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Forced Prenuptial Agreements: Australian Cases

Posted by Jeremy Morley | May 21, 2015 | 0 Comments

Australia

Courts around the world generally reserve the right to invalidate prenuptial agreements that were entered into under duress.

The meaning of “duress” can be extremely hard to determine in specific cases.

Can there be duress when a young impecunious foreign woman moves to another country to marry a rich man who then demands that she sign a “take it or leave it” prenuptial agreement?

Yes, says an Australian court in a very recent decision in Brisbane, Australia.

Can there be duress when the man gives a prenuptial agreement to his wife-to-be just three days before the wedding, after all the wedding arrangement are made, that their relationship will end if she does not sign the one-sided agreement forthwith?

"Yes" said another Australian court last year.

The specific facts of the case of the most recent included the following:

The woman knew that there would be no wedding if she didn't sign the agreement. The husband's position about that was plain.  

The husband did not negotiate on the terms of the agreement as to matters relating to property adjustment or spousal maintenance. He did not offer to negotiate. He did not create any opportunities to negotiate. The agreement, as it was, was to be signed or there would be no wedding and no further relationship. Indeed, the judge stated that, “I am satisfied that when [the man] said there would be no wedding, that meant that the relationship would be at an end.”

The applicant wanted a wedding. She loved the man, and wanted a child with him. She had changed her life to be with him.  

She was in Australia only in furtherance of their relationship. She had left behind her life and minimal possessions in her own country. She brought no assets of substance to the relationship. If the relationship ended, she would have nothing. No job, no visa, no home, no place, no community. The consequences of the relationship being at an end would have significant and serious consequences to her. She would not be entitled to remain in Australia and she had nothing to return to anywhere else in the world.

Every bargaining chip and every power was in the man's hands. Either the document, as it was, was signed, or the relationship was at an end.

The woman consulted a lawyer but he told her, before signing the prenup: “It is the worst contract I have ever seen. Don't sign.''

The man knew that the woman wanted to marry him. For her to do that, she needed to sign the document. He knew that she would do that. He didn't need to open up negotiations. He didn't need to consider offering something different, or more favorable to her. If she wanted to marry him, which he knew her to want, she must sign. That situation was something much more than inequality of financial position. The woman's powerlessness arose not only from her lack of financial equality, but also from her lack of permanent status in Australia at the time, her reliance on the man for all things, her emotional connectedness to their relationship and the prospect of motherhood, her emotional preparation for marriage, and the publicness of her upcoming marriage.

In those circumstances, the wife signed the first agreement under duress. It was “duress borne of inequality of bargaining power where there was no outcome available to her that was fair or reasonable.”

In another case, an Australian court ruled in 2014 that there had been duress when a man  asked his bride-to-be to sign an “unfair” pre-nuptial agreement just three days before their wedding.  The groom told the bride that the wedding would be off if she did not sign, although they had been together for six years and engaged for 11 months.

All the arrangements were made, all the guests had been invited, and the wedding reception had been paid for by the wife's parents. The wife was in a position of “special disadvantage”. If she did not sign the prenup not only would the wedding be cancelled but the judge found that “the likely result of such a traumatic event would be that the wife's relationship with the husband would be over. This after six years and an 11 month engagement.

The judge ruled that:

“The wife says she considered that she had no choice. She was clearly in a position of special disadvantage and the husband knew so. The prenuptial  agreement was not to the wife's advantage. It gave her no rights at all in the future to any of the husband's property. She knew that it was to her disadvantage because her lawyer told her so. Nevertheless, she signed it because she considered she had no choice.

The husband knew that the wife was in a position of special disadvantage. The only inference from his late production of a completed and signed agreement is that he wanted to give the wife no choice and he knew that if it was presented to her days away from the wedding she would have no choice. I infer that the husband considered there was no risk that the wife would refuse to sign the binding financial agreement and cancel the wedding.

The wife's consent to the agreement was not independent and voluntary because it was overborne thus she was subject to duress and undue influence by the husband.”

About the Author

Jeremy Morley

Jeremy D. Morley was admitted to the New York Bar in 1975 and concentrates on international family law. His firm works with clients around the world from its New York office, with a global network of local counsel. Mr. Morley is the author of "International Family Law Practice,...

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