Mention the word “prenup,” and most Filipinos react with unease. The “prenuptial agreement,” a legal contract between future spouses on how their assets will be divided during their marriage, often pulls up the issue of trust, a deal-breaker that most romantic couples would rather not think about this early in their union.
In fact, when Sunday Inquirer Magazine attempted to get married and engaged couples to talk about their prenup, all of them refused. When SIM asked singles or dating individuals if they would ever consider a prenup when they get married, an overwhelming majority said no, never.
The reticence seems to stem from the Filipinos’ rather conservative culture. Most Filipinos associate prenups with foreign celebrities like Kim Kardashian and billionaires like Donald Trump, whose multiple prenups seem to presage multiple divorces. The prenup is thus seen as a hedge against future heartbreak and financial loss should one’s partner prove more mercenary than true.
Locally, it goes against the grain of love-ever-after that most couples still believe in. Anticipating anything but long-term marital bliss goes against a culture deeply rooted in family and religion.
Hazel Naredo-Ruiz, a lawyer who specializes in family law, said the negative reaction to prenups is “a knee-jerk reaction” deeply rooted in trust issues. In Ruiz’s experience, one of the first questions usually raised by a surprised or offended partner is: “Why, don’t you trust me?”
Suggesting or bringing up the subject is automatically labeled as mistrust. Filipino families are so tight-knit that any hint of doubt on the integrity or character of the prospective partner gets the future in-laws hurt, as if the family or clan reputation has been tainted. “When Filipinos get married, [you’re expected to] accept everything about the person, including the family,” Ruiz said.
But Ruiz said many negative assumptions about prenups were often based on misinformation. Prenups, or the lack of one, should not be used as a measure of love or proof of pure intention, she added.
Another lawyer, Juor Buted, who specializes in corporate law, said couples should not be afraid of legal prenups because in essence, these agreements cover only material wealth and assets, and cannot dictate other aspects of a marriage.
This is perhaps one of the most common misconceptions about prenups, he said, as prenups in other countries often include clauses on alimonies, cheating spouses and divorce.
In the United States, for example, Buted cited golf legend Tiger Woods and his ex-wife, Elin Nordegren, who received a hefty sum on their separation because their prenup stated such, should Woods be found guilty of extramarital affairs.
Sometimes, too, the amount the estranged partner receives is based on the number of years that they have stayed together.
But since the Philippine Constitution does not permit divorce, prenups done here deal only with the couple’s material possessions, also known as “property relations.”
“Prenups really involve only material things. Essentially, it’s your properties and nothing else,” Buted said. “A prenup focuses on how the properties of each of the parties will be treated: those they presently own and those they acquire during the marriage. How are they going to be divided after the marriage?”
The legal bases for prenups, also referred to as marriage settlements, can be found in the 1987 Family Code of the Philippines, which also details the laws on marriage.
In fact, Buted pointed out that “the first order of the Family Code is how the property relations of the spouses should be governed.”
According to Article 74 of the Family Code, property relations between husband and wife shall be governed in the following order: 1) by marriage settlements executed before the marriage, 2) by the provisions of the Family Code, and 3) by local custom.
The Family Code offers three regimes that can govern property relations: absolute community of property, which rules that whatever one party owned before a marriage now also belongs to the other; conjugal partnership of gains, in which assets owned before a marriage remain separately owned by each party, but any interest, tax or earnings from those assets are owned by both spouses, and complete separation of property, in which all assets remain separate during and after a marriage.
“[A prenup] takes precedence over the Family Code unless it is void,” Buted said, adding that in any prenup, the couple can choose any of the three regimes stated in the Family Code.
If there is no marriage settlement, absolute community of property will automatically govern a couple’s property relations.
Prenups don’t have to be written in a set format, nor should it have set clauses on what should be included, Ruiz said. “It can be as specific and detailed as the couple wants, and can include such details as how to apportion salaries or wages during the marriage, or commissions from their jobs. It can be very specific or as general as a complete separation of property.” (See sidebar for more information on what prenups usually contain.)
“You have to be as exhaustive and as detailed as possible, although nothing prevents you from making it very general as long as the couple entered into it knowingly, voluntarily and freely,” Ruiz added.
