May

2

New Jersey Premarital Agreements

Filed Under Attorney-Client Relationship, Family Law Basics, Marriage & Family, Property & Asset Distribution | Leave a Comment

Premarital agreements, also referred to as prenuptial or antenuptial agreements, can be a difficult topic of discussion among couples getting married, especially if one party is seeking the agreement. A prospective spouse opposed to the idea will typically view such agreements as an affront to the institution of marriage and the relationship as a whole. However, a properly drafted prenuptial agreement can save spouses a great deal of emotional and financial expense in the event of a divorce.

In New Jersey, prenuptial agreements are governed by the Uniform Premarital Agreement Act, which was enacted in 1988. The Act requires that all prenuptial agreements be in writing, with a statement of assets attached to it. Parties are required to sign the agreement, which becomes effective upon the marriage of the parties. The contents of a prenuptial agreement are limited to certain areas. For instance, parties can negotiate the following:

a. the rights and obligations of each of the parties in any property of either or both of them whenever and wherever acquired or located;

b. the rights to buy, sell, use, transfer, exchange, abandon, lease, consume, expend, assign, create a security interest in, mortgage, encumber, dispose of, or otherwise manage and control property;

c. the disposition of property upon separation, marital dissolution, death, or the occurrence or nonoccurrence of any other event;

d. the modification or elimination of spousal support;

e. the making of a will, trust, or other arrangement to carry out the provisions of the agreement;

f. the ownership rights in and disposition of the death benefit from a life insurance policy; and

g. the choice of law governing the construction of the agreement.

In addition, parties can negotiate any other matter, including their personal rights and obligations, not in violation of public policy. It also cannot adversely affect the right of a child to support or stipulate which party should have custody of any child born of the marriage.

A prenuptial agreement may be amended or revoked after marriage only by a written agreement signed by the parties. The amended agreement or revocation is enforceable without consideration. A party may also seek to set aside a prenuptial agreement as unenforceable. However, the party seeking to set aside an agreement must prove that: (a) the agreement was not entered into voluntarily; (b) the party did not have an opportunity to consult with independent legal counsel; and (c) there was not full disclosure of all assets, liabilities and income. If these three factors can be proven by a party, then the burden to set aside the agreement shifts to the other side and the primary focus will be on whether the agreement was fair and reasonable, which is a determination made by the court.

Posted by Jason Medina,
Medina, Martinez & Castroll, LLC

Jan

13

Post-Nuptial Agreements in New Jersey

Filed Under Attorney-Client Relationship, Marriage & Family, Property & Asset Distribution | 3 Comments

A recent NY Times article discussed the increased use of post-nuptial agreements, as reported by attorneys who are members of the American Academy of Matrimonial Lawyers. According to the article, hedge funds and other high-value equity partnerships are encouraging their newly-minted partners to get post-nupts to guard against giving away part ownership in these lucrative positions.

What are “post-nuptial agreements”? Well, unlike pre-nuptial agreements, which deal with parties interested in getting married before they’re actually married, and unlike property settlement agreements, which deal with parties interested in not being married after they’re actually married…post nuptial agreements are intended for a married couple who did not previously enter into a premarital agreement and, despite wanting to be married, would like to plan for the division of property in case they later get divorced.

With that as a backdrop, the New Jersey Appellate Division set forth some very stringent standards for post-nuptial agreements in 1999. In order for a family law attorney to recommend that a client enter into a post-nuptial agreement, there must be four (4) standards that absolutely must be met.

1) There needs to be full disclosure by the parties.

2) Each party must have independent representation by his/her own lawyer.

3) There needs to exist the absence of coercion or duress.

4) The terms must be fair and equitable.

Let’s take these one at a time.

Full Disclosure by the Parties

At the very least this means that the parties should exchange tax returns, a statement of current net worth (listing assets & liabilities and current value) and any other information about the party (not necessarily financial in nature) that would be pertinent to disclose for this situation.

Independent Representation

As it suggests, each party should involve a separate attorney. While it is theoretically possible that a post-nuptial agreement with one pro se party would be upheld, I would not feel confident going forward. In fact, as a practice habit, our firm insists on separate representation.

Absence of Coercion or Duress

I think this one is self-explanatory.

Fair & Equitable Terms

This is the most difficult one to address. The truth of the matter is that fair and equitable is such a subject standards, it’s nearly impossible to discuss. And to make things even more complex, the post-nuptial agreement needs to be fair and equitable when being enforced, as well as when negotiated and executed, which suggests that changing circumstances could render the initial post-nuptial agreement unconscionable in the future.

