Questions About Premarital Agreements
1. What is a Premarital Agreement?
A premarital agreement is a written agreement entered into by a couple before they marry or register as domestic partners. The agreement defines the economic aspects of their relationship using private choice, rather than the rules of state law. Many state law rules that apply automatically when a couple marries – such as the rule that earnings during marriage and domestic partnerships are jointly owned, community property – can be altered by written agreement.
2. What are Typical Premarital Agreement Provisions?
The following matters are often addressed in Premarital Agreements:
- Ownership of Earnings and Benefits Acquired During Marriage and Domestic Partnerships
- Ownership and Use of the Marital Home
- Ownership and Management of a Business
- Ownership and Management of Investments
- Payment Responsibility for Debts and Taxes
- Gift Giving
- Planning for Property Rights After the Death of One Spouse
- Spousal Support Upon Divorce
Matters concerning children – both child support and child custody – cannot be the subject of Premarital Agreements.
3. What Formalities are Required for Agreements to be Valid?
California law sets forth specific requirements that should be followed to assure a Premarital Agreement is valid and enforceable on death or divorce. There are requirements for attorney advice, financial disclosure, waiting periods, and requirements for translating agreements for foreign speaking parties. These formalities are designed to make sure agreements are voluntary. They also assure that both parties to an agreement understand the legal rights and responsibilities that would apply in the absence of a premarital agreement, and those rights and responsibilities the parties are accepting or relinquishing under the terms of the premarital agreement.
4. Can Couples Make Agreements After Marriage?
Couples can enter into agreements after marriage comparable to Premarital Agreements. These are commonly referred to as “Postmarital Agreements.” With Postmarital Agreements, it is particularly important that each spouse disclose the full nature and extent of his/her assets and debts. Married individuals are in a “confidential” relationship under the law, and cannot take financial advantage of each other. For this reason, it is important that both parties understand the full nature and extent of any property and support rights and obligations they are changing through their Postmarital Agreement.
5. Can Unmarried Partners Make Agreements?
Unmarried partners can enter into agreements concerning their property and support rights, just as married couples can. However, the law pertaining to unmarried partners is different from the law pertaining to married partners, and, therefore, the terms of agreements involving unmarried partners differ from the terms commonly found in premarital agreements. Agreements for unmarried partners are often referred to as “Cohabitation Agreements.”