Thursday, December 05, 2019

Prenuptial Agreements in Texas - A Brief Introduction

The sad reality of the current divorce rate in America indicates that almost 50% of couples will enter a marriage that has an expiration date.  Although most happy couples don’t go into marriage anticipating a divorce, it has become increasingly important to consider a potential split as a likely possibility. As such, the importance of a prenuptial agreement for a couple headed into marriage is warranted, now more than ever.

What is a Prenuptial Agreement?
A prenuptial agreement, or prenup, is an agreement between a couple, before marriage, that generally establishes the rights and responsibilities of each party and controls the division of property. According to Texas law, in order for a prenup to be enforceable, the agreement

(a) must be in writing;

(b) must be voluntarily signed by both parties prior to the marriage and in contemplation of marriage;

(c) must not be unconscionable when written; and

(d) must be signed after both parties have knowledge of each other’s finances. 

A prenup is enforceable without consideration and can cover a range of issues from outlining the rights and obligations of each spouse concerning property -- to a spouse’s right to receive alimony. An exhaustive list with respect to what prenups may cover can be found in Section 4.003 of the Texas Family Code. A prenup can be amended or revoked after marriage only by a written agreement between the parties. Similar to the prenup itself, an amended agreement or a revocation of a prenup is enforceable without consideration.

Avoiding Unenforceability
To avoid having a prenup declared legally unenforceable, couples should adhere to all of the following:

  1. Both parties must sign the prenup voluntarily with knowledge of the other spouse’s financial obligations and property owned. A prenup that is entered into wherein one party lacks a full understanding of the property and financial obligations of the other party, without having waived the right to the disclosure in writing, may result in a void prenuptial agreement if that same party didn’t have, and reasonably couldn’t have had, knowledge of the other party’s obligations.
  2. The prenup must not be unconscionable or one sided.
  3. Prenups cannot include designations for child support or child custody.
  4. Both parties should preferably have independent attorneys representing each parties’ respective interest. 

The decision to split from a loved one is hard enough.  During such time, prenuptial agreements act as insurance policies, protecting each party’s interests at their times of need while also ensuring that the dissolution of a marriage occurs in a more simplified, expedited, and stress-free way.

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Zirwa Sheikh is an Associate at Cowles Thompson and handles Family Law and matters related to Commercial/Business litigation.
 

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