These agreements address several different areas and it is important to keep in mind that they are simply contracts whereby you can create absolutely any terms you want that are not against public policy. Please view this as a mere overview of certain terms to include, but not a limitation on terms that you may include in such an agreement.
New York, though case law and statute, has created certain rules in upholding these agreements. Amongst those standards are the timing of the execution of the document. If the agreement is handed to the bride the night before the wedding with the threat of calling off the wedding if she does not sign, that speaks toward not upholding the agreement. That brings up another standard: threatening someone into signing the agreement speaks against upholding the agreement. The rule of thumb to use is if the signing of the document is manipulative and underhanded, then there may be a serious problem in a court upholding the agreement. Common sense goes a long way here.
These agreements generally encompass language by which the growth of one party=s pre-marriage assets do not become marital property or property over which the other party may have a future claim. The agreement, though, can also state that certain assets are shared, parts of certain assets are shared or that upon one party=s death (but not divorce), the asset goes to the other party, or many other possible divisions and protections.
Prenuptial Agreements are multiple purpose agreement: Who gets what in the event of a divorce and potentially who gets what in the event of the death of either party, dealing with estate rights, insurance and retirement benefits, business interests and a myriad of other things. Often there is a provision to somehow protect a non-monied spouse upon the death of the monied spouse by way of an insurance policy, or as part of estate planning within the document itself.
Young people, in the beginning of their lives and careers, too often believe that a prenuptial agreement is not necessary. All they own are the clothes on their back and their pick-up. They are wrong. The benefit and purpose of a prenuptial agreement is not just protection of what the parties own at that moment of execution of the agreement, but the protection of the assets that will accrue over the term of the marriage. In ten or fifteen or twenty years into a career, there is a great deal more on the line than those clothes and pick-up. Prenups protect your future wealth and each other’s debt as well as your already accrued wealth and debt.
Because the primary purpose of this agreement is to prevent a Court doling out a couples’ assets as they see fit, it helps to view this in terms of the standards a court uses to divide assets in a divorce. Your agreement may well set forth that certain items coming into the marriage will be marital property, and how, in the event of the end of the marital relationship, how the two of you want those assets divided. You may want to override statutory estate rights and statutory requirements for beneficiaries on various accounts to which your spouse would be otherwise entitled.
Prenuptial agreements are detailed documents that cannot be fully described in such a brief writing. Hopefully, this gives you some general information and food for thought. If you require services concerning prenuptial agreements, please email Diana@CunninghamRules.com