Premarital agreements get a bad rap for being anti-romantic, anti-relationship and getting a marriage off to a bad start. If they are done right, nothing could be further from the truth.
The Collaborative Process has gained traction in the last decade as a respectful way for couples to settle their divorce issues outside of court. Less attention has been given to how couples about to embark on marriage can use the Collaborative Process to develop a premarital agreement. Clients can benefit greatly if attorneys take note of how well the Collaborative Process fits this situation. In the Collaborative Process, the couple make their own decisions, staying together in the same room to discuss options to resolve their issues. They are guided in their discussions by legal, financial and mental health professionals, who are present for the meetings as needed. The discussions focus on the parties’ goals and interests, which each party develops and shares with the other at the outset. Each party commits to respect the individual goals of the other and, together, they develop joint goals. For example, each party may have the goal of his or her financial security. Together, they may have the goals of providing a secure financial footing for their family and estate planning in the event of death.
The process by which a premarital agreement is negotiated can determine whether the couple ends up stronger or resentful, fearful about their future and worried about whether they can repair their relationship. Developing their individual and joint goals for their lives together in the Collaborative Process and discussing each issue with their attorneys present can result in a clearer understanding of their financial attitudes and the underlying reasons that each seeks a particular financial outcome. Meeting together with their lawyers prevents the lawyers – and the clients – from polarizing. It allows the lawyers to get to know both parties, to hear first-hand from the other party, and to see the couple interact. The role of the lawyer in the Collaborative Process is to support the client in seeking a resolution that meets the needs of both clients. When the attorneys work toward a common goal of financial protection of both parties in the Collaborative Process, they model for the clients how they can work together to resolve their issues.
When emotional impasse blocks resolution, mental health trained coaches can join the meetings to help the parties get to the source of their emotional reactions. Emotional reasons are the most common cause of breakdown in negotiations, particularly negotiations between intimate partners. Differing views of financial outcomes often provoke strong emotional reactions from the parties, for example, fear and vulnerability on the part of the party with fewer financial resources and anxiety about loss of resources on the part of the party with greater financial resources. Divorce coaches, who get to know the parties and witness their interaction in the meetings, can gently elicit from the parties feelings that could fester if buried. Although not the same as marriage counseling, this contribution from mental health professionals can strengthen the parties’ relationship for the future.
Parties use premarital agreements for a number of different reasons. The Collaborative Process adapts according to the need. A party marrying later in life with few retirement assets may worry about waiving rights that a court might grant upon divorce or to which he or she would be entitled at death. A wealthier party may need the premarital agreement to protect assets for his or her children’s inheritance. In the Collaborative Process, the less wealthy spouse is able to express fears about being bereft of assets or support in the event of divorce or death. The wealthier spouse is able to be direct about the desire to preserve his or her wealth and what he or she is prepared to do consistent with his or her goals. The professionals normalize these discussions and assist the clients in handling difficult emotions and avoiding reactivity.
Sometimes parents with a family business or great wealth will insist that their young adult child must have a premarital agreement. The goal of the family of origin may be to keep all the stock ownership in the family or to protect the wealth for the grandchildren. In the Collaborative Process, the family of origin and their lawyer can be invited to join the meetings, to speak to both parties, both attorneys, and the financial professional at once. The family can explain their motivation in a way that helps the young couple to understand. If complicated stock, trust, tax or other financial issues are involved, the family can work directly with the financial professional and Collaborative attorneys with the young couple participating.
Premarital agreements often involve complex tax, trust, or other financial issues. The Collaborative attorneys and the financial professional can identify areas in which they need to include additional professionals, such as estates and trust attorneys, business valuation experts, or specialized tax experts. Since the Collaborative meetings are inclusive, these professionals can provide information to the parties and the other professionals at once and explain it in the meetings so that both clients and both attorneys are fully informed and share the same information.
In sum, the Collaborative Process depends on the clients’ willingness to look out for each other and to work toward an agreement that protects both parties – a sound foundation for beginning a marriage. To this end, attorneys and financial and mental health professionals provide the needed resources to make sure that the clients communicate well and are fully informed of all the facts, law, and finances necessary to carry out their goals. The protection of a supportive team and process provides a safe place for the clients to resolve their issues and strengthen their relationship as they approach marriage.