The divorce process is the same regardless of how many assets you have – or don’t have. But cases involving high-net-worth individuals are often more complicated simply because there’s a lot at stake for both parties.
A prenuptial agreement can help minimize quarrels and allow the divorce (if it should come to that) to move along smoothly. Whether one party is contributing the majority of the wealth to the marriage or both partners are on par in this regard, a prenup can help each party protect his/her assets. A prenuptial agreement can also ensure that all parties are taken care of if the marriage ends in divorce.
Prenups aren’t iron-clad, however. For this reason, it’s important to ensure that the agreement is carefully crafted. Otherwise, the court may toss out the prenup if it feels that it was not drafted in good faith.
The Importance of a Prenuptial Agreement in a High-Net-Worth Divorce
To better demonstrate the importance of a prenup in a high-asset divorce, consider the divorce cases of Ken Griffin and Harold Hamm, two wealthy businessmen.
In Ken Griffin’s case, a prenup was beneficial, although the case wasn’t cut-and-dry. When Griffin married his ex-wife Anne Dias in 2003, he had an estimated net worth of about $650 million. When the two divorced 11 years later, his net worth had skyrocketed to $6.9 billion.
Anne Dias argued that the prenup was invalid, but settled just days before the trial was set to begin. According to one divorce attorney, Ms. Dias would have had a “hard road” ahead of her if she wanted the judge to throw out the prenup.
Harold Hamm, on the other hand, did not sign a prenuptial agreement when he married his ex-wife Sue Ann Arnall in 1998. At the time of marriage, he had a net worth of $16 million. After 26 years of marriage, the two filed for divorce. Meanwhile, his net worth soared to between $11 billion and $17 billion.
Litigation lasted for years, but Hamm wound up having to pay his ex $1 billion.
The divorce took place in Oklahoma, an equitable distribution state, which means that all property acquired during marriage was considered fair and equitable. Without a prenup, Sue Ann had a legitimate argument that she was entitled to a significant portion of Hamm’s fortune.
A prenuptial agreement can help you protect your assets if you’re in a high-net-worth marriage, but it’s important to remember that a prenup is not ironclad. Full financial disclosure is crucial, and both parties should have their own attorneys. Finally, ensure that the agreement is not signed during a time of great pressure (i.e. the day before the wedding).
The Micklin Law Group, LLC is a New Jersey law firm specializing in family law and estates. Attorney Brad Micklin was recently named to The National Advocates list of Top 100 attorneys from each state. To set up a consultation, call 973-562-0100.