South Carolina Prenuptial Agreement Info

Duress and unconscionability; two great ways to have a prenup declared invalid!

Long, long ago, in the ancient year of 1997, a Ukrainian woman named Nataliya was perusing a magazine when she saw a very handsome American man’s photo. His name was William. She thought William was so attractive that she wrote him a letter in English. Nataliya’s English was so-so, but she was constantly practicing it. The pair became pen pals and hit it off immediately. Before they knew it, William flew out to Ukraine to visit her.

Only two months after stepping foot into Ukraine, William and Nataliya became pregnant. William and Nataliya wanted to raise their child in America, but Nataliya could only live in America if she was married to William. Nataliya did not have any money of her own, so she would need to rely on him. Thus, they decided to get married.

William faxed her over a copy of the prenup his lawyer wrote up. This prenup was in English and riddled with the typical legal jargon you would expect. As you can imagine, reading this without a lawyer and without English as a first language was very difficult. Nataliya was hesitant to sign it since she couldn’t understand a thing, nor could she afford her own attorney. William also told her that South Carolina’s laws required her to sign this as it was a requirement for marriage. Reluctantly, Nataliya signed off on the prenup.

Unbeknownst to Nataliya, the prenup actually stated that both she and William had their own money and would be responsible for self-supporting. That was clearly not the case, as she could hardly speak English and had no skills or experience to work in America. She also had a net worth of $0, while he had a net worth of $150,000. In addition, the prenup was not mutually beneficial. It listed many provisions benefitting William but not giving Nataliya similar interests.

After just about two years of marriage, Nataliya filed for divorce seeking distribution of property, child custody, and alimony. If the prenup were to be declared valid, she would not be entitled to any property or alimony. Thus, she asked the court to throw the prenup out. The court agreed with Nataliya and found this prenup unenforceable based on duress and unconscionability.

The court said that this prenup was unconscionable because of the unfair and impossible terms of the prenup. The terms were so one-sided that no fair or reasonable person would sign it. It was clear that she could not support herself and had no assets to support herself.

The court also said the prenup was signed under duress. They noted that she could not understand the English, even with a translator, because it didn’t make sense. She noted in court that she couldn’t translate terms like “pro-rata,” “undivided,” and “equitable.” She also couldn’t stay in the USA without signing the agreement because she needed support from her child’s father. Within context, all these factors together pointed to duress.

Moral of the story? A prenup will only be valid if signed voluntarily, understandingly, and fairly. One foolproof way to make sure this doesn’t happen is to have you both get your own independent legal representation. Having your own attorney to advocate for you will show the court that this was voluntary, and your own attorney will help make the terms fair and not one-sided.

Holler v. Holler, 612 S.E.2d 469 (2005)

South Carolina Antenuptial Agreement Statute and Case Law

If you would like to get a prenup in South Carolina, you must comply with the following: 

• The prenup must be in writing
• The terms must be fair and equitable
• The terms must be lawful or immoral
• The terms must be financial in nature (not relating to personal business, such as weight gain or in-laws)
• The prenup must be signed at a reasonable amount of time before the wedding (not last minute)
• The prenup must be signed by both parties (HelloPrenup recommends initialing each page)
• There must be full disclosure of income, assets, and debt *Do not skimp on this*
• Both parties must be represented by their own attorneys (This is not a suggestion, it’s a requirement!) 
• The terms must not be unconscionable (unconscionable means so one-sided that a reasonable person would never sign it)
• Do not include clauses about child custody or child support, that is for the court to decide

South Carolina Code of Laws Title 20 and South Carolina case law govern prenups in South Carolina. You can see the statute’s fine print here. Most of South Carolina’s prenuptial standards are based on case law. 

A deeper dive on what South Carolina judges think about unconscionability

As opposed to the case of Nataliya and William, this case shows you what is not an unconscionable prenup in South Carolina. 

Husband and Wife were married for about nine years when Husband (63 years old) filed for divorce against Wife (41 years old). The prenup they signed stated that Wife would not be entitled to Husband’s property (and vice versa), and Wife would not be entitled to alimony. Wife willingly used Husband’s good friend as her independent legal representation and Husband hired his own attorney. 

At the time of divorce, Wife had nothing, but debt and Husband had a significant amount of assets. During the divorce proceedings, Wife argued that the prenup should not be held valid because it was unconscionable. Let’s find out if the court agreed with her…

South Carolina judges use this test to determine if a prenup is valid: 

(1) Was the prenup signed under fraud, duress, by mistake, or by misrepresentation? 

(2) Is the agreement unconscionable? (Unconscionable means one spouse had no meaningful choice, and so one-sided that no reasonable person would sign it)

(3) Have the circumstances changed so much since the signing of the agreement that it now makes the agreement unfair? 

The part of this test at play here is #2: unconscionability. The South Carolina court ultimately decided this prenup was VALID! In other words, not unconscionable. Remember, in South Carolina, unconscionability means one spouse had no meaningful choice, and the agreement is so one-sided that no reasonable person would sign it. 

In this case, the court explained that Wife had a meaningful choice to sign the agreement because she could have simply not married him. She also could have hired an attorney that wasn’t Husband’s best friend. The court further declared that the prenup was not so one-sided that a reasonable person would not sign it. Husband and Wife both waived their rights to the other’s property (read: not one-sided). The court reiterated that the whole point of a prenup is to decide how you want to split your assets. This prenup did exactly that. 

The lesson to be learned: a prenup in South Carolina can waive your right to alimony and your spouse’s property, even if you end up with much less than your spouse.

