Prenuptial and Post-Marital Agreements.
What is a Prenuptial Agreement?
Generally, a prenuptial agreement (better known as a “prenup”) is a written contract between prospective spouses that outlines several rights and duties and how assets and debts will be divided in a divorce. Without a valid prenup, Texas law concerning separate and community property will apply. Unless the spouses agree otherwise in a final property settlement, they will keep their respective pre-marital property, and all assets acquired and debts incurred during the marriage will be divided in a “just and right” manner.
Unfortunately, prenups sometimes have an unfair reputation for stirring up unnecessary negativity before a wedding and a false perception of enabling the wealthy to take advantage of prospective spouses with smaller assets and less bargaining savvy. In reality, prenups can be beneficial to couples from all walks of life and encourage candid discussions about issues that most couples don’t anticipate going into a marriage. If done the right way, there will also be detailed financial disclosures before couples sign a prenup, allowing them to negotiate with full transparency and avoid surprises down the road.
Prenuptial Agreements Can Cover a Variety of Important Matters
Clients rely on Epstein Family Law to help them review, negotiate and craft prenups that can address a number of significant issues, including, but not limited to:
- Each spouse’s rights and obligations regarding assets and debts
- The distribution of property in the event of a divorce, separation or death
- Management and control of property, including business interests
- Rights to spousal support
- Rights upon the death of a spouse
- Which state’s laws will govern interpretation of the agreement
- The impact of adultery on property division
Prenups are also subject to some restrictions. Specifically, they can’t include provisions that may lead to criminal liability, violate public policy or limit the amount of child support owed in the event of a divorce or separation.
Challenging the Enforceability of a Prenuptial Agreement
We also have substantial experience in cases where a spouse attacks the enforceability of a prenup and asks the court to set aside all or part of its terms. Prenups are presumed to be valid even if they favor one spouse over the other, which means challenging one in the courtroom can be an uphill battle. To overcome the presumption of validity, a challenging spouse must establish one of the following:
- The prenup is not in writing or signed by both parties. Notably, consideration – transferring something of value – is not required to create a binding prenup.
- It was not signed voluntarily, typically as the result of fraud, duress or undue influence.
- The agreement is unconscionable, and enforcement would be grossly unjust. For a prenup to be set aside on unconscionability, the court must find that not only is the prenup unconscionable but also that the challenging spouse: 1) did not receive full disclosure about the other spouse’s financial condition, 2) did not waive disclosure, or 3) did not, or could not reasonably have had, sufficient knowledge of the other spouse’s financial condition when the prenup was signed.
Advising clients on post-marital agreements is another important feature of our practice. Post-marital agreements include partition agreements in which the spouses partition community property as separate property to one or the other spouse and conversion agreements in which the spouses agree to convert one spouse’s separate property to community property. The formation requirements are similar for both prenuptial and post-marital agreements; however, there are some important nuances with partition agreements and conversion agreements that an experienced family lawyer will be sure to address. For example, a conversion agreement requires a fair and reasonable disclosure of the legal effect of converting the character of the property, which oftentimes results in the agreement containing a statement, prominently displayed in bold-faced type, capital letters or underlined regarding the legal effect of changing separate property to community property.
Post-marital agreements can cover the same territory as prenups. But they’re also effective for addressing new issues that arise during the marriage, such as ownership and control of family businesses, asset ownership determinations, inherited debt issues, probate and estate planning, new or modified life insurance policies and much more.
Consult with a Prenuptial and Post-Marital Agreement Lawyer
To consult with an experienced lawyer about a prenuptial or post-marital agreement, contact Epstein Family Law at 972-232-7673. We represent clients in counties throughout the Greater Dallas area, including Dallas, Collin, Denton, Tarrant, Ellis, Rockwall, Kaufman and Johnson, plus others.