News
Family
Feb. 28, 2002
New State Legislation Makes Mockery of Prenuptial Pacts
Forum Column - By Fred Silberberg - Last year, the California Supreme Court decided that consenting adults could expect to have their prenuptial agreement upheld. The court also decided, in companion decisions, that spousal support waivers were permissible and that a party need not be represented by counsel in the negotiation and execution of a prenuptial agreement.
Forum Column
By Fred Silberberg
Last year, the California Supreme Court decided that consenting adults could expect to have their prenuptial agreement upheld. The court also decided, in companion decisions, that spousal support waivers were permissible and that a party need not be represented by counsel in the negotiation and execution of a prenuptial agreement. The court correctly believed that consenting adults should be held accountable for these decisions, and these cases sent a message that parties would be held to their bargains.
Unfortunately, however, the era of personal responsibility in domestic matters was short-lived. Thanks to our Legislature, prenuptial agreements no longer provide parties with assurance that financial matters will be handled in the manner in which they agreed.
Newly enacted Family Code Section 1615, one of the sloppiest pieces of family law legislation to hit the books in years, has made a mess of the law regarding premarital agreements and essentially has abrogated the right to contract before marriage.
This new law, introduced by state Sen. Sheila James Kuehl, will turn our court system into a casino, where the parties to prenuptial agreements are the players and our judges are the dealers. It appears that gambling is now legal in California and not just on Native American reservations.
This most inelegantly drafted statute makes a mockery of the concept of premarital agreements in California. In the old days, the burden of setting aside a premarital agreement fell on the party challenging it. That made logical and legal sense. That party had to establish that he or she signed the document under duress, that there was not adequate disclosure or that there was lack of informed consent.
Under the new law, however, the opposed is presumed. The court is required to make affirmative findings in order to uphold the agreement. Those findings may include the fact that the party challenging the agreement was represented by counsel, signed a document waiving counsel representation, or had at least seven days to review the agreement before signing it.
If the party signed it without benefit of counsel, the party seeking to uphold the agreement must prove that the other party was provided with a written explanation in his or her native language explaining that party's rights and obligations under the agreement and that the party signed a document acknowledging that this written explanation was provided in advance of execution.
The court then must find that there was no duress, fraud, undue influence or lack of capacity in order to uphold the agreement. And, in an ingenious move to provide the court with even more discretion, the statute also provides that the court can consider "any other factors the court deems relevant."
The Legislature thereby gives the message that a reluctant party to a prenuptial agreement negotiation need only neglect to hire a lawyer in order to have the document nullified.
Not only does the burden of proof shift in favor of the party suffering from buyer's remorse, but the court also can set aside an agreement on finding that the agreement was unconscionable at the time of execution. The determination of unconscionability is not made until the agreement is challenged, which could be many years after the agreement is executed.
Moreover, there is nothing in the statute that defines "unconscionability" in this context or what the standard of proof will be on this issue. It is a roll of the dice for both parties, and the only party who suffers is the one who was trying to protect his or her assets by requesting the agreement.
Prenuptial agreements have been around for years. This statute, however, does not specify whether the law may be applied retroactively or prospectively. Undoubtedly, some creative litigant who signed a prenuptial agreement 20 years ago will attempt to use this piece of legislation to have it thrown out.
This piece of legislation is an insult to the intelligence of Californians considering executing such a document. We do not need the Legislature to interfere in the private financial affairs of a couple contemplating marriage. Nor should the Legislature create a road map on how to get out of an agreement to which the parties committed. We also don't need a legislative declaration that the state disfavors such documents.
It appears that Kuehl, reputed to be a champion of the rights of women and children, has gone too far. People contemplating signing these agreements are not the downtrodden, disenfranchised and underrepresented citizens who require such drastic protection. For the most part, they are intelligent, capable adults who can make their own decisions.
