A prenuptial agreement can help a couple decide how property, income, debt, and support issues will be handled before they marry. It can also reduce uncertainty when one or both people own a business, have children from a prior relationship, expect an inheritance, or enter the marriage with substantial assets or obligations.
Irwin & Irwin helps clients throughout Orange County prepare and review California prenuptial agreements. We identify the financial issues that should be addressed, explain the rights affected by the proposed terms, and prepare agreements intended to reflect the couple’s decisions clearly.
Our firm practices exclusively family law. From our office in Fullerton, we bring a practical understanding of the property and support disputes that can arise during divorce. That experience helps us identify vague terms, incomplete disclosures, and future problems before an agreement is signed.
Discussing a prenuptial agreement does not mean a couple expects the marriage to fail.
Marriage changes the legal and financial relationship between two people. Without an agreement, California law will generally control how property, income, debt, and support issues are addressed if the spouses later separate or divorce.
A prenuptial agreement allows prospective spouses to make certain decisions for themselves.
California defines a premarital agreement as an agreement between prospective spouses made in contemplation of marriage and intended to become effective when they marry. The agreement must be in writing and signed by both parties.
A well-prepared agreement may help a couple:
The agreement should fit the couple’s finances and plans. A generic form may not account for the property, compensation, business interests, or family obligations involved.
California law permits prospective spouses to enter agreements concerning a broad range of property rights and financial obligations.
The agreement may address rights in property owned by either person before the marriage or acquired later. It may also govern how property will be managed, transferred, sold, or divided following separation, divorce, death, or another specified event.
Common subjects include:
An agreement can identify property that each person wants to keep separate.
This may include:
Identifying an asset is only part of the work. The agreement may also need to address appreciation, income generated by the asset, payments made during marriage, refinancing, improvements, and whether community funds will be used.
California’s community property system can give each spouse an interest in income earned during marriage.
A prenuptial agreement may provide that some or all earnings will remain separate property. It may also define how joint accounts, household contributions, savings, and investments will be handled.
The terms should account for how the couple expects to manage money in daily life. An agreement that does not match the way the spouses actually handle their finances may create confusion later.
A person may enter the marriage owning a residence, rental property, commercial property, or land.
The agreement can address:
Clear terms may be especially important when one person owns the home but both expect to contribute to the mortgage or improvements.
A business can create difficult property and support questions during divorce.
A prenuptial agreement may address:
The agreement should be coordinated with shareholder agreements, partnership documents, operating agreements, and succession plans when applicable.
A prenuptial agreement may identify debts each person brings into the marriage and establish responsibility for future obligations.
This can include:
An agreement between spouses does not necessarily change a creditor’s contractual rights. A lender may still pursue a person whose name appears on the account or loan.
Retirement plans, pensions, deferred compensation, stock options, and restricted stock may require careful treatment.
The agreement may identify premarital benefits, address future contributions, or define how equity compensation will be characterized.
Plan rules and federal law may affect what can be waived or divided. Some rights may require additional documents after marriage.
A person with children from a prior relationship may want to preserve certain assets for those children while also providing for a future spouse.
California law allows premarital agreements to address wills, trusts, life insurance, and property rights at death.
The agreement should be coordinated with the couple’s estate-planning documents. A prenuptial agreement alone may not carry out every intended transfer.
A California prenuptial agreement may include terms concerning spousal support, including a proposed waiver or limitation. These provisions are subject to stricter rules.
A spousal support provision is not enforceable against a person who did not have independent legal counsel when the agreement was signed. A support provision may also be unenforceable if it is unconscionable when enforcement is requested.
This means a valid agreement concerning property does not necessarily make every support term enforceable.
Support provisions should be reviewed in light of:
A provision that appears reasonable before marriage may be examined again years later when enforcement is sought.
A prenuptial agreement cannot eliminate a child’s right to support. California law states that a child’s support rights may not be adversely affected by the agreement.
Prospective spouses should also avoid treating a prenuptial agreement as a way to predetermine future child custody or parenting time. If parents later disagree, California courts make custody decisions based on the child’s best interests and the circumstances existing at that time.
An agreement also cannot include terms that violate public policy or a law imposing a criminal penalty.
We help clients distinguish between subjects that can be addressed effectively and terms that may not be enforceable.
A prenuptial agreement should be based on a meaningful understanding of each person’s finances.
California law provides that an agreement may be unenforceable when it was unconscionable at signing and the person opposing enforcement did not receive fair, reasonable, and full disclosure, did not validly waive further disclosure, and lacked adequate knowledge of the other person’s property or financial obligations.
Disclosure may include:
A verbal description such as “I own a business” may not be enough to give the other person a useful understanding of its value, debt, and income.
We help clients organize financial schedules and identify supporting records that may be appropriate for the agreement.
Each prospective spouse should have the opportunity to receive advice from a separate lawyer.
One attorney cannot represent both people when preparing and negotiating the agreement. Even when the couple agrees on the general terms, each person may be giving up different rights and assuming different obligations.
Independent representation gives each person an opportunity to:
Independent counsel is particularly important when the agreement addresses spousal support. California law requires independent representation for a support provision to be enforceable against the person affected by it.
Irwin & Irwin may represent one prospective spouse in drafting or reviewing an agreement. The other person should obtain separate counsel.
A prenuptial agreement should not be presented for the first time days before the wedding.
For agreements signed on or after January 1, 2020, California law generally requires at least seven calendar days between the date a person is first presented with the final agreement and the date it is signed. This period applies whether or not the person has an attorney, subject to the statute’s exception for nonsubstantive changes.
Seven days is a legal minimum, not a recommended planning schedule.
The process may require time to:
Starting several months before the wedding gives both people time to consider the terms without unnecessary pressure.
A signed agreement is not automatically enforceable in every circumstance.
California law allows a person to challenge enforcement based on grounds that may include lack of voluntary execution or certain problems involving unconscionability and financial disclosure. The court also considers whether the statutory requirements connected to counsel, timing, language, capacity, duress, fraud, and undue influence were met.
Disputes may arise when:
No drafting process can prevent every future challenge. Careful preparation can reduce avoidable questions about how the agreement was negotiated and signed.
A prenuptial agreement should be more than a list of assets followed by a waiver.
We help clients identify the financial issues that matter, understand the legal effect of the proposed terms, and document the process carefully.
Our work may include:
We write in clear terms so the client can understand what the agreement is intended to do.
Business owners, physicians, executives, attorneys, investors, and other professionals may have compensation and ownership interests that require more detailed planning.
A straightforward agreement may not adequately address:
We help clients identify these issues early and determine when input from an accountant, valuation professional, tax adviser, business attorney, or estate-planning lawyer may be useful.
You should not assume that an agreement is standard because it was prepared by a lawyer.
Before signing, you should understand:
We review proposed agreements for clients who did not participate in the initial drafting. We explain the terms, identify areas of concern, and discuss revisions before the client decides whether to sign.
You do not need to have every financial document before contacting us.
Helpful information may include:
The sooner the process begins, the more time there is for disclosure, review, and negotiation.
A prenuptial agreement can help prospective spouses establish clear expectations before marriage. The process should allow time for financial disclosure, independent advice, negotiation, and careful review.
Irwin & Irwin helps clients prepare and review California prenuptial agreements involving property, businesses, debt, support, estate planning, and other financial concerns.
Schedule a consultation with Irwin & Irwin to discuss your Orange County prenuptial agreement.