Hudson v. Hudson, 757 S.E.2d 727 (2014)

Divorce Statute 

Official term for Divorce in South Carolina

A divorce occurs when two people, who have been legally married, begin the court process to end the marriage. South Carolina is one of the few states that still recognize “fault” as a reason for divorce. This means that you can file for divorce based on the claim that one spouse “did something wrong.” You can also file a “no-fault” divorce in South Carolina. However, the benefit of filing “no-fault” is to have the court potentially make decisions in your favor if you can successfully prove your spouse was at “fault.” 

In South Carolina, there are four grounds for “fault” divorce: adultery, desertion for at least one-year, physical cruelty, and habitual drunkenness. On the other hand, if you want to file a “no-fault” divorce in South Carolina, you must show that you and your spouse have been living separately for at least one year. 

How to end a marriage in South Carolina

In South Carolina, there are two ways to end a marriage: annulment or divorce. Legal separation is not recognized in South Carolina, but you can still get an order of separate maintenance, which provides details regarding child custody, visitation, support, and marital assets/debts. This is a temporary order and does not actually end the marriage. 

Again, it’s important to understand that you can only file for divorce if one of the following applies to you:

• Your spouse has committed adultery
• Your spouse has deserted you for at least one year
• Your spouse has been physically cruel
• Your spouse is habitually drunk
• You and your spouse have been living separately for at least one year

If none of these apply to you, you should begin the process by ceasing cohabitation with your spouse. In other words, one of you must move out and live in another dwelling for at least a year! 

Residency requirement

Each state has residency requirements that must be fulfilled before you can divorce in that state. In South Carolina, these are the residency requirements:

– One spouse must live in South Carolina for at least one year before you file for divorce, or; 

– Both spouses must live in South Carolina for at least three months before you file for divorce.

>>For the entire fine print on divorce, review South Carolina Code of Laws, Title 20, Chapter 3

Separate Property

Non-marital property is the official term for property not considered part of the marital estate.

Non-marital property means separate property that does not get divided in the divorce. In South Carolina, courts consider gifts, inheritances, or property acquired before the marriage to be non-marital property, thus not subject to division. If this is not to your liking, you’ll need to specify it clearly in a legal document (such as a prenup or postnup) otherwise.

>>For more fine print, review South Carolina Code of Laws, Section 20-3-630

Who gets the business, and who gets the jewelry? 

In 2013, a South Carolinian couple filed for divorce on the grounds of adultery. The divorce was granted, but the big issue, in this case, was the division of a business and some diamonds. The husband was 66 years old, and the wife was 48 years old at the time of the divorce. The husband had a successful business founded before the marriage. The couple lived off the profits from the business during the marriage. The wife worked for the company and used the company car, phone, and gas card. Additionally, the husband also gifted the wife jewelry during the marriage. 

Remember, South Carolina is an equitable distribution state, meaning that “marital property” is divided in divorce. When property is deemed “separate property” (in South Carolina, it’s called non-marital property), such property is not divided, and the spouse may keep it. The question is: should the business and jewelry in question be considered marital or separate property? 

The South Carolina court said the jewelry in question should be considered a gift, and gifts between spouses during the marriage are marital property. This means the jewelry should be divided. 

As for the business, this court said it was non-marital property (a.k.a. separate property), and the husband should keep it. There are many factors the court used to support this decision. The first of the reasons is that the husband did not intend to make the business a commingled asset. The business was initially considered separate property because the husband founded it before the marriage. If it were to be considered marital property, evidence must show that the husband intended to make the business a shared asset. This was not the case here. 

Secondly, the court said that because the wife was a salaried employee for the business, it shows that her work there was not to further the business or put sweat equity into the business. Instead, she was compensated for her work as if it were any other business. Just because she worked for the business doesn’t mean the entire business itself should be considered a shared asset. 

Finally, because no marital funds were used to increase equity in the company, it shows that the business was not a marital venture. In other words, because the wife did not invest her funds or the couple’s shared funds, it is evidence showing the business was meant to be kept separate.

What’s the bottom line here? First, if you give a gift to your spouse during the marriage, it will be split up in the divorce. Second, property that you acquired before the marriage will stay your property in the divorce unless you show strong intent to have it be marital, shared property. 

McMillan v. McMillan, 790 S.E.2d 216 (2016)

Spousal Support (also commonly known as alimony)

Term used for spousal support in South Carolina: alimony

In South Carolina, you may include provisions in your prenup limiting or eliminating alimony for a spouse in the event of divorce. There are four types of alimony in South Carolina: periodic alimony, rehabilitative alimony, lump sum alimony, and reimbursement alimony. 

Periodic alimony is exactly what it sounds like: alimony paid periodically until the receiving spouse remarries or cohabits or either spouse dies. The purpose of this type of alimony is to provide ongoing support 

Rehabilitative alimony also ends when receiving spouse remarries, cohabits, or either spouse dies. Rehabilitative alimony is different from permanent periodic alimony because it declares a specific date where the receiving spouse will become self-supporting. Rehabilitative alimony can be paid periodically or in a lump sum.

Lump-sum is alimony paid in a lump sum, all at once or in payments. This type of alimony is unique because it doesn’t end when the receiving spouse remarries or cohabits. It doesn’t even end when the paying spouse dies, only if the receiving spouse dies. 

Reimbursement alimony is paying the other spouse back for investing in the other spouse’s education or career. This type of alimony ends when receiving spouse remarries, cohabits, or either spouse dies.

>>For the fine print review South Carolina Code of Laws, Section 20-3-130