Prenuptial Agreements

Prenuptial agreement is a dirty little word that no one likes to talk about, especially couples entering into their first marriage.  Yet no one can predict the future and protecting yourself should be your first consideration.  Studies have shown that approximately one-third of all first marriages and one-half of all second and third marriages end in divorce.  In a Maryland court of law, which is an “equitable distribution” state, a prenup agreement, a written agreement between a husband and wife, can save considerable time, both emotionally and time wise.  Obviously, no one goes into a marriage expecting to get divorced, however, just like an insurance policy takes care of you when your health is in danger, likewise a prenup will help to protect you in case of a divorce. 

While you may have no money or property when you first get married, this should not be a deterrent from sitting down and agreeing to how things should be separated in the event of a divorce or death.  As time goes on, money may be acquired, education expanded and talents become more valuable.  These developments should be thought out beforehand.  What if one partner writes a best seller, or goes on to higher levels of education and brings in a considerable amount of income?  What if a couple marries for the second time and both of them have children?  How will the property be divided fairly so that not only the partner is treated fairly, but also the children receive what was theirs prior to the marriage. 

Prenuptial agreements are not only for the wealthy.  They are designed to protect both spouses.  An unfair and one-sided agreement is not one that would probably stand up in court.  Full disclosure must be made prior to making the agreement and signing must be voluntary.  Remember, agreements made while you are both deeply in love will be much more generous than waiting for the bitter divorce when vengeance and anger are involved.  In the event of a divorce if the settlement terms are outlined in the prenuptial agreement as to the terms, amount and duration of support or division of property the control would be in your hands as opposed to those of the court.  Working thru the ins and outs of a prenuptial agreement may actually serve to strengthen and help a relationship.  Learning to listen and respect the wishes of your partner and coming to an amicable agreement prior to a divorce may actually teach the couple communication and financial skills needed to sustain a healthy relationship.

There are no “set” rules as far as what needs to be addressed in a prenuptial agreement.  As little or as much as both partners want may be included.  If all the couple wants to address is division of property that is fine.  If they would like to make sure every “T” is crossed and “I” is dotted that is also an option, it is completely up to them.  Lack of a marriage license however, does not necessarily mean that your assets are protected.  This is one reason why, even in a cohabitative relationship an agreement is necessary.  This can be a very tricky and grey area and it is best to protect oneself before rather than during a breakup.

When considering a prenuptial agreement the following criteria should be met:

• The agreement must be in writing.  No action can be brought on an agreement made in consideration of marriage unless the agreement, or some memorandum or note of it, is in writing and signed by the person to be charged.
• It must be “supported by consideration”.  This means something of value must be exchanged; however, marriage itself is sufficient consideration.
• It must be fair and reasonable.  This is judged as of the time the agreement is made, not on the conditions occurring subsequently.
• There must be full and truthful disclosure, or actual knowledge of one another’s assets and debts, income and expenses.
• The agreement must be entered freely and voluntarily.  There should be no fraud or duress.
• Each party must have separate legal advice, or at least an opportunity to seek independent legal advice.

Divorce is not a fun or anticipated occurrence in any marriage; however, protecting oneself when times are good makes for a much more pleasant and often fair experience for both parties.

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