Many couples these days are approaching marriage from the reality that you can’t always bank on a life-long marriage. Despite the fact that prenuptial agreements sometimes have a bad connotation, well-thought-out prenups may make any potential divorce a lot more predictable and less costly given the Florida Supreme Court’s recent decision on enforceability.
Florida Supreme Court Makes Landmark Ruling on Prenuptial Agreements
In Hahamovitch v. Hahamovitch (No. SC14-277), the Florida Supreme Court upheld the Fourth District Court of Appeal decision, holding that when a contract is clear and unambiguous, it must be enforced according to its plain language. This ruling came despite the fact that the agreement significantly benefitted the husband over the wife, and that it deviated from Florida family law.
The question at hand in Hahamovitch was whether spouses in a prenuptial agreement could:
- Waive any interest in the other spouse’s property;
- Hold sole ownership in properties acquired during marriage;
- Waive any claims to rights each spouse may have to a share of assets titled in the other spouse’s name as a result of the marriage;
Under Florida Family Law, spouses generally have the right to an equal share of the marital assets, meaning assets purchased by either spouse during the course of the marriage. Marital assets also include any increase in value that properties may have amassed.
The wife argued that, since the prenuptial agreement did not specifically discuss enhancement of value of any of the properties, that she should be entitled to half of the enhanced value of her husband’s assets.
Previously, two other Florida Courts of Appeal had ruled that prenuptial agreements could not trump a spouse’s claim to the other spouse’s “earnings, assets acquired with those earnings and the enhanced value of the other spouse’s non-marital property resulting from marital labor or funds.” If the appellate courts were correct, there leaves little room for prenuptial agreements in Florida.
Wife Gives Up Rights to Husband’s Property
The Florida Uniform Premarital Agreement Act provides that couples may contract generally with respect to property, spousal support and estate planning issues. Prenuptial terms may address things like:
- Division of property acquired during marriage
- Identification of joint and separate living expenses, including how each will be paid
- Determination of how assets acquired during marriage will be titled
- Spousal Support
The terms of the prenuptial agreement in Hahamovitch provided that the wife would have no right or claim to her husband’s property. In consideration for this waiver of rights, Mrs. Hahamovitch was to receive $1.9 million over the course of seven years.
Prenuptial Agreement Facts
The Florida Supreme Court’s ruling does not mean that spouses can contract away just anything. For one thing, child support is not negotiable in a Florida premarital agreement. Anything that might go against public policy is also prohibited, such as making spousal support so low that the spouse is forced to rely on public assistance.
In addition to regulating specific terms of prenuptial agreements, the Florida Uniform Premarital Agreement Act requires a number of factors to be in place in order for the agreement to be enforceable. For example:
- The agreement must be entered into voluntarily;
- The agreement must not be a result of fraud, duress, coercion or overreaching; and
- The agreement must not be unconscionable when it was executed.
Furthermore, the agreement must be in writing, signed by both parties who have had time to consult with an attorney and consider the consequences of the agreement. Any revocations to the agreement must also be in writing. The prenuptial agreement in Hahamovitch reportedly was drafted by attorneys for both spouses and the wife had ample opportunity to object to the terms.
If you are considering entering into a prenuptial agreement, it’s important to seek the advice of experienced counsel. Contact the attorneys at Beller & Bustamante, P.L. today. We’ve helped countless families and individuals with family law issues like prenuptial and postnuptial agreements, divorce and custody issues.