What is a Florida Premarital Agreement
A prenuptial agreement is a legal document executed between two partners prior to getting married. During the course of working with a Tampa-based family law attorney, you will plan for your future by considering the many outcomes of your union. A prenuptial agreement is a contract summarizing these discussions in legal terms. For those planning a second or third marriage, this contract also provides advantages concerning alimony and inheritance rights.
Florida law has certain requirements for prenuptial agreements to be enforceable. Statute Section 61.079 states that these contracts must be placed in writing and signed voluntarily by both spouses. Neither party can be under duress or make the agreement involuntarily. Once both parties have signed the contract, your prenuptial agreement becomes a legally binding contract. In the event of a divorce, however, prenuptial agreements can be contested based on a number of different criteria. We listed some of them below:
Material Misrepresentation or Fraud – If either party provided the other with a false financial statement, hid assets or debts , or made a misleading representation of material fact in order to induce the other spouse into entering the prenuptial agreement, the contract might be rendered invalid. For example, if your partner deceitfully claimed to have liabilities greater than those the couple has, he might have been trying to significantly lower his alimony obligations. Spouses have a legal duty of good faith when entering this contract, and cannot hide or minimize assets in order to influence the terms of the contract.
Unconscionability – If the prenuptial agreement would result in grave inequities or an unjust outcome for one of the spouses, it may not be enforceable. Courts often find prenuptial agreements unconscionable when one spouse was at a disadvantage during negotiations, such as by not having a lawyer present or being under psychological pressure from the other spouse to sign.
Involuntary Execution – One of the few legally acceptable reasons for disputing a prenuptial agreement is if it was not made voluntarily. Spouses must be represented by legal counsel and have at least seven days to consider the contract before signing it.
Important Clauses for a Florida Premarital Agreement
When spouses agree to marry, they may consider making a legal document called a prenuptial agreement to divide assets and avoid financial disputes in the future. These voluntary, written contracts are used to waive the right to share in each other’s property and income, to protect children from a previous relationship and/or to pre-determine the outcome of a divorce or death of a spouse.
Florida law requires both spouses to voluntarily make the prenuptial agreement, Division of Assets: The primary purpose of this type of contract is to determine which person will get what asset in the event of a divorce. The most basic formula for the division of assets would be fundamental:
-Assets belonging to each spouse before marriage would remain their property
-Assets brought into the marriage would belong to the partner who brought them in
-Gifted and inheritance assets belong to the spouse who received them
-Assets earned and gained during the marriage are typically considered joint property
Florida Marital Assets, however, do not always follow this simple formula since other agreements and factors can influence the division of assets. Therefore, other factors should also be included for a proper division of marital assets including:
-The kind of asset involved
-The length of the marriage
-Tax ramifications
-Duty of care of minor child
-The potential for increase or decrease in value of assets
-Each spouse’s economic status
-Dedication and contribution of each spouse to the marriage
-Any other issues that could be unique to each case
Spousal Support: Also called alimony or spousal support, this clause would either require one spouse to support the other financially during the divorce process and/or after the divorce settlement, or make it clear from the outset that alimony would not be paid.
Debt Payments: Similar to alimony, this clause allows spouses to evenly divide debt payments, or it may shift the responsibility to one spouse to pay specified debts based on prior agreements or contributions made to the marriage.
Financial Disclosure: Both spouses should provide full financial disclosure through a completed marital disclosure form that includes all earnings, assets and debt. Because the agreement is being made without coercion or intimidation, spouses should be informed and agree to every aspect of the contents.
Naming Beneficiaries: Will beneficiaries be named for a will or trusts, or will the agreement state that a specific beneficiaries will be dis-inherited?
Estate Planning: Will or estate planning procedures be changed if a marriage, divorce or death occurs? Would a pre-nup override a will if made after the date of the marriage?
Child Custody: If children are born during the marriage, this clause would determine custody and child support if a separation occurs after the divorce.
