An Introduction to Illinois Premarital Agreements
Premarital marriage agreements are contracts between individuals that intend to marry. Like other contracts, the terms are generally determined through mutual negotiation. When both parties agree to the terms, the agreement is then signed. Premarital agreements may contain a wide variety of provisions, including those pertaining to the division of property, estate rights, spousal support, and even parenting responsibilities. Since the parties have relatively equal bargaining power at the time of negotiation, premarital agreements often result in greater certainty and cost savings should an eventual divorce occur. A premarital agreement need not be a lengthy contract of hundreds of pages. Instead , the parties can use a one- or two-page premarital agreement to address key issues that are most important to them.
The Uniform Premarital Agreement Act was adopted by several states in the early 1990s, including Illinois. The statutory section addressing premarital agreements is located at 750 ILCS 10/1, et seq. While there is no requirement that a premarital agreement be in writing or notarized, it is strongly recommended that premarital agreements be in writing and notarized. Parties should remember that premarital agreements may only affect property rights and obligations during marriage and may not include any provisions that deal with the dissolution of the marriage or support rights under the Illinois Marriage and Dissolution of Marriage Act.
Legal Criteria for a Valid Premarital Agreement in Illinois
According to the Illinois Uniform Premarital Agreement Act ("UPAA"), your premarital agreement must meet several requirements to be deemed a valid contract. The formalities imposed by the Act are likely to come as no surprise – a valid premarital agreement between parties requires following of certain steps before the marriage.
Certain formalities apply when creating a valid premarital agreement between the parties. Illinois law requires that such premarital agreements must be in writing and signed by both parties. In other words, oral premarital agreements are not valid under Illinois law. Furthermore, a premarital agreement is not enforceable if the party against whom enforcement is sought proves that:
Because a premarital agreement is a valid contract, it must also meet the same standards for contract formation as any other contract – the parties must have freely entered into the agreement. Thus, both parties must have acted knowingly and voluntarily to enter the agreement.
Additionally, a valid premarital agreement should be signed well before the actual marriage. Illinois courts have held that an agreement signed one day before the marriage was not valid because the party did not have sufficient time to fully consider its effect.
While premarital agreements may cover many issues regarding the property rights of the parties, they cannot be used to affect right’s regarding children. For example, a premarital agreement may not be used to restrict the right of a child to support or in determining custody. Thus, although spousal support may be waived by the parties pursuant to a premarital agreement, the issues regarding support payments for a child can never be waived.
Illinois law clearly provides that the provisions of the agreement that are permitted by the UPAA will be enforceable. However, in the event that a particular provision of the agreement violates public policy in the State of Illinois, the provision will be enforceable, but to the extent that it does not violate public policy.
Further, Illinois law provides that the provisions that are deemed severable will be enforced to the extent that they may do not violate public policy or that they are not unconscionable when handled alternatively. However, unenforceable provisions will be treated as if they were not contained in the agreement.
Typical Provisions in Illinois Premarital Agreements
Section 504 of the Illinois Marriage and Dissolution of Marriage Act (750 ILCS 10) lays out the various topics that may be addressed in a premarital agreement. Aside from deciding how assets will be divided if the parties divorce, there are other topics that may be addressed in a premarital agreement: Parties may also agree to the waiver of statutory provisions. For example, a party may waive the right to an award of fees and costs payable by the other spouse as well as spousal support or maintenance under the Illinois Marriage and Dissolution of Marriage Act. The division of property is one of the most common issues addressed in the typical Illinois marital agreement. Generally speaking, the division of property is a factual matter that is determined at the time of trial. Available assets, the length of the marriage, the parties’ respective incomes, and other factors all play a role in the division of property at the time of trial. Under Section 504 of the Illinois Marriage and Dissolution of Marriage Act, however, a premarital agreement offers an alternative considering that the agreement may provide that each party will retain his or her separate property, just like that about which the parties could privately agree after they are married. For example, the parties may agree to certain property remaining the separate property of either or both parties, and they may agree on the equal division of jointly held property. If either of them should later petition for divorce, the court will generally be bound by the couple’s agreement. A premarital agreement may also limit or eliminate spousal maintenance. A party’s obligation to pay spousal maintenance is a complex issue. The amount of maintenance that a party may be required to pay is often determined by the length of the marriage and the income of the parties. Illinois law spells out the manner in which courts are to determine the amount of maintenance that a party may be required to pay (see 750 ILCS 315/750) and the manner in which maintenance is to be paid. The parties can agree, however, to a different result. They may agree even in advance of marriage to modify or eliminate the application of that statute in its entirety. While the court may set aside or refuse to enforce a provision that, in the court’s opinion, is unfair or inequitable, the court will not interfere with the binding effect of other provisions (750 ILCS 315/505). In fact, the parties may mutually agree to a greater amount of maintenance or a longer duration. Parties may even agree that a certain amount of time will pass before either party may file for divorce, or that a divorce will not be filed within the first year of the marriage. Under the Illinois Marriage and Dissolution of Marriage Act, agreements in premarital agreements cannot affect the rights of a spouse or children with respect to child custody and visitation or child support. A premarital agreement that contains provisions that are unconscionable at the time of enforcement may, within the court’s discretion, be rendered unenforceable. Although premarital agreements are not alone sufficient to confer jurisdiction on any specific Illinois court in a subsequent action by either party, other law in effect, by virtue of Illinois’ status as a Uniform Premarital Agreement Act jurisdiction, may have that effect. The parties must comply with the procedural requirements of the Illinois Act if they want their agreement to be enforceable.
