The air was chilly at West Virginia's Charles Town Races, and Cindy Levine snuggled beside Kenneth Black, the man she had agreed to marry.
It would be the second wedding for both; each had two children from previous marriages. Both were entrepreneurs. Kenny was opening an environmentally friendly dry-cleaning business. Cindy, before her divorce, had followed in the footsteps of her late father, Murray Levine, an early franchisee of McDonald's. In the 14th year of her first marriage, Cindy had bought two McDonald's franchises of her own in Hagerstown and Williamsport, Maryland. Her father once had owned ten, from Hagerstown to Carlisle, Pennsylvania.
In addition to raising two children, Cindy had found herself working 12 hours a day at her business. Ultimately, the strain was too much for the marriage. She and her husband divorced. "We had just grown into different people," says Cindy.
An attractive brunette, Cindy, then 40, had no trouble getting dates, but nobody pulled at her heartstrings. Then her daughter and Kenny's daughter were paired in a b'not mitzvah at their synagogue. Cindy and Kenny had been friends in high school but had lost touch until they were reunited by the religious ceremony. They went out for coffee while their daughters were practicing. They started dating. They fell in love.
Cindy was delighted with the romance, but worries about money nagged at her. "I was in love, but I also knew the number-one thing I had to do was protect my kids," she says. "I just didn't know how to bring it up."
Throughout the courtship, Cindy thought about the need to take steps to ensure that if she died, her business assets would go to her two children. Under Maryland law, if she were to die without a prenuptial agreement, her spouse might get one-third of her assets, the kids two-thirds.
Cindy didn't know how to bring up the subject. Neither did Kenny, who had been in a family business and wanted to protect family assets. So both kept their concerns to themselves. Each worried that raising the idea of a prenuptial agreement might offend the other.
That's how it was until Cindy and Kenny looked down at the entries in one of the races at Charles Town that night. A horse was named Sign a Prenup. The colt's sire was named Prenup. Prenup's dam was named Homewrecker.
Cindy and Kenny looked at each other. "You know," Cindy said, "we should really get a prenup." Kenny agreed. She gave him a hug. Moments later, Sign a Prenup loped around the Charles Town oval in first place and paid a nice price.
The following week Cindy went to visit Cheryl New, the lawyer who had handled her divorce. Like many couples starting out on their first prenuptial contract, Cindy and Kenny figured it wouldn't be hard. They assumed that New, who Cindy said had been wonderful during her divorce, could handle it easily.
But New told Cindy as soon as she arrived in the lawyer's high-rise office at Tysons Corner, "He needs his own lawyer."
Rule number one: The two sides have to have separate attorneys, and picking the lawyers is like walking a tightrope. You need opposing counsel, but not so opposing that it throws the marriage into jeopardy.
New suggested that Kenny pick someone New had dealt with before so they could work harmoniously but with their own client's interests foremost. She gave Cindy several names her fiancé might try. One was John Dondero, a lawyer from Silver Spring. Kenny met with Dondero and hired him.
Kenny and Cindy probably had waited too long to talk about their prenuptial agreement. Their wedding date already was set. Some attorneys, like Carol Schrier-Polak of Northern Virginia, refuse to handle prenups less than 60 days prior to the wedding. "I should make it 90 days," she says. "The biggest mistake I see couples make is waiting too long to bring up the prenup."
Although divorce and family-law specialists handle the bulk of prenups, some of the expertise needed is in the area of estate law, especially for the part that deals with what happens if one of the parties dies. At New's firm, Sandground New & Lowinger, the third name on the letterhead, Jeff Lowinger, is the financial guru.
Divorce lawyers who don't have someone in house like Lowinger often hire an estate lawyer to help with the death aspects of a prenup as opposed to the divorce issues.
In creating a prenuptial agreement, the first step is to compile a complete accounting of the parties' assets and liabilities.
"When you buy a used car," says Rockville attorney James S. Maxwell, "there is the principle of caveat emptor--it's up to the buyer to discover flaws in the item being sold. The seller has no burden to reveal problems."
But in a premarriage contract, both parties have a legal obligation to report everything fully and fairly. Should they fail to do so, the prenup is likely to be tossed out during a divorce proceeding. Then decisions the couple thought they had made about their property are put into the hands of a judge.
Ordinarily, the party more interested in a prenup is the wealthier one. But the requirement that both parties disclose everything they own, from trust funds to Redskins tickets, often gives the wealthier party pause. Not only do some people not want their spouses to know what they have, some families don't want their children to know.
In a recent case, the mother of a woman about to get married insisted that her daughter get a prenup to protect assets held in family trusts. The mother did not want her prospective son-in-law to know what trusts she had--nor did she want her daughter to know how much she was worth. The mother feared that if the daughter knew the extent of her wealth, she might stop working.
