In Indiana, generally, the property that two individuals bring into the marriage or acquire during the marriage is property subject to division at the time of divorce. The use of a premarital or prenuptial agreement can be used by parties to prevent this.

Premarital agreements are legal contacts which are entered into prior to marriage which attempt to settle the interest each spouse has in property of the other, both during the marriage and upon its termination. Under Indiana law, a premarital agreement can be amended or revoked only by a written agreement signed by both parties.

Recently, the Indiana Court of Appeals determined a trust document constituted a written agreement between the parties that revoked their premarital agreement even though the trust document did not specifically reference or even mention the premarital agreement. In that case, after twelve years of marriage, the parties executed a joint trust, placing all previously designated separate property into that trust. In a Memorandum Decision, the Indiana Court of Appeals held the trust document, signed by both parties, was “contrary to the philosophy and intent of the Premarital Agreement.” In particular, it determined “the Trust pulled the parties’ separate premarital estates into the Trust and it provided the parties with joint and equal control over all assets transferred into the Trust.”

In short, parties who enter into premarital agreements prior to their marriage must continue to act with that intent during the marriage. Actions contrary to the language set forth in the premarital agreement, especially those done by a signed written agreement, such as a trust, can obliterate the parties’ efforts to keep their property separate during the course of a marriage.

This article is for information purposes only and is not intended to constitute legal advice.