With the recent passing of media tycoon and Playboy founder Hugh Hefner at the age of 91, the topic of the division of Mr. Hefner’s purported $53 million estate has entered the news. Reports, including this article from the Atlanta-Journal Constitution, indicate that Hefner, who had four children at the time of his death, entered into an “ironclad” prenuptial agreement when he married 31-year-old model Crystal Harris in 2012.
The pre-nuptial agreement, which apparently provides for Ms. Harris to be “looked after” following Mr. Hefner’s death, precludes her from inherit anything, per reports. She will receive an undisclosed monetary assistance, but the bulk of Hefner’s estate will be split between his four children, the University of Southern California film school, and various charities.
What if the Playboy Mansion was located in New Jersey and Mr. Hefner had entered into his prenuptial agreement in this state?
Prior to 2013, New Jersey law permitted prenuptial agreements to be set aside if they were deemed to be unconscionable, not only at the time they were being entered into, but also when they were to be enforced at the time of divorce. The practical effect of this New Jersey law prior to 2013 was judges simply did not enforce prenuptial agreements, making that very expensive document pretty much useless. This is completely contrary to the very purpose of prenuptial agreements – fixing the parties rights, responsibilities and obligations in advance of the marriage in an effort to prevent litigation in the future.
In an effort to make prenuptial agreements actually enforceable, the New Jersey Legislature amended the statute in 2013, completely removing the common attack on unconscionability at the time of enforcement. In order words, a litigant cannot complain that the agreement is unconscionable when it is trying to be enforced, i.e. after a Complaint for Divorce has been filed. The new law also removed the statutory definition of unconscionability.
Instead, a premarital or pre-civil union agreement is unenforceable when the party seeking to set aside the agreement proves, by clear and convincing evidence, that the party executed the agreement involuntarily, or the agreement was unconscionable when it was executed because that party, before execution of the agreement:
1) was not provided full and fair disclosure of the earnings, property and financial obligations of the other party;
2) did not voluntarily or expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided;
3) did not have, or reasonably could not have had, an adequate knowledge of the property or financial oblgiations of the other party; or
4) did not consult with independent legal counsel and did not voluntarily and expressly waive, in writing, the opportunity to consult with independent legal counsel.
If Crystal Harris was trying to set aside this agreement in New Jersey, what would she have to prove? First, it is important to remember that this 2013 amendment to the prenuptial agreement statute only applies to future prenuptial agreements and any agreements revised after the amendment. Thus, this heightened burden would not be applicable to Mr. Hefner’s estate in the above scenario. However, given that it was executed in 2012, Ms. Harris could challenge the prenuptial agreement by taking the position that it was unconscionable not only at the time of execution but also at the time of enforcement, the latter of which is no longer available per the amendment. The pre-2013 version of the statute gives those challenging the enforceability of a prenuptial agreement much more latitude in the positions they take.
However, for all prenuptial agreements entered into after the effective date, so long as there was full disclosure, voluntariness and the agreement was not unconscionable at the time it was signed and entered into by the parties, it should be enforced by the Courts in New Jersey.
If you are considering entering into a prenuptial or pre-civil union agreement, it is always advised to have experienced, reputable counsel guide you through the process. Please contact the Law Office of James T. Rosenberg, Esquire, LLC to schedule a consultation to review your agreement today.