What Makes a Prenuptial Agreement Valid in Washington State

In case you’ve not been keeping up with celebrity divorce news, Kanye West is challenging the validity of Kanye and Kim’s 2014 prenuptial agreement in his divorce from Kim Kardashian. Kanye’s case is worth reviewing, since challenging the validity of a prenup often occurs when legal safeguards are not followed.

What is a Prenuptial Agreement?

First, we need to define what a prenuptial agreement is. A prenuptial, or premarital agreement, is a written contract entered into between an engaged couple before marriage. If valid, it generally lets you choose the law to govern what happens to your property and alimony when a marriage ends by death or divorce.

Kanye West and Kim Kardashian’s prenuptial agreement, for example, states that any income earned, and property acquired with that income, during the marriage would be solely that person’s property (known as “separate property”). Anything bought jointly – presumably with both on title – would be a community asset and 50% owned by each party. Such terms are also common in Washington State prenuptial agreements. Without a prenuptial agreement, under Washington State (and California) law, all property acquired during the marriage would be presumed community.

Ways a Prenuptial Agreement Can Be Deemed Invalid

In Washington State, if a spouse challenges the validity of a prenuptial agreement, the spouse seeking enforcement has the legal burden to show it’s enforceable using a two-pronged test:

Is the agreement economically (or “substantively”) fair? If it is, the prenuptial is valid and the challenge ends. If not, then,
Is the agreement “procedurally” fair?

An agreement that is economically unfair is STILL valid if the agreement is entered with certain legal safeguards to make sure the spouse knew what he or she was signing and did so voluntarily.

The same two-pronged test applies to cohabitation and post-nuptial agreements (i.e., marital agreements made after marriage).

Is the Washington State Prenuptial Agreement Economically Fair?

Whether the agreement is economically fair depends on whether it provides fair and reasonable economic terms based on the economic circumstances of the parties at the time of marriage. The more unequal the economic circumstances when marriage, the more likely an agreement that limits obtaining community property will be “substantively” unfair.

When Kim and Kanye got married, Radar Online reports that the Keeping Up with the Kardashians star’s 2012 federal income tax return reported adjusted gross income of $8.4 million. On the other hand, Ye’s income reportedly totaled $4.6 million in 2012. Their prenup also appears to significantly limit the acquisition of community property by stating all earnings after marriage are each’s separate property, and only property acquired “jointly” is community. We don’t know the total separate assets, such as real estate and investments, and debts brought into the marriage.

If Kanye challenged the agreement based on economic unfairness in a Washington State court, would he succeed? We don’t know their total economic circumstances but based solely on their difference in incomes (Kim’s 8.4 million vs. Kanye’s 4.6 million), probably not. Yes, there’s a difference, but, both were very prosperous and in the top .1% of income earners. By that measure, they were of relatively equal economic stature (they were both really rich!). However, what is “economically unfair” is a broad standard, not a precise calculation, and family law judges may rule differently on the matter.

For that reason, IT IS ESSENTIAL that any prenuptial (or postnuptial agreement) that is even slightly inconsistent with Washington State family and community property law be “procedurally fair”.

Is the Prenuptial Agreement Procedurally Fair?

If the prenuptial agreement is not substantively fair, then the spouse seeking enforcement will need to show the agreement was procedurally fair. An agreement is procedurally fair if:

There is full disclosure of the amount, value, and character of the property. All financial obligations and income are also important to disclose. Only approximate values are needed; and,
The agreement is freely and voluntarily entered, and not signed under duress, fraud, manipulation, or coercion. How close in time the signing of the prenuptial is to the date of marriage is an important factor; and,
The challenging spouse had at least a realistic opportunity to obtain an attorney to advise them. This is the minimal requirement. It is highly advised, however, that both parties hire their own attorneys to advise them.

Other Ways a Prenuptial Agreement May be Deemed Invalid

In addition to the above two-pronged test that applies specifically to prenups, the following reasons that apply to all Washington State contracts may invalidate prenups:

If the prenuptial contract has intentionally not been complied with, the contract may be rescinded by the spouses’ conduct.
One of both spouses lacked the mental capacity to understand or consent to the contact when it was signed.
The contract is “unconscionable” as a matter of law at the time it was made.
The agreement is illegal. For example, a prenuptial agreement signed with a person who is currently married is void.

What is Kanye West’s Reason for Challenging the Validity of his Prenuptial Contract?

TMZ only cites his ”Weird objection” that California prenuptial agreements entered into after 2002 are presumed invalid. I can’t speak to his California law-based objection, but a legal presumption is not a legal argument in itself. It simply puts the burden of proof on the other party (Kim Kardashian) to rebut it. Washington State does not have a presumption of invalidity.

Is Kanye and Kim’s Prenuptial Agreement Valid in Washington State?

We’ve already discussed whether it is economically fair. Assuming it is not, however, the next question is whether it “procedurally fair.”?

Of course, we don’t know all the circumstances but based solely on reviewing the initial pages of his prenuptial agreement we see the following:

Full Disclosure – The agreement states that both “had adequate knowledge of the property and financial obligations of the other Party”. It also references an attached “Exhibit A” and “Exhibit B” that are net worth statements reflecting each’s assets and debts, and an income statement for 2013. The contract also details their occupations and incomes reported on their tax returns. If the lists were complete, this would suffice for full disclosure.
Voluntarily Entered – The agreed terms point to Kanye’s freely and voluntarily signing the agreement. The agreement states it “was not executed under duress, fraud, or undue influence”. It was signed on March 20, and they married on May 24, or slightly within two months of their wedding. However, both contractually agreed it was “sufficient time to discuss and negotiate the terms of this Agreement.” That’s less time than is ideal, but certainly not a reason by itself invalidate it.
Independent Counsel – Both Kanye and Kim were represented by their own attorneys in drafting, negotiating, and executing the agreement.

The agreement also explicitly states neither “lacked capacity” to enter into the Agreement, the terms are not one-sided, harsh, oppressive, surprising or unfair”, both had “equal bargaining power”. Kanye’s lawyers have not alleged the agreement’s terms were not complied with, or that the contract is “unconscionable”.

In sum, if the agreed-to-terms are in fact true, the agreement would be procedurally fair in Washington State, and no other reasons to invalidate it appear to exist. All legal safeguards have been met. Also, unless facts show otherwise, a Washington State judge is prone to hold a spouse to the facts they acknowledge in a premarital contract.

CONTACT A SEATTLE DIVORCE LAWYER

If you are interested in getting a premarital agreement lawyer and want to ensure it is valid and enforceable, contact the Seattle and Bellevue divorce and family lawyers at Weintraub Law Office, PLLC. We have the experience you need to make sure your prenuptial contract is valid and will be enforced. Call us at 425-374-4045 or Schedule a Consult now.