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Posted 09/27/2022 in Family Law by Robert Howard

Prenuptial Agreements in Arizona - What You Need to Know

Both couples and legislatures alike are often anguished about prenuptial agreements. They are both concerned if having a prenuptial agreement (frequently referred to as a “prenup”) can make divorce more likely because the couple is talking about how their marriage ends before it even begins.

However, there is an argument to be made that a prenup may help strengthen a marriage. Disputes over money are already one of the most common reasons for divorce. Therefore, discussing finances might help a couple resolve these issues before they become a source of turmoil. 

So let’s discuss some basics of a prenup—why you might (or might not) want to enter into one. 

What Are Prenuptial Agreements?

Simply put, a prenuptial agreement is a contract between two people who are about to get married—principally to determine who owns what property (assets and liabilities). 

Prenups are typically used to determine how a couple would divide their property if they were to divorce. This is significant in Arizona because Arizona is what’s known as a “community property” state. Unless there is evidence to the contrary, the presumption is that a couple shares joint ownership of property acquired during the marriage. In a prenup, the couple can specify what is “separate property,” i.e., property that one spouse owned before the marriage—and intends to keep as theirs alone.   

Prenups are valid under the Arizona Uniform Premarital Agreement Act. To be enforceable, an Arizona prenup must be:

  • A formal written agreement 
  • Fair to both parties
  • Be signed after each party has made a fair and reasonable disclosure of their finances
  • Signed voluntarily

While those are the formal requirements, there are informal standards that should be addressed. For example, most experts agree that both parties should be represented by an attorney of their choosing. If only one party has an attorney, this may raise concerns that the unrepresented party is being taken advantage of. 

What Can a Prenup Include? 

As explained above, a prenup can include terms relating to how property would be divided if the couple divorces. The prenup can also include agreements for post-divorce spousal support (alimony).

Additionally, a prenup can include terms that relate to how they control property during the marriage. A prenup can include requirements that the spouses will change their wills or the beneficiaries of their life insurance policies. It can provide that one spouse will give the other a stipend during their marriage. It can also specify who is responsible for the tax liabilities relating to their assets. 

On the other hand, there are things that a prenup cannot include. 

A prenup cannot include terms relating to child support or child custody. It cannot include financial support for other family members. 

And it cannot include conditions relating to infidelity. (In other states, those infidelity terms are allowed, but they’re not permissible in Arizona.)

If You Have a Prenup and Want a Divorce, Can You Cancel or Change It Somehow? 

There are indeed conditions that can invalidate a prenup. A prenup may not be enforced if

  • either spouse did not voluntarily enter into the agreement 
  • either spouse was not provided with a fair and reasonable disclosure of the other’s finances (or they didn’t waive the right to that disclosure)
  • if enforcing the prenup would result in a spouse requiring public assistance that they otherwise would not need
  • the contract is otherwise unconscionable (e.g., it’s grossly unfair)

If the prenup is determined to be unenforceable, the agreement should be interpreted in a way that is fair. So, for example, if one provision is a problem, only that provision might be canceled, and the remainder could still be enforced.

It’s important to keep in mind that you can renegotiate a prenup after you’ve been married. A “postnuptial agreement” is also enforceable (presuming it meets the required standards) and can be used to amend a prenup. In fact, “postnups” are a tool for couples to settle divorce terms before any divorce litigation begins. 

What Should You Consider Before a Prenup or Challenging an Existing One?

If you’re considering a prenup (or evaluating an existing one), the best way to start is to hire an attorney. A lawyer will examine the agreement to ensure it meets all the necessary legal requirements. 

A prenup should address both parties’ interests: It shouldn’t be one-sided.

Ensure that the property list is a reasonably complete inventory of both parties’ assets and liabilities. For larger estates, the agreement should include any out-of-state or international properties—especially if they are located in places with different legal standards for either property division or prenup enforceability. 

Discuss if you want it to include any requirements for changing ownership of assets or other financial arrangements to take place during the marriage. 

Also, reflect on how the prenup does or does not handle property you acquire during a marriage, especially if it relates to separate property. Say, for instance, that Spouse A owns a business identified in the prenup as Spouse A’s separate property. But during the marriage, Spouse B ends up working full-time at the business. Depending on the prenup’s language, Spouse B could walk away with no more compensation than any other salaried employee, or they could share ownership in the company’s growth.  

Drafting a prenup can be fraught with emotions. But a good prenup may help you enter into a marriage on a stronger basis—preventing disputes over finances before they begin.

On the other hand, if you already have a prenup in place and are thinking about divorce, you may wonder what that long-ago signed contract will really mean when it comes to your separation. 

In either case, send a message to the Stewart Law Group (or call us at 602-548-3400). We can answer your questions about prenups, and we will be happy to schedule an initial confidential consultation with one of our family law attorneys. Don’t wait. Call today.

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Robert Howard

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