Couples needing a prenuptial agreement can also benefit from the mediation process.
Prenuptial agreements are frequently used when: there’s a large differential in wealth and earning capacity between two people; a person from a wealthy family is getting married; two previously-married people with adult children want to insure that the children from each side retain their estate expectations, regardless of the new marriage; or when two people — either from painful personal experience or well-founded fear of the divorce “system” — want to make sure that the difficult financial issues that can arise if the marriage doesn’t work out are addressed and resolved in advance.
A prenuptial agreement (also referred to as an “ante-nuptial” or “pre-nup”) is a contract that sets out a couple’s rights in the event of their marriage and a subsequent death or divorce. There are five major areas that can be addressed in a prenuptial agreement:
ESTATES: Absent a waiver, a surviving marital partner in New York has the right to take a share (essentially a third) of a deceased spouse’s estate, even if there’s a perfectly valid will leaving a lesser amount… or nothing at all. Prenuptial agreements frequently waive any such claims, or define exactly what each spouse will be entitled to inherit, and allow each spouse authority to leave the remainder of their estate to whomever they choose.
DIVORCE: Couples can designate what property, owned before the marriage, inherited, or earned during the marriage, would be subject to a claim by the other in the event of a divorce. A prenuptial allows spouses to set their own private rules in advance, rather than be subject to the uncertainty of a judge’s determination of “fairness” after the fact.
SUPPORT: A prenuptial agreement can specify whether spousal support is to be waived, or can define in advance its amount and duration.
OPERATING EXPENSES: Pre-nups can be used to address how regular expenses and major expenditures will be handled during the marriage.
RELOCATION: Who will stay in the marital home in the event of a divorce, and how long the other person has to vacate, can be addressed in the prenuptial agreement.
Mediation provides an excellent forum for working out the terms of a prenuptial agreement, in that the process emphasizes problem-solving rather than competitive negotiations; this can be helpful in resolving the immediate issues, while preserving the long-term relationship. Mediation can also address “phaseout” mechanisms that can prevent unfairness if a prenuptial agreement is an appropriate protection in contemplation of a short-term marriage, but may become one-sided when a spouse in a long-term marriage has permanently waived what would have been their marital rights.
The important factors in entering into an enforceable prenup are: a.) the length of time before the wedding date (as negotiations too close to the ceremony can become inherently coercive); b.) the need for each person to select — and confer privately with — their own lawyer (unlike divorce mediation, where separate attorneys are invited, but not mandated); and, c.) full financial disclosure of all income, assets, liabilities and expected inheritances (in sufficient time so that questions can be asked and answered before any agreement is signed).