Drafting A Prenuptial Agreement
Years ago, prenuptial agreements were frowned upon as many assumed the spouse asking for the prenup was not committed to the marriage and anticipating a divorce. Millennials are changing that mindset as prenups are growing in popularity among this age group. An article published by CNBC in July 2018, reported that 62 percent of the lawyers polled saw an increase in the total number of clients seeking prenups during the prior three years, which followed a fivefold increase over the past 20 years. The article stated one of the reasons why such a large increase has occurred is because millennials are getting married later in life after establishing their careers. Getting married later typically means that assets have been accumulated that need to be protected in the event of a divorce. At a minimum, there are 401(k)s or stock programs that they want to protect in the event of a divorce, according to John Slowiaczek, president of the American Academy of Matrimonial Lawyers. Additionally, the millennial population has a total of approximately $497.6 billion in outstanding student loan debt (Forbes, 2019); therefore, some prenups are made to cover a student loan debt to avoid the other partner from being liable for the debt.
Arkansas uses the Uniform Prenuptial Agreement Act (UPAA) to determine the enforceability of prenuptial agreements. The act states that parties are free to create financial terms that they both agree with. There are a few limitations, such as a review of minimal standards of fairness by the state mandatory based on circumstances at the time of the agreement. The Act also establishes when rights at divorce or death might be waived or modified. An advantage of the UPAA is that rulings are more stable on issues such as estate planning, division of property, alimony and financial assets than in states that base rulings on case law rather than the UPAA. Guidelines used to determine if a prenuptial agreement will not be enforceable if a spouse can prove:
- He or she did not sign the original agreement voluntarily, or with full knowledge of the agreement. This means if the agreement was signed because of fraud, duress or coercion then it is not enforceable. Examples of these three are:
- If one spouse misrepresents his or her financial information then the prenuptial agreement was signed under fraudulent circumstances.
- Although this is a bit far-fetched, a good visual example of duress is one spouse holding a gun to the other spouse’s head forcing him or her to sign the agreement. Duress is one of the most common reasons that a spouse asks that a prenup be set aside during a divorce. However, it is hard to prove.
- Coercion can take the form of blackmail, threats or undue pressure such as waiting until closer to the wedding date to give the partner limited time to review it before signing without feeling pressured to do so.
- The agreement was unconscionable meaning it was illegally unfair when it was signed. The spouse could say he or she didn’t waive in writing the right to receive a fair disclosure of the other spouse’s assets and debts.
Agreements that have outrageous provisions or immoral in nature can discredit and weaken an entire prenuptial agreement. Examples include:
- Maintaining a certain weight,
- Making one spouse obligated to do a specific task or chore,
- Requiring intimate encounters
If you are thinking that you need a prenuptial agreement, give Kevin Hickey Law Partners a call. We are experienced with divorce laws applicable to Arkansas. Our firm has years of experience dealing with prenuptial agreements and divorce cases. We know what is to be included and not included so that it not only fairly represent both parties but also abides by the law. Our firm will draft a clear and concise prenup that does not have room for misinterpretations as the validity of a prenup depends on the language used. Give us a call today to help you with your prenuptial agreement.