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If you earn a large income or own valuable assets, you will want to make sure you are financially protected if you or your spouse choose to pursue a divorce. In many cases, the best way to protect yourself from financial losses in a high net worth divorce is to make decisions ahead of time about how certain issues will be handled. A prenuptial agreement, which you and your partner can sign before getting married, will allow you to specify how you will handle the division of community property if your marriage ends, as well as other matters related to your finances.

To be valid and enforceable, a prenuptial agreement (also known as a “prenup”) must be in writing, and it must be signed before you get married. Both spouses must also provide each other with a fair and reasonable disclosure of their finances, including the property they own, the income they earn, and the debts they owe. A spouse can waive their right to receive a financial disclosure from the other party, but this waiver must be completed before the prenup is signed.

What Decisions Can a Prenuptial Agreement Make?

In Texas, a prenuptial agreement is also known as a “marital property agreement,” and it can include decisions related to the ownership or disposition of the couple’s property, including community property or separate property owned by either spouse. A prenup can define each party’s rights and obligations toward their property during their marriage, including the right to buy, sell, lease, transfer, or use physical property, real estate, financial instruments, or anything else owned by either or both spouses.

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TX high asset lawyerPrenuptial agreements are a common legal tool used to avoid protracted litigation, particularly in the event of a high-asset divorce. Of course, when a divorce proceeding actually begins, it is not unusual for one spouse to challenge the validity of the prenuptial agreement. This is why it is essential to follow certain procedures when drafting the agreement initially.

Houston Court Rejects Wife's Challenge to Prenuptial Agreement

A recent decision from a Texas appeals court illustrates how to successfully defend a prenuptial agreement from such a challenge.

This case involves a couple that initially met through a dating website. The future husband lived in Houston, while the future wife lived in Vietnam. Even before the two met in person, the husband said he "wanted his future wife to sign a prenuptial agreement to protect his assets," according to court records.

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Texas divorce attorneyPremarital agreements can help ensure that in the event of a divorce, both parties will have a clear understanding of their assets and liabilities. However, premarital agreements are not always enforceable, in which case, a couple may need to reevaluate property division issues, so if you believe that your premarital agreement does not conform to the state’s requirements, please contact a complex divorce lawyer who can explain your options.

Voluntary Signatures

In order to be considered valid, a premarital agreement must be in writing and signed by both parties. Even when these technicalities have been honored, an agreement can still be challenged if one of the parties alleges that at least one of the signatures was not voluntary. To establish that a signature was not voluntary, the party may need to provide evidence that the document was signed under duress, fraud, or undue influence.

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Texas family law attorney, Texas high asset divorce lawyer, Texas prenup lawyer, New homeowners never think that their houses will burn down, and they certainly do not desire such an outcome. But responsible homeowners always obtain insurance policies, even though there is nothing "fun" about filling out insurance forms. In a similar vein, no soon-to-be-newlywed couple anticipates a high asset divorce, and they certainly do not desire this outcome. But a premarital agreement and a homeowner's insurance policy have much in common: they both help couples be prepared if the unthinkable should happen.

These contracts serve an additional purpose. Much evidence indicates that financial squabbles are among the leading causes of marital strife. When these disagreements inevitably appear, a premarital agreement helps bring order to the chaos, because some important financial decisions have already been made.

Making a Premarital Agreement

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Texas divorce attorney, Texas complex litigation attorney, high-asset divorce,A premarital agreement can hardly be considered romantic, but it is an important part of a strong marital foundation. Many couples fight over money issues, and although the issue is normally dealing with debt, dealing with large assets can be every bit as stressful.

By executing a solid premarital agreement, you can eliminate a potential source of conflict before it ever manifests itself in the first place. If there is a high-asset divorce later, a premarital agreement may help narrow the issues, and the spouses might avoid a legal battle that is both financially and emotionally costly.

Who Needs a Premarital Agreement?