Legal Advantages of a Premarital Agreement
A Florida prenuptial (or ante-nuptial) agreement is essentially a contract that is intended to provide as much clarity as possible into the financial and legal aspects of a couples budding marital life. It’s something that a lot of people scoff at. The idea of planning for your divorce before you even walk down the aisle doesn’t make a lot of sense to most people.
But regardless of how you feel about the subject, the reality is that there are a number of legal benefits to a prenup.
Asset Protection: Setting Up For Success
Florida is a "shared" property state. This means that anything a couple acquires during the term of the marriage – excluding any gifts or inheritances – becomes evenly divided should there be a divorce. A prenuptial agreement, however, can protect an individual’s assets if a couple gets divorced. This means that assets owned by one individual before the marriage can be guarded against division during the divorce. This is also true for assets acquired during the marriage, but before the divorce. For example, if only one spouse buys a new car during the marriage, that asset can be exempted from division in Florida family court. The same is true if you plan on starting a business before or during the marriage but worry that it might end in divorce.
Protection of Premarital and After-Acquired Assets:
A prenuptial agreement can set aside all types of assets into two distinct categories:
These assets are not a part of joint marital property to be divided in the case of a divorce. Depending on your circumstances, this could be beneficial for the individual spouse that owns the asset.
Clarity on Financial Responsibility:
In some cases, both spouses work outside of the home. This is especially true in Florida where the cost of living can be quite high. When both spouses have their own jobs, a prenuptial agreement can set clear ground rules for financial responsibility. These agreements can specify the source of funds in marital accounts and require that there be no outlandish spending. If too much money is spent, the financial responsibility during the divorce would not be evenly split.
No No-Fault Divorce (In Some Cases):
Florida adheres to no-fault divorce policies. This means that there is no need to prove adultery or other pregnant-spouse blunders dishonest in order to dissolve the marriage. During divorce, both partners are expected to divide their assets evenly regardless of misconduct during the term of the marriage. While this has been a boon to most divorce seekers, it does leave some spouses unprotected. A prenup can protect the spouse that believes that he or she was the victim in the relationship. It can also contain provisions that allow for separation if one spouse is unfaithful.
Minimize Disputes During a Divorce:
In most cases, divorce proceedings result in drawn out conflicts and arguments. A prenuptial agreement can provide much needed clarity by laying out the financial future of both spouses. When a divorce is contested, the prenuptial effectively ends the argument before it starts. It is important to note that not only must both spouses sign the agreement – it is also critical that both individuals know what they are signing. This means that third-party attorneys must review the document with both individuals and ensure that they know exactly how the agreement would affect them if a divorce were to take place.
Sample Premarital Agreement Provisions
There are various methods that can be utilized to tailor a prenuptial agreement to the needs of the parties. While each party’s situation is unique, and prenuptial agreements can be written or customized to the particular circumstances, there are several examples of typical provisions. These examples are not all encompassing and are only a sample of the types of provisions that may typically be included in a prenuptial agreement. With that said, following is a list of potential basic provisions with a discussion of their purpose.
- Statement of Disclosure: The agreement will generally contain a requirement that each party provide personal financial disclosure to the other prior to executing the prenuptial agreement. Many of the requirements for a valid prenuptial agreement will be contingent upon each party providing accurate financial disclosure to the other.
- Choice of State Law: Jurisdiction and law used to interpret the contents of the prenuptial agreement.
- Spousal Support: This provision will frequently limit or eliminate a party’s ability to obtain alimony in the event the parties were to divorce. Both parties will factor their income and net worth into this determination when negotiating a settlement. If one party is ready to negotiate and the other is not, this provision is an important bargaining tool as the party who stands to not receive alimony should heavily weigh the potential future receipt of alimony in their decision to proceed with the negotiation .
- Inheritance and Estate Planning: Under Florida law, neither party is required to include in their estate plan a provision providing for the other spouse. Several types of provisions can modify the parties’ statutory and common law rights concerning a spouse and their estate. A typical provision will turn on whether the parties’ are still married at the time of the inducement of death. Other provisions will require one party to name the other as beneficiary for a certain amount in life insurance.
