In an age of amicable celebrity divorces, Kevin Costner’s divorce appears to have bucked the trend. The divorce between Kevin Costner and Christine Baumgartner became fraught after Baumgartner refused to vacate the family home within 30 days of the initiation of divorce proceedings, thus challenging the stipulations of a 2004 prenup.
Making a prenup is often advised for high net worth individuals. Where did it all go wrong with Kevin Costner and Christine Baumgartner?
Prenups are highly effective instruments for clarifying what would be considered separate and marital assets in a divorce. They can simplify divorce negotiations and avoid conflict by setting expectations in advance. A prenup must be drafted carefully, however. Problems may arise if the prenup does not accurately reflect the wishes of both parties, if parties felt pressured into signing the prenup, or if the prenup puts one of the parties at such a disadvantage that it could no longer be considered fair and reasonable at the time of divorce (amongst other reasons). According to Massachusetts law, a prenup must be “fair and reasonable” to be enforceable, to adhere to the court’s requirement an agreement must be reviewed for fairness at the time it was written and at the time of the divorce.
It’s not clear what legal grounds Christine Baumgartner based her challenge of the prenup, but we can speculate based on the information we have. The most obvious thing to consider is that the prenup was made in 2004 and may not have contemplated that Christine Baumgartner would be a stay at home mother responsible for raising the parties’ three children while her husband frequently traveled for work. Meanwhile, Kevin Costner is worth hundreds of millions of dollars and his yearly income is estimated to be around $19 million. This represents a significant income disparity between the two spouses. According to the prenup signed in 2004, Christine Baumgartner gets $1 million and Costner is required to pay $200,000 to help Baumgartner buy a new home. Costner is also required to pay property taxes and insurance for a year.
As a dependent spouse who has raised the couple’s children to a high standard of living and has no income of her own, Baumgartner likely views this situation as inadequate for her needs. The judge ordered Christine Baumgartner to vacate the home (the home was premarital property purchased by Costner in 1988), indicating that the prenup, or at least a portion of it was deemed enforceable. However, in a recent tentative ruling, Costner was ordered to pay $129,000 in monthly child support and to provide an advance payment of $200,000 in legal fees and $100,000 in forensic costs that will be incurred by both parties during the divorce. Baumgartner did not request spousal support or a greater share of Costner’s assets. It appears that the court acknowledged that while the prenup was enforceable, it was necessary to accommodate for the spouses’ vastly different resources and Christine Baumgartner’s child-rearing commitments.
Can Prenups Be Challenged?
Challenging a prenup is a difficult process. The initial premarital agreement should be fair to both parties and drafted with foresight. Prenups may have provisions that increase the assets due to one spouse the longer the marriage lasts or other circumstances that may be reasonably anticipated. Sometimes premarital agreements may be re-evaluated within a marriage and a post-marital or postnuptial agreement can be drafted instead. A prenup should be carefully drafted by a highly skilled attorney who will advise the parties on the risks and benefits of signing a premarital agreement. All assets should be fully disclosed and both parties should be aware of the earning potential of the spouse-to-be and should make accommodations for a change in circumstances or for the sacrifice of earning potential that child rearing can represent. Under most normal circumstances, a prenup will be accepted by both parties and the court, and a divorce can move on.
Some reasons a prenup may be challenged in Massachusetts include:
The prenup is not in writing. All prenups must be in writing and signed and notarized.
The prenup contains invalid provisions. Prenups cannot determine things like child support or child custody in the future. In many cases with younger couples we will also leave the agreement silent as to future spousal support to avoid the court finding an agreement invalid in the future.
The prenup was signed under duress or coercion. Timing can indicate that one party was pressured to sign. If a prenup was signed the day before the wedding, this might indicate that the prenup was rushed and that one party was signing under duress. A good rule of thumb is to sign the agreement no less than 30 days in advance of ceremony.
The prenup is unconscionable. This could mean the prenup leaves one spouse with no assets. A prenup can’t leave one spouse with nothing while the other walks away with millions.
Financial Information is false or wasn’t fully disclosed. Financial information can’t be concealed or fraudulent. Both parties should be fully appraised of each other’s financial situation.
Both parties should have access to an attorney when signing a prenup. This provision is so important the spouse with more assets or income should provide the funds necessary to the other spouse to obtain independent legal counsel.
If you are getting a divorce and your prenup is inadequate or if you are facing a challenge to a prenup from a divorcing spouse, you need to consult a highly skilled Massachusetts prenup and divorce attorney, as your next moves could be critical. So much depends on the unique circumstances and the document itself, such as the provisions in the marital agreement, the language in the premarital agreement and your financial circumstances. For example the language in some prenups could mean that challenging the agreement risks forfeiting the assets you are entitled to in the prenup. In Costner and Baumgartner’s agreement, an “in terrorum”, or no contest clause stated that Christine loses her rights to payment, property or interest pursuant to the agreement if she challenges the agreement. These clauses can dissuade spouses from taking the risk of disputing a premarital agreement.
Unfortunately, many divorces are less than amicable. In these situations, spouses can try to gain leverage over each other and the prenup can be part of a strategy by one spouse to get the other to accept a less than ideal outcome. If you are dealing with a spouse with superior resources they may hire a highly skilled attorney to out-maneuver you. For example Kevin Costner has reportedly hired in-demand Hollywood divorce attorney Laura Wasser.
What Are Your Options In Challenging a Prenup?
An ounce of prevention is better than a cure. Drafting a fair and reasonable prenup that is overseen by skilled and ethical divorce attorneys is the first step to ensuring a prenup works as it is intended. In most cases, prenups can make a complicated situation more transparent and efficient. If a prenup is unfair, or if you feel the challenge to a prenup is unwarranted you should hire a highly skilled Massachusetts divorce attorney as soon as possible. A prenup is a document that could determine your financial future, thus how you deal with any related issues that arise during your divorce is critical. If you are facing problems in your divorce related to a prenup, or if you are thinking of challenging a prenup, or if you just want to be sure you are signing a prenup that is fair, reasonable and will stand the test of time, please contact our experienced, thorough and highly skilled Massachusetts divorce attorneys to guide you through the process or advise you of your next steps.