Navigating Love and Legalities: Your Guide to Prenuptial and Postnuptial Agreements in Alberta

Marriage is an exciting time for a couple. Amidst the excitement, it is important to consider the practical and legal implications that come with such unions. Marriage involves legal rights and responsibilities, financial considerations and potential future challenges. This blog details prenuptial and postnuptial agreements, explaining key points about each agreement and what they can mean for you and your partner.

What is a Prenuptial Agreement?

A prenuptial agreement, commonly referred to as a prenup, is a legal binding contract that a couple enters into before they are married. A prenup specifies each partner’s rights, responsibilities and obligations during the marriage in the event the marriage breaks down or one partner dies. A prenup outlines the ownership of each partner’s assets and addresses how their assets and debts will be divided in the event of divorce or death.

What can a prenuptial agreement include? 

A prenuptial agreement addresses a broad range of topics and can be personalized to meet the unique circumstances of the couple. The couple can pre-determine how key matters in their relationship will be determined. Some of the key matters that may be included are finances, property, support and parenting, protecting professionals assets, estates and inheritance. Negotiating these agreements with independent legal advice (ILA) prior to marriage prevents disputes in the event separation occurs. Should separation occur, the couple can remove their emotions and feelings and solely make decisions based on these agreements.

What makes a prenuptial agreement enforceable in Alberta?

Under the Family Property Act, section 38(1), prenuptial agreements in Alberta require each party to the agreement to acknowledge in writing, apart from the other party that they:

1. Are aware of the nature and effects of the prenuptial agreement;

1. Are aware of the possible future claims to property they may have under this Act and intend to give up these claims to the extent necessary to give effect to the prenuptial agreement; and

1. Are executing the prenuptial agreement freely and voluntarily without coercion by the other party.
   

Section 38(2) of the Family Property Act asserts that this acknowledgment must be made before a lawyer that is independent from the lawyer acting for the other party. This ensures that each party enters into the prenuptial agreement voluntarily with informed consent, without coercion or duress, and with a clear understanding of the terms of the agreement.

Other requirements for a prenuptial agreement to be enforceable in Alberta includes disclosure and exchange of financial information, including both parties’ income, assets, and liabilities. This ensures both parties have a full understanding of each other’s financial background before entering into the prenuptial agreement.

Having a prenuptial agreement can significantly decrease the cost of separating from your partner. A prenuptial agreement may help resolve many issues if the relationship breaks down and can serve as a roadmap to help the couple resolve matters amicably, avoiding costly legal disputes.

Postnuptial Agreements: What are they and when would a couple need one?

Postnuptial agreements in Alberta are becoming increasingly common and in many ways, they are similar to prenuptial agreements. Postnuptial agreements are legally binding contracts and  are created by a married couple after their wedding. These agreements outline the rights and responsibilities of each spouse on various matters within their marriage including property division, financial matters and support obligations in the event of separation or death.

It is important for couples to understand that many of your assets become joint property when you are married. This means that even if an asset was purchased by one spouse, it could be considered jointly owned if it was obtained during the marriage. Common examples may include real estate, vehicles, bank accounts, benefits or pensions.

In Alberta, there are certain exceptions to family property. Exempt family property refers to assets that are excluded from division during separation. Under the Family Property Act s. 7(2) this can include property acquired by one spouse before the marriage, gifts and inheritances. However, section s.7(2.2) of the Family Property Act, outlines that if the value of these exempt assets has increased during the marriage, the increase in value may be subject to division. 

Whether a couple is entering into a prenuptial or postnuptial agreement, it is important that each party obtains their own ILA. Having your own ILA to draft and negotiate your agreements, ensures your individual rights and interests are protected. Each lawyer has the responsibility to ensure their client has a clear understanding of the agreements’ implications and allows their client the opportunity to ask questions freely from their partner before signing the agreement.

Should you wish to have a prenuptial or postnuptial agreement drafted for you, or to speak with a lawyer about your family law matter, please contact Stokes Law for a consultation.

BOOK A CONSULTATION