Prenuptial Agreements, sometimes called Antenuptial Agreements, are a special type of contract between two people who intend to marry. Under the United States Constitution, competent adults have the freedom to enter into contracts and be bound by the terms of the contract. In general, contracting requires both parties to a contract to give up something, and get something … a promise to do something in exchange for a benefit. Prenuptial Agreements are no different. The benefit that each person gets is that the marriage will occur.
Prenuptial agreements are gaining in necessity with the rise of second marriages, later in life marriages, and dual income households. Often times there are children from a prior marriage, considerable assets acquired before marriage, or business or real estate owned by one of the parties that must be protected and held separately from marital assets and debts.
Prenuptial Agreements can be very general or very specific, and tailored to the couple’s specific needs, desires, and goals. It is important that each side understands his or her legal rights that they are entitled to should the marriage end in divorce or death before entering into a prenuptial agreement. It is equally important to determine which rights will be given up or preserved through the pre-marriage agreement. Prenuptial agreements are not always a means of taking away rights, but sometimes, if drafted correctly, can be used to provide. In many cases a prenuptial agreement can be a great tool for couples entering into marriage to discuss very important aspects of the partnership, such as how finances will be mutually handled, small businesses run, or property held.
It is also important to understand that if one wishes to enter into a prenuptial agreement, it must be done before the marriage. While post-nuptial (after) agreements exist, they are not simply a contract one enters into after the marriage has taken place because there was no time before the marriage ceremony. Post-nuptial agreements have very specific requirements that must be met at execution (signing) to be valid. In Michigan typically a post-nuptial agreement may only be entered into, and considered valid and enforceable, if it was agreed to during a time that the marriage was in distress, and the continuation of the marriage is the bargained for benefit. Generally this means that a divorce action was filed, and dismissed as a consequence of entering into a post-nuptial agreement.