Texas courts recognize both premarital and post-marital (or marital) property agreements. A post-marital agreement may provide for the “partition or exchange of community property,” that is any property acquired by either spouse during the marriage (with some exceptions). A properly drafted premarital agreement, however, can declare that all property brought into the marriage should remain separate, and that nothing should be treated as community property.
“Informal” Marriage Can Occur Before Formal Wedding Ceremony
After a marriage takes place, any property acquired may be considered part of the community estate. This is why the timing of a premarital or post-marital agreement can be critical. It is also important to understand that a marriage may occur before, or even in the absence of, a formal wedding ceremony.
Texas does permit “informal” or common-law marriages. Under Section 2.401 of the Texas Family Code, an “informal marriage” may be proven by evidence that the partners “agreed to be married and after the agreement they lived together in this state as husband and wife and there represented to others that they were married.” Even if the parties later formally marry, an earlier date of informal marriage may be established during a subsequent divorce proceeding.
This is precisely what happened in a recent case from Dallas. A husband and wife married in 2003. The husband filed for divorce seven years later. As part of his divorce petition, the husband sought to enforce a purported premarital agreement that he and his wife signed on July 23, 2003, nine days before they were formally married. This agreement specified that “no community property would be created during the marriage.”
In response, the wife claimed the couple was “informally married” on July 1, 2003, three weeks before the purported premarital agreement. The day before, the wife learned she was pregnant–with triplets, it turned out–and thereafter, she said, they represented themselves as “married” in public. For instance, the wife testified she started wearing a “wedding band” and “represented to Husband’s bank in legal documents that they were married” in early July, even though the wedding ceremony did not take place until August 1, 2003.
The husband disputed the wife’s account of these events, but the jury apparently found the wife’s testimony credible. The jury ruled an “informal marriage” existed prior to formal marriage, and that in turn made the purported premarital agreement a post-marital agreement. As a Texas appeal court explained in a decision upholding the jury’s verdict, since the agreement took effect after the parties were already married, it “did not prevent the creation of a community estate.” As a result, the couple’s $1.2 million home was classified as community property, and the wife received 50 percent in cash to compensate her for her share.
Are You Considering a Premarital Agreement?
This is a pretty stark illustration of what can happen when a couple fails to appreciate their own legal status before entering into a premarital–or in this case, post-marital–agreement. If you need help from a Galveston prenuptial agreement attorney understanding the law in this area, contact the Law Offices of Tad Nelson & Associates today at(281) 280-0100.