By Jim Warren
Nearly everyone has heard of prenuptial agreements, but very few people understand them or know people who have them. As with any contract, it’s important to know when prenuptial agreements may be a good option and to understand how they work.
Here in North Carolina, prenuptial agreements (also called “prenups”) are governed by Chapter 52B in our General Statutes. A prenuptial agreement is a contract between two people who are planning to get married, and the purpose of a prenup is to address in advance any financial issues such as alimony and division of marital property and debts in the event of a divorce. Actually, such contracts can be entered into after marriage, too.
In a prenuptial agreement, the parties to be married can agree to waive the right to pursue spousal support in the event they separate and divorce. In other words, they can give up the right to pursue financial assistance from the other even if they would otherwise be able to receive spousal support. If the parties agree to waive the right to pursue spousal support in the event of a separation and later divorce, they give up the right to pursue post separation support (temporary alimony) and alimony even if the other party is at fault in the breakup of the marriage. The parties can also agree in a prenuptial agreement to limit their total exposure to alimony. For instance, they can agree to limit both the amount and duration of any payments that might be awarded in the event of a separation and divorce.
In a prenuptial agreement parties can specify what is their separate property and provide how property acquired during their marriage and prior to their separation will be divided. This can be done strictly along the lines of anything acquired in the name of one spouse will be that spouse’s or a prenuptial agreement can provide that marital property will be divided in certain percentages.
Prenuptial agreements are contracts. However, to be valid in the state of North Carolina, in addition to both parties signing the agreement, their signatures must be verified by an officer authorized to give oaths such as, but necessarily limited to, a notary public. Furthermore, in order to be valid, the agreement negotiated between the parties needs to be free of duress, coercion, undue influence, or fraud. Both parties should give a full and fair disclosure of all of their assets and those complete disclosures should be included, if not in the agreement, then as exhibits to the agreement.
While you can address important financial concerns that will arise if the marriage fails in a prenuptial agreement you cannot provide in a prenuptial agreement what will happen with regard to any children born to the marriage. Issues regarding the children such as child custody, visitation, and child support cannot be provided for in a prenuptial agreement. Those are issues that will have to be worked out, if at all, between the parties at the time of or following their separation.
If you are engaged and thinking that a prenuptial agreement would be right for your situation, it’s important to seek the advice of an attorney focused on family law. In our three decades of practice at Warren Family Law, we’ve helped many people make plans for after their marriage ends through divorce or makes plans for the possibility that the marriage may result in a separation and divorce, and we can help you, too. Call us today to get started.