Stephen J. Buhler, Attorney at Law

When is a premarital agreement not enforceable?

There is often a right way to do things and a wrong way to do things for Salt Lake City residents. This is certainly the case when it comes to legal issues, such as a legally binding contract between two parties. If done right, the contract can satisfy both parties' wants and needs in an effective manner. When done wrong, however, the contract can turn out to be a headache that costs both sides more time and money in the long run.

Last week, for example, this blog discussed how premarital agreements can be an effective way for individuals to protect themselves and their assets when entering into a marriage. The prenuptial agreement can be flexibly tailored to meet the needs of both spouses.

Under Utah law, parties to a premarital agreement can contract with respect to their rights and obligations in any of the property owned by either spouse. Parties can also contract with respect to security interests, and the disposition of property upon separation, divorce or death.

Accordingly, premarital agreements are very effective in dealing with issues of property division in a divorce. They go beyond that, however, to include spousal support issues, ownership rights in the death benefit of a life insurance policy and other issues involving the personal rights and obligations of the parties.

However, there are some no-no's when dealing with premarital agreements. First, there are certain issues the parties cannot contract with respect to, including a child's right to support, health expenses, medical insurance and child care coverage.

Even if the provisions in the agreement are generally okay, the manner in which the agreement is executed can also pose enforcement problems. For instance, the agreement is not valid when a party did not enter into it voluntarily or it was executed as a result of fraud. Similarly, if there was not a reasonable disclosure of a party's property or financial obligations, and the other side did not waive disclosure and could not have had knowledge of these issues, it may render the agreement not enforceable. Accordingly, while premarital agreements can be a great tool for both parties, they should be properly drafted and executed in order to be upheld by the courts.

Source: Utah Legislature, "Uniform Premarital Agreement Act," accessed on July 30, 2016

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