Approximately 82,000 Texans get divorced every year. For those who have a valid and enforceable Prenuptial Agreement, the divorce process can be simplified, quicker and less costly. Although the Texas Family Code provides for prenuptial agreements, there are elements that must be included in order for the written document to be valid and enforceable
Benefits of a Prenuptial Agreement
Some people balk at the idea of having a “prenup”. They think it demeans their love and trust in their partner and is a sign they do not expect the marriage to last.
Those are valid thoughts and if you don’t want an agreement, then you should not have one. But there’s another way to think about these agreements – It’s like having earthquake or flood insurance. You do not expect to use the insurance and hope you never have to file a claim. The odds are against you ever really needing the coverage. But, if you do suffer earthquake or flood damage, you are certainly happy you had the coverage. So, even though you will hopefully not need to use your prenup, you might consider the benefits of one if you are in any one of the following categories.
You earn a high income and have a substantial net worth at the time you enter into the marriage. You own a business or you might want to start a business using your separate property. You already own property that you want to keep as your separate property without any question if you should divorce. You and your new spouse have both been married before and have children from your prior marriages.
When marriages end in divorce, even when both parties agree that they want to part ways, it is still an emotional time. The stress of making property division decisions is reduced if a prenup is in place, which already covers the distribution of assets and even debts.
How to Make a Valid and Enforceable Prenuptial Agreement
In Texas, a prenuptial agreement must be in writing and signed and dated by both parties. The prenup may cover all eventualities and possible circumstances or be limited to specific property. The prenup can include whether or not spousal support will be paid and, if it is, how the amount will be determined. The only limitation to items covered in a prenup is that it cannot include, with any degree of enforceability, most items involving children – custody, visitation and support.
Items to include in the pre-marital agreement in order for it to be valid:
All assets of both parties must be fully disclosed. If assets are later discovered during the process of a divorce that were not included, the agreement may be subject to a more vali attack.
The parties must both disclose their current income and any expected change in future income.
The document must be voluntarily signed without any coercion. The further in advance of the marriage that the document is signed, the more likely a court will find it was voluntarily signed. An agreement signed 30 to 60 days in advance will have a greater likelihood of enforcement than one signed the day before vows are taken.
How to Challenge the Validity of a Prenuptial Agreement
Although courts generally enforce prenuptial agreements, a party can challenge its validity if that person can prove:
That the agreement was not signed voluntarily; or
The agreement was unconscionable when it was signed and before signing the agreement, the wronged person:
Was not provided with a disclosure of the other person’s assets and debts;
Did not expressly waive disclosure of those assets and debts; and
Could not have reasonably known what the assets and debts were.
If a prenup is signed voluntarily and with full knowledge of all assets, the court will not likely later invalidate it just because it is unfair. If the person signing it made a bad decision, that is not an issue for the Court and, unless the court finds the agreement unconscionable, involuntarily signed or against public policy, the unhappy member of the couple will have to live with his or her unfortunate choice.
If you are considering marriage and have questions about a prenuptial agreement, contact Jeff Anderson. He can answer your questions and prepare your prenuptial agreement for you. If you are in the process of divorce and have a marital agreement, he can help you challenge or defend your pre-marital agreement.