A premarital agreement is a documents signed by parties in anticipation of marriage that addressees what will happen in the event of divorce of a spouse or death of a spouse.
Unlike a regular contract, a premarital agreement is enforceable without the exchange of consideration by the parties. Consideration was a traditional element of contracts under the common law and, in essence, meant that the parties must bargain for and exchange something of value before a valid contract is created. In family law, North Carolina has abandoned this common law requirement both in premarital agreements and separation agreements.
Although consideration is not required, a valid premarital agreement under the premarital agreement act must have certain qualities:
- A premarital agreement must be in writing and signed by both parties.
- A premarital agreement is effective upon marriage and marriage is a prerequisite of an effective premarital agreement. This means that if the parties do not marry the premarital agreement is not valid.
- Premarital agreements may dispose of their property upon divorce through the provisions of the agreement rather than by equitable distribution.
- Premarital agreements under North Carolina law may control rights and obligations in property, whenever and wherever acquired or located.
- “Property” is defined as “an interest, present or future, legal or equitable, vested or contingent, in real or personal property, including income and earnings.”
- Premarital Agreements may control the right to sell, transfer, buy, use, exchange, abandon, lease, consume, expend, assign, encumber, dispose of, or otherwise manage and control property.
- Premarital agreements may bar alimony and postseparation support and attorneys fees under certain circumstances.
- Premarital agreements may control the making of a will or trust to carry out the agreement.
- Premarital agreements may impact ownership rights in and disposition of the death benefit in a life insurance policy.
- A premarital agreement may define which law applies to it.
- Finally, a premarital agreement may control “Any other matter, including personal rights and obligations, not in violation of public policy or a criminal statute.”