Prenuptial Agreements: Who Needs Them and When Can They Be Broken?
These days, a significant percentage of Michigan marriages end in divorce. All sorts of complications come with divorce, including the need to divide marital property and determine spousal support. Divorces become even more complex when you consider that one or both spouses might have pre-existing debts, inheritances, business interests or children from a prior relationship.
Increasingly, couples are choosing to sort these issues out before marriage by entering into prenuptial agreements. Among other things, a prenuptial agreement outlines what will happen with the couple’s property and finances in the case of a divorce.
Nobody wants to contemplate divorce immediately after deciding to get married. However, a prenuptial agreement can provide valuable security in the unfortunate event that the marriage does end.
Who Needs Prenuptial Agreements?
A lot of people think that prenuptial agreements are just for the very rich. This isn’t true. Anyone with even a modest amount of premarital assets can benefit from entering into a prenuptial agreement. The need for a prenuptial agreement is even greater when the couple falls into one of the following categories:
- One partner has significantly more assets — like property, savings or investment accounts — than the other
- One partner is coming into the marriage with a sizable amount of debt
- Both partners have vastly different incomes or earning potentials
- One or both partners own an interest in a small business
- One or both partners have received, or are expecting to receive, a substantial inheritance
Prenuptial agreements are also advised when one or both of the partners have been married before.
Breaking Prenuptial Agreements
A correctly drafted prenuptial agreement will stand strong in the face of even the most contentious divorce. However, there are a few situations in which a prenuptial agreement can be broken.
- Dishonesty: Most often, these situations arise when one spouse is found to have been dishonest at the time the prenuptial agreement was executed. For example, prenuptial agreements can sometimes be broken when one spouse has hidden assets or otherwise significantly misrepresented their financial situation.
- Coercion: In other situations, a judge might throw out a prenuptial agreement after finding that one party had been coerced into signing it. However, this is a very high burden to meet. Simply claiming that the other partner would have called off the wedding is not enough.
- Unreasonable conditions: Finally, prenuptial agreements can sometimes be voided when they contain unenforceable or unreasonable conditions. Again, there is a very high burden to prove. In Michigan, the party seeking to break the prenuptial agreement must show that enforcing the agreement would be inequitable because of changed circumstances that were not foreseeable at the time the agreement was executed.
Whether you are seeking to draft a prenuptial agreement before marriage or trying to negotiate a divorce that involves a prenuptial agreement, it is always a good idea to consult with an experienced family law attorney who can make sure your rights are protected.