A prenup agreement is a tricky instrument. The purpose of a prenuptial or pre-marital agreement is to try and resolve as many issues as possible in the event that the parties divorce. However, this can be tricky because no one has a crystal ball to see how a marriage is going to turn out. This is certainly the case if you need a divorce and hate your prenup agreement.
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A Prenup Agreement Can Be Risky Business
Just because one person has substantial assets going into the marriage doesn’t mean they will maintain those assets throughout the marriage. Additionally, someone may have a high earning capability going into the marriage, and then experience something which limits their ability to work, such as a disability, or taking time off to raise children. No one knows what position the parties will be in if and when they divorce, so generally speaking, a prenup agreement is a risky business to get into.
Provisions Regarding Children Are Unenforceable
One thing that prenup agreements cannot address at all is child support or child custody. So, those issues are never included in a premarital agreement of this type as those provisions would not be enforceable. One cannot possibly know what would be in the best interests of the minor children when they have not even been born yet.
Protecting Substantial Pre-marriage Assets
Of course, someone who has substantial assets going into the marriage can safely enter into an agreement that those assets will remain that person’s assets if the parties divorce. That is an easy way to utilize a prenuptial agreement and it is pretty straightforward. However, allocating or waiving spousal support, deciding on a percentage division of the marital estate and waiving contribution to attorney’s fees are difficult to predict. It is hard to guess what will be equitable at some unknown time in the future.
Provisions Regarding Validity of the Agreement
Further, most prenuptial agreements have a provision which indicates that in the event either party tries to contest the validity of the prenuptial agreement, and they are unsuccessful, then they will have to pay the other party’s attorney’s fees. That could be a substantial undertaking depending on how long and how contested the argument regarding validity is. So, this discourages the litigants from trying to undo the prenuptial agreement, which creates the attorney’s fees the parties set out to avoid by entering into the prenuptial agreement, to begin with.
When Contesting a Prenuptial Agreement is Warranted
However, there are certain red flags which could mean a contest of a prenuptial agreement is warranted. First of all, if a maintenance waiver would cause someone substantial financial hardship, then that could be a basis for a Court to award them spousal support, despite a waiver of maintenance in the prenuptial agreement. Other red flags include executing the document too close to the date of the marriage (which could be sued to argue coercion or duress in signing the document), the parties not having legal counsel in the review and execution of the prenuptial agreement; the parties not making a full and accurate disclosure of all assets when signing the prenuptial agreement, and many more.
Should You Have a Prenup?
Overall, prenuptial agreements certainly serve a purpose when parties have their own nonmarital substantial assets going into a marriage. They are particularly useful when parties are on a second or third marriage and want to ensure children from their prior marriage receive all of their property upon death, etc (though estate planning can also effectuate this). However, prenuptial agreements can also cause a lot of harm when people gamble with what their financial ability/position will be at the unknown time if and when a divorce occurs. This is when it can become problematic.
So, be careful before entering into a prenuptial agreement and do it for the right reasons.
At Anderson & Boback, we’re passionate about solving complex family law issues for our clients and their families throughout the Chicago area. Contact us today for a confidential consultation when you have questions or concerns about prenuptial agreements including what to do if you have a prenup agreement and want to divorce.