Until such time as the Legislature reads and corrects the statute, those parties to prenuptial agreements who want the document upheld should consider relocating to another state. Nevada would be such a state. Gambling also is legal there, although it appears to be limited to licensed casinos as opposed to courthouses.
Fred Silberberg is a certified family law specialist with offices in Century City.
By Fred Silberberg
Last year, the California Supreme Court decided that consenting adults could expect to have their prenuptial agreement upheld. The court also decided, in companion decisions, that spousal support waivers were permissible and that a party need not be represented by counsel in the negotiation and execution of a prenuptial agreement. The court correctly believed that consenting adults should be held accountable for these decisions, and these cases sent a message that parties would be held to their bargains.
Unfortunately, however, the era of personal responsibility in domestic matters was short-lived. Thanks to our Legislature, prenuptial agreements no longer provide parties with assurance that financial matters will be handled in the manner in which they agreed.
Newly enacted Family Code Section 1615, one of the sloppiest pieces of family law legislation to hit the books in years, has made a mess of the law regarding premarital agreements and essentially has abrogated the right to contract before marriage.
This new law, introduced by state Sen. Sheila James Kuehl, will turn our court system into a casino, where the parties to prenuptial agreements are the players and our judges are the dealers. It appears that gambling is now legal in California and not just on Native American reservations.
This most inelegantly drafted statute makes a mockery of the concept of premarital agreements in California. In the old days, the burden of setting aside a premarital agreement fell on the party challenging it. That made logical and legal sense. That party had to establish that he or she signed the document under duress, that there was not adequate disclosure or that there was lack of informed consent.
Under the new law, however, the opposed is presumed. The court is required to make affirmative findings in order to uphold the agreement. Those findings may include the fact that the party challenging the agreement was represented by counsel, signed a document waiving counsel representation, or had at least seven days to review the agreement before signing it.
If the party signed it without benefit of counsel, the party seeking to uphold the agreement must prove that the other party was provided with a written explanation in his or her native language explaining that party's rights and obligations under the agreement and that the party signed a document acknowledging that this written explanation was provided in advance of execution.
The court then must find that there was no duress, fraud, undue influence or lack of capacity in order to uphold the agreement. And, in an ingenious move to provide the court with even more discretion, the statute also provides that the court can consider "any other factors the court deems relevant."
The Legislature thereby gives the message that a reluctant party to a prenuptial agreement negotiation need only neglect to hire a lawyer in order to have the document nullified.
Not only does the burden of proof shift in favor of the party suffering from buyer's remorse, but the court also can set aside an agreement on finding that the agreement was unconscionable at the time of execution. The determination of unconscionability is not made until the agreement is challenged, which could be many years after the agreement is executed.
Moreover, there is nothing in the statute that defines "unconscionability" in this context or what the standard of proof will be on this issue. It is a roll of the dice for both parties, and the only party who suffers is the one who was trying to protect his or her assets by requesting the agreement.
Prenuptial agreements have been around for years. This statute, however, does not specify whether the law may be applied retroactively or prospectively. Undoubtedly, some creative litigant who signed a prenuptial agreement 20 years ago will attempt to use this piece of legislation to have it thrown out.
This piece of legislation is an insult to the intelligence of Californians considering executing such a document. We do not need the Legislature to interfere in the private financial affairs of a couple contemplating marriage. Nor should the Legislature create a road map on how to get out of an agreement to which the parties committed. We also don't need a legislative declaration that the state disfavors such documents.
It appears that Kuehl, reputed to be a champion of the rights of women and children, has gone too far. People contemplating signing these agreements are not the downtrodden, disenfranchised and underrepresented citizens who require such drastic protection. For the most part, they are intelligent, capable adults who can make their own decisions.
Until such time as the Legislature reads and corrects the statute, those parties to prenuptial agreements who want the document upheld should consider relocating to another state. Nevada would be such a state. Gambling also is legal there, although it appears to be limited to licensed casinos as opposed to courthouses.
Fred Silberberg is a certified family law specialist with offices in Century City.
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