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Austin family law attorney, prenup, prenuptial agreement, pre-marital property, financially disastrous, planning your wedding, prenups and business, property division settlementDividing up marital property and assets during a divorce can become difficult if one of the spouse's owns a business. That business may be one of the most important assets in the marital estate, especially if it is a successful one. Ideally, if the business was started before the marriage, the couple should draw up a prenuptial agreement that includes specific details regarding the business in the event of a divorce. However, if a prenuptial agreement is not drafted, a divorce could become increasingly difficult and potentially financially disastrous for one spouse or the other if the marriage fails.

For example, one couple going through a divorce, did not have a prenup, and thus put the husband's corporation at risk. Shareholders were left to wonder what would happen to the company. Said husband is currently worth $14.6 billion and is listed in Forbes Magazine as a global billionaire. He also owns 126 million shares of his company, giving him 70 percent ownership.

The judge overseeing the divorce stated that just over 122 million of the shares the husband owns were acquired prior to his marriage and are therefore considered "pre-marital property" and will not be part of any property division settlement. However, the remaining 4 million shares will not be covered by the judge's order.

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prenuptial agreementIt is rare that a prenuptial agreement is dismissed as invalid in divorce proceedings. But the recent case in New York where a the wife of a Long Island real estate mogul convinced the judge that the prenup she signed before their marriage was invalid is considered precedent setting in legal circles. Elizabeth Petrakis told the court that she was coerced to sign the agreement, only four days before the wedding, because her husband, Peter Petrakis, threatened to call off the wedding. Petrakis said she felt pressured because her father had already spent $40,000 in wedding costs.

In the agreement, Peter Petrakis would keep everything if they should divorce. Elizabeth Petrakis said her husband told her he would tear up the agreement as soon as they had a child. But two children later, he still did not tear it up. Elizabeth Petrakis has been arguing the validity of the agreement for seven years. Two prior Nassau County courts said that Peter Petrakis "fraudulently induced" Elizabeth to sign the agreement and those decisions were affirmed by a Brooklyn appellate court. So what are some of the grounds where a prenuptial agreement could be overturned?
  1. Fraud is one reason why a judge could throw out an agreement. If one party fails to make full disclosure of all their assets, the court considers that fraud.
  2. If someone can prove they signed an agreement while under duress or with coercion, the agreement may be thrown out. Each state does have different standards of what is considered duress or coercion.
  3. If an agreement was signed when a person lacked mental capability, a judge may order it invalid. For example, if the person was under the influence of drugs when the agreement was signed, they may not have fully comprehended what they were signing.
  4. Improper filing of paperwork or incorrectly drafted can also end up making a prenup invalid.
  5. If you sign a prenup without having your own, impartial legal representation can invalidate an agreement.
  6. What the court would consider asinine provisions – such as not having to pay child support in the event of a divorce – will more than likely have a judge stamp the prenup as invalid.
If you are planning a marriage and are discussing drawing up a prenuptial agreement with your future spouse, it's important to have your own independent council. Contact an Austin family law attorney to represent your best interests in this process.

prenuptial agreement IMAGEPrior to getting married, it is important to discuss things such as potential children, jobs, and where you both will live. One subject that might be harder to talk about is about money. That is especially the case if one spouse comes into the relationship with a better financial position such as higher wages, property or a possible inheritance. That spouse may want to protect their assets in the future by drafting a prenuptial agreement.

There are certain things that a properly written prenup can achieve. It is generally used to specify how assets shall be divided on the chance that the marriage ends in divorce. It can also dictate how certain separate or marital assets can be characterized, managed and controlled. This is essential if either spouse owns a family business or home prior to becoming married. Also if either spouse has a large amount of debt, it can protect the other from being financially responsible. A prenup may also dictate if a spouse is eligible to receive alimony or direct how much support can be awarded.

There are other aspects of a divorce which cannot be changed by a prenuptial agreement. Child support, custody and visitation cannot be negatively impacted by any prenuptial agreement. It is also incapable of including any action that is against state or federal law.

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