Postnuptial Agreements

What is a Postnuptial Agreement (or Postnup)?

Similar to a prenuptial agreement (or prenup), it is a legal document that creates rules for a married couple regarding their assets and finances upon divorce or death. The difference between a prenuptial and a postnuptial is timing. A prenuptial agreement is signed before marriage whereas a postnuptial is signed after the marriage begins.

Why have a postnuptial agreement?

There are many reasons why a couple might decide to have a postnuptial agreement. A couple may enter into a postnuptial agreement in anticipation of a possible separation or divorce. It can not only protect a spouse if they come into the marriage with large assets, but also the other spouse should their assets significantly change during the marriage. According to the California Family Law Practice and Procedure, a postnuptial agreement can be signed for reasons including but not limited to:

 

1.     To clarify ownership of property,

2.     To divide community assets,

3.     To change the character of property from separate to community or vice versa,

4.     To amend or revoke a premarital agreement.

What is the law regarding postnuptial agreements?

There are a multitude of California Family Codes that discuss postnuptial agreements. In general, the Code says that postnups can address financial settlement terms. Here are some relevant codes":

  • Cal Fam Code §1500: The property rights of spouses prescribed by statute may be altered by a premarital agreement or other martial property agreement.

  • Cal Fam Code §1620: Except as otherwise provided by law, spouses cannot, by contract with each other, alter their legal relations except as to property.

  • Cal Fam Code §1614: After marriage, a premarital agreement may be amended or revoked only be written agreement signed by the parties. The amended agreement or the revocation is enforceable without consideration.

  • Cal Fam Code §3580: Spouses may agree, in writing, to an immediate separation, and may provide the agreement for the support of either or them and of their children during the separation or upon the dissolution of their marriage. The mutual consent of the parties is sufficient consideration for the agreement.

 

There is also case law supporting the validity of postnuptial agreements.

First, in Tompkins v. Bishop, 94 Cal. App. 2d 546 (1949), the Court said that the postnuptial agreement by the couple was valid. The court also noted that spouses could contract respecting their property and to change the character of their property, whether it was separate or community.

 

Second, in In re Marriage of McCourt (2015), the issue was that the language converting separate property to community property was vague. The Court stated that language changing ownership must be unambiguous and an express declaration.

Requirements for a Valid Postnuptial Agreement

California has specific requirements for postnuptial agreements and they are as follows:

 

  1. The agreement must be written, signed by both spouses, and properly notarized.

  2. Neither spouse can be forced to sign the agreement. This includes threats, deception, coercion, and the use of physical force. The agreement must be signed and entered into freely and voluntarily.

  3. The agreement must be fair and cannot be “unconscionable.” A judge will not enforce an agreement that is serving only one spouse.

  4. The parties must be honest and transparent with each other, assets must be fully disclosed. Hiding assets, debts, income, or property will invalidate a postnuptial agreement.

Questions or concerns?

A postnuptial agreement may not be right for every couple. Cordial Family Lawyers can help you and your spouse get more information and counsel to find if it is right for you. For more information, email us at info@cordiallaw.com

Cheryl Prout