Estate Planning Lawyer in Rolling Meadows, IL
The planning done before marriage is often as important as planning after marriage in assuring that a client’s estate planning wishes are carried out. Laws governing prenuptial agreements vary somewhat from state to state, but often the circumstances surrounding the drafting, execution, and administration of a prenuptial agreement are crucial to the effectiveness of the agreement.
The case of In re Estate of Ingmand, No. 1-357 / 00-1281 (Iowa App. 7/31/2001) involved a prenuptial agreement. Eugene and Frances Ingmand married on March 14, 1986. Eugene, a retired Arizona veterinarian, and Frances, a resident of Iowa, had known each other for years before their wedding. Eugene entered the marriage with over a half million dollars in assets. Frances’ net worth at the time of their marriage was less than $300,000. Because Eugene had assisted Frances with her finances before their marriage, Eugene was familiar with her finances. In contrast, Frances was not familiar with Eugene’s finances, other than the fact he was “comfortably well off.”
Days before their marriage, Eugene drove Frances to his attorney’s office after telling her they were going to procure their marriage license. Instead, Eugene’s attorney, after informing Frances that he was representing Eugene only, presented her with a prenuptial agreement that kept each party’s income and assets separate. Feeling uncomfortable and embarrassed at the prospect of people finding out that Eugene was conditioning their marriage on the execution of the prenuptial agreement, Frances signed the agreement without requesting to consult with her own attorney. She did not even read the document before signing it. Nor did she keep a copy of the executed document. When Eugene died a number of years later, Frances, as Eugene’s surviving spouse, filed an election to take against Eugene’s will. Eugene’s personal representative denied her election, arguing that it was precluded by the prenuptial agreement. The court held that the agreement was valid and that Frances would take nothing from Eugene’s estate.
In a second prenuptial agreement case, In re Estate of Hollett, No. 2002-346 (N.H. 9/26/2003), John and Erin Hollett married in 1990 after dating for six years. John was a successful real estate developer worth about six million dollars. He was about thirty years older than Erin, who had dropped out of high school and worked as a cashier and bartender.
Mr. Hollett’s attorneys hired a young, inexperienced attorney to represent the soon-to-be Mrs. Hollett with regard to a prenuptial agreement that was being presented to her days before the marriage. The young attorney recognized that the proposed agreement was not very favorable to his client and that the financial disclosure was very sketchy. Despite his inexperience, he was able to negotiate an agreement that guaranteed Erin one-sixth of her husband’s estate in the event of death or divorce. The prenup was signed by both parties on the morning of the wedding.
Mr. Hollett died ten years later, at which time Mrs. Hollett moved to have the agreement declared invalid, claiming she had signed it under duress. The New Hampshire courts held for her, citing the couple’s great disparity in education and finances and the hurried nature of the agreement’s execution.
In an unreported California case, a multi-millionaire oil and real estate investor married a woman decades younger than himself. She brought nothing into the marriage other than a small residence in rural Texas. The couple signed a prenuptial agreement prior to marriage, giving the new bride interests in several apartments worth about five million dollars, but retaining the bulk of husband’s assets as his separate property. Each party was well represented by separate legal counsel. During the marriage, husband acquired several new properties and started new business enterprises, giving wife varying ownership interests in them. When wife unexpectedly pre-deceased him years later, husband tried to invoke the prenuptial agreement against wife’s heirs. Despite finding the prenuptial to be a valid agreement, the court held that wife’s heirs had acquired ownership in many of husband’s properties and business enterprises because of his actions in contravention of the agreement throughout the marriage.
While a prenuptial agreement can be a vital part of an estate plan, improper drafting or administration, or the failure to fully disclose financial information or to obtain independent legal counsel before execution, can have disastrous consequences. An experienced estate planning lawyer in Rolling Meadows, IL, working together with family law professionals, can prevent this from happening.
Contact Bott & Associates for their insight into estate planning and prenuptial agreements.