A request for a premarital agreement does not mean that you are selfish, do not trust your intended spouse, or are anticipating a brief marriage. Typically, the purpose of a premarital agreement is to make clear what is marital property and what is not marital property. If you and your intended spouse have savings, gifts, or other expected assets that have a source outside of the marriage you may wish to keep them separate for various reasons. A premarital agreement typically contemplates the distribution of assets not only after a divorce but also after a death of one of the spouses. For this reason a premarital agreement should be created together with other estate planning methods, such as a will.
What if there are children from a previous relationship? By making use of a premarital agreement you can guarantee that your non-marital assets will be reserved for those children. There may be very specific gifts received from family members that you wish to maintain in a family line. There can be many reasons to keep non-marital assets separate and a premarital agreement is an effective tool to do so. Aside from your children, a premarital agreement is also an effective tool in protecting your financial health in the unfortunate event of a divorce. The agreement may set out many terms, none the least of which are division of assets and spousal support.
What Does A Premarital Agreement Do?
An Illinois premarital agreement goes into effect at the moment the marriage begins, and not before. The agreement must be written and signed by both intended spouses. A well written agreement will clearly lay out each intended spouse’s assets and debts.
Some of the premarital agreement’s arrangements may include:
- Disposition of property at separation, divorce, or death;
- Choice of law governing the agreement (the particular state law that will control);
- Any other matter that does not violate a law or public policy. This might include a variety of rights or obligations.
Under certain circumstances, a premarital agreement may control whether spousal support can be modified or eliminated. Typically the provision can control if it:
- Was entered into and became effective before January 1, 1990, or
- It does not cause an “undue hardship” that was foreseeable at the time of the agreement’s execution. See the Illinois Uniform Premarital Agreement Act
It is important to note that an Illinois premarital agreement can NOT be written with provisions that will adversely affect a child’s right to support (750 ILCS 10/4).
Defeating A Premarital Agreement
To defeat enforcement of a premarital agreement and set it aside, it must be proven that:
- The agreement was not entered into voluntarily, or
- The agreement was unconscionable when it was executed (See 750 ILCS 10/7)
- When the agreement was presented and signed, a fair and reasonable disclosure of the property and financial obligations was not provided;
- You did not voluntarily waive in writing any right to the disclosure of the property or financial obligations (Pro tip: don’t waive your rights), and
- You did not have an adequate knowledge of the property or financial obligations
- Essentially, the agreement was so one sided in favor of the one with all the bargaining power that “no person who is mentally competent would enter into and that no fair and honest person would accept.”
To ensure that a premarital agreement is upheld, each party should be represented by his or her own lawyer. Contact an attorney to review your agreement or to draft a pre or post-marital agreement that will be enforceable.