What Cannot Be in a Prenuptial Agreement?
Once thought of as something for the rich and famous, prenuptial agreements, also sometimes referred to as premarital agreements, have grown quite a bit in popularity in the past few decades. In a survey that was conducted in 2018 by the American Academy of Matrimonial Lawyers, more than half of the divorce attorneys who responded reported seeing a significant increase in the number of their clients who wanted one compared to just a few years prior. However, these contracts cannot include just anything that you want in them. There are specific provisions that are not allowed by courts in New Jersey and around the country, and the document in its entirety must meet certain requirements of fairness and transparency to be upheld by a court in the event of a subsequent challenge.
Make Sure That the Agreement Can Be Enforced
Couples who are planning on getting married in the future need to make sure that their prenuptial agreement will be enforceable in the event of a divorce. With that in mind, they need to be careful to include only terms that are legal. This is why it is beneficial to consult with a family law attorney before negotiating and drafting this type of a document.
Some prenuptial agreement terms could be considered void against public policy. When they violate a law, the terms could be unenforceable. It would then be up to the court to determine whether those terms are severable from the rest of the agreement or whether the entire agreement should be thrown out.
Prenuptial Agreements Have Broadened in Scope
Your family lawyer will tell you that, historically, prenuptial agreements were primarily designed to address financial aspects of the proposed marriage and its aftermath. This remains an important purpose of these types of contracts, and they continue to deal with these matters, such as outlining what assets will be deemed separately owned as opposed to being classified as marital property and thus subject to division in the event of a divorce. However, they have grown in scope, and it is now more common to see clauses dealing with the allocation of household chores, grooming standards, or the determination of who will be entitled to the ownership of a family pet should the marriage come to an end.
Alimony continues to be a subject covered in many New Jersey prenuptial agreements. One example is setting forth a baseline amount that will be paid by one party to the other in the event that the marriage comes to an end. In other cases, each party waives the right to receive any alimony whatsoever.
It is important to note that a prenuptial agreement cannot have any provisions that detail illegal conduct. In that regard, a prenuptial agreement is like any other contract. A written agreement between two parties cannot be for any illegal purpose, and in the case of a prenuptial agreement, the parties cannot stipulate that one or both of them will engage in any activity that is against the law.
No Child Support or Custody Provisions
Two topics that are off limits for a prenuptial agreement are child support and custody. As a matter of public policy, parents cannot agree to this in advance of their marriage, and if courts are presented with an agreement that tries to cover one or both of these issues, they will strike that portion of it from the document. Although parents whose marriages have come to an end legally can and often do negotiate their own child support and custody agreement as part of an overall divorce settlement, the court must approve it before it can become part of the decree.
The following sets forth some subjects that deal with some aspects of a couple’s finances and that are frequently covered in detail in prenuptial agreements:
- Property division and distribution after a divorce
- Whether the couple will keep joint or separate bank accounts
- The treatment of the couple’s debts that were incurred prior to the marriage
- Life insurance requirements and the distribution of policy proceeds
- Alimony, if any, including the amount that will be paid and how long it will be paid for
- The responsibility for the payment of certain financial obligations incurred after the marriage, including credit cards, medical expenses, and student loans
- The protection of children from a prior marriage
Unfair Terms or Terms That Were Obtained by Fraud Could Invalidate the Agreement
The prenuptial agreement also will not be allowed to include any terms that would be considered unconscionable. This is a legal term that describes a contract that is egregiously unfair to one of the parties. The prenuptial agreement must be somewhat balanced between the two parties. If there are terms that are so one-sided as to favor one side, then a court may strike down the entire agreement instead of merely excising those terms.
This is why both parties each need to have their own family lawyer review the agreement. If one party has a lawyer and the other does not, you run the risk of having an unbalanced agreement that the court will ultimately throw out in the event of a challenge. The prenuptial agreement should be the product of unfettered discussions and fair negotiations between the two parties. Otherwise, courts may not enforce something that they believe to be unfair, especially if one of the parties was in a much better financial position than the other at the time the prenup was signed.
In addition, any terms that were introduced into the agreement under fraud or duress will not be enforced by a court in the event of a challenge. Each of the two parties must make a full and open disclosure of their assets and liabilities before they sign the agreement. Every term must be something that each person signs on their own free will instead of under pressure. A failure to completely disclose their full financial situation could lead to the court ruling that the entire agreement is invalid.
It should also be noted that most family law attorneys will advise their clients that the terms of the prenuptial agreement should, if possible, be negotiated and then signed by both parties well in advance of the proposed wedding date. This can help to combat an argument on the validity of the contract if one party is suspected to have been coerced or pressured into signing it.
You never know if an illegal term could cause the court to throw out the entire agreement. Never leave anything to chance with a prenuptial agreement and always consult with a divorce attorney before it is signed. The last thing that you want is to be counting on the protection of this agreement during the divorce process only to find out that the other party can successfully challenge the agreement in its entirety. Your divorce lawyer will be able to advise you should they believe that certain proposed terms would be problematic.
For help with your prenuptial agreement, contact a divorce attorney at Lawrence Law at (908) 645-1000. Our Red Bank and Watchung divorce lawyers are here to guide you through the process.