The situation created a dilemma for the mother, whose lawyer told her that failure to reveal the amount in her daughter's trust funds would make a prenuptial agreement unenforceable. The mother had no choice but to disclose the information.
As it turned out, the marriage lasted only a year, and the son-in-law departed without any of his wife's wealth. But the young woman discovered she had a legal right to the money in her trust, which no one had ever revealed to her. She dismissed her mother as trustee and took the money for herself.
There was nothing the mother could do. Had she failed to disclose the family assets, the prenup would have been invalidated and the divorced husband might have had some claim on earnings from his wife's trusts.
"You want to make sure you are fairly and fully disclosing all of your assets," says New. "What differentiates a prenup negotiation from a divorce is that in a prenup the people aren't mad at each other yet."
Washington may be the nation's prenuptial capital. As Teresa Heinz Kerry said during the last presidential campaign, "You have to have a prenup. You've got three kids with somebody else, you've got to have a prenup. You could be as generous or as sensitive as you want. But you have to have a prenup."
Nationally, 5 to 10 percent of marrying couples execute prenuptial agreements: Because prenups are not filed in court, it's impossible to get an exact number. In Washington, attorneys say, the number may be twice the national average.
In many places prenups are associated with older couples entering second marriages who want to protect their assets for their children. But in Washington, lawyers say, more and more younger couples get prenuptial agreements. They want to make sure that in a breakup, both keep what was theirs going into the marriage.
Among lawyers, there is debate about whether prenups are good or bad. They can create an awkward environment leading up to one of the most joyous moments in a person's life. Many couples on the eve of marriage are distracted by the impulse to try to extract one last concession from the person one is about to vow to share a life with.
By the time Cindy and Kenny agreed they needed a prenup, a wedding date had been set. Now the race was on to get an agreement written and signed before the marriage.
"The trick is not to have the prenup ruin your life," says Cindy. "It's not the most fun thing to do, especially when you are in the middle of planning a wedding."
Many attorneys find working on a prenup more unpleasant than a divorce. One lawyer says the best that can be said of a prenup is that if you survive the negotiations, you have a better chance of surviving the marriage.
At best, a prenup serves as a divorce insurance policy. While it can cost $15,000 to $20,000, a well-thought-out prenup can save multiples of that at divorce time. As with an insurance policy, you hope you won't need it, but if you do, it can make a divorce far simpler and easier. As one attorney explains it, the parties are more rational before one of them has committed adultery.
Attorney Patrick Dragga recently litigated a divorce case that cost his client $250,000. A prenup probably would have saved him $200,000. "My guy should be a poster child for prenup," says Dragga. "He spent half the value of his estate on the divorce."
Proponents of prenups, such as Carol Schrier-Polak, who speaks on the topic to legal and civic groups, say that forcing the parties to discuss finances before they marry, as difficult as it might be, has a long-term benefit.
Says Linda Ravdin, considered one of the nation's leading specialists, "The prenup negotiation forces a couple to put their thoughts about marriage on the table." She has seen many instances in which couples sat down to discuss money and discovered that their preconceptions and family experiences were different. "Sometimes a person thinks that because their parents commingled all the money and bank accounts that this was how everyone does it. Then they learn that in their spouse's family, it was the opposite."
The prenup offers an opportunity to honestly discuss the marriage. Occasionally the conversation reveals attitudes that cause couples to decide not to get married. That's why attorneys wish couples would do the prenup before sending out the invitations.
The prenuptial discussions begin with a working draft. Some attorneys ask the financially dominant party to prepare one. Others have models that they start from, often developed from years of writing such contracts.
In Ravdin's Bethesda practice, the side pushing for the prenup starts the process with a draft. "I tell my clients there is nothing to talk about until we see the terms drafted by the stronger party," she says. "Then we have something to negotiate from."
Negotiations on the agreement between Cindy and Kenny began, after the disclosure of assets, with a telephone discussion between Cheryl New and John Dondero. "You start throwing ideas around," says New. "What's hers, what's his, what's going to be marital property, what's going to be separate, what happens if they buy a house and put in uneven sums of money."
What can the parties expect in spousal support or alimony? Do things change if the couple is married for two years as opposed to 25 years? Will the prenup expire after a certain number of years if the financially weaker spouse has "proven" himself or herself?
Sometimes one attempts to mandate personal behavior on the part of the other. Almost every lawyer in Washington has a story about a client who tried to put language into a prenup regulating sexual activity. One prominent Washingtonian offered his wife-to-be financial inducements, to be paid upon the apparently inevitable divorce, to have sex a certain number of times a week.
