How a Prenuptial Agreement Can Change the Divorce Process in BC

When a couple separates and divorces in British Columbia, many situations can arise that are both stressful and difficult to resolve.

Matters such as child custody, property division, spousal support, and child support can all create difficulties and without a process to resolve disagreements, they can escalate into disputes that require court intervention.

A legally binding marriage agreement can make the divorce process more straightforward by addressing the main contentious points before they arise. Here is how the divorce process changes when there is a prenup.

The standard divorce procedure in British Columbia 

When couples divorce in B.C., the standard procedure is as follows:

1. One spouse files an application or Notice of Family Claim for a divorce and serves the documents to the other spouse.
2. The other spouse may file a response.
3. If there is no response after 30 days, the divorce proceeds as uncontested.
4. The couple attempts to settle key matters such as the division of property, spousal support, child support, parenting, and child custody.
5. If no agreement is possible from collaboration, either mediation or arbitration may be required.
6. If no agreement is possible even after alternative dispute resolution methods have been used, the matter will go to trial and be settled in court.

This process can take anywhere from a few months up to a year or more if it needs to be settled in court.

However, a prenuptial agreement, i.e., an agreement signed before the marriage, can simplify divorces and help “fast-track” the process.

What are prenuptial agreements in BC? 

In BC, prenuptial agreements are referred to as marriage or cohabitation agreements. These agreements, entered into before or during marriage or cohabitation, outline how property, debt, and spousal or child support will be handled if the couple separates. By setting clear guidelines on these issues, they help prevent conflict and provide a roadmap for addressing separation matters.

A properly drafted marriage agreement (“prenup”) addresses many of the main contentious financial issues in a divorce so that, in a sense, these matters are already resolved if they should arise.

This can speed up the flow of events that lead to a divorce and reduce the stress and expense along the way.

One of the main roles of a prenup is usually to list the assets that each spouse brings into the marriage and specify instructions for the division of the marital property. For instance, there will be instructions for how to divide the following assets in the event of a divorce:

• Shared real property
• Shared bank accounts/savings
• Shared investments
• Pension contributions
• A shared business
• The increase in value of assets brought into the marriage

A prenuptial agreement may outline the responsibilities for the payments of any debts incurred during the marriage too. It can also address whether spousal support is payable and, if so, how much and for how long.

Most matters concerning children should not be included in a prenuptial agreement as the B.C. family court will need to approve any actions taken over custody, parenting, and child support to ensure that the child’s best interests are looked after.

Note that postnuptial agreements, or postnups, can cover the same issues. The only difference is that they are signed after the marriage has already started rather than before it.

What are the legal requirements in BC for a prenup? 

Not all prenups are legally enforceable in B.C. Unless they are prepared properly according to the guidelines set out, the court may not accept the agreement, if and when the time comes to apply it.

For prenups to be enforceable in B.C., the following rules apply:

• The agreement must be in writing, signed, and witnessed
• Each signing spouse must acknowledge the following:
  • He/she is aware of the prenuptial agreement’s nature and effect.
  • He/she is aware of potential future claims to property under the relevant state and federal laws and that he/she intends to give those claims up in favour of the agreement’s terms.
  • He/she is signing the agreement freely and voluntarily without any compulsion from the other party.

What are the main benefits of marriage agreements during a divorce in BC?

Even divorces that seem entirely amicable can run into problems if there are matters that the divorcing couple does not agree completely on. These can take time, patience, and expense to resolve. Often, collaboration between lawyers, mediators, arbitrators, or litigation is required.

The vast majority of divorces are settled without the need for a trial—and a properly drafted prenup can increase the odds in your favor. Because a prenup already answers most potential financial points of conflict, it removes some of the elements that can lead to disputes in a divorce.

A judge may still decide on issues that impact the children, such as child custody and support but if the main financial components have already been decided, fewer matters remain to create conflict.

Ultimately, a prenup or postnup can save legal fees, time, and stress for a divorcing couple and their families.

What are the “cons” of prenups in a divorce?

Most times, prenups are beneficial, especially if the spouses marry later in life when they have already accumulated significant assets. These assets should be protected in the event of divorce so that only those associated with the marital estate are subject to division.

Provided the prenup is correctly prepared, signed without coercion, and determined valid by both spouses, there are very few downsides.

One potential negative consequence is if one spouse challenges the validity of the agreement. The court may reject the agreement if it rules in favor of the plaintiff, rendering the terms of the agreement null and void.

How can marriage agreements be challenged in BC?

To challenge a marriage agreement in B.C., you must ask a judge to review the circumstances of how the agreement was created and decide whether it was valid.

There must be legal grounds to do so. Most times, simply being unhappy with the terms of the prenup is not sufficient if the agreement was prepared according to the rules outlined above.

To be successful, you will need to demonstrate to the court that one or more of the following applies to your case:

• Duress: you did not freely enter into the agreement.
• Coercion: you were taken advantage of out of ignorance, need or distress.
• Unconscionability: the agreement is obviously and seriously unfair to you.
• False information: you signed the agreement based on false information.
• Lack of independent legal advice: you signed the agreement without taking independent legal advice (though this may not render the agreement invalid as prenups can be made without legal advice in B.C.)
• Mistake: you did not fully understand the nature or consequences of the agreement.
• Fraud: you only signed the agreement because the other spouse misrepresented its contents.
• Failure to make full disclosure: you signed the agreement without full disclosure of property/debts.

If due process was not followed or the court finds that the agreement is “significantly unfair”, it may be invalidated in part or entirely. The divorcing couple will then need to revert to the rules outlined in the Family Law Act for the division of assets and debts and spousal support.

This will create delays in the divorce process, often involving a complete reassessment of the financial situation before and during the marriage. This can increase complexity, legal expenses, and delays—and could even lead to a trial.

The basic process for challenging a prenup in BC is as follows:

• File the marriage agreement with the court if this has not already been done.
• Apply to the Supreme Court under section 93 of the Family Law Act to set aside a part or the whole agreement and to replace it with an order from the Court.

If you are considering a marriage agreement, make sure that it is drafted by a lawyer experienced in family law in British Columbia to avoid potential challenges.

DSG Family Law offers a free initial consultation to assess your situation and outline your legal options. Speak with a family lawyer in Langley today.