Some time ago I was researching the divorce and inheritance laws of a particular state when I ran across an article entitled “Getting Ready for Marriage,” which dealt with premarital contracts and asset-protection planning.
It was written by a law school professor, who laid out each element of that state’s property and inheritance laws and described in great detail how far the terms of a prenuptial agreement could go toward preventing the sharing of assets and income with a new spouse. The entire thrust of the article was to explain how the wealthier, more-moneyed future spouse could minimize or eliminate the post-marriage rights of the less-moneyed spouse and also ensure that the prenup would be still enforceable under that state’s laws.
I was shocked at the tone of the article. Why would anyone want to destroy the financial security of a future spouse—someone that person loved enough to marry—especially in a first marriage of young people? But I shouldn’t have been surprised. I run across this attitude often when dealing with other attorneys who are representing the more-moneyed spouse in a prenup negotiation.
The article reminded me of a conversation with a big-firm attorney whose client was the more-moneyed future spouse. It was a first marriage for two young people. That attorney had presented a prenup draft that was truly severe. It significantly reduced what the less-moneyed spouse could receive in the event of a divorce, regardless of the length of the marriage. It had the potential of leaving the less-moneyed spouse in a very fragile economic condition…even if the marriage were to end because of the natural death in old age of the more-moneyed spouse. The attorney then quoted with admiration and approval a recent state supreme court decision that reduced sufficient grounds for the overturning of a prenup by a less-moneyed spouse at the time of a divorce to a “standard of unconscionability.”
Unconscionability is quite a high legal standard. To judge an agreement as unconscionable and thus worthy of being set aside, the terms for the less-moneyed spouse at the time of divorce must be more than just patently unfair, or even very unfair or extremely unfair. Courts have defined an unconscionable agreement as “one which no person in his or her senses and not under delusion would make on the one hand, and no honest and fair person would accept on the other, the inequality being so strong and manifest as to shock the conscience and confound the judgment of any person of common sense.”
The problem with this standard is that many sensible future spouses do enter into such unconscionable contracts, despite their unfairness. They agree to them because they have already invested so much time and emotion in a given relationship and do not want to break off the engagement or start all over again.
Unconscionability is very hard to prove in a court of law, and the court gives the suing party the burden of proving it. The less-moneyed spouse may not have the funds to litigate, and the court case may be well be a losing battle under this extreme standard anyway, especially if that spouse originally had the benefit of being represented by an attorney in the prenup negotiations, as happens in most cases.
Here are some of the terms I’ve seen offered in prenup drafts (even in first marriages of young people) by attorneys for more-moneyed spouses:
Alimony? It should be banned in total, no matter the circumstances at the time of a divorce, and no matter the income or assets of the more-moneyed spouse or the valuable non-monetary contributions of the other spouse.
Property division? In many agreements, all premarital property—and often post-marital property—is forever owned by the more-moneyed spouse. Gains and income generated by that property are also separate and belong to the more-moneyed spouse. The assets are only shared if the owning party chooses to do so.
Earnings during marriage? I’ve seen many first-draft prenups declare that earnings from employment during a marriage shall forever belong to the earner, who will share the earnings only if and when he or she wants to. I even find this term in first drafts of prenups between relatively young people marrying for the first time, who have been dating and engaged for a significant period and who plan to have children; it doesn’t matter if the other spouse will be a stay-at-home mom or dad and homemaker during the marriage.
When I represent less-moneyed spouses, I usually find myself fighting an uphill battle to try to make the terms of a prenup more generous to them and evidencing of greater caring on the part of the more-moneyed partner. If I am representing the more-moneyed partner, I will encourage that future spouse to exhibit caring and protection and fair treatment, even if the marriage should end in divorce.
My take on prenups is that they should meet the goals of both parties and also be as generous as possible within that framework. Too often an “off-the-shelf” prenup, generally submitted by the attorney of the more-moneyed spouse, dramatically departs from those aims.
Money isn’t everything in a marriage, even legally speaking. Providing the comforts of home is valued in divorce law equally with earning money. The less-moneyed spouse needs to be educated that he or she deserves security, even if starting with fewer assets or earning less. For the sake of the marriage at hand, the more-moneyed spouse will do well to ensure the future security of the partner that he or she loves, even if that union could eventually end in divorce.
This is the operative question: What’s more important—the money or the marriage?
The knee-jerk asset-protection route will lose its appeal if all eyes are on the prize: the marriage itself. In my experience, the best process is one in which both clients and their attorneys aspire to create a prenup that supports the health of the impending marriage and helps it to thrive.
Sharing is healthy and good for a marriage. That’s the way I encourage people to think about prenups, whether I am mediating one between partners or representing clients individually. Recent academic studies have confirmed that generosity is at the root of a good marriage, and couples (especially young people) who sign ungenerous prenups have unwittingly put a serious roadblock in the way of success.
If you or a loved one plan to be married and are considering a prenup, think about what terms you would want in it to demonstrate caring toward your partner…no matter whether the marriage might someday end in divorce. That’s the standard you should aim to meet.
by Laurie Israel, attorney/mediator
Published on The Huffington Post on May 31, 2016.
on both prenuptial and postnuptial agreements. She works as a consultant and mediator
nationwide. She previously practiced for 35 years in the areas of tax law, divorce, collaborative
law, estate planning, probate of estates and trust administration, as well as mediation and, in
Massachusetts, providing counsel for couples entering into prenuptial agreements. Laurie is
one of the initial practitioners and developers of the field of marital mediation, the practice of
using mediation to help couples solve marital problems and improve their marriages. Laurie is a former board member of the Massachusetts Council on Family Mediation and the
Massachusetts Collaborative Law Council. Her writings include articles on divorce, mediation,
marital mediation, and prenuptial agreements. You can find her articles on www.ivkdlaw.com,
Huffington Post, and Mediate.com. She is the author of the book “The Generous Prenup: How
to Support Your Marriage and Avoid the Pitfalls,” available on Amazon. Laurie is frequently
called upon by attorneys and mediators to share her expertise, through giving both formal and
informal presentations, on the subject of prenuptial agreements all across the country. You can
contact Laurie at laurie@laurieisrael.com. Her website is www.laurieisrael.com.