Parting Words

In one of the most important cases in matrimonial law, the New Jersey Supreme Court remarked that “contract principals have little place in the law of domestic relations.” With that as a backdrop, it’s difficult to have confidence in any privately negotiated agreement, whether a pre-nuptial agreement, post-nuptial agreement or property settlement agreement. At any time, each of them is vulnerable to attack by creative lawyers arguing difference concepts of unfairness.

Posted by Victor J. Medina -
Medina, Martinez & Castroll, LLC

Oct

7

Prenuptial Agreements - revisited

Filed Under Attorney-Client Relationship, Family Law Basics, Marriage & Family | Leave a Comment

I recently posted on prenuptial agreement. I then came across a great summary of the case that illustrates the need to have competent legal counsel representing you before signing a pre-nup.

The women in the case ended up on the losing end of a challenge to the prenup. The court took into account a number of factors that weren’t relevant to her ability to adequately assess the situation. It shouldn’t have mattered whether she was a real estate agent or a securities lawyer - and it certainly wasn’t relevant that her husband was a millionaire. Either way, by signing a pre-nup the day before the wedding, without a lawyer, she ended in the worst position of all.

Posted by Victor J. Medina,
Medina, Martinez & Castroll, LLC

Oct

4

Suze Orman on Prenuptial Agreements

Filed Under Attorney-Client Relationship, Family Law Basics, Marriage & Family | 2 Comments

A local New Jersey newspaper recently published a great article from Suze Orman on the advisability of pre-nuptial agreement.

Here’s the article:

Should marrying types have prenup? Yup

I know what you’re thinking: Prenups are so unromantic — a sign of distrust, not love. Time for a reality check, my friends. First, drawing up a prenuptial agreement together is a sign of incredible trust and financial openness — you’re fooling yourself if you think you can achieve complete in timacy without it. And at the risk of being a complete wet blanket, I just want to mention that north of 40 percent of marriages end up in divorce.

A prenup is doubly important for anyone entering a second marriage, as there may be sizable as sets from the previous marriage that you want to retain sole owner ship of (you can pass them along to any children from that first marriage). And those of you who are living with a partner should get a cohabitation agreement; it’s the prenup for couples who aren’t officially married.

Some prenup basics:

  • Before you sit down with lawyers, talk to your spouse about what you want to include in the prenup. There’s a lot you can talk through when you’re not getting billed by the hour.
  • You both need your own lawyers; you should not be represented by the same attorney. For a straightforward prenup, you might pay $1,500 each.
  • The prenup needs to be drawn up months before the wed ding, not days — it’s not something you slap together and sign in the car on the way to the ceremony. A shotgun prenup might not hold up in court.
  • Be honest. Concealment of any asset or debt can invalidate your prenup.
  • Everyone involved — including the lawyers — should sign the documents.
  • If you move to another state, have a local attorney review the agreement in order to see whether you need to make changes.

    • Why do couples need to address money issues early on? If you aren’t in sync financially, there’s little hope of sustaining a happy relationship. Here’s what I suggest — whether you’re dating, married or remarried:

  • Hold on to your independence. No matter how long you’ve been together, keep at least one credit card in your name only. This enables you to maintain your own credit report and score; if you break up or are widowed, that makes it easier to start over.
  • Watch your property. It’s not uncommon for women to enter a relationship with sizable assets of their own. You have every right to retain 100 percent ownership of anything acquired before your marriage.
  • Consider ‘for richer or poorer.’ Once you wed, you and your spouse are legally responsible for debts accrued during the marriage. Even if your guy seems as if he has his act together, don’t assume. Start by swapping your FICO credit scores (myfico.com). Both of you should have good scores (at least 650), or you could be heading for serious stress.

    • Use your scores to open a broader conversation about money. What are your views on spending and saving? Do you agree paying 15 percent interest or more on credit card debt is stupid? How about bouncing checks or missing bill payments?

    Next, move on to your dreams: If you have kids, are you on the same page about the cost of education? Do you expect to help out your parents after they retire? Ignore these important talks, and you may end up panicked and with a partner who doesn’t respect you. You deserve better.

    Posted by Victor J. Medina
    Medina, Martinez & Castroll, LLC

    Oct

    3

    Electronic Evidence - A Cautionary Tale

    Filed Under Divorce & Separation, Family Law Basics, Marriage & Family | Leave a Comment

    Our firm has long been using electronic evidence as means to get a full financial picture or to help determine the fitness of a parent to retain custody or visitation privileges.

    This article from the New York Times highlights how this electronic evidence is being used by spouses. (Registration required to view the article.)

