In this blog post, Komal Rastogi, Student, Nirma University, Ahmedabad, writes about prenuptial agreements, the importance of prenuptial agreements, provisions and conditions of the prenuptial agreements and also about the benefits from the prenuptial agreements.
Marriages are considered to be a sacred relation between man and woman. It is a journey of joy, bliss, and love until it’s brutally destroyed due to halts like breakdown or divorce. To avoid issues related to divorce, it is advised to have a prenuptial agreement. A prenuptial agreement is a type of contract entered by couples who are about to get married wherein they decide the liabilities and finalize the distribution of their assets upon failure of their marriage. It is also known as premarital agreements and commonly known as pre-nup or prenupt agreements. The content of the contract varies widely. It includes the distribution of property or any spousal support in the event of a break of marriage or divorce. Many countries like Canada, France, Italy, etc. are indulging in a prenuptial agreement.
In European countries, it is very common to have a prenuptial agreement between couples. This made husband bankrupt and wife a millionaire. For example, the vocalist of Band Beatles Paul Mac Cartney divorced his wife under the prenuptial agreement; he is still reeling under debt because of the break in marriage and his wife Heather Mills is one of the richest women in Britain. Another example of pop diva Britney Spears who was under a prenuptial agreement with her husband where she had to pay a huge chunk of money to her husband after divorce.
Importance of Prenuptial Agreements:
- “Prenuptial agreements ensures speedy maintenance, and expensive advocate fee can be avoided.
- Provision for maintenance after the death of a spouse can be ensured.
- Prenuptial agreements can help couples, especially women, in the case of illness if either of the parties wants to divorce.
- Wives, generally give up their career to raise children, can feel financially more secure.
- A prenuptial agreement can help in avoiding embarrassing situations such as sharing intimate details of marriage and photographs during the court proceedings.”[1]
Although prenuptial agreements are not popular in India but is used to avoid financial disputes at the time of separation. In India, prenuptial agreements are not legal as well as not valid under marriage laws because Hindu marriages are not considered as a contract. Any agreement which is opposite or contrary to the public policy is not an acceptable agreement. Even if prenuptial agreements came into force in India, it would not be socially accepted as marriages are believed to be a religious bond between husband and wife.
In India, prenuptial agreements are valid under Indian Contract Act. The wave of prenuptial agreements is growing in India also. Mumbai people are now becoming money minded, and there is an increasing number of a prenuptial agreement between couples. Through a survey, a lawyer said that only 10% of the married couples make a prenuptial agreement between them. The Indian court takes cognizance of the prenuptial agreement if both the parties are agreed to it and voluntarily sign the document without any fear, force or undue influence. The agreement should be clear and fair stating the basic consented topics decided by the couple.
The agreement has certain major provisions that are:
- Separate property: the couple agreed upon dividing the property so that even after divorce they get their property without any delay or without any court matters.
- Alimony or maintenance: the amount to be paid if there is any break of marriage.
- Estate planning: every individual has reference to the estate or will plan if there is divorce.
- Disclosure of assets and liability: ask the couple to define their debts and assets. This provision is important as it can invalidate all the clauses in the agreement.
Prenuptial agreements are enforceable if certain conditions are fulfilled. It is much more than a financial agreement. The conditions:
- The agreement must be fair, and it should be voluntary.
- The agreement must have attorney certification from both the parties who signed it.
- The agreement should have a particular clause which clearly states that if any provision gets invalidated, the rest of the agreement would still be in force.
- The agreement should have a list of all the assets owned by both the parties and also the liabilities.
- The agreement should be reviewed by two different lawyers and must be certified by them.
- The agreement must have all the clauses of agreements arrived at between the
Prospective[2] - The agreement should also mention the necessary history of the proposed alliance.
- The Agreement must be setting out each party’s assets, debts, and property rights before the marriage, settling issues of division of property and spousal support in the event of marriage breakdown.[3]
Prenuptial agreements are beneficial to men as it reduces misuse of section 498A of IPC and also Domestic Violence Act for blackmail by women. This agreement shows that there are transparency and no ill mind at the time of binding for marriage. It will be very useful in India if it is enforced as it will reduce the burden of the court in the matter of divorce.
Other benefits of the prenuptial agreements are:
Firstly, this agreement can prevent them from each other’s debt.
Secondly, it ensures support from the spouse regarding monthly maintenance or alimony if any.
Thirdly, it also guarantees remarriage rights and custodial issues.
Fourthly, it also protects one’s business from getting divided.
Fifthly, it protects the child’s future in case of separation.
All this agreement requires voluntary consent and honest declaration of the property assets.
All matrimonial laws depend on the Hindu marriage act which has a particular provision of maintenance and alimony if either of the parties claim it after divorce. The amount which is payable depends on the income and property of partner. In a prenuptial agreement, the shares and assets are already declared hence it is easier for couples who are fighting a legal battle. This is one of the important reason behind drawing up a prenuptial agreement so that a person may have a fair idea about what to give and what to receive if marriage is ruined. Prenuptial agreements can be valid if the couple wants to go according to the terms and conditions. This will be helpful because it will reduce the time and workload of the judge and even of the couple.
Other than its benefits, the agreement is a sign of mistrust or lack of commitment among couples even before the marriage. In metropolitan cities of India, more than twenty percent people make agreements for their peace of mind and personal satisfaction and make them strong to undergo any circumstances.
Though, a prenuptial agreement is not so common in society but is known by some. It is important because people can know how much property will remain with them if they applied for prenuptial agreements. It helps to resolve and simplify a lot of financial issues. This agreement will save a lot of nasty arguments between the couples as it solves the issues of distribution of assets and property by mutual consent.
As every concept have pros and cons, the concept of the prenuptial agreement also have some pros. Many of the people do not see the need of this kind of agreements. It is a fact that marriages do not work for all. Hence, it is advised to have a prenuptial agreement for future convenience. It can only be successful if both the partners consented to the agreement. It is wiser to go in for a prenuptial agreement that clearly states fair division of property, personal possessions and financial assets than to fight over one’s favourite piece of furniture and crystal ware, later in the marriage.[4]
[1] http://www.thequint.com/india/2016/04/12/exclusive-or-prenup-vital-to-safeguard-womens-interests-mwcd
[2] Retrieved on http://www.legalserviceindia.com/article/l284-Pre-nuptial-agreements.html
[3] Ibid
[4] Ibid