- Credit Card Debt: Parties will often have credit card debt and they will also likely have joint credit cards. Whether they are married or not, both parties typically are jointly responsible for any debts that are incurred on a joint card. For many, the most significant debt incurred after marriage is the mortgage debt on their home. A prenuptial agreement can address the allocation of debt to one or both parties.
- Division of Property: While this provision will frequently be drafted based on which party contributed the property or whose name holds a particular title, a prenuptial agreement can also be used to reallocate property acquired during the marriage.
- Waving Pension and Retirement Benefits: It is fairly common not to include in the marital estate pension or retirement benefits that can be earned by a member spouse after the marriage. Depending on the length of the marriage, medical coverage and support may be related to these benefits.
How to Prepare a Premarital Agreement in Florida
As with any binding contract, there are specific steps that must be taken when drafting a prenuptial agreement. With respect to Florida prenuptial agreements, those steps include the following: Upon making the decision to enter into a prenuptial agreement, the first step for both brides and grooms-to-be is to have a frank discussion about their expectations of sharing assets and liabilities during the marriage. It is crucial that both parties be open-minded and honest about the prenup to ensure the best chance of upholding the clause in the future. Next, each party should consult a trusted legal professional who will be able to shed light on the intricacies of prenuptial agreements, including which clauses should be included and what type of assets Florida courts look for in the event a prenup is contested after being signed. Attorneys with family law experience are particularly important in this stage of the process, as they will be highly familiar with Florida laws regarding prenuptial agreements. Once you have worked with your partner and legal professional to create a mutually acceptable prenuptial agreement, take some time to review Florida state laws to make sure your prenup complies with all current regulations. Each state has different requirements for prenuptial agreements to be upheld in court, so it is crucial to know where Florida stands on the issue.
Frequently Asked Questions and Misunderstandings
To begin with, we should give a brief primer on what a Florida prenuptial agreement is, and what such an agreement can do. What a prenuptial agreement cannot do is get the applicant everything she or he could ever want. A prenuptial agreement cannot address matters such as child custody, child support or visitation rights.
Myths and Facts
Myth: Prenuptial agreements are only for very wealthy people or for those who have been previously married.
Fact: Anyone about to enter marriage can benefit from a prenuptial agreement. In fact, if one or both parties has children from a previous marriage, a prenuptial agreement can ensure that those children will not end up disinherited or unfairly treated in the case of death or divorce.
Myth: It is a sign of distrust between the parties.
Fact: Prenuptial agreements can be an expression of love and caring. They help to ensure that both parties will be treated fairly.
Myth: Once a prenuptial agreement is signed, it cannot be changed.
Fact: Much like any other contract, a prenuptial agreement can be amended by the parties. Important changes, however, should be done with the advice and assistance of legal counsel to ensure there is a clear meeting of the minds and to avoid future disputes.
Myth: Couples can easily draw up their own prenuptial agreement because they both know what they would like to see done .
Fact: Prenuptial agreements should always be carefully drafted and reviewed by legal counsel for both parties. If this is not done, a court may ensure that one or both parties is not left with their "day in court," should the agreement later be challenged.
FAQs
Must both parties disclose all assets and liabilities? No, but it is highly recommended that they do so. If one party fails to provide such disclosures, it could invalidate the document.
Are there any restrictions on what a prenuptial agreement can provide? There are virtually no restrictions other than the aforementioned caveat regarding child custody, support and visitation rights.
How can I ensure that my prenuptial agreement will be valid and enforceable? Be sure to have an experienced family law attorney draft the agreement. You should also be represented by counsel when you sign the document. The Florida Supreme Court has held that full and fair disclosure of assets is required before a prenuptial agreement is executed.
What if my husband or wife says he or she will not marry me without a prenuptial agreement? We do not recommend that you enter into a prenuptial agreement under such duress. A prenuptial agreement should be freely made by both parties.
Can I ask for money to pay for an attorney to review a prenuptial agreement? You can and if you are lawfully owed it, your spouse is legally obligated to pay it.