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A Better Partnership
June 12, 2015

MSC to determine whether prenup trumps statute providing for spousal support

In Allard v. Allard, No. 150891, the Michigan Supreme Court granted leave to appeal on the issues of an antenuptial agreement or prenup trumps Michigan statutes allowing a court to distribute either spouse’s personal or real property when necessary to provide support of either spouse.  If the statutes control, the court will also address whether real estate held by one spouse’s limited liability companies can be treated as marital assets.
MCL 552.23 provides that if, upon divorce, the marital assets are insufficient to provide for the support of either spouse, the court may distribute either spouse’s real or personal property and award spousal support out of either spouse’s real or personal property.  MCL 552.401 provides that a court may distribute the property of either spouse where the other spouse has contributed to the acquisition, accumulation, or improvement of the property.
The parties’ antenuptial agreement provided that the spouses would keep their separate property separate, and all property owned jointly during the marriage would be split 50/50 in the event of a divorce. The agreement further provided that any increases in the value of separate property due to the effort of either spouse would remain separate property. During the marriage, the husband controlled several LLCs that owned significant real estate, including the marital home. The Court of Appeals held that the antenuptial agreement was enforceable, although remanded to the trial court in order to determine whether the wife may be entitled to some of the proceeds from the LLC’s real estate because they qualified as marital income.

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