The Importance of Legal Counsel
The appointment of legal counsel during the drafting process of a premarital agreement is mandated by law. Each party must have had the opportunity to be separately represented by legal counsel, unless they individually and voluntarily waived such representation in writing. If the opportunity to be represented by legal counsel is waived, a waiver does not constitute grounds to challenge the validity of the premarital agreement as long as each party received the following information:
- (1) The type of spousal rights and obligations that will be affected by the agreement;
- (2) The type of spousal rights and obligations that would otherwise arise from the State of Illinois or any other jurisdiction’s law; and
- (3) A fair and reasonable disclosure of that factual information that would materially affect either party’s rights under the agreement that is above and beyond the disclosure that has been provided between the parties.
Premarital agreements are generally enforced against a premarital spouse. However, if a spouse was not represented by counsel at the time the agreement was executed, a court may set it aside if:
- (1) That spouse was not provided with a fair disclosure of the property or financial obligations of the other spouse;
- (2) That spouse did not voluntarily waive the disclosure of property or financial obligations;
- (3) That spouse was not provided with this opportunity to have independent legal counsel; or
- (4) The agreement was unconscionable at the time the agreement was executed, taking into consideration the financial circumstances of each party.
Challenges to the Enforceability of Premarital Agreements
While the law generally supports the validity of premarital agreements between spouses-to-be, there are circumstances that can result in their unenforceability. For example, if the agreement is found to be in violation of public policy or unconscionable at the time of enforcement, then the court must invalidate it, because premarital agreements are not legally binding if they include terms that are morally or ethically unacceptable.
Premarital agreements that are formed as the result of fraud, coercion, or misrepresentation, or that were entered into without the proper financial disclosures by one spouse, can also be challenged. If neither spouse has turned over information about their current debt obligations or financial circumstances, then a court may find any pre-nuptial agreement to also be unenforceable .
The most common reasons why a court will find a premarital agreement to be unconscionable are: Unless both spouses have had independent attorneys review and properly explain the terms of the agreement to each, then the agreement may be voided for a lack of independent counsel.
Irrevocable waiver of child support is an extremely uncommon provision in a premarital agreement and a court will likely find it to be unconscionable, making it more likely to be contested. For instance, while child support cannot be waived expressly, the court can determine that one or both parties have voluntarily relinquished their right to request child support at a later date.
Unconscionability of a premarital agreement refers back to the key factor requiring full and fair time for each party to consult with legal counsel. Therefore, if a spouse does not believe they had the chance to fully negotiate the terms of the contract fairly, they could successfully argue that it is unconscionable if they demonstrate that they did not have adequate time to consider the matter.
Recent Case Law and Legal Precedents
An important recent case to illustrate the analysis courts will undertake before deciding the enforceability of a premarital agreement is that of In Re Marriage of Favelas, 2013 IL App. (2nd Dist.) 130562. In this case the appellate court reversed the trial judge’s decision not to enforce a premarital agreement despite the husband’s claim it was unconscionable-the husband claimed that he had no access to legal advice prior to signing the agreement. The Court held however that the agreement was enforceable nevertheless.
The Court cited favorably to In Re Marriage of Kessler, 2013 IL App (2nd Dist.) 120607, which upheld a premarital agreement in which the wife waived maintenance and other rights. This case is another positive step showing that courts are going to enforce premarital agreements as long as there is no overriding finding of fraud, mistake or unconscionability. In fact, the Kessler court pointed to testimony by the husband that the wife was offered the opportunity to have counsel, that she chose not to consult with anyone regarding the agreement, and specifically held that the wife was not misled into signing the document. Ultimately, the Court noted that the husband sat in the room with the wife when the agreement was prepared, and that it was his burden to show unconscionability, which he failed to do.
In summation, the Kessler and Favelas lines of cases are supportive of premarital agreements, and indicate that courts will not strike down these contracts whenever they are able to find a basis (no matter how thin) for enforcing them. While your author cannot condone deceptive or manipulative actions to get someone to sign an agreement, if Illinois courts can find a basis for enforcement, that will be the result.
FAQs About Premarital Agreements
While many people still find premarital agreements confusing, the truth is that once you start to peel back the underlying layers, they are not that complicated. In fact, premarital agreements are reams of ink (or bytes) attempting to put the inevitable legal changes that come with marriage into the right perspective for the people involved.
Q: What are some things that a premarital agreement can accomplish?
A premarital agreement can do a variety of things. It can:
Q: Are premarital agreements enforceable in Illinois?
Yes, but as with most things in law, there are some ground rules. According to the Illinois Premarital Agreement Act, 750 ILCS 10/1 et seq., premarital agreements are enforceable if they are (1) entered into voluntarily, (2) full disclosure was provided along with independent legal counsel for each party, and (3) the terms of the agreement were not unconscionable when the agreement was made.
Q: How does full financial disclosure work when it comes to premarital agreements?
If either party is concealing assets or income, the court can declare the premarital agreement voidable. A court will only look at whether the other party was "lied to." The person who is attempting to use the agreement to their benefit has the burden to prove that no one was "lied to."
Q: Are premarital agreements binding for the life of the marriage?
Not necessarily. Agreements that are unconscionable when made are not enforceable, and courts can base this determination on the terms of the agreement, the fact that one party was not represented by legal counsel, or it could be based on the life circumstances of the parties upon divorce.
Conclusion: Striking a Balance between Love and Legal Protections
In conclusion, premarital agreements are an essential tool in the modern world, helping couples navigate the complexities of financial planning and potential future disputes. They provide clarity, promote open communication, and establish a foundation of mutual understanding and respect. However, entering into such an agreement requires thorough consideration of the specific needs of each party and should not be undertaken lightly .
This post has provided an overview of the key considerations and factors related to premarital agreements, including common provisions, legal requirements, and potential limitations. Overall, premarital agreements can help establish a clear framework for a relationship, potentially preventing future disputes and minimizing conflict.