Partner
We often hear or read in the news about high-profile individuals who have entered into prenuptial (“prenup”) agreements to protect themselves, especially in situations where one of the individuals getting married has celebrity status and has amassed a great deal of wealth. Things often get tense when these individuals are about to file for divorce, and the specific provisions of the prenup are now called into question. There is a good chance that you might have come across the news headlines in the past few months concerning the validity of a prenuptial agreement involving Kevin Costner. Costner was quoted as questioning the claim that his estranged wife, Christine Baumgartner Costner, made that she “felt pressured” to sign a prenup.
This is despite the provisions in the prenup that apparently stated that she “voluntarily” entered the agreement and was “free from duress, fraud or undue influence”. This leads one to question just how enforceable these prenuptial agreements are, and how you can help ensure that they will be upheld, specifically in New Jersey, in the event that a marriage ends in divorce.
A prenup agreement is a contract entered into by two individuals prior to marriage. It typically outlines the ownership of respective assets, financial rights, and potential spousal support should the marriage end in divorce. The enforceability of prenuptial agreements varies from state to state, and New Jersey has its own set of laws and guidelines. It is important to consult an attorney who specializes in family law in New Jersey before entering into a prenuptial agreement to help ensure that your financial rights are outlined and that your assets are protected.
Steps to Prepare a Proper Prenuptial Agreement in New Jersey
- Hire an Attorney: It is essential for both parties to be represented by separate attorneys to ensure that each person’s interests are adequately represented. This helps to provide evidence that both parties understood the agreement they were entering into, and can also avoid potential claims of coercion or duress later on.
- Full and Fair Disclosure: Both parties must fully disclose their assets, liabilities, and income. If one party fails to disclose, it might lead to the agreement being invalidated in court.
- Negotiation: The couple will negotiate terms that both parties feel are fair. This may include provisions regarding the division of assets, debts, and any other important financial issues.
- Drafting the Agreement: Once both parties have agreed upon the terms, the attorneys will draft the prenuptial agreement. It should be written clearly and without any ambiguity.
- Provisions for Alimony: New Jersey allows couples to make provisions about alimony in their prenuptial agreements, but these provisions are subject to scrutiny by the court, especially if they appear to be unconscionable.
- Child Support & Custody: It is important to note that you cannot provide for child custody or child support in a prenup. These issues are decided based on the best interests of the child at the time of the divorce.
- Fairness and Reasonableness: The agreement must not be unconscionable when it is executed or when enforcement is sought. If the terms heavily favor one party over the other, or if they leave one party without any means of support, there’s a risk that the court might not enforce it.
- Waiver of Rights: Be careful when waiving rights, especially regarding retirement benefits, the right to inherit, or the right to alimony. Ensure you understand the implications fully.
- Provisions about Infidelity: Some couples include “infidelity clauses” in their prenups, outlining monetary consequences if one party is unfaithful. While this is legal, the enforceability of such clauses can be complex and may depend on specific circumstances.
- Review and Sign: Both parties should thoroughly review the agreement with their respective attorneys. It is necessary that each party understand every provision within the document. Once both parties are satisfied with the content, they can sign the agreement. Ideally, this should be done well in advance of the wedding to avoid any claims of rushing due to urgency, or signing the document under coercion.
- Full Agreement in Writing: Ensure that the entire agreement is in writing. Oral promises or agreements related to the prenup may not be enforceable.
- Notarization and Witnesses: The law in New Jersey requires that a prenup agreement be notarized to confirm the authenticity of the signatures. It is also wise to have witnesses.
- Postnuptial Agreement: If, for some reason, the couple does not sign a prenuptial agreement before marriage, they can still enter into a similar contract after marriage called a postnuptial agreement.
- Review Periodically: Circumstances change, and what might have been applicable at the beginning of a marriage might not be suitable later on. It’s a good idea to review and, if necessary, update the agreement periodically. Some couples choose to include clauses that require regular reviews of the prenup (for example, every 5 years).
- Enforcement: If the couple decides to divorce, the prenuptial agreement will be one of the primary documents reviewed during the process. Make sure your prenup is drafted and executed in a manner compliant with New Jersey law. New Jersey courts will generally enforce prenuptial agreements as long as they are fair, both parties had legal representation, and there was full disclosure of assets and liabilities. The burden of proof will be on the marital party who is challenging the prenup agreement.
- Provisions upon Death: Prenups can also include provisions about what happens upon the death of one spouse, such as waiving rights to an elective share of the deceased spouse’s estate.
Takeaway
Before drafting or signing a prenup agreement, consult with an attorney who specializes in family law in New Jersey. They can provide guidance tailored to your specific situation and ensure that your rights and interests are protected. If you or someone you know would benefit from having a prenuptial agreement, contact Bozanian McGregor to help navigate you through this type of agreement. You can trust that we will make sure that your interests are protected.