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When is a Pre-Marital Agreement Appropriate and EnforceableDivorce & Family Law
Posted in on March 13, 2014
The purpose of a Pre-Marital Agreement (also known as a Prenuptial Agreement) is to govern the respective rights of two people contemplating marriage in the event of termination of the marriage by death or divorce. Typically a Pre-Marital Agreement is used where there is a significant disparity in the income and/or assets between the parties, where one party has a specific asset he or she wishes to protect (oftentimes a family owned business or piece of real estate that has been in the family), or for individuals that are entering into their second marriage, have accumulated his or her own assets and would like to preserve those assets for the benefit of their children from a prior marriage.
For a Pre-Marital Agreement to be deemed valid in Massachusetts it must be held to be fair and reasonable at the time of execution and at the time of entry of the judgment nisi. Prior to execution of the Pre-Marital Agreement each party must make full and accurate disclosure of his or her financial situation. A Pre-Marital Agreement is deemed to be fair and reasonable unless the contesting spouse is left without sufficient payment, maintenance or appropriate employment to be self-supporting.
There are several factors to take into consideration when drafting a Pre-Marital Agreement. These factors include, although may not be limited to, utilization of segregated funds (i.e. are these assets going to be used during the course of the marriage to maintain a specific lifestyle and if so, will they then become marital assets?); the impact of the marriage on earning capacity (i.e. will one spouse be giving up his or her career and if so, should a support mechanism be incorporated into the Pre-Marital Agreement?); do the parties intend to have children (this will most certainly impact several provisions of a Pre-Marital Agreement and needs to be taken into consideration).
If you are contemplating getting a Pre-Marital Agreement it is imperative that negotiations get underway sooner rather than later. Typically the closer the execution of the Pre-Marital Agreement to the actual wedding date, the stronger the possibility that the Court will find that the Pre-Marital Agreement was signed under duress; unless of course there is no question of the Pre-Marital Agreement’s meeting the fair and reasonable standard.
Like all legally binding contracts there are many pitfalls to be weary of; Pre-Marital Agreements are no exception. While the intentions of the parties may seem clear at the time of execution; at the time the parties are seeking a judgment, terms may be interpreted differently which is why it is important to seek competent legal counsel such as the attorneys at Baker, Braverman & Barbadoro who have extensive experience drafting Pre-Marital Agreements to address a variety of individual circumstances.