40-50% of first marriages end in divorce, and it can get messy. The best way to keep the emotions and the court costs down is a prenuptial agreement. The purpose is not to set you up for failure (may you enjoy a long and fruitful union!) but to preserve your financial independence.
Only 10% of newlyweds currently sign prenups, even in Western countries, and in more conservative societies, like Georgia, that dips to just a tenth of a percent. Be that as it may, a marriage contract is most certainly allowed, by Article 1172 of the Civil Code of Georgia, to be precise.
The prenup
If you have registered your marriage in Georgia, your property relations will be governed by local law, according to which everything you owned before marriage remains your personal property by default, and everything you acquire during marriage is shared (to be divided equally should you choose to join the 40-50%). Such is the law in many countries, and it applies to most assets, from real estate and art to shares in a business (the only exception is property inherited or donated during the marriage).
Enter the prenuptial agreement (or marriage agreement, marital agreement, or even postnuptial agreement), the official contract you enter into voluntarily before marriage or at any time after your wedding to regulate the distribution of property as part of your life together or in case of divorce or the death of one of the spouses.
The clauses usually included in a prenup
The content of a prenuptial agreement can vary greatly depending on you. For example, Jay-Z is bound by his prenup to give Beyonce USD 5 million for the birth of each child. Or Justin Timberlake is subject to a penalty of USD 500,000 in case of infidelity to Jessica Biel. Basically, the possibilities are endless.
Still, the document will generally contain:
- Directions for the distribution of movable and immovable property. For example, all property, including property acquired before marriage, can be defined as joint. Or, on the contrary, you could choose to share all real estate in Georgia, give assets in the UK to the wife, and a house in the UAE to the husband, just for example…
- The terms of ownership for future property: Maybe you’ve invested in a house you’re planning to build in the future
- Procedures for the distribution of cash, bank accounts, interest, jewelry, art and antiques, etc.
- The terms of business ownership and profits from the business
- Terms of debt distribution: Who is responsible for which loans (especially relevant for mortgages)
- Financial obligations: How the spouses will divvy up expenses, the terms of maintenance for one of the signatories, or financial support for the children
- The procedure for dissolving the marriage. In general, the contract can include separate terms to distributing property during marriage and after divorce
It is important to note that any property not specified in the marriage agreement will be distributed in accordance with Georgian law. In addition, the agreement is not all powerful, it cannot limit the free will of one of the parties (who cooks dinner), affect issues of child custody or alimony (in divorce, this is determined by the court, based on the interests of the child), regulate the inheritance rights of third parties, or contain provisions in direct contradiction of the law.
Who might want a prenup and why
Anyone can benefit. The idea that a contract destroys romance in a relationship is a myth. Psychologists have noted the importance of being able to discuss financial issues openly and say it has the potential to strengthen a relationship and build trust. But the main advantage of a prenuptial agreement is not in that.
It is in the protection it provides to financial assets, such as when there is a marked imbalance in personal wealth between the spouses. That is not to say it protects only the wealthier party. On the contrary, a court may invalidate a contract deemed overly disadvantageous for one of the signatories.
Debt protection, particularly relevant for couples with a business, is another major advantage. The law divides debt between spouses according to their shares in the property they have in common. If the couple separates without an agreement, liabilities may well be divided equally.
A prenuptial agreement reduces the personal conflict inherent to a divorce and softens an already stressful process. When a clear plan for the distribution of finances exists, both parties can focus on personal healing and prepare to face the future.
Finally, a prenuptial agreement is extremely useful in international marriages, when a couple owns assets in more than one country, or where the spouses plan to move to another jurisdiction. All of these pose the risk of having an unexpected right applied to you.
For example, if you were married in Georgia, where common ownership of jointly acquired property applies, and then moved to the UK and divorced there, you would face equitable rather than equal division (taking into account each person’s contribution to the family). A prenuptial agreement allows you to spell out how you want it to be in advance and will be recognized internationally. To learn more, schedule a free consultation with the lawyers at PB Services.
How to execute a prenuptial agreement in Georgia
- As with a wedding, passports are needed to register the prenup. A marriage contract in Georgia is drawn up in the Georgian language and can be in others languages too so the parties definitely understand
- It must be certified by a Georgian notary to have legal force. The notary checks it for compliance with Georgian law, and if you want, you can get an apostille or consular legalization at the House of Justice for use in another country
- The spouses must sign the contract in person in the presence of a notary. It cannot be done by power of attorney or online. And both parties must agree to the terms of the contract
We already mentioned that a marital agreement can be signed before the wedding or after. In the first case, it will be effective from the moment the relationship is officially registered. In the second case, it is either from the moment the contract is signed or the moment the marriage was registered. The contract can also be renegotiated or terminated by agreement.
Why you are going to want some help with the legal stuff
It is impossible to draw up a prenuptial agreement on your own or download a ready-made template. It is unique for each couple and requires a thorough understanding of the laws of one or more countries. If you enter into a contract in Georgia, you need to understand Georgia law. If you plan to move to another country, you’ll need understand the legal norms in that particular jurisdiction (and the basic principles of international law). Otherwise you run the risk of having the contract or individual provisions being invalidated.
The lawyer will also make sure that both parties disclose their assets and explain the rights and obligations of each spouse. If it later turns out that someone failed to understand all the terms of the agreement, the agreement can also be challenged in court.
The PB Services law firm can help you draft the best prenuptial agreement for your union, and if necessary, even plan your Big Fat (or small) Georgian Wedding. Email us to learn more.