Before jumping into a discussion of
the new Uniform Law for Premarital and Marital Agreements (ULPMA), I thought it
might be a good idea to provide a short primer on prenuptial agreements in Alaska . As always, keep in mind that this is not
legal advice – it’s a general statement of the history of the law governing
premarital agreements (prenups) in Alaska . If you want legal advice, contact a good
family law attorney – if not me, then someone else. Alaska
has many quality practitioners.
Our common
law (the law set out in our cases) traditionally taught that prenups were “inconsistent
with the sanctity of marriage and the state's interest in preserving marriage
and maintaining the financial security of divorced persons.” Courts
uniformly viewed prenups as inherently conducive to divorce and as allowing a
husband to get around his legal duty to support his wife. Their reasoning was interesting, as seen in
this opinion from a court in Tennessee :
[S]uch [a] contract is promotive of
divorce and void on grounds of public policy. Such contract[s] could induce a
mercenary husband to inflict on his wife any wrong he might desire with the
knowledge that his pecuniary liability would be limited. In other words, a
husband could through abuse and ill treatment of his wife force her to bring an
action for divorce and thereby buy a divorce for a sum far less than he would
otherwise have to pay.
Crouch v. Crouch,
53 Tenn.App. 594, 385 S.W.2d 288, 293 (1964).
So, prior to 1970, prenuptial
agreements made in contemplation of divorce were almost universally viewed as
ineffective by our courts. They
regularly held that prenuptial agreements (1) are incompatible with and
denigrate the marital relation; (2) tend to facilitate and induce divorce; and
(3) burden the state by casting indigent spouses on public charity.
In Brooks v. Brooks, the law of this state
changed when the Alaska Supreme Court announced that prenuptial agreements in
contemplation of divorce would be judicially recognized. The court noted that with the advent of
no-fault divorce laws and the changes in society such laws represent, the
traditional rule has rapidly given way to the more realistic view that
prenuptial agreements are not automatically void but are valid and enforceable
if certain standards of “fairness” are met. Although the standards vary from
state to state, the following three criteria are typically considered and are
recognized in Alaska
as barriers to acceptance:
1. Was
the agreement obtained through fraud, duress or mistake, or misrepresentation
or nondisclosure of a material fact?
2. Was
the agreement unconscionable (unbelievably unfair) when executed?
3. Have
the facts and circumstances changed since the agreement was executed, so as to
make its enforcement unfair and unreasonable?
If none of the above factors are present, prenuptial
agreements have generally been given judicial recognition.
In taking this new position, the
court cited to the old Uniform Premarital Agreement Act, as well as to changing
socio-economic norms:
The idea that prenuptial agreements
induce divorce is anachronistic. Today, divorce is a “common-place fact of
life.” As a result there is a concurrent increase in second and third
marriages—often of mature people with substantial means and separate families
from earlier marriages. The conflicts that naturally inhere in such
relationships make the litigation that follows even more uncertain, unpleasant
and costly. Consequently, people with previous “bad luck” with domestic life
may not be willing to risk marriage again without the ability to safeguard
their financial interests. In other words, without the ability to order their
own affairs as they wish, many people may simply forgo marriage for more “informal”
relationships.
. . . .
Prenuptial agreements, on the other
hand, provide such people with the opportunity to ensure predictability, plan
their future with more security, and, most importantly, decide their own
destiny. Moreover, allowing couples to think through the financial aspects of
their marriage beforehand can only foster strength and permanency in that
relationship. In this day and age, judicial recognition of prenuptial
agreements most likely “encourages rather than discourages marriage.”
. . . .
In sum, both the realities of our
society and policy reasons favor judicial recognition of prenuptial agreements.
Rather than inducing divorce, such agreements simply acknowledge its
ordinariness. With divorce as likely an outcome of marriage as permanence, we
see no logical or compelling reason why public policy should not allow two
mature adults to handle their own financial affairs. Therefore, we join those
courts that have recognized that prenuptial agreements legally procured and
ostensibly fair in result are valid and can be enforced. “The reasoning that
once found them contrary to public policy has no place in today's matrimonial
law.”
So, for the
past twenty-five years or so, Alaska
has recognized prenuptial agreements as a reasonable way to predetermine how
economic circumstances will be treated in the event of divorce – spousal
support, property division, and more.
Unfortunately,
not all states apply the same standards to prenups, which can create quite a
bit of consternation in our mobile society.
I’ll discuss this in some detail in my next piece on the new Uniform Law
for Premarital and Marital Agreements, passed last summer.
