How Can a Prenuptial Agreement Affect the Outcome of a Divorce?

Are prenuptial agreements legally enforceable in California?

California recognized the Uniform Premarital Agreement Act (UPAA) and has abided by it since 1986. The UPAA says that a written prenuptial agreement that both spouses sign legally goes into effect once the marriage is finalized.

One common misconception is that a prenuptial agreement (often referred to casually as a prenup) expires after a certain point, such as when the couple has been married for at least a decade. That’s not correct. The prenup remains valid until the couple divorces or one spouse passes away.

How Does a Prenuptial Agreement Affect Property Division in a Divorce in California, and Does it Override Community Property Laws?

California is a community property state. That means if a couple gets divorced, any property they’ve acquired during the marriage (which is then considered community property) is divided as evenly as feasible. There are assets that may be considered separate property that are owned only by one spouse. That can include property one spouse acquired before marriage, gifts, inheritances, etc. However, those assets must not have been commingled into marital property. For example, if one spouse owns a house prior to the marriage, but both spouses move into it, and the other spouse contributes to the mortgage payments or upkeep, the home becomes community property.

It’s important to understand that community property includes not just assets but debts. If the couple accrued significant debt together while married, that could be divided as evenly as possible as well.

A prenup can have the power to override community property laws in many instances. The key is to keep separate property separate.

When Is a Prenuptial Agreement Recommended for Couples Approaching Marriage?

Sometimes, people think only tremendously wealthy people need to bother with a prenup, but that’s far from the case. There are several reasons to consider creating a prenup prior to marrying to protect both parties. These are just a few situations that could warrant signing a prenup.

• Different incomes. If the incomes earned by each spouse are significantly different, there could be an imbalance in terms of what they bring into the marriage. 
• Debts and assets. One spouse may have considerably more assets or debts that could become community property if not addressed in a prenup.
• Potential inheritances. California generally considers cash inheritances to be separate property, but things like real estate can be considered community property. If someone expects to inherit a home that they may use while married, addressing ownership in a prenup is highly recommended. 
• Business ownership. This should be addressed by a prenup, both in terms of who would own the business if the marriage ends and who would be responsible for any liabilities the business incurs. 
• Conflict resolution and efficiency in the event of divorce. A premarital agreement can help streamline the divorce process and avoid unnecessary conflict. This saves time and money and allows people to move on with their lives and start a new post marriage chapter. 

Can a Prenuptial Agreement Address Child Support and Custody or Spousal Support?

No. Prenuptial agreements can’t legally determine who pays child support, how much they’ll pay, and who will have custody of the child(ren), also known as parenting time. In fact, trying to add this to a prenup may cause it to be deemed invalid and unenforceable. Even if the couple has children prior to drawing up a prenup and getting married, these issues must be handled as part of the divorce process in court, not through the prenup.

Spousal support (also known as alimony) can potentially be covered in a prenup. There are various ways to include this, all of which could benefit from working with an experienced prenuptial agreement attorney who understands the law and what should be covered.

What Could Cause a Prenuptial Agreement to Be Legally Invalidated?

There are several potential trouble spots, another good reason to work with a prenuptial agreement attorney who can help ensure mistakes aren’t made that could be costly down the road. Here are a few things to know.

• In writing, signed, and notarized. Valid prenups in California must be in writing, signed by both parties, and notarized. Verbal, unsigned, or unnotarized prenups could be challenged. 
• No coercion. Neither spouse is allowed to engage in undue pressure or coercion to force the other spouse to sign a prenup that’s not in their best interests and with which they don’t agree. That’s why the following was enacted.
• The 7-day rule. California prenuptial law mandates that once the final prenup is drawn up, there must be a 7-day waiting period before it can be signed and finalized. This gives both parties a chance to consider the prenup and legally prevents one spouse from trying to force a new prenup on the other the night before the wedding.
• Financial disclosure. Both parties must provide the other with a full, detailed disclosure of their financial situation, including all assets and debts. If it turns out one party didn’t, the prenup could be invalidated.
• Legal counsel. Lawyers aren’t required for most prenups, but it’s highly recommended each party have one. There are situations when they’re required. Check with your attorney if this is a concern. 

What Should I Do if My Spouse and I Want to Divorce and Have a Prenuptial?

Call Hepner & Pagan as soon as possible at 408-688-9153 to request an intake appointment. As discussed above, a prenuptial isn’t necessarily set in stone, but you could benefit from the advice of our experienced, knowledgeable divorce attorneys. It’s vital to work with California laws around the division of property and prenuptial. We can walk you through your prenuptial and current assets to determine what might be the best approach for favorable outcomes.