What is a Sunset Clause in a Prenuptial Agreement?

A lot has been written about prenuptial agreements and how they’re gaining popularity across the United States. Today, more Americans are signing prenuptial agreements before they get married. There are numerous good reasons for this. If you want to keep certain properties separate from the marital estate, a prenuptial agreement is a great way to do it. Businesses, bank accounts, credit cards, and more can remain separate property in the case of a divorce and not be subject to distribution during divorce proceedings. American couples are catching on that prenuptial agreements are a great way to avoid New York State rules when it comes to matters such as property distribution and alimony.

That brings us to the topic of our blog post. You may have heard of “sunset clauses” being used in prenuptial agreements. But what exactly are they?

What is a sunset clause in a prenuptial agreement? 

In a prenuptial agreement, you can specify the date at which the agreement expires. In other words, you can say something of the like, “This agreement is null and void on the seventh anniversary of our wedding.” You can also specify that certain provisions of the prenuptial agreement expire after a set amount of time. In other words, certain terms of the prenuptial agreement are phased out over time. This is known as a sunset clause.

The general idea behind a sunset clause is that, as the marriage moves forward, the reasons behind including these specific provisions may no longer apply. What works in a marriage that lasts a couple of years may not be appropriate in a marriage that lasts 10 years or more.

How are sunset clauses typically used?

Most often, you’ll see sunset clauses used around the issue of alimony. In these cases, a spouse can specify that they will not have to pay any alimony to the other spouse unless the marriage lasts for a set number of years.

Alternatively, sunset clauses are employed around matters relating to the marital estate. For instance, a certain property, for example, a business, may be kept as separate property unless the marriage lasts a specific number of years.

Sunset clauses: a case study 

In one case, a couple had a sunset clause that nullified their prenuptial agreement on their seventh wedding anniversary. Four months before the anniversary, the husband moved out of the house and filed for divorce. Divorces can take some time to process, so the couple was still technically married on their seventh wedding anniversary. The husband argued that the prenuptial agreement should remain in effect, while the wife argued that the prenuptial agreement was void. In this case, the court sided with the wife and nullified the agreement. Had the prenup contained specific language that voided it upon filing for divorce, the husband may still have been able to enforce the agreement. In this case, however, it did not.

Talk to a Rockland County, NY Family Law Attorney Today 

Need help drafting a prenuptial agreement? The Westchester County family law attorneys at The Law Offices of Robert S. Sunshine can help. Call our office today to schedule an appointment, and will begin discussing your goals right away.