California Prenuptial Law
California is a community property state, meaning the default position is a 50-50 split of community (or marital) property between spouses upon divorce. However, California allows spouses to freely vary the community property division by contract. Such contracts are known as premarital or prenuptial agreements. Those considering creating a premarital agreement should seek legal counsel.
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Premarital Agreements
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Premarital agreements are enforceable in California, but the law imposes a set of requirements for valid execution of a premarital agreement. California law will also hold a premarital agreement invalid if that agreement offers active incentive for one spouse to seek divorce.
CPAA
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The California Premarital Agreement Act, which was passed in 1985, established the rights of parties to make a contract disposing of their property upon a potential divorce. The act also created specific guidelines for premarital agreements. According to the CPAA, premarital agreements must be written, and both parties must voluntarily sign the written agreement.
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Definition of Voluntary
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California's legislature has amended the CPAA to elaborate on what makes a party's signature on a premarital agreement "voluntary." Voluntary execution requires that the party who waives rights under the agreement (meaning the party who is theoretically disadvantaged by the agreement) be able to look the agreement over for at least seven days before the signing date. No party to the agreement may subject the other to duress, threats or fraud. Even if all of these requirements are met, a court may still deem a premarital agreement involuntarily executed based on other evidence.
Enforcement
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Upon divorce, one party may seek to claim that the court should not enforce the premarital agreement. Under the CPAA, such a party must prove either involuntary execution of the premarital agreement or that the agreement was unconscionable (an offense to justice). Amendments to the CPAA in 2001 made California into what is known as a "look-back" jurisdiction; when assessing the validity of one party's waiver of the right to spousal support, courts may consider circumstances at both the time of execution of the agreement and the time at which one party seeks enforcement. Therefore, changed circumstances may theoretically render a valid spousal support waiver unenforceable when the time comes for divorce.
Independent Counsel Requirement
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In 2001, the state Legislature amended the CPAA so that voluntary execution of a premarital agreement requires each party have independent counsel during the contract process. If a party waives the right to independent counsel, such a waiver must be made explicitly in a separate document from the contract. Moreover, should any party waive spousal support rights in the premarital agreement, the court will not enforce that waiver unless the party had independent counsel in crafting the agreement.
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References
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- Photo Credit signing a contract image by William Berry from Fotolia.com
