By: Jonathan James
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Collaborative Pre-Nuptial Agreements
This article was written by Hance Law Group associate attorney Jonathan James.
In a prior blog article, I discussed how pre-nuptial agreements can help project couples from confusion and rancor in the case of a divorce. While pre-nuptial agreements only require the participation of the two people who are getting married, I strongly advise that lawyers are involved in order to make sure it passes the scrutiny it will receive if brought into divorce proceedings. As I discussed in that prior article, “unconscionability” and “voluntariness” are two important standards that are helped immensely by the involvement of lawyers.
The best possible option, if you want a prenuptial agreement with maximum professional oversight, is a collaborative pre-nuptial agreement. The end product is similar to what might happen if each party had a lawyer to help in drafting and reviewing the agreement, but the process is obviously different – with the potential to be more thorough and better suited to a couple’s needs.
In a typical pre-nuptial agreement, both parties will be aware of the intent to have a pre-nuptial agreement going into the negotiation, but one party will take the lead in drafting the agreement. Sometimes, an agreement will pass between the lawyers for the spouses-to-be without the spouses-to-be discussing the specific terms with each other, and they’ll arrive at a version that’s acceptable to everybody.
But in a collaborative negotiation, you start with both parties sitting in a room (with their attorneys) talking about what they want out of the pre-nuptial agreement. By understanding objectives and goals at the outset, it’s easier to frame an agreement that both parties will agree to. In a traditional pre-nuptial agreement drafting process, the objective or reasoning behind certain clauses or provisions in a draft may get lost in translation of simply passing draft back and forth between the parties. This can cause unnecessary delays, or worse, it can create a source of contention between the parties. Many times these delays and contentions can be avoided using the collaborative process as both parties’ objectives are clearly communicated to each other as a precursor of the drafting of the pre-nuptial agreement.
With a collaborative pre-nuptial agreement, the involvement of a financial professional and mental health professional provide more professional oversight than other pre-nuptial agreements, and they have specific roles that help both parties arrive at settlement.
The financial professional acts as what’s called a “neutral,” in that he or she isn’t specifically working for one party or the other. The financial professional is there to make sure that the entire financial picture is clear to both parties: assets and debts are disclosed, and the lawyer then has clearer guidance as to what needs to be protected and apportioned in the agreement.
The mental health professional acts as a “coach,” making sure that conversations are productive, to help the couple work through any tensions that might arise in the discussions, and to keep the couple focused on resolution.
This is a method that I’d recommend in particular to people who have a good deal of wealth, who have adult or teenage children, or those who anticipate difficulty to come to a consensus on a pre-nuptial agreement. While it can take longer and can be more expensive than a traditional pre-nuptial agreement, it’s a worthwhile investment to make in a number of situations. In fact, I recently had a client who so valued the process that he paid for his attorney (me) and his fiancée’s attorney to use the collaborative process in preparing the pre-nuptial agreement.
I’m glad it’s a service we offer. I see the value of both the collaborative process in divorce and the pre-nuptial agreement in warding off contentious divorces, and I think there’s great value in bringing them together.