Beyoncť married Jay Z in 2008, she reportedly signed a prenuptial
agreement that gives her $5 million for every child she bears to him,
plus $1 million for every year of the marriage if they divorce. Itís
a step Roseanne Barr didnít take when she married Tom Arnold. The
two never signed a prenup, and when the marriage ended in a bitter
divorce just four years later, Arnold walked off with $50 million.
Hollywood. In the real world, most people marrying for the first time
are young and have very little "pre" to bring to the "nup."
Second marriages, however, are a different story. By this time, one or
both parties have probably accumulated assets worth protecting. And
that is what a prenup does. It is a legally binding contract between
two people who are getting married that essentially puts down in
writing what will happen with property and spousal support if the
marriage ends in divorce.
states like Wisconsin have default statutes that cover property in a
marriage, divorce and death. A prenup is an opportunity for a couple
to alter those default statutes in a way that suits their needs or
situation better, through legal agreement," says Eido Walny of
the Walny Legal Group.
The clauses of
each prenup vary, and some include sunset provisions that allow for
the agreement to expire if the marriage lasts a certain amount of
time. In general terms, prenups seek to categorize property acquired
before and during the marriage as either marital or individual
property or assets into "mine" vs. "ours" groups.
If the marriage ends, I get to keep what is "mine," but
everything that is "ours" must be divided.
can be contoured as the parties wish too. For example, the parties may
want to treat each other one way if there is a divorce, but another
way if a spouse dies. The parties may have the property division
change over time, or they might want to be less forgiving toward one
another if the marriage ends over certain reasons, such as infidelity.
"Divorce can be messy and expensive," says Walny. "A
good prenup settles a lot of the issues while the parties still like
one another, not when they are least likely to agree on anything.
Unfortunately, the people who know this best are those who have
already gone through a divorce. Most of the prenups we arrange are for
people marrying for the second or third time."
If there is a
second or third (or more) marriage, prenups can also protect any
financial obligations to a previous spouse. "We often see divorce
agreements require life insurance policies as a way to ensure payment
of support to an ex-spouse or children. A prenup can protect such an
asset from going to the wrong place," says Walny.
prenup to be legal, it has to fulfill certain requirements ó it must
be in writing, there must be full financial disclosures by both sides,
the document cannot be unreasonable, it must be executed legally, and
it has to have been entered into voluntarily by the two parties. For a
prenup to hold up, we always want both spouses to have legal counsel
and be properly represented. This helps ensure that no one is being
taken advantage of," Walny continues. "Also, the agreement
should be signed well in advance of the actual marriage. We never want
to see a spouse threaten to cancel the wedding if it is not signed.
That is a clear cause of duress and evidence of a lack of willingness.
The same applies to when the marriage is for the next day. You always
want the parties calm and clear headed as they enter into such an
Walny says the
question he is most asked is whether prenups really hold up in court.
"The answer is: it depends," he says. "In theory, a
good, valid, properly negotiated prenup should always hold up in
court. When they fail, itís usually because the parties took their
very good agreement, put it in a drawer, and left it there until the
marriage was breaking up, having never followed a single term they
agreed to. Just like any legal contract, you cannot selectively
enforce terms. If you ignored the prenup during your marriage, a court
is unlikely to enforce the deal upon divorce. And there are always
defenses available to an aggrieved spouse who can claim things such
duress, lack of full disclosure, unreasonableness and other such
claims. It is very important to follow legal formality during the
prenup drafting and agreement stage with the hopes of having a court
enforce the agreement later. Going through that process will likely
help avoid fighting, stress and other factors that lead to divorce. In
an odd way, prenups can actually save marriages."
Tell that to