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Prenuptial Agreements | Planning For The Worst

 

Prenuptial Agreements: What Is A Prenuptial Agreement? A prenuptial agreement is just an agreement that two parties enter into, like any other contract. It lays out what assets remain separate; what maintenance gets paid if the parties divorce, and how the assets get divided if the parties divorce. A sample of a prenuptial agreement is here.  Prenuptial agreements have been used for many years.  The oldest one I know of was used in ancient Egypt – 3500 years ago!

What Can’t It Do? A prenuptial agreement cannot control a parenting plan or child support. It can’t remotely control what the parties do duringthe marriage. For example, I have seen prenups which say things like, “Husband will wash dishes three times per week and take wife out to dinner at least one time per week”. Those are nice things to have  in the agreement, but they are totally unenforceable.

Similarly, agreements that say things like “Parents agree to split the children 50/50” may be useful to remind the parties what they agreed to; but in divorce the court will ignore it. (I find it still helps to get parties to agree on a parenting plan, though. It reminds the parties of what they had – even if informally – agreed to.)

Prenuptial agreements really have three purposes.

  • First, by their very existence they discourage people from having fights in a future divorce.
  • Second, they eliminate the vast majority of potential arguments in a future divorce.
  • Third, when people do have an argument down the road, they give both parties something to point at to remind the other side what they agreed to.

So when you have a prenuptial agreement drafted, you need to consider all three of these purposes. But the main purpose is usually making it enforceable, if someone tries to take it to courtAfter having had several trials over enforcing prenuptial agreements, there are several things I have found to be true:

  • The legal boilerplate matters very little. I have never had a trial turn on the fine print or legalese. A judge tends to think, if the terms in a prenuptial agreement are not clear to the average person, they may not be enforceable, and/or don’t matter in the slightest.
  • The actual terms matter a great deal.
  • The further away they are from what the community property law in Washington is, the clearer they have to be, and the clearer it has to be to any future court that the disadvantaged party knew clearly what they were signing.
  • That means the critical terms have to be in simple, clear language; there have to be examples/samples in the agreement to demonstrate what the terms mean; and to the decree the terms are one-sided they have to be boldfaced and preferably initialed.
  • Prenuptial agreements do not have to be reviewed by an attorney to be enforceable. It is a good idea though, because it takes away the argument that the disadvantaged party didn’t understand what they were signing. In a couple of my trials, the courts have held that parties are free to make bad deals, as long as they knew clearly what they were doing. And having it reviewed by an attorney, meant they knew what they were doing.
  • But as well, every judge, when they look at an agreement, will to some degree consider whether or not they think it is fair. And so the more “unfair” you make a prenuptial agreement, the more clear it has to be.

BUT – call me with questions.  There is no substitute for talking to an experienced attorney!

Case Law And Citations:

Separate property agreements (prenuptial agreements) are held to a higher standard than community property agreements because the law favors the creation of community property.
Harry M. Cross, The Community Property Law in Washington (Revised 1985), 61 WALR 13, 101 (1986)
Ryan v. Diafos, 110 Wn. App. 758, 371 P.3d 304 (2001), review denied, 147 Wn.2d 1024 (2002).
The enforceability of separate property agreements or prenuptial agreements is determined by a two-pronged test, now known as the Foran test. If the agreement is fair on its face, the agreement is valid. If not, the agreement may still be valid if (1) full disclosure has been made of the amount, character, and value of the property involved and (2) the agreement was entered into fully and voluntarily on independent advice and with full knowledge by both spouses of their rights.
In re Marriage of Burke, 96 Wn. App. 474, 980 P.2d 265 (1999);
In re Estate of Hansen, 77 Wn. App. 526, 531, 892 P.2d 764 (1995);
In re Marriage of Foran, 67 Wn. App. 242, 249, 834 P.2d 1081 (1992)
Under the Foran test, a party does not have assistance of independent counsel if the attorney failed in “assisting the subservient party to negotiate an economically fair contract.” Failures can include not representing the party in the negotiations, but only advising the party.
In re Marriage of Bernard, 137 Wn. App. 827, 835-36, 155 P.3d 171 (2007)
Under the Foran test, a party does not have full knowledge of his or her legal rights where the party’s attorney failed to provide accurate legal advice.
In re Marriage of Bernard, 137 Wn. App. 827, 836, 155 P.3d 171 (2007)