather than litigating what property could be divided in the divorce. A prenup can also include provisions to stop either spouse from asking for spousal support or attorney’s fees in the event of a divorce.

However, while a prenup can be used in many different ways, it also has a lot of requirements to be enforceable. While statutes lay out a few of these requirements, many of the important things a court will consider come from case law. For instance, courts will want to make sure that each side had an opportunity to ask a lawyer about their prenup, that the prenup doesn’t create a “gross disparity” in how it divides future assets, and that both sides fully disclosed all their existing assets in the agreement.

Indeed, a large part of a divorce case when a prenup is involved can be a challenge to the validity of a prenup. One spouse might claim that part or all of the prenup is “unenforceable” or “unconscionable” for a number of reasons. For instance, if only one member of the couple works, a prenup that lets that member keep all the money they earned during the marriage may be considered “unconscionable”, although a court would need to make this decision and would consider many other factors.

Another important consideration a court will look to when deciding if a prenup is enforceable is when it was signed. Essentially, a court will want to see that both sides had an opportunity to have a lawyer advise them about the prenup before signing it. If it looks like one party was pressured into signing the prenup, a court is less likely to enforce it.

Recently, in a case styled Remillard v. Remillard, the Court of Appeals of Virginia ruled that a prenup was unenforceable, because the agreement created a “gross disparity.” Essentially, the court took issue with the agreement because the groom failed to disclose $10 million in assets and because the prenup was signed the day before the marriage.

One important part of any prenup is a disclosure of assets. The prenup should include an addendum where each member of the couple lists their real property (such as land or houses), valuable personal property (such as jewelry), businesses, and bank or investment accounts. In the recent case, the groom claimed that the bride should have known about the $10 million in assets he chose not to disclose, because the bride worked at his property management business. However, the Court ruled that the bride’s general awareness of the Groom’s assets did not amount to a “fair and reasonable disclosure.”

The Court considered this alongside the timing of the agreement. The facts showed that the groom gave the bride the agreement the day before the wedding and told her that, if she didn’t sign it, the wedding was off. While there is no set deadline by which a couple must sign a premarital agreement, it’s best to do so as far ahead of the wedding as possible. At the very least, the Court easily decided that the day before the wedding didn’t give the bride enough time to consult an attorney.

A pre-marital agreement can be a great way for you and your spouse to protect your assets. While every wedding should be based on the idea of being together forever, a pre-marital agreement simply provides a safety net for both people—it doesn’t mean you don’t take your wedding seriously.

If you’re planning your big day and think a pre-marital agreement may be right for you and your future spouse, don’t hesitate to contact us!

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