Chase, Berenstein and Murray, Counselors at Law provides collaborative divorce solutions to clients in San Mateo, San Francisco and Santa Clara counties.

What Happens in a Divorce When You Have a Prenup?

When planning a marriage, it’s essential to consider the possibility of divorce and its implications beforehand. This is where a prenuptial agreement, commonly known as a prenup, comes into play. A prenup is a legal contract that defines the financial and property rights and obligations of each spouse during marriage and in the event of a divorce. In this blog post, we will explore what happens during a divorce when a couple has a prenup in place.

  • Property Allocation: A primary purpose of a prenuptial agreement is to establish how finances and property will be allocated between the spouses. Typically, the premarital agreement will dictate the division of property in the event of a divorce. For example, if the agreement states that all retirement accounts belong solely to the person whose name they are titled, this arrangement will carry forward into the divorce. Each spouse will be assigned their respective retirement assets without any equalization of those accounts. The agreement may also define what income and expenses will be considered shared and what income and expenses will be considered separate income and obligations.
  • Contesting the Prenup: In some cases, a spouse may contest the validity or enforceability of the prenuptial agreement. If a person seeks to challenge the agreement, the court would need to find that there is a legal reason not to follow it. The court may consider factors such as whether the agreement was obtained through coercion or fraud, or if there was a lack of comprehensive financial disclosures, or a circumstance where enforcing the agreement would lead to an unconscionable outcome for one spouse. If the court determines that the agreement is unenforceable, the judge may order an alternative division of assets, such as a substantially equal distribution of retirement assets.
  • Spousal Support and Child Custody: While a prenuptial agreement primarily focuses on property allocation, it can also address spousal support in the event of a divorce. It’s important to note that a prenup cannot dictate child custody and child support arrangements. Courts are obligated to evaluate these matters based on the best interests of the child and the prevailing laws at the time of divorce. Therefore, any provisions in a prenuptial agreement relating to child custody or child support will not be enforceable.
  • Circumstances for Invalidating a Prenup: There are several circumstances under which a prenuptial agreement may be set aside by the court. These include:

a) Failure to follow the legal requirements: In some jurisdictions, there may be specific rules surrounding the execution of a prenup. For example, a mandatory waiting period may be required before signing the agreement. Failing to adhere to these legal requirements could render the prenup invalid.

b) Unconscionable circumstances: If enforcing the prenuptial agreement would result in one spouse being in an extremely disadvantaged or unfair financial position due to unforeseen circumstances during the marriage, the court may overturn the agreement.

c) Lack of proper legal representation: If one spouse had legal counsel while the other did not, it can raise concerns about the fairness and informed consent of an unrepresented spouse when entering into the agreement. The court may scrutinize such cases more closely to ensure both parties fully understood the terms and implications of the prenup.

d) Fraud or inaccurate financial disclosures: A prenup requires full and accurate disclosure of each spouse’s assets and debts. If one party conceals or misrepresents their financial information, the court may consider the agreement to be fraudulent and set it aside

A prenuptial agreement can be an effective tool for protecting your assets and establishing clear guidelines for property allocation in the event of a divorce.  However, it’s crucial to understand the legal requirements and limitations of prenups, especially regarding spousal support, child support, and child custody. While prenups can provide security and peace of mind, it’s advisable to consult with a qualified family law attorney to ensure your agreement is legally binding and equitable to both parties.

Lisa R. Murray is an experienced Collaborative Divorce and Mediation Attorney.  She can help you determine the goals for your divorce and work to a settlement that allows you to achieve those goals.

You can call her at 650-297-0367.