Prenuptial agreements, commonly referred to as prenups, are legal agreements designed to outline decisions about key financial issues like how assets and liabilities will be divided in your divorce. Any prenup, even if well-drafted, can be contested during a divorce and questions often arise about their enforceability. Disputes commonly center on perceived gaps in disclosure or fairness. While guidelines may vary from state to state, courts generally employ a three-pronged “test” to determine whether a prenuptial agreement will hold up during divorce proceedings.
If you’re facing divorce where a prenup is in place, understanding these three factors can provide clarity on the degree of enforceability:
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- Full Disclosure of Assets, Liabilities, and Income
- Unconscionability
- Significant Changes in Circumstances
1. Full Disclosure of Assets, Liabilities, and Income
The first and most important factor is whether both spouses fully disclosed all financial information at the time the prenuptial agreement was executed. This includes sharing information about all assets, liabilities, and income transparently and accurately. A lack of full disclosure can lead to allegations of fraud that can invalidate a prenup if one party was misled, or did not have all the necessary information to make an informed decision.
For instance, if you discover during your divorce that your spouse failed to list a substantial asset or understated their income at the time of the prenup, the agreement may be called into question. Courts take this requirement very seriously because it ensures that both parties entered into the agreement with their eyes wide open. If a party can prove that the other concealed significant financial details, the agreement is more likely to be contested and potentially deemed unenforceable.
In practice, this is the most frequently contested aspect of prenups. However, agreements with clear, documented financial disclosures typically withstand scrutiny.
While no prenup is immune to challenges, generally speaking, prenuptial agreements do hold up, provided they meet the legal requirements of full disclosure and fairness.
2. Unconscionability
The second factor to determine enforceability is whether the agreement is unconscionable. It’s important to note that an agreement being “unfair” does not necessarily render it unconscionable. Most prenuptial agreements are going to be viewed as unfair, but unconscionable rises to the level that is so one-sided or oppressive that no reasonable or sane person would have ever signed it. This is a high legal standard to meet.
Most prenuptial agreements inherently have some level of imbalance, but that alone does not make them unenforceable. The courts look for extreme situations—such as agreements that leave one party destitute or disproportionately enrich the other—to determine whether unconscionability applies. It is rare for a court to strike down a prenup on these grounds.
3. Significant Changes in Circumstances
The third prong of the test evaluates whether the facts and circumstances of your marriage have changed so significantly since the agreement was signed that enforcing it would be unfair at the time of divorce. This sounds easier to prove than it actually is because it requires evidence of drastic and unforeseen changes.
Examples might include a spouse developing a severe disability or medical condition that prevents them from supporting themselves after the divorce. These scenarios are exceptional, and I’ve only seen a handful of cases succeed on these grounds. For instance, if a spouse becomes incapacitated and enforcing the original terms of the agreement would result in undue hardship, the courts might reconsider its enforceability. Minor or predictable changes in circumstances are unlikely to meet this threshold.
Final Word
Prenuptial agreements can provide clarity and protection as you enter marriage, but their enforceability hinges on key legal principles. While no prenup is immune to challenges, generally speaking, prenuptial agreements do hold up, provided they meet the legal requirements of full disclosure and fairness. Typically, the most important factor is whether all of the assets, liabilities, and income were disclosed. With that disclosure, the prenup will likely hold up and can offer a strong level of legal protection and predictability.
