Is a Prenup a Binding Contract?

Probably the most common question that I get asked about Prenups: Is my Prenup (or Postnup or Cohabitation Agreement) a binding contract? Like all legal questions since the dawn of time, the answer is: it depends.

Family Property is governed by pieces of provincial legislation that vary from province to province. In Saskatchewan, we have The Family Property Act. The Family Property Act covers a wide range of topics pertaining to Family Property including what constitutes family property, how Family Property is to be divided upon relationship breakdown, how the Family Home is to be divided upon relationship breakdown, and more.

The Family Property Act classifies any prenuptial, postnuptial, or cohabitation agreement into two distinct classes:

  1. Interspousal Contracts (section 38), which are binding (hooray!); and
  2. Agreements Between Spouses (section 40), which may or may not be enforced (ugh).

An “Agreement Between Spouses” is defined as any Agreement, verbal or otherwise, that is not an Interspousal Contract. So a Prenuptial Agreement will either be an Interspousal Contract or an Agreement Between Spouses. There is no alternative. It will be classified as one of those two. So the better question to ask instead of “Is my prenup a binding contract?” would be “Is my Prenup a binding Interspousal Contract or a potentially unenforceable Agreement Between Spouses?”

An Interspousal Contract is required to have the following elements according to section 38:

  1. It must be in writing [38(1)(b)];
  2. It must be signed in the presence of a witness [38(1)(b)];
  3. It must contain an acknowledgement in writing, made apart from the other spouse, saying that the spouse:
      • Is aware of the nature and the effect of the contract [38(1)(c)(i)],
      • Is aware of the possible future claims to property he or she may have pursuant to The Family Property Act [38(1)(c)(ii)]; and
      • Intends to give up those claims to the extent necessary to give effect to the contract [38(1)(c)(iii)].
  4. The acknowledgement above must be made in the presence of a lawyer who is:
      • Not the lawyer acting in the matter for the other spouse [38(2)(a)]; and
      • Not the lawyer before whom the acknowledgement is made by the other spouse [38(2)(b)].

If an agreement between spouses fits the above criteria, it is, according to section 38(1), “binding between spouses”. However, one tiny little provision—section 24(2) of The Family Property Act—provides a caveat. Section 24(2) states:

24(2)          If at the time the Interspousal Contract was entered into it was, in the opinion of the Court, unconscionable or grossly unfair, the Court shall distribute the property or its value in accordance with this Act as though there were no Interspousal Contract, but the Court may take the Interspousal Contract into consideration and give it whatever weight it considers reasonable.

Therefore, if the Interspousal Contract is unconscionable or grossly unfair at the time it was entered into, the Court may choose to consider it in the same manner as an “Agreement Between Spouses”. The Court may also choose not to consider it at all. Assessing if an Interspousal Contract is unconscionable or grossly unfair is often a daunting task that requires the assistance of a lawyer.

So if a Prenuptial Agreement doesn’t quite meet the section 38 criteria for Interspousal Contracts, is it still enforceable? The answer, yet again: it depends.

Section 40 of The Family Property Act states:

40               The Court may, in any proceeding pursuant to The Family Property Act, take into consideration any agreement, verbal or otherwise, between spouses that is not an Interspousal Contract and may give that agreement whatever weight it considers reasonable.

This means that if an Agreement Between Spouses falls short of an Interspousal Contract, the Court can use its discretion however it deems necessary in determining whether to enforce the Agreement in part, in full, or not at all. So a Prenuptial Agreement that falls short of being an Interspousal Contract may still be enforced. It may also be struck down in its entirety. This is why Interspousal Contracts are a much safer avenue—if the Contract meets the criteria of section 38 and is not unconscionable or grossly unfair, it is binding. Period, full stop.

If your eagle eyes spotted the phrase “verbal or otherwise”, give yourself a pat on the back. A Court may choose to consider a verbal agreement. Even if not strictly enforced, a Court may choose to give the Agreement whatever weight it deems necessary. So be careful making verbal promises—those can be upheld in the same way that written Agreements are. If the Agreement was made verbally, it still constitutes an Agreement Between Spouses even though it cannot constitute a binding Interspousal Contract.

So to answer your question: Yes, you can complete a Prenuptial Agreement on your own. However, it will be classified as an Agreement Between Spouses, which a Court may or may not choose to enforce in full, in part, or not at all. With the help of a lawyer, you can complete an Interspousal Contract, which is binding if it is not unconscionable or grossly unfair.

You’ve probably got more questions. What is the standard for unconscionable or grossly unfair? Can I make my acknowledgment before a lawyer over Zoom? Can my Prenup cover other things like spousal support or child support? These questions can be answered by a lawyer. We recommend that everyone consult a lawyer prior to preparing a Prenuptial Agreement—having a lawyer draft the Agreement for you is the safest bet to ensuring that the Agreement complies with the requirements of section 38 of Saskatchewan’s Family Property Act.

-Slade Hall

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