Contrary to popular belief, the lawyer said, prenups are not done out of mistrust between future spouses. Based on cases she has handled, the most common reason for drawing one is the protection of the assets of children born before a marriage, whether illegitimate or from a previous marriage.
While there are inheritance laws that can also protect them, prenups can be drawn to make sure that certain funds are used only for their education, or that no matter what happens, these children are ensured specific assets due them.
Another common reason is to protect family businesses and keep them intact or within the family. Business leaders who abide by this reasoning include patriarchs John Gokongwei of Robinsons Land Corp. and Zobel de Ayala of Ayala Corp., Buted said.
Other reasons include protecting a spouse from inheriting the debts of his or her partner, usually because of an age disparity between spouses.
On a more personal note, Ruiz said prenups could essentially “eliminate doubts and fears that a person is marrying you just for your money” in a situation when there is a financial gap between future spouses.
Looking at it another way, a prenup can even be viewed as romantic, as the less wealthy partner is willing to forego the money aspect just to prove his or her love.
But should a couple want legal separation in the future, prenups also speed up the process. “It’s easier… because all the questions on property relations are settled. The only question that remains is whether your marriage will be voided. That’s the only question that has to be settled by the court,” Ruiz said.
As for other conditional clauses before a marriage is allowed especially in cases where one partner’s family is against the future spouse, Buted said these are not allowed. Prenups are meant only to supplement the future spouses’ property relations. Like any other contract that binds two parties, it is similar to contracts of sales and lease. “[A prenup] is a contract within another contract—the marriage contract,” he added.
To be considered valid, a prenup need only be in writing and done before the marriage. “Anything added or details included after the marriage will need a court order for it to take effect,” the lawyer said.
Like any other contract, a prenup need three prerequisites. One, there must be consent between future spouses who are both “sound of mind,” meaning they are capable of entering into an agreement willingly. Two, there must be objects, or properties and other assets that will be included in the contract’s scope. And three, there must be a consideration that dictates the context of the agreement; in the case of a prenup, the consideration is the marriage itself.
Once a prenup is filed with the local civil registry—the same registry where the marriage contract is filed—and the Register of Deeds—where the couple’s properties are documented—the concerned parties are now bound to obey it.
The only time a prenup can be voided after it had been signed is if, after the marriage, it is found to be contrary to either “[constitutional] law, morals, public policy, public order or customs,” Buted said.
Despite its natural parameters, why are Filipinos still afraid of the prenup, or harbor reservations about it?
Aside from culture, other factors make the idea of a prenup daunting to most Filipinos.
Most couples who have one would rather not talk about it and that’s understandable, said Buted, because the details of any marriage are a private matter between the parties involved. Then when it comes to prenups, there is an added layer of sensitivity because it involves property relations that, Ruiz pointed out, is “one of the most contentious issues” in a marriage or a family dispute.
In fact, families are actually one of the biggest influences behind couples who opt for a prenup, especially if the family of one partner has a lot of assets.
“The family plays a big, big role in pushing for prenups. Ordinarily, the parties involved… are so blinded by love and so romantic (they think nothing of property relations.) Love is blind, they say,” Buted said. “[So] it’s usually the children from a previous marriage or the mother or the brother or the sister or whoever, who pushes the parties concerned.”
Although prenups seem more common among the moneyed class, Ruiz said the middle class should be encouraged to draw up one themselves.
“Even average-income families can have a prenup. It’s just as pressing and important. Why? Because you have limited assets. There is a more urgent need to protect whatever little you have,” she added.
“It’s not just for the rich. It’s not just for the famous. It’s not just for celebrities. It’s also for common folk like us,” she said, citing her own decision to push for one before she married her businessman husband a few years ago.
There are now more men and women like her, who no longer “enter marriage with rose-colored glasses,” no matter their financial status.
“I was very open to the realities of life, and even my husband was, too. But that doesn’t mean that I love him any less,” Ruiz said.
Despite their openness to the idea and mature discussions about a prenup, however, Ruiz said they eventually did not push through with the idea. As in most cases, it all came down to Filipino culture and values.