If it sounds a little like prostitution, that's why a judge might not uphold such a payment in a divorce settlement.
Some people want a prenuptial agreement with financial penalties for straying. Although the wedding never took place, movie star Jennifer Lopez had a prenup written before her almost-marriage to Ben Affleck. It stipulated that he'd pay her $5 million in a divorce settlement if he'd been caught in another woman's bed.
Washington lawyers say financially weaker females often insist on such provisions.
The financially weaker party to a prenup almost always caves at the end of the negotiation, says Rockville attorney Patrick Dragga. On the morning of a wedding, a lawyer for one party tells the lawyer for the other, "No agreement, no wedding." With 400 guests arriving in three hours, the strain of such a demand is excruciating. At that point, says Dragga, the client, usually the woman, can't back out. She signs the agreement even if her lawyer advises her not to.
"When a client first comes to me," says Ravdin, "I ask them right out: Are you willing to walk away from this marriage if the terms aren't right? It's not a question that is easy to answer, and most people who are in love know that in their heart of hearts, the true answer is no. You know when you get that answer that if the dominant spouse insists, your client is going to cave. So you have to get the best deal you can."
One of the key elements in whether a prenuptial agreement will be upheld by a court is whether it was voluntary. In Maryland, DC, and Virginia, a prenup voluntarily signed even under the pressure of a wedding deadline usually will be upheld. In some jurisdictions, judges increasingly are entertaining arguments that last-minute signings constitute coercion. A spouse forced to sign a wedding-morning prenup is free to argue later that his or her signing was not voluntary, but under law and precedent, the argument is not likely to prevail.
"As long as the person understood what they were doing," says Dragga, "the court is likely to uphold the prenup."
"The real problem you have with a prenup," says Dragga, "is that you have two people in love, who want to get married, and the closer you get to the wedding date . . . the likelihood is that the person who is the underdog is going to end up agreeing to what the person with the money wants."
Adds Dragga, "If the bride slips out of the rehearsal dinner to make a hushed phone call, there's a good chance she's negotiating some final prenup details. My partners and I have been in on those phone calls."
"A prenup is supposed to be fair, but what is fair today might not be considered so fair 20 years down the pike," says Marna Tucker, Washington's doyenne of divorce law. "The second problem is what is voluntary. If a smart, sophisticated businessman tells his wife-to-be a day before the wedding, 'I want you to sign these papers, trust me,' and the invitations are out and the people are coming, that does raise an issue of voluntariness."
At the divorce proceeding, says Tucker, it is up to the person benefiting from the prenup to prove that the spouse "knew what she was doing. To me such a circumstance could show an element of coercion."
Some attorneys don't buy the notion that a woman about to marry a much wealthier man is helpless.
"Power in the negotiations doesn't always follow the money," says Fairfax matrimonial lawyer Richard Colten. "Love, lust, and the urge to demonstrate eternal commitment are also powerful tools. It takes a cold heart to hold firm when the object of your yearning looks at you with teary eyes and pleads, 'What's the matter? Don't you love me? Don't you trust me?' "
Richard Shadyac Jr., of Falls Church, takes the argument a step further. He says he has seen cases in which a gold digger used the prenup to extract wealth from an older man. "What might happen," says Shadyac, "is that the woman urges the man to write a prenup, knowing that she doesn't intend to stay in the marriage one minute longer than she has to. Then whatever she gets out of it is money in her pocket."
Another attorney tells of a female client who had a quick and powerful answer to her wealthy fiancé's insistence on a prenup. "She announced there would be no premarital sex until the marital contract was consummated. That had the effect of leveling the negotiating playing field very quickly. It also sped up the process."
Provisions for how long you have to stay married to receive certain levels of benefits are not unusual. Stay married for a certain number of years, and you ensure yourself a lump-sum payout in a settlement. Divorce before that time and possibly get nothing.•
Former General Electric chief Jack Welch's prenup with his wife, Jane, had a ten-year expiration date. After he had an affair with a magazine editor and he and Jane divorced--after 13 years of marriage--a judge threw out the prenup, which promised $15 million to Jane in a divorce. Instead she got more than $100 million. Had an affair been discovered and the divorce taken place in the ninth year of marriage, Jane would have gotten $85 million less. Maybe that's why she never saw anything happen before that episode, speculates one attorney.
Sometimes the spouse who has put the time limit into the agreement uses the final year like a football player's option clause: If you want to get out of the marriage, you do it before the expiration date or pay the price. "I've had clients call me up for a divorce the month before the prenup is going to expire," says one Washington divorce lawyer. "If he takes a chance on waiting, it is going to cost more."
