MA Prenuptial Agreements: Appeals Court Reaffirms "Second Look" Requirement

As I explained previously in my Massachusetts Prenuptial Agreement Primer, the enforceability of a Massachusetts prenuptial agreement depends on the court finding it to be valid at two moments in time: first, looking back to when the engaged couple signed it, and second, under present circumstances when its enforcement is being contested. The latter of those two inquiries is called the "second look." Now, the Massachusetts Appeals Court has confirmed the importance of the "second look," by throwing out provisions of a prenuptial agreement due to circumstances that changed during the marriage.

The new case, Kelcourse v. Kelcourse, involves a couple whose prenuptial agreement (the Appeals Court uses the more academic term "antenuptial") included provisions that (1) all property held going into the marriage would be considered separate property, and (2) any principal residence purchased during the marriage would belong to the wife, regardless of whose name was on the deed. During the parties' twenty-year marriage, they did indeed buy a home, but at the time of separation, it had fallen into serious disrepair. It was encumbered by a $265,000 mortgage — significantly more than its estimated value — and needed an estimated $300,000 of remedial work. Meanwhile, the husband had moved into a separate home valued at approximately $1.7 million.

Simply put, the "second look" asks whether, if a prenuptial agreement is enforced, the contesting spouse will have "sufficient property, maintenance, or appropriate employment to support herself." (While the court assumes the contesting party is female, as was the case here, it is understood that the inquiry would be the same regardless of the parties' genders.) In Kelcourse, that inquiry failed. Enforcing the prenuptial agreement would have meant leaving with wife with a house having "negative equity" and insufficient means with which to repair it, an outcome that the trial judge found would be "unconscionable." Instead, the trial judge awarded the wife $400,000 as a substitute for the residence itself. The Appeals Court agreed.

One can only speculate as to why the husband thought leaving his ex-wife in that home would be an acceptable outcome, particularly since the couple had three children together. In any event, the Kelcourse case provides useful guidance for those entering into a prenuptial agreement today. Specifically, it reaffirms the importance of looking ahead and making at least minimal provisions for the worst-case scenario. A prenuptial agreement cannot be so cut and dry that in the unfortunate event of divorce, one spouse is left in financial ruin. The bar may not be very high, but as Kelcourse shows, there certainly is a bar.

Frankly, this should not be difficult to accomplish. Going into a marriage, a couple typically finds itself in a place of caring for each other and wanting to ensure that each will be adequately provided for. With sufficient information about the law and somebody to guide them through their discussions, every couple should be able to devise a prenuptial agreement that will gently steer them away from the tortured litigation path the Kelcourses ended up taking.