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The Divorce Encyclopedia
Prenuptial Agreement

Term Definition Prenuptial Agreement - a legal contract signed by two people before marriage, typically limiting the other spouse’s rights to property, support, and inheritance in the event of divorce.
Application in Divorce Also called premarital agreement or antenuptial agreement, prenuptial agreements (sometimes called "prenups") are often recommended for second marriages when both spouses are likely to have accumulated property and have children from first marriages. These agreements afford both parties a measure of protection: if the second (or third) marriage crashes, the assets are already divided.

Many lawyers advise prenuptial agreements in the case of second (or third) marriages between older people who have children to whom they wish to leave an estate. This is particularly true when one of the spouses, usually the man, is significantly older than the other (the new wife), who is virtually certain to outlive him. Men seem more likely to acquire younger woman as the second (or third) partner, and the stereotype of a older man (a "sugar daddy") with a much younger women (a "gold digger") is very often with foundation. Some men go into marriages in their sunset years looking for a younger woman who will take care of them.

Even with these agreements, couples some inadvertently taint their assets by commingling them. For example, with or without a prenuptial agreement, a couple who put his money in their account make that money their money.

In general such agreements must be "fair and reasonable" when entered and when enforced. The longer a marriage has lasted, the harder they are to enforce. And even with a prenuptial agreement, a spouse normally makes some reasonable provision for a second partner in a will. In other words, in death one partner is not free to leave the other partner destitute and penniless by virtue of a premarital agreement in favor of his or her adult children.

Sometimes prenuptial agreements are an adjunct to estate planning and the establishment of marital-family trusts to minimize estate (federal) taxes.

Although more frequent than before, prenuptial agreements are much less common in first marriages because these involve younger people who usually have smaller assets (and, in all honesty, more hope than experience).

As a rule, the burden of proof is on the spouse seeking to avoid enforceability of a prenup. In general, there are four factors that make a prenuptial agreement valid. They are: 1) Public policy (Would its enforcement encourage some undesirable result, such as divorce?); 2) Voluntariness (Was the agreement signed without duress, with "full opportunity to review the agreement with counsel...?"); knowledge (Did both spouses understand the rights waived and the value of them?); and 4) what is termed "substantive sufficiency" (Did the agreement meet the minimum needs of each spouse in terms of property and support?). Every state requires that the first and second factors be met. Some states require that the third or fourth be met for the prenuptial agreement to be valid.

Some legal observers believe that prenuptial agreements will become more common because they can be an excellent way to make more a divorce more fair "since the parties know their own situation and needs far better than any court."

At least 25 states and the District of Columbia have adopted the Uniform Premarital Agreement Act (UPAA), which defines the terms and conditions of such agreements. UPAA provides that premarital agreements must meet the requirements of procedural fairness, fair financial disclosure and proper legal advice.

While there is no such animal as a ironclad prenuptial agreement, lawyers agree that certain steps can be taken to minimize disputes after a prenuptial agreement has been signed. These include clarity in asset identification; ample time before the execution of the agreement so that no one can later allege duress; independent review by both parties; specification of controlling state law governing prenuptial agreements; and full disclosure. In particular a lawyer should advise his or her client about the importance of not commingling assets, transferring them into joint title, "or taking any other action inconsistent with the prenuptial agreement."

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