De-Stigmatizing Prenuptial Agreements

How a premarital contract can help divorcing individuals avoid post-marital chaos…

By Gregory Gilston, Esquire

September 1, 2022

A Prenuptial Agreement is a legal contract signed by two individuals who plan to enter into a marital relationship with one another. Prenuptial Agreements can protect marrying individuals and their assets when the parties divorce, or when one spouse dies during the marriage. These agreements, although extremely useful at times, are often stigmatized due to the implications of having to implement the terms therein, in the event of a divorce.

Some individuals entering the marital relationship are hesitant to sign a Prenuptial Agreement, mostly because they do not want to entertain the idea that their marriage may end up in a divorce. There is a general stigma surrounding Prenuptial Agreements, as many individuals feel that they may be placing some sort of jinx or curse on their marital relationship before it even begins by considering such possibilities of divorce. Nevertheless, Prenuptial Agreements – when constructed, reviewed, and executed appropriately – can be a useful tool for minimizing conflict and costs associated with the dissolution of the marital union. When parties have signed an enforceable Prenuptial Agreement prior to their marriage, then they will often experience their divorce process more amicably, expeditiously, and efficiently.

When attempting to understand the overarching goals of a Prenuptial Agreement, it is important to first understand the overarching goals of the divorce process for divorcing individuals. When an individual retains a family law attorney to assist with dissolving their marriage, they will generally express their desire to minimize the cost, stress, and time associated with their impending divorce. From this point forward, and to avoid litigation over commonly disputed divorce issues such as spousal support or the division of marital property, family law attorneys will try work diligently with their clients, as well as with the opposing party/counsel, to structure, negotiate and memorialize the terms of a Property Settlement Agreement that best accommodates the needs of both parties. However, it is important to note that the process of negotiating a Property Settlement Agreement is not always so cut and dry. This process requires a lot of back-and-forth communication between the parties and their attorneys, in order to figure out how to best achieve a mutually beneficial outcome agreed upon by both parties. However, when there is a Prenuptial Agreement in place from the outset, then the terms written within the Prenuptial Agreement will often take precedent and will dictate the terms of the Property Settlement Agreement.

As previously mentioned, most individuals who enter into a Prenuptial Agreement will do so to protect themselves and their assets in the event of death or divorce. Therefore, when the divorce does occur, then the parties will have already mapped out the terms for their Property Settlement Agreement, which may include terms involving the distribution of marital assets, inherited assets, or alimony. However, some individuals will enter into a Prenuptial Agreement for altruistic motives, including their desire to protect their spouse’s interests in the event of death or divorce. Part of the reason why Prenuptial Agreements can be so helpful during the divorce process is because they will implement the intentions of the parties at the time when they were getting married, not at the time when they are getting divorced. This helps to prevent divorcing individuals from allowing their present emotions to interfere with the pending divorce process.

Quite often, divorcing individuals will become jaded by their feelings of resentment towards their soon-to-be ex-spouse, especially at the end of the marriage. These feelings of anger often manifest into spiteful behaviors and can cloud a divorcing individual’s judgment. As family law practitioners, we will often witness the starry-eyed newlywed who “only wants the best for their spouse no matter what” transform into the contemptuous spouse whose primary goal is “to drag out the divorce process.” This transformation does not bode well for an efficient and amicable divorce process, but generally can be circumvented through the implementation of a well-drafted, properly executed Prenuptial Agreement.

In Pennsylvania, and most other states, Prenuptial Agreements can be utilized to address the same issues that would otherwise be contained within a Divorce Order. A Prenuptial Agreement may address one or more of the following subjects:

• each spouse's right to property owned by either spouse

• the division of assets and debts if the couple divorces or either spouse dies

• either spouse's entitlement to spousal support or alimony

• each spouse's right to buy, use, spend or sell assets during the marriage

• each spouse's right to the gifts or inheritances of the other

• management of a family business

• each spouse's entitlement to death benefits from the other's insurance policy, and

• any other matter agreed upon by the couple.

While a Prenuptial Agreement can address many areas of potential conflict among couples who might separate in the future, there are limitations. Specifically, a Prenuptial Agreement cannot resolve any of the following issues:

• the religious upbringing of children

• temporary alimony paid while a divorce is pending

• Child Support, or

• Child Custody.

It is particularly important to note that Child Support and Child Custody are always modifiable. Parents cannot resolve Child Support issues in a premarital contract. This is because the child—not the parents—possesses the right to child support. Furthermore, parents and the courts cannot decide Child Support or Child Custody arrangements until the parties are separating or divorcing. When it comes to Child Custody, the child's best interests are paramount to any custody decision. Ultimately, the judge must evaluate these interests at the time the custody decision is pending, and after the parties have physically separated, not in advance.

Generally, Prenuptial Agreements in Pennsylvania will be considered enforceable, unless there is clear and convincing evidence showing that:

• one spouse did not sign the Agreement voluntarily

• the Agreement was unconscionable because before the parties signed:

• one spouse did not provide full and fair disclosure of existing assets and liabilities

• one spouse was defrauded because they did not expressly waive (in writing) the right to full and fair disclosure of the other spouse's finances, or

• one spouse did not have adequate knowledge of the other spouse's financial situation prior to signing the Agreement.

Furthermore, before signing a Prenuptial Agreement, both parties must have the opportunity to review their agreement with an attorney. If they opt not to review their agreement with an attorney, then they must explicitly waive their right to do so. Prenuptial Agreements must follow basic contract principles, and therefore must be free of fraud, duress, or significant misrepresentation.