Area of Law:
The requirements for prenuptial agreements vary from state to state, but the National Conference of Commissioners on Uniform State Laws has approved the Uniform Premarital Agreement Act as an attempt to streamline prenuptial agreement laws throughout the country. Most states have adopted some version of the act, though the state of Vermont has not. It is one of only four states that does not have a statute controlling prenuptial agreements. However, the following general rules should largely apply to Vermont as well.
Generally speaking, there are five basic requirements for a validly executed prenuptial agreement: (1) it must be in writing; (2) it must have been voluntarily executed; (3) it cannot be unconscionable; (4) it must have full disclosure of any relevant information at the time of execution; and (5) it must be notarized at the time of signing.
The first requirement that the prenup be in writing is for obvious reasons. Prenuptial agreements are very sensitive documents that are often signed in emotionally charged situations. Therefore, any challenge to a prenup down the road will involve very careful scrutiny of the agreement. It is due to this fact that prenuptial agreements are required to be memorialized in writing.
The requirement that the prenup be “voluntarily” executed pertains to the pressure being placed on the party with fewer assets who is going into the relationship. By nature, prenuptial agreements are typically signed during highly emotional times, and the party with fewer assets could be vulnerable to coercion or pressure to agree to the separation of assets. Any finding of unreasonable duress placed on the signee at the time of signing will render the agreement invalid.
The requirement that the prenup not be “unconscionable” is another way of protecting the party with fewer assets. This requirement can be met very simply by not leaving the party with fewer assets destitute in the event of a divorce. In other words, the agreement just needs to be fair.
Both parties need to have disclosed all relevant information to determine the agreement's fairness at the time of its signing. This includes assets and debts as well as anything else that is obviously relevant to the parties. The reason for this is to protect both parties from agreeing to anything that would be objectively unfair.
The final requirement for the agreement's notarization goes back to the court’s desire to protect the party with fewer assets by ensuring that he or she voluntarily consented to the agreement at the time of its signing.
The aforementioned prenuptial requisites not only are necessary at the time of the agreement's signing, but they must also be sustained for the duration of the marriage in order for the agreement to be enforceable should the marriage be dissolved. One typical example of a provision in a prenuptial agreement is that the marital home will go to Spouse A at the time of dissolution, and Spouse A will make all the mortgage payments from his or her individual income. However, if Spouse A and Spouse B were to mingle their income and pay for the house from the mingled income pool, then that provision would likely be held unenforceable.
Courts generally looked unfavorably on prenuptial agreements prior to the late 1960's, and they were rarely held to be enforceable as societal values deemed them immoral. The issue was that marriage was regarded as a bond in which financial considerations should not play a role. However, as societal values evolved and practical considerations came to the forefront, the courts began enforcing them.
Prenuptial agreements are a good idea for anyone getting married. Not only do they force couples to consider the financial ramifications of their marriage, but they also reduce the amount of conflict in the event of a divorce. The advantages of entering into marriage with a prenuptial agreement extend beyond the realm of divorce as well. A prenuptial agreement can protect the wishes of a spouse in the event of him or her dying without a validly executed will.
*You can also see what a Vermont prenuptial agreement looks like on Free Legal Aid.