Love & the Law
The Realities of Prenuptial Agreements
Published on May 2013 | By Mark NeJame; Vanessa Louise Braeley contributed to this article.
It’s an all-too familiar story: It’s a week before the wedding.You’ve been dreaming about this day for years and are overwhelmed with the last minute details, when your soon-to-be spouse presents you with a document entitled “Prenuptial Agreement”. Do you sign?
The short answer is: “Not without consulting a lawyer.”
While one may initially be offended or wonder if their significant other is in it for the long haul, it is important to remain level-headed and objective when addressing this situation. A marriage is not just a legal union of two persons, but also of their assets and liabilities. Unromantic as it may be, the bond is similar to that of a business partnership, and developing an exit strategy in the event of a divorce can be a smart way to protect your assets and prevent avoidable, emotionally draining (and expensive) litigation.
Currently, Florida evaluates prenuptial agreements under contract law principals. This means that parties are generally free to decide their own interests through contractual arrangements and will be held to the terms, whether or not the party understands every term at the time of signing. Additionally, the prenuptial agreement must be subjectively reasonable to each party. This takes into consideration what is reasonable for the parties in the circumstances that exist at the time of signing. Lastly, a full and fair financial disclosure must be made to each party. This can be tricky, for if the prenuptial agreement has a blanket statement that such a disclosure has been made, the court will presume this to be true and a party will have a higher burden of proof to meet if they wish to show misrepresentation.
A recent landmark decision in the New York case Cioffi-Petrakis v. Petrakis, 2013 NY Slip Op 01057 (2012) may very well change the way the courts construe premarital agreements. In Cioffi-Petrakis, the court set aside the premarital agreement and awarded Ms. Cioffi-Petrakis her share of the marital estate as determined by New York statutory law. The court held that Mr. Petrakis induced Ms. Cioffi-Petrakis into signing the agreement four days before the wedding by incentivizing her with promises he never intended to keep. While this may seem promising for those who feel the agreements can be one-sided or unconscionable, the case has yet to effect how Florida courts apply the law. Currently, Florida continues to uphold most premarital agreements in the absence of fraud, duress or undue influence (all of which are difficult to prove).
Here are a few smart tips to consider before saying “I do”:
- Have a serious discussion about the scope of your assets and liabilities. Regard this to be a normal part of the wedding-planning process. Memorialize your discussions in writing and be as detailed as possible.
- It may be uncomfortable, but develop an exit strategy together if possible. This will increase the chance both parties will adhere to the contract in the event of a divorce since each person had an active role in drafting the terms.
- Address the issue of a prenuptial agreement well in advance of the wedding! This will give the spouses-to-be a chance to review the document with their respective attorney (each person should have their own counsel). Rushed agreements right before a marriage can suck the joy out of your special event.
- Amend the prenuptial agreement to fit the present circumstances of the marriage. Families change. Children are born, properties are bought and sold and jobs are lost and gained. The agreement should be relevant.
So consult with a family law attorney. Approach the situation from a business perspective. Prenuptial agreements can save a lot of stress, time and money in divorce litigation should that unfortunate day ever come.