Saturday, May 11, 2019
Michael A. Sneeringer recently published an Article entitled, The Case for Trusts as an Alternative for Prenuptial Agreements When Religion Intervenes, Probate & Property Magazine, Vol. 33 No. 3, May/June 2019. Provided below is the introduction to the Article.
A funny thing happens on the road to marital bliss. I love you becomes "I love you, but...do you mind signing this...this protects both of us...my parents think it would be a good idea...," etc.
For estate planning attorneys with a client who is single and contemplating marriage, one set of facts causes concern. Clients with religions leanings want to protect their valuable businesses and property interests but also be married in accordance with their particular religion. Entering into a prenuptial agreement may not be allowed as a precursor to marriage and could jeopardize the client's ability to be married in the eyes of his religion. If the client is religious, is there another alternative to prenuptial agreement that would suffice? Is this alternative available in every state?
For estate planning attorneys and their married clients, a typical question at the beginning of the process is whether, upon the surviving spouse's death, assets should remain in trust for the clients' children or be distributed outright and free of trust. The estate planning attorney will often caution the client about leaving assets outright. The estate planning attorney's chief concern is that assets left outright to child or grandchild beneficiaries become susceptible to creditor's claims, including spousal creditors. Sometimes the conversation ends here: clients want their children's inheritance to be left in trust - no further discussion. In other cases, clients circle back to their unmarried child or child with the weakest marriage. ("Her husband's lazy." "All my son's wife does is spend his money.") The client wants the estate planning attorney to draft protective provisions for such child within the client's revocable trusts. Some estate planning attorneys take the client's cue and suggest provisions be placed in a trust to specify that trust distributions are made to a married child or grandchild only if he has entered a prenuptial agreement (or, if the child or grandchild is already married at the time the estate planning document is signed, a postnuptial agreement). Such advise is well-intentioned and might work. But what if the client is religious? Might his religion prevent the use of a prenuptial agreement? If a prenuptial agreement arrangement cannot be made to protect the child or grandchild beneficiary's interest, what is the client to do?