Prenups on rise, but may not hold

When social historians seek a label for American-style marriage of the past 30 years, the "age of romanticism" probably won't come to mind.

Just as the divorce rate of modern marriages has risen to nearly 50 percent, the "just in case" practice of signing prenuptial contracts has also grown.

"We live in an age of realism. We live in an age of contracts," says Linda Elrod, a law professor at Washburn University in Kansas.

Indeed, while there are no statistics, legal experts say the frequency and content of prenuptial agreements are expanding. Many now include everything from where the newlyweds will live to the designated religion of the couple's first child.

But as the practice increases, so do the questions about whether state laws are effectively governing these premarital contracts, which generally set out who gets what in the event of divorce.

A case before the California Supreme Court involving baseball superstar Barry Bonds is throwing a spotlight on some of the central issues swirling around prenuptial contracts in this state and others.

In this case, Bonds presented his fiance, Susann, with a prenuptial contract the day before their wedding in 1988, which she signed without legal counsel. While at the time Bonds was a young ballplayer making only $106,000, his bank account skyrocketed during the course of their seven-year marriage.

By the time the "prenup" came into force, he was making $7 million per year and had accumulated property and assets of which his former wife now wants a share. The case is before this state's top court because an appeals court earlier ruled the agreement invalid based on his wife's lack of counsel.

Besides the issue of counsel, law professor Carol Bruch of the University of California at Davis says the case "exemplifies the weakness of the law" because it doesn't weigh the fairness of a prenup at the time it is enforced.

In other words, given Bonds's spectacular growth in wealth during his marriage, should an agreement that precluded a division of community property still be valid after one party enjoys such sudden riches?

Whether or not Bonds's prenup survives, he's typical of the growing number of entertainment stars, sports figures, and wealthy technology entrepreneurs who are finding prenups alluring.

Of course, prenuptial agreements have been around for ages. They were used traditionally by parties remarrying for a second time and wanting to protect the property rights of children from an earlier marriage. They have also long been used when one party comes into the marriage with a business or significant inheritance.

But as the rate of divorce has risen and many people are getting married later and with more assets, the practice has spread.

Lynn Gold-Bikin, a partner in a Philadelphia law firm, says the use of prenuptial contracts has risen in the past five years, though she estimates they are still used in less than 10 percent of new marriages.

It is not uncommon today for parties to include in a prenup an agreement that one party compensate the other if the marriage results in a career sacrifice.

For instance, Ms. Gold-Bikin recalls writing a prenup requiring compensation in the event of a divorce for a woman who gave up a six-figure salary in Florida to live with her husband in Philadelphia. The provision was ultimately tested and upheld in court after the marriage ended.

For most of the past century, premarital contracts were simply guided by laws governing all types of commercial contracts. But as discrepancies and inconsistencies mounted, there was a move in the 1980s to draw up a uniform statute for states to adopt.

The so-called Uniform Premarital Agreement Act (UPAA) has now been adopted by 26 states, including California, though state legislatures often amend it to their own liking. Other states have gone their own way, guided by contract law and rulings from state courts. Because requirements for marriage are left to the states, the US Supreme Court has not been directly involved in the issue.

Ms. Bruch says the UPAA was an advance in that it broadened the range of agreements that could be included in a prenup. For instance, under the UPAA, a prenup can settle virtually everything except child support and custody matters.

But she says the act actually lowered the bar in terms of fairness, setting out conditions for a prenuptial contract that are easier to meet, for instance, than for probate contracts in some states.

The American Law Institute has just completed a decade-long evaluation of family-dissolution law, which recommends setting a higher standard for demonstrating that the prenuptial was not signed under duress and that both parties were fully informed of its content and advised about seeking legal counsel.

The report also recommends that when a prenup is contested, the courts should ask whether enforcement "works a substantial injustice," if the parties have children or if they signed the agreement more than 10 years earlier.

While there was a movement in the 1970s to popularize prenuptials as a means of making marriage a more equitable, negotiated arrangement, experts say in practice, prenups most often codify unequal situations.

"In a perfect world," says Grace Ganz Blumberg, a law professor at the University of California at Los Angeles, a prenuptial agreement simply means "the parties really care about each other and are trying to do the right thing."

But in practice, she says, they amount to "unequal partners making sure they don't share the wealth."

Experts debate whether prenups promote or discourage marriage in the first place. For the stronger, more affluent partner, an agreement may be the first step to walking down the aisle. Such was the case with Bonds, whose wife was told by his lawyers that without a contract, the wedding wouldn't happen.

Yet there are also prenups with "sunset clauses" that disappear after a certain number of years, a built-in incentive to end the marriage, say some.

(c) Copyright 2000. The Christian Science Publishing Society

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