A prenuptial agreement is a contract between two parties who intend to marry detailing their money-related agreements. Arizona refers to these agreements as “premarital agreements” and defines them as agreements: “between prospective spouses that is made in contemplation of marriage and that is effective on marriage.” Agreements can address issues during the marriage, and in the case of divorce.
To be valid, the agreement must be in writing and signed by both parties. One can fight the validity of the agreement if that party did not enter the agreement voluntarily or if: (1) an agreement was unconscionable when executed; and (2) and there was inappropriate disclosure of property and financial obligations.
A prenuptial agreement can be used to define property rights and debt obligations. For example, if one party has a business prior to marriage, the parties can agree that that business will remain hers alone. A prenuptial agreement can also be used to limit or extinguish one’s right to spousal maintenance. However, the Court can override that provision if the party who would otherwise be entitled to spousal maintenance now qualifies for public assistance. A prenuptial agreement cannot adversely impact child support.
Parties can also agree to other terms, so long as they do not violate criminal law or public policy. For example, the parties can limit expenditures during the marraige and encumbrances on community assets.
Discussing a prenuptial agreement with one’s future spouse may seem…awkward. However, if done correctly, the prenuptial agreement may actually strengthen a marriage. Discussing money issues prior to marriage will facilitate trust and set the foundation for open communication. Agreements allow the parties to form mutual understandings and expectations about an issue that traditionally causes so many problems in a marriage: money. More people are now marrying later in life and coming into marriages (and sometimes second or third marriages) with substantial assets and debts. Such conditions make prenuptial agreements are even more important.
Using mediation to reach prenuptial agreements is especially effective. Mediation is a non-adversarial process. The parties sit down with a mediator – who is neutral — to reach agreements. Mediating the matter helps to facilitate communication and sets the path of the parties making decisions together. The parties still need individual attorneys to review the agreements and ensure that the parties are entering into the agreement with full knowledge and understanding. However, with a mediator, the process is less like two combatants negotiating a contract through attorneys, and more like future spouses working together in a friendly manner to agree on their financial future.
Alona M. Gottfried is a family law mediator and attorney in Arizona. If you have questions about mediation, she can be reached at: 480-998-1500 or firstname.lastname@example.org. This is a general interest article only and is not intended to be legal advice. See a legal professional before making legal decisions.
Simmons & Gottfried, PLLC
8160 E. Butherus Dr., Suite #7
Scottsdale, AZ 85260