Although it is generally thought that prenuptial agreements were devised to protect rich husbands, their origin in law was the opposite. They were first conceived as a way to protect wealthy heiresses from gigolos.
In the 19th century, married women weren't allowed to own property. If a woman inherited property, she would lose control of it if she remarried. So the first prenuptial agreements were designed to make sure that any inheritance went to the heiress's children, not to a second husband. Otherwise her fortune became his as soon as they said the words "I do."
To this day, a signed and separately lawyered prenuptial agreement, which need not be filed anyplace except a drawer, overrides a state's community property laws and can help clarify what is separate property and what is community property over the life of a marriage.
Life would be simpler for couples, and for their attorneys, if the partners remembered what's written in the prenup. Take the case of the Maryland couple who stipulated that the house was the husband's and would be considered his separate property in a divorce settlement. Within a year, the couple went out and jointly refinanced the house, thereby commingling their money--and rendering moot what they had agreed to in the prenup.
Prenups have been the focus of at least one recent movie, Intolerable Cruelty, which starred George Clooney as the lawyer and Catherine Zeta-Jones as the wife of a client. Clooney's character is the author of an "impenetrable" prenuptial, one that had never been tossed out by a judge. In the real world, an impenetrable prenup does not exist. But barring a finding that a prenup wasn't voluntary or that the financial disclosure was fraudulent, courts usually regard the agreement favorably.
In an episode of Seinfeld, Jerry's sidekick George decides he can break up with his fiancée by telling her he will need a prenup before they get married. She laughs and announces that she is wealthier than he is.
In real life, couples are full of such surprises. A well-known Washington pundit made such a request when he got engaged, only to discover too late that his wife-to-be had twice the money he had. She gladly signed the agreement, and when she later divorced him after he cheated on her, he fared much worse than he would have without a prenup.
Prenup negotiations sometimes have surprising results. One DC case featured a prospective husband who was heir to a fortune. Trying in his own way to be generous, he agreed to start his wife out in her own business, which would be her property alone, while protecting all that was going to be his. The attorney stared at the draft of the agreement and said somewhat sadly, "There is a lot of his here, and there is a lot of hers there. But I don't see any ours."
At that, the woman--one day from being a bride--burst into tears and ran from the room. The couple postponed the marriage and went into counseling. When they finally decided to marry, they did so more as a couple. Says the lawyer, "That case made me try to ensure, in every prenup I worked on, that at least something in the marriage was jointly held, no matter how determined the parties were to keep things separate."
Another issue that sometimes gets included in prenups is where each party can take a job. Geography can get in the way of a happy marriage. In Washington, where two-professional marriages are common, it is often the case that one spouse doesn't want to be dragged to someplace like Atlanta. So some couples try to settle in advance who has to go where with whom.
Some women try to ensure in a prenup that if she puts her career on hold to raise children or support her husband as he moves up the ranks, in a divorce settlement she is compensated commensurate with the career she could have had. Otherwise, judges are likely to assign less monetary value to her position. Marna Tucker says that any woman contemplating a prenup should make sure her lawyer tries to include language that would elevate her nonworking status if she raises children. It is much easier to have a man agree to such things in a prenup than in a contentious divorce proceeding.
Sometimes arguments over the content of a prenuptial agreement can become the most expensive aspect of litigating a divorce. That happened in the 1989 breakup of boxing champion Sugar Ray Leonard and his wife, Juanita. According to Juanita, the prenup she had signed with Sugar Ray before their marriage--they had lived together for seven years--would have left her with nothing. Sugar Ray was wealthy by the time they married, and Juanita had little choice but to sign what was clearly a one-sided agreement. In the divorce proceedings, she claimed that Sugar Ray's adulterous behavior made the prenup invalid. The settlement eventually provided her with several million dollars out of Leonard's boxing/endorsement fortune, estimated at the time at more than $50 million. The prolonged battle fattened the pockets of lawyers on both sides.
Most people who sign prenups hope they never have to see them again. A surprising number, say family-law practitioners, forget about them, ignore the provisions, and go about their lives as if they had never been written.
As for Cindy Levine Black, "I tucked ours in a safe where Kenny keeps his basketball medals from the JCC championship he won in 1977. I was a cheerleader on that team, and the prenup is squeezed under the picture.
"For me the process of doing a prenup was like divorcing my husband before I was married," she says. "But what got me through it was that I was mad for him, and we were in love.
"We had to look at it like we were both protecting our kids as the first and foremost goal. It was something that had to be done."
Cindy's strategy for getting through the ordeal? "We did a lot of hugging. Big hugs, because I was marrying such a cute guy.
"If you are really in love, you can survive a prenup."