    Typically, if one spouse is considering gathering electronic evidence against another spouse, things are bad and there is some reason why they think they’ll find something. While we counsel our clients not to get involved in snooping for snooping’s sake, we still believe that there is some value in gathering electronic evidence for the right reasons.

    Posted by Victor J. Medina
    Medina, Martinez & Castroll, LLC

    Sep

    26

    Common Myths of Divorce

    Filed Under Divorce & Separation, Family Law Basics, Marriage & Family | Leave a Comment

    Here is an excellent article discussing the common myths of divorce. Pardon the lazy blog writing, but this is best shared in its entirety:

    Legal Notes: Common myths of divorce

    By Donald L. Pitman III/Legal Notes

    Georgetown -
    The very mention of the word “divorce” fills many with sensations varying from dread to shame. Scenes from movies such as “Kramer vs. Kramer” have reinforced the angst many feel when faced with the option of staying in a bad marriage or getting a divorce. However, much of what people believe to be true regarding divorce has changed since the 1970s, when one person had to be “at fault” in order to file for divorce. Now, “no-fault” divorces allow couples to get a divorce when the marriage has suffered an “irretrievable breakdown.”

    Here are some of the most prevalent “myths” I’ve encountered over the years as a family law attorney. Every divorce, like every family, is different; however, many of these questions and issues are common.

    Myth: If I leave the marital home, I lose all rights to it.
    Fact: There are 18 factors that are considered when dividing property between spouses. Nowhere does it state that a person who leaves the marital home loses any rights to it. In fact, there is a trend to consider the fact that a spouse who leaves the home to keep peace in the family deserves some credit for doing so.

    Myth: The house is in my spouse’s name, therefore he will get the house.
    Fact: The fact that a house is titled in only one spouse’s name does not matter. Generally, any assets that someone has when they get married are considered part of what can be divided for the purposes of divorce, no matter where they came from.

    Myth: Once the divorce is done, it’s done.
    Fact: Not exactly. Some terms of a divorce agreement can be changed on a showing of a “substantial change in circumstances,” such as one party moving far away, spending less time with the children, the loss of a job or a large promotion that results in a significant increase in income, or as children get older, go to college, or move out of the house.

    Myth: My spouse doesn’t need to support me or our children because he’s re-married.
    Fact: Child support is not optional in Massachusetts. While the court does consider the existence of a second family, it will do so only after making sure the first family is taken care of. The Child Support Guidelines are a uniform way to ensure that children are provided with an appropriate amount of financial assistance. They can be found at www.massdor.gov.

    Myth: My spouse had an affair, so he won’t get anything.
    Fact: The fact that one spouse had an affair can be an embarrassment and, sadly, a stumbling block to resolving a case, but it will likely not make a substantial difference in the division of assets. Among the many factors considered in the equitable distribution of property in a marriage is the conduct of the parties (e.g. having an affair). This factor does not determine how assets will be distributed. However, if it can be shown that one spouse spent significant amounts of money on the affair, the other spouse would be credited for what was spent on a dollar for dollar basis.

    Myth: Just like in the movie “War of the Roses,” divorce is inherently a mud-slinging battle.
    Fact: While divorce can become a battle, it doesn’t have to be. There is a growing trend among lawyers to offer mediation as a way to bring people to an agreement by using a third person who helps guide the process. More recently, some lawyers have started to work together with their clients to find a resolution to their divorce through what is known as collaborative law. Collaborative law includes the use of specialists that both parties agree to work with — and pay for together — that help them deal with issues regarding the children, each other and the allocation of their finances. Both mediation and collaborative law allow the parties to help guide the process along, and aims to avoid the damage that can be caused through the litigation process. Finding an attorney who has experience in mediation or collaborative law is the key to making this successful.

    Donald L. Pitman III, a family law attorney at Barron & Stadfeld of Boston, is a resident of Georgetown and lifelong resident of the North Shore. For more than a decade, he has helped clients in both collaborative and litigation-based divorces as well as other family law matters. For information, call 617-531-6597 or e-mail dp@barronstad.com.

    Sep

    18

    First Post

    Filed Under Adoption & Guardianship, Alimony, Alternative Roads in Family Law, Assets & Debts, Attorney-Client Relationship, Child Custody & Visitation, Child Support, Divorce & Separation, Domestic Abuse, Family Law Basics, Father's Rights in Family Law, Impact on Children, Marriage & Family, Mediation & Collaboration in Family Law, Property & Asset Distribution | Leave a Comment

    It seems that every weblog starts with a post called “First Post” and I don’t want to jinx the success of this blog by deviating from the standard. Not to mention, this gives me a chance to test the blog. So, here’s “First Post” - this is going to be a great resource for family law, especially in New Jersey.