But thanks to Internet technology and more exposure to information, there is now a growing awareness about one’s financial future that is resulting in more prenups, Buted said. Or, at the very least, more openness to the idea of having one.
“It’s a changing culture. Filipinos now are getting more modern. They’re more informed because of social media and they have a lot of access to technology and information. And (finances) they now realize are a part of reality,” he said. “It’s a changing mindset,” he added. “The changing idea of what marriage is includes the possibility that one day, a couple may decide to end the union for good.
“At this point, we do not really know how your relationship will fare in 10 or 15 years’ time. So you’d like to anticipate or make provisions for how properties will be treated when that contingency comes,” Buted said.
Ruiz agreed. “I don’t want to sound trite, but one of the most constant in this world, aside from debt and taxes, is change. So somehow, feelings and emotions can change after a couple of years, just as circumstances can.”
The “debacle,” in Ruiz’s words, from the messy and drawn-out annulment between talk show host Kris Aquino and basketball star James Yap’s in 2010 is one popular example of such change. But more than the couple’s sudden change of feelings for each other, the case also had an impact as it highlighted the property rights of Aquino’s son Josh who was born from a previous relationship.
“Although her ex-husband (Yap) is an accomplished athlete himself, she obviously had more assets. What could possibly have been apportioned for [Josh] might have been affected by a prenup,” Ruiz said.
After that annulment, more people have become curious about prenups. “More and more people are now asking (lawyers) like us how to do it, how to go about it,” she said. “So we try to guide them. We explain to both parties that it’s not about the trust, that [prenups are] actually very, very convenient for both parties.”
That was exactly how Elsa, 31, and her fiancé felt, when they agreed that prenups are separate from trust issues between spouses.
The engaged couple who is due to marry in February next year, said there is nothing remotely taboo about prenups, even if they eventually decided not to draw up one.
Elsa, a banker and her fiancé, a lawyer and an entrepreneur, saw the prenup as “more of a precaution,” as both of them come from families with established businesses.
But when their families said a prenup wasn’t necessary, the couple acquiesced. It was no big deal, the couple said, “so why bother?”
It all boiled down to what Elsa and her fiancé wanted, as well as their situation. “It probably depends on the situation, your lifestyle, what your family says,” she added.
Ruiz, who had prepared close to a hundred prenups, said a lot of couples who draw up the agreement think like Elsa. “The more mature [and older] ones are pretty much OK with it. They’re more open to it,” she said.
One couple, she added, signed a prenup upon the man’s suggestion but lived “as if there was no prenup”; another man offered it to his wealthier significant other to prove that he was not after her and her family’s money.
In Ruiz’s own marriage, her choice was to have one although her husband disagreed.
Buted, on the other hand, said that given the opportunity now to get a prenup with his wife of 26 years, he’d still choose otherwise.
In the end, getting a prenup remains a very personal choice, and something that, given enough time and information, could become an issue worth mulling among couples. •
Is that prenup valid?
A prenuptial agreement is like any other legal contract and does not need to follow any specific format. But as a contract, a prenup must be in writing; verbal agreements cannot be accepted. A prenup should also contain these general details:
• A heading indicating that the contract is a prenuptial agreement
• The full names of the parties involved
• Date of writing and signing, which must be before the wedding
• Country, to make sure that the prenup complies with Philippine laws
• A clause indicating that the involved parties willingly entered into the agreement and have fully understood its contents
• A clause indicating that there are no other prenups or existing contracts between the future spouses
• A full disclosure agreement
• A severability clause
• An arbitration or mediation clause
They may also contain the following clauses:
• Statement of assets to be included in the contract, as not all of the future spouses’ assets need to be governed by the prenup
• How the future spouses’ stated assets will be divided once they’re married, whether by conjugal partnership of gains, complete separation of assets or other more detailed conditions
• What-if situations and subsequent actions regarding stated assets should the spouse dies suddenly or if one party has a child born out of wedlock
In short, a prenup can be as simple or as detailed as the prospective spouses want it to be, depending on their assets and conditions.
But no matter its length or wording, a prenup is binding as long as it is in writing and signed willingly by both parties.