Prenuptial Agreements – Not Always Enforceable

Posted on Tuesday, April 25th, 2017 by Tim Simonson and is filed under Divorce,  Lawyer,  Marriage,  Minnesota,  Prenuptial Agreement.

If you’re reading this blog, it’s probably because you’re related to me and doing it out of obligation (thanks, Mom). Or, it might be because you’re looking for information about prenuptial agreements. Either way, thanks for reading! This one is about a prenuptial agreement that the Minnesota Supreme Court recently determined was not enforceable because it was not carefully prepared.

First, what is a prenuptial agreement? Minnesota law gives parties contemplating marriage the ability to enter a contract that affects her/his property rights in a marital relationship. This can be helpful in cases where the marriage ends in a divorce, and, the parties would like to secure their property rights, rather than leave it to the Court to decide.

Without a prenuptial agreement, a court will assume that everything that a married couple owns is marital or ‘jointly-owned’ property, and try to divide it fairly.

But if the parties have a prenuptial agreement, the court must do what the prenuptial agreement says, so long as the agreement is properly prepared.

Minnesota law lays out some fairly straightforward requirements to have a valid prenuptial agreement:

-the agreement must fully and fairly disclose assets and income
-the parties must have an opportunity to consult with their own lawyer
-the agreement must be in writing, witnessed by two people, and, notarized.

See Minn. Stat. §519.11

Pretty simple. So long as those elements are there, the court can follow the prenuptial agreement and do what it says when dividing the parties’ assets in a divorce.

But, like we learned from Of Mice and Men, even the best-laid plans….what happens if the agreement covers assets that the parties didn’t have at the time of marriage? Can the parties include things they don’t yet own, in their prenup? The answer is…..maybe.

The Minnesota Supreme Court took up this issue and decided that a prenup doesn’t necessarily apply to property that the husband and wife acquired during their marriage. The reason was, the Court didn’t think the parties did a good enough job with their prenup.

The Court believed that more scrutiny should be applied when an agreement affects spouse’s future property rights.

Here’s what the Court looks for when giving a thumbs up or down to a prenup that covers (or tries to cover) future property rights:

did the parties fully disclose their assets?
did they receive some benefit from the agreement?
(3) did they know the particulars of the agreement and how their rights are affected?
(4) was the agreement reached with undue influence, or duress.

So if you are asking your fiancé to give up rights to assets that you might acquire after marriage, make sure your prenuptial agreement is carefully prepared.

The Minnesota Supreme Court recently decided that a prenuptial agreement that required a Wife to give up part of the Husband’s farming operation was invalid because these four factors were not properly considered when the agreement was prepared.

In that case, the Husband asked the Wife to sign a prenuptial agreement three (3) days before the wedding, didn’t give the Wife a chance to meet with a lawyer of her choosing, and, didn’t tell the Wife about his net worth when he asked her to sign the agreement. The result, said the Court, was that the farm belonged to the Wife too, in spite of the prenuptial agreement.

Remember to seek legal advice when contemplating a prenuptial agreement, otherwise, be prepared that a Court may not be willing to enforce it.

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