How Does Arizona Law Treat Prenuptial Agreements in Divorce Proceedings?

What Is the Purpose of a Prenuptial Agreement?

Contrary to popular misconceptions, prenuptial agreements are not a sign of distrust or an indication that the marriage will not last. They are designed to outline the rights and responsibilities of each party in the event the marriage should terminate through death or divorce. Couples planning to marry enter into prenuptial agreements to protect existing assets, to shield themselves from each other’s debts, and as a tool for estate planning purposes.

Who May Benefit from Having a Prenup in Place?

Almost any couple could benefit from a prenup. Premarital agreements are common when:

• Either or both parties own a business
• There is a significant disparity in wealth before the marriage
• Significant assets are owned by either or both parties
• One or both parties have children from a previous marriage
• The age gap between the parties is significant
• Either or both parties anticipate a substantial inheritance
• One party is retired
• One spouse will support the other while he or she pursues higher education

What Is Included in an Arizona Prenuptial Agreement?

A prenup is a contract between two individuals entered into before marriage. Most premarital agreements list each party’s assets and debts, and detail how these will be allocated if the couple divorces or if one of the spouses dies. Items listed in prenup may include:

• Bank accounts and cash
• Real estate
• Retirement funds
• Investments, such as stocks and bonds
• Valuable personal property, such as jewelry, art, automobiles, appliances, and furniture
• Business ownership interests
• Debts each spouse brings into the marriage
• Terms, including duration or waiver (but not a specific dollar amount) of spousal maintenance in case of divorce
• Provisions related to children from previous marriages, employer benefits for either spouse, responsibility for attorney fees should a dispute arise under the prenup, etc.

What Is Required for a Prenuptial Agreement to Be Valid in Arizona?

Prenups are governed under the Uniform Premarital Agreement Act, Arizona Revised Statutes, § 25-202. To be valid in Arizona, a prenuptial agreement must be in writing and signed by both parties. The contract goes into effect when the couple marries. A premarital agreement is not valid or enforceable in Arizona under any of the following circumstances:

• The premarital agreement is not legally fair to both parties.
• Full disclosure of the property and/or debts of one party was not provided to the other, and he or she did not expressly waive the right to that disclosure in writing and did not have, or could not reasonably be expected to have, adequate knowledge of the other party’s financial situation.
• Either party did not voluntarily execute the agreement.
• A provision of the prenup that eliminates or modifies spousal support causes one party to become eligible for public assistance after the couple separates or the marriage ends.
• Either party was not competent (of sound mind and body) at the time he or she signed the agreement.
• Both parties did not have independent legal representation when drafting the prenup.
• Terms of the agreement pertain to child custody or child support for a child of both parties.

How Do Prenuptial Agreements Affect Divorce in Arizona?

Arizona is a community property state. Under Arizona Revised Statutes § 25-318, all assets and debts acquired during the marriage by either party are considered marital property and subject to equitable division in a divorce. Without a prenuptial agreement, the law dictates what happens to these assets. Entering into a premarital agreement with your soon-to-be spouse allows you to keep your property and your debts separate, except for joint property and debts created and agreed upon in writing during the marriage by both spouses.

A prenup can also help protect you from court-ordered alimony payments that may otherwise be part of a divorce. Arizona courts recognize that two people getting married have the right to agree that neither will be entitled to spousal maintenance should the marriage terminate in divorce. However, in a contested divorce, if the judge determines that the agreement is unconscionable, one spouse could be ordered to pay alimony to the other. An experienced family law attorney will know how to draft a premarital agreement that will be enforceable in court and ensure that it is appropriately executed according to Arizona law.

Do Prenuptial Agreements Need to Be Recorded?

Although it is not necessary to file your prenuptial agreement anywhere, it is a good idea to record a memorandum of prenuptial agreement with the county recorder’s office. This memorandum is a short document that does not provide any specific information about your prenup but simply states that you and your spouse have entered into a premarital agreement altering state community property law. Once it is recorded with the country you live in, this memorandum provides constructive notice to creditors and others that Arizona community property laws may not apply to your marriage.

How Can a Prenup Serve As an Estate Planning Tool?

If you were to die without an estate plan during your marriage, all your assets would pass to your spouse under Arizona law. This may not have been your intention, particularly if you have children from a previous marriage. A prenuptial agreement drafted in coordination with a sound estate plan can help ensure your assets are distributed to your chosen beneficiaries when you are gone.

Why Choose Our Firm for an Arizona Prenuptial Agreement?

At The Turner Law Firm PLLC, we provide zealous, compassionate legal representation with fast service and superior results. Our firm offers flat fee rates for estate planning and some family law matters. We have extensive experience in bringing resolutions that work best for our clients in terms of asset division and peace of mind. If you are considering a prenuptial agreement, contact us at (480) 618-1221.