Disclaimer: This article does not constitute legal advice. If you have any questions about your individual situation it is best to seek the advice of an experienced legal professional.
Kevin Costner’s divorce is in the news because of a dispute over a 2004 prenup he made with his divorcing spouse Christine Baumgartner. The divorce has turned contentious pretty quickly, and the prenup seems to be one of the main factors. The prenup was entered into 18 years ago, and Costner’s estranged spouse Christine Baumgartner has made it clear that it is no longer adequate for her needs.
Could the prenup have been done differently?
Prenups for high net worth spouses need to take into account a number of factors, and the most obvious one is whether there is a big wealth gap between the spouses. Prenuptial (premarital agreements) and post-nuptial (marital agreements) need to be drafted with care, especially where there is a large wealth disparity. They should be able to accommodate current and future needs and to take into account the earning potential of both parties. Christine Baumgartner stayed at home raising the couple’s children while Costner traveled for work. According to Baumgartner, she has no current income. Kevin Costner’s net worth is estimated to be around 200 million and his annual income in recent years has been around 19 million.
Prenups are often misunderstood as being cold and unromantic instruments that disadvantage one party. Hoever, this is not the goal of any legitimate or well drafted prenup. Successful prenups are those that are fair to both parties. Legal conflict costs divorcing spouses time and money. Kevin Costner and Christine Baumgartner have already racked up hundreds of thousands of dollars in legal fees, and a judge has awarded Christine Baumgartner 129K in monthly child support. Kevin Costner made the prenup to avoid the large payout he made in his divorce from Cindy Silva, but making an inadequate prenup has already cost him large sums of money.
How to Make a Prenup Fair and Long-Lasting
Make the Prenup Well in Advance of The Marriage
If you can’t do this, consider making a Postnup instead. Prenups that are made less than a week before the wedding are not valid in California. Parties entering into a prenup are expected to have time to consider all the factors involved. Full disclosure of assets during the prenup is required in order to make an informed decision.
Increase Benefits Over Time
Prenups often include benefits that increase the longer the marriage lasts. This recognizes the commitment spouses make to the marriage, such as raising children and/or foregoing their own career and income. Prenups may include a waiver of a claim to spousal support or inheritance rights. Waiving spousal support might actually be a good thing for both spouses, because it means they don’t have to remain tied together in the event of a divorce. If the marriage ends after a long period of time, and one spouse’s income has increased compared to the other or if one spouse has committed their time to the marriage or child-rearing, a lump sum may no longer be fair or adequate, and staggered provisions could make the outcome fairer.
Include a Sunset Clause that Allows You to Renegotiate The Prenup
Some spouses include a clause in their prenup that allows them to renegotiate the prenup after a period of time. Each individual situation will be different and you should consult carefully with legal professionals. For some spouses however, it works well for them to include a clause stating that the prenup should be renegotiated by a certain date in the future. This allows parties to review a changing situation that could involve children, wealth, health isssues, commitment and more. To protect everyone involved, these clauses dictate that the prenup should be negotiated in the same manner as the original prenup, ie in a fair and transparent manner where all assets are disclosed and parties have access to individual legal counsel.
Mediate the Prenup
One of the best ways to draft a long-lasting prenup is to mediate the agreement. If you mediate the agreement with a highly skilled mediator, there is a significant amount of buy-in by both parties, as well as a high level of transparency and clarity. A mediated prenup is drafted in the presence of a neutral mediator who empowers the parties to take charge and own the agreement rather than relying solely on attorneys or reactively agreeing to terms that don’t suit both parties. A mediated agreement requires both parties to craft the agreement together. This can help to build teamwork and actually provide a positive foundation starting out in the marriage. The goal of a mediated prenup is a fair and equitable outcome for both spouses.
Our Services and How We Can Help
At Divorce Options San Diego we are highly skilled West Coast Divorce Mediators who assist spouses-to-be who want to make durable, fair and solid premarital and post-marital agreements. These prenuptial and postnuptial agreements are tailored for the needs of the couple. A prenup can provide for a range of issues that are relevant to the lives of couples who have complex assets. These could include family business interests, family trusts, real estate, independent incomes and children from a previous marriage. A prenup can include provisions to clarify marital and premarital property, take care of children from a previous marriage, maintain a spouse’s standard of living, include asset protection and harmonize with estate planning. A prenup can be drafted along with other accompanying legal agreements such as confidentiality agreements and estate planning or business succession planning documents.
At Divorce Options San Diego, we are West Coast divorce mediators who have legal expertise, financial expertise and deep experience negotiating thorough and comprehensive agreements that have a complex financial component. We work with couples nationally and people embarking on a marriage or getting a California divorce. We have offices in San Diego, CA, Berkeley, CA and Silicon Valley and can meet with you in person or mediate remotely. Please contact us to learn more about negotiating a fair and lasting marital or premarital agreement.
