Determining The Validity of a Prenup

EXAMINING ANTENUPTIAL AGREEMENTS

by Ravelle Smith, JD of Cordell & Cordell, PC

In the past, agreements that contemplated for the dissolution of the marriage prior to the actual nuptials have been held to be invalid.  The legislature decided that such a practice was against public policy in that it promoted divorce.  This absolute barring of antenuptial agreements has such been repealed, and there is now a test in order to see if a prenuptial agreement passes muster in the State of Georgia.

 

The High Court of Georgia has done away with the fine line test between antenuptial agreements, which were previously unenforceable, per the public policy standard, and postnuptial agreements incident to a divorce , which facilitate the termination of a marriage, which had been upheld by the Georgia Courts.  Agreements incident to a divorce where the issues of property division, child custody and support, visitation, and alimony have traditionally been held to be valid. 

The Court now implies a litmus test to help it in determining whether it should enforce agreements that were entered into prior to the marriage.  This litmus test gives the trial court a great deal of discretion, but requires that it employs a three prong criteria in determining whether to enforce an antenuptial agreement.  This litmus test is referred to as the Scherer Test, and the courts are using this criteria to determine the validity of prenuptial agreement.

In Scherer, the Supreme Court held that prenuptial agreements in contemplation of divorce are not absolutely void as against public policy.  The court then set forth factors for the evaluation of prenuptial agreements made in contemplation of divorce.  The Scherer factors are:

(1) Was the agreement obtained through fraud, duress or mistake, or through misrepresentation or nondisclosure of material facts?  For example, duress which will avoid a contract must consist of threats of bodily or other harm, or other means amounting to coercion, or tending to coerce the will of another, and actually inducing that person to do an act contrary to their free will.  The threats must be sufficient to overcome the mind and will of a person of ordinary firmness.   

(2) Is the agreement unconscionable? An unconscionable contract is one abhorrent to good morals and conscience where one of the parties takes a fraudulent advantage of another.  It is an agreement that no sane person not acting under a delusion would make and that no honest person would take advantage of.  Obviously this may be the most difficult factors of the Scherer test to overcome should you be looking to invalidate an agreement.  

(3) Have the facts and circumstances changed since the agreement was executed, so as to make its enforcement unfair and unreasonable? If the circumstances have changed beyond the parties’ contemplation at the time they entered into the agreement, it may not be enforceable.

Whether an agreement is enforceable in light of these criteria is a decision made in the trial court’s discretion.  The agreement must meet the usual requirements of offer, acceptance, and consideration.  These agreements are a factor which should be considered in determining an equitable division of property, and in determining whether alimony should be provided. 

It is important to evaluate how much is at dispute between the parties when an individual is deciding whether to challenge an agreement because nullifying a contractual agreement by overcoming a factor of the Scherer Test can be an onerous undertaking.  If there is not a significant amount at stake, you could see easily see the efforts and costs of attempting to overturn an agreement surpass the amount at dispute.  Therefore, take heed not only when drafting an antenuptial agreement, but use prudence when deciding when to fight one.

 

Ravelle Smith is an Associate Attorney and Litigation Manager in the Atlanta, Georgia office of Cordell & Cordell, P.C. 

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