For Love and Money

FOR LOVE AND MONEY: CONSIDERING A PRENUPTIAL AGREEMENT

By Cynthia M. Lifson

America's current interest with reality television shows demonstrates our unending fascination with matters related to love, money, and conflict. While the law cannot manage the love aspect of relationships, applied appropriately, the law can organize financial relationships between individuals who plan to marry. By clarifying economic relationships within a family, the potential for conflict is reduced. This is particularly true in situations where the either member of the engaged couple has already been married or has had children from previous relationships.

One way in which engaged couples can manage their economic affairs in anticipation of marriage is by entering into a prenuptial agreement. A prenuptial agreement that is fair, voluntary, and settles property rights between parties is valid and proper. Such an agreement has long been well established in the eyes of the law.

While accepted in the law, how a prenuptial agreement reached as well as the contents of the prenuptial agreement can be subjected to intense scrutiny if a prenuptial agreement is challenged in court. Fortunately, there is sufficient information in Maryland case law to provide us with basic guidelines to ensure that a prenuptial agreement is clear and enforceable.

To begin, individuals who are expecting to marry are involved in a confidential relationship. This means that each is not treating the negotiation of a prenuptial agreement in the same manner that he or she may treat the negotiation of a contract with a stranger. The existence of a confidential relationship requires that each party engage in frank, full and truthful disclosure of his or her assets and liabilities, or that each have an actual knowledge of the other's assets and liabilities.

Second, for a court to enforce a prenuptial agreement, each party must understand the legal effect of the prenuptial agreement and voluntarily and intelligently agree to it. The person who wishes to uphold the validity of a prenuptial agreement has the obligation of showing the court that both parties entered into the agreement voluntarily. A reviewing court is much more likely to find that there was a voluntary, intelligent, and knowing understanding by each party of the prenuptial agreement if at the time the parties entered into the prenuptial agreement each had independent legal advice.

Third, for a court to enforce a prenuptial agreement, the agreement itself must not be so one-sided that it can be found to be "overreaching." Consequently, even if each party had complete information concerning the other's economic situation and entered into the prenuptial agreement willingly, if the prenuptial agreement is seen to be so unfair and inequitable to one party, the prenuptial agreement may not be upheld.

Ironically, while the law does not manage the love aspects of relationships, some of the legal principles associated with prenuptial agreements show us the ingredients of a successful marriage: open sharing of information; acceptance of the positive and negative by each partner of the other's strengths and weaknesses; and a spirit of generosity toward one's life partner. In my experience, the negotiation of a prenuptial agreement is not necessarily a pleasant or easy task. Approached and conducted properly, however, the achievement of a prenuptial agreement may create the framework for a successful marriage and other family relationships.

Cynthia L. Golomb is a Maryland attorney and mediator. Her main office is located in Howard County, and she can be reached at 410/988-4209.

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Cynthia M. Lifson was formerly known as Cynthia L. Golomb and can still be reached at 410/988-4209 or by clicking the contact button below.

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