There is a rising trend to use prenuptial agreements. Prenuptial agreements are no longer for the rich, becoming more and more prevalent with successful middle-class couples. The use of a prenuptial agreement is especially important in cases involving substantial premarital assets or prior familial relationships which need to be maintained.
Prenuptial agreements can be used to relinquish or alter rights and duties that parties would otherwise acquire through marriage and to create new rights and duties. Such agreements may define each party’s rights and responsibilities in three key areas: (1) divorce, (2) death of a party, and (3) financial or other domestic arrangements during the marriage. A prenuptial agreement can be as simple or complex as the needs and desires of the individuals involved. Clients with substantial estates and premarital assets will require greater detail and attention to the disclosure requirements.
While generally favored under Oregon law, courts subject prenuptial agreements to a high level of scrutiny. The court will examine the circumstances surrounding the agreement for evidence of involuntariness or unconscionability.
Prenuptial agreements are governed by the Uniform Prenuptial Agreement Act (UPAA) in Oregon as set forth in ORS 108.700 though ORS 108.740. Oregon law defines a prenuptial agreement as a contract “between prospective spouses made in contemplation of marriage.” The agreement “must be in writing and signed by both parties.” A prenuptial agreement becomes effective on marriage. After marriage, the agreement may be amended or revoked only by written agreement signed by both parties.
Under ORS 108.725, the parties may contract with respect to:
• their rights and obligations in their property;
• their rights to transfer or encumber their property;
• the disposition of property on separation, divorce, death or any other event;
• the modification or elimination of spousal support;
• the making of a Will or Trust;
• life insurance provisions;
• choice of law; and
• other matters not in violation of public policy or a criminal statute.
A premarital agreement is not enforceable if the party against whom the enforcement is sought can prove that either:
(1) the party did not sign the agreement voluntarily; or
(2) The agreement was unconscionable when executed if, before the agreement was executed, that party did not have adequate knowledge of the other party’s property, was not provided with disclosure of that property or did not waive his or her right to disclosure of the property.
The key to the enforceability of any prenuptial agreement is voluntariness and full and adequate disclosure of the assets sought to be protected by the agreement. Last minute execution of a prenuptial agreement without the benefit of counsel may subject the agreement to later invalidation by the court. The duty of good faith and full disclosure is essential to evaluating the fairness of the agreement.
CONTACT PAUL F. SHERMAN FOR EXPERT ADVISE ON YOUR PRENUPTIAL AGREEMENT OR COMPLEX PROPERTY DIVISION ISSUES
We know you have more questions and we have the answers. If you would like to learn more about prenuptial agreements, child custody, divorce, or any family law matter, call the Law Offices of Paul F. Sherman at (503) 223-8441 for legal advice, or Contact Us for a free consultation.