Prenuptial Agreements Aren’t Only for the Rich

The words Prenuptial Agreement generally call to mind marriages between wealthy partners, or, more often, a marriage between a wealthy person and a person of more modest means. It may surprise you to learn that prenuptial agreements are a good idea for quite a few couples, particularly those who are remarrying.

1. Prenuptial Agreement Defined. A prenuptial agreement may also be called an antenuptial agreement. What is a prenuptial agreement? Simply put, it is a contract between two parties who are going to marry delineating what will happen to separate property brought into the marriage and what will happen to joint property in the event of a divorce or death of one of the parties.

The agreement is crafted and signed by both parties ahead of the wedding. Ideally, each party should have an attorney to be sure that each party's best interests are being served. The agreement should include a list of property and assets each party will bring to the marriage and what will happen to these assets.

2. Who Needs a Prenuptial Agreement? The prenuptial agreement most people are familiar with is that between a wealthy party and one whose circumstances are more modest. A prenuptial agreement is often common for first marriages where the parties come from wealthy families. In these situations, one or both parties wish to protect premarital assets and future inheritances.

But prenuptial agreements are not solely for the well to do. A prenuptial agreement can deal with not only property issues, but also issues that would arise in the event of divorce, such as alimony. It could also deal with what will happen to property upon the death of a spouse. These issues are particularly important to work out in the case of a second marriage. One or both spouses may have assets and property they want to leave solely to their children, or they want to keep their separate property from becoming marital property.

3. Fairness of Prenuptial Agreements. Prenuptial agreements are valid in Michigan, and are generally enforced in this state, even after years of marriage. In order for a court to determine the validity of a prenuptial agreement, it will look at fairness of the agreement both at the time it was signed as well as at the time it is being enforced.

4. Rendering a Prenuptial Agreement Unenforceable. There are issues and circumstances that will make a prenuptial agreement vulnerable to invalidation. Among these are:

• Not accurately disclosing assets, either through a lack of disclosure or inaccuracy
• Coercion or undue influence in signing the prenuptial agreement
• An inability or incapacity to read or understand the terms of the prenuptial agreement
• Unequal bargaining power between the parties
• Both parties using the same attorney
• Unforeseeability, meaning an event occurred during the marriage endowing one party with assets that could not have been foreseen at the time of the prenuptial agreement

Keusch, Flintoft & Conlin, PC
119 South Main Street
Post Office Box 187
Chelsea, Michigan 48118
734-475-8671