Not so many years ago, preparing a prenuptial (premarital) agreement was believed to demonstrate a lack of trust between the partners. However, when a marriage occurs, there may be significant differences in wealth, a family business, children from previous marriages, as well as inherited property. These are some of many situations in which premarital agreements may be vital. Additionally, there may be property ownership disputes between the families of the partners and the family members of a partner (such as siblings) if one or both of the partners unexpectedly die. While a will may transfer property at death, a premarital agreement may clarify what property is subject to the provisions of a will as well as address inheritance and probate matters. This comment merely provides a brief overview of some aspects of a complex subject. Always involve experienced legal counsel in creating, reviewing, and enforcing a premarital agreement.
A premarital agreement is a contract. As is true of all contracts, it may not be created by fraud, duress, or undue influence. Virtually without exception, a premarital agreement must be written and signed by the partners. While signatures may not need to be notarized, doing so may prevent a subsequent claim of forgery. If for some reason the agreement is to be recorded in the public records (not typical), signatures must be notarized. Witnesses are usually not required by law.
Additionally, state legislation addresses premarital agreements. The applicable statutory requirements must be followed. Some statutes mandate that each partner have separate legal counsel who review and possibly sign the agreement. Some require a seven day waiting period between the presentation and signing of the agreement. Having separate legal counsel and a waiting period, even if not required by state legislation, is desirable as it reduces subsequent claims of misunderstanding, overreaching, or a mental state that prevented a partner from being competent to create a contract. Some states allow domestic partners to create a valid property agreement whether or not it is deemed to be "premarital."
Whether specifically addressed by statute or not, many courts require that each partner fairly and fully disclose her or his property to the other. Premarital agreements may not determine child custody and child support. A "best interest of the child" standard applies. Spousal support provisions may or may not be enforced, depending upon the jurisdiction. Probate and inheritance matters may typically be addressed in the premarital agreement. Provisions concerning habits, household chores, occupation, religion, infidelity, and illegal drug use frequently are not enforced. Property, not personal matters, is considered by many courts to be the proper subject of a premarital agreement.
If a partner is not proficient in the language of the premarital agreement (a non-English speaker for example), one should attach an accurate translation to the premarital agreement and partners should sign both copies. Courts are reluctant to enforce unconscionable (grossly unfair) contracts. Consequently, a court may have the ultimate right to refuse to enforce an otherwise valid agreement. Typically a premarital agreement is presumed to be valid with the burden of proof on the partner who challenges it.
There are many items to carefully address in a premarital agreement. The following are a few of many. Define or explain the terms that are used. For example, does a reference to a "bank account" include a "brokerage account"? Ambiguities create disputes. Does the agreement continue indefinitely or have an expiration date? What state law will govern the agreement? Personal mobility and scattered property make this provision important. An additional complication is how marital property is addressed within the state of marriage, residence, or divorce. What partner may manage or control an asset? Is there to be a distinction between the ownership of an asset and the right to receive income from the asset? If an asset is sold, are the proceeds of the sale treated in the same manner as the original asset? What assets are considered a partner's separate property and what assets are jointly owned by the partners? Consult an experienced attorney in premarital agreement situations.