It is no secret that marriage not only takes the form of a committed, emotional partnership, but a financial partnership as well. To facilitate a marriage built on a foundation of clear expectations and open communication in that financial partnership, it can be beneficial for parties to enter into an antenuptial, or more commonly referred to as, a prenuptial agreement.
First and foremost, despite how the media portrays prenuptial agreements, such agreements are not only useful to those who want to protect their wealth prior to getting married, but also useful to other individuals including, but not limited to, those who want to address the distribution of assets, property rights and debts in the event of a spouse’s death.
Although some individuals in a marriage may have no issues with blending all aspects of their lives, emotional and financial, many individuals, such as business owners, those with children from a previous relationship, those who anticipate a significant inheritance, or perhaps have a stake in a closely-held family business may want to plan ahead and negotiate a prenuptial agreement with their future spouse as to how property, debt and the like should be handled or distributed between them in the event the marriage ends either by divorce or death. Consider it a contract entered into between two competent and consenting adults containing provisions regarding the distribution of assets or responsibility of liabilities belonging to each spouse. It is an agreement that is entered into by parties prior to marriage or a civil union.
As it relates to the termination of a marriage by divorce, a prenuptial agreement, or contract, sets out the couple’s negotiated agreement of how the assets and liabilities brought to the marriage, and those that are acquired during the marriage, will be divided when the marriage ends. As it relates to the termination of a marriage by death, a prenuptial agreement can be a great estate planning tool that outlines what portion of the estate will be disbursed to a spouse in the event of a death. Specifically, a prenuptial agreement identifies each spouse’s property rights upon termination of the marriage, whether that termination is determined by a court of law, or by the death of one spouse. In the absence of a prenuptial agreement, when a marriage becomes “official”, each state has its own laws on the division of assets and debts between spouses in the event of a divorce and in the event of one spouse’s death.
Are Prenuptial Agreements Actually Enforced?
For a prenuptial agreement to be fully enforceable, each future spouse must participate in the process voluntarily and fully disclose their assets, liabilities, and earnings they are bringing into the marriage. Once fully disclosed, the future spouses negotiate to determine the extent to which they are willing to waive their rights to certain assets that each spouse would otherwise automatically be afforded under law.
Regarding the specific provisions within the agreement, there is no limitation on what future spouses may include in their agreement, however, not all terms may be enforceable. Thus, the prenuptial agreement should include a severance clause that reflects that even if one or more provisions are found to be unenforceable, the remainder of the terms should be enforceable.
Additionally, to ensure a fair negotiation, it is preferred that each future spouse is represented by separate counsel. Upon conclusion of the negotiations, it is imperative that each future spouse has ample time to review and consider the terms of the agreement, and that the agreement is finalized and executed well in advance of the wedding date.
Ultimately, a prenuptial agreement will allow a couple to enter their marriage with full disclosure not only as to what assets and liabilities each spouse brings to the marriage, but the expectation as to what will happen to those assets and liabilities should the marriage terminate either by divorce or death. An enforceable prenuptial agreement eliminates surprises that may otherwise arise in court and can streamline the process of terminating the spouse’s financial partnership.
Already Married? Ohio Law Now Also Provides for Postnuptial Agreements
As of March 23, 2023, Ohio law now allows for postnuptial agreements which permit a married couple to modify or terminate their existing prenuptial agreement or enter into an entirely new agreement (similar to a prenuptial agreement) that alters their marital legal rights. Such modification or termination of a prenuptial agreement or execution of a new agreement can be necessary for many reasons, including, but not limited to, a change in the assets of one spouse, an outdated prenuptial agreement, or an inheritance or gift to one spouse which was not initially contemplated at the time a prenuptial agreement was entered into or at the time of marriage.
Similar to prenuptial agreements, postnuptial agreements identify the assets which are to remain separate property and the assets which are considered to be marital property at the time the agreement is entered into. As assets disclosed in a prenuptial agreement can change significantly over the years, the new law provides an avenue to amend and update such agreements, allowing married couples to address changes in their finances and property at any time.
The enforceability requirements discussed above likewise apply to a postnuptial agreement as well.
When You Need a Family Law Attorney, Contact Plakas Mannos
Seeking professional assistance when entering into a prenuptial or postnuptial agreement is crucial to ensure fair negotiation and the enforceability of the provisions in the agreements.
Plakas Mannos has a team of attorneys dedicated to family law who are experienced in these types of agreements, ready to provide counsel for those seeking prenuptial or postnuptial agreements. Our knowledge and understanding of these agreements allow us to handle navigating through the complexities, leaving you with the ability to focus on the more exciting moments of wedding planning and marriage. Contact us today with any Ohio family law questions.
About the Authors
Marietta Pavlidis is a litigation attorney who specializes in family law and workers’ compensation law. Brooke Meneses is an associate attorney who also works on our Family Law Team, as well as employment litigation and personal injury.
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