Pre and Post Marital Agreements

What are the Different Types of Martial Agreements?

There are different types of martial agreements that are covered in the Family Law Code. A prenuptial agreement or premarital agreement is an agreement that is signed prior to the marriage.  This agreement may outline whether or not spousal support will be paid or will determine the character of the assets during the marriage. The agreement may allow for community property to be accumulated or they may indicate that all property will remain separate property.

A post-nuptial or post marital agreement is an agreement that occurs after a marriage. In many cases where a spouse is entering into a partnership agreement or some other business interest, the business may require that a post marital agreement be signed.  In some instances the parties have separated or may have even filed for Divorce and they decide to reconcile.  In theses cases they may decide that they want to have a post-nuptial agreement prepared to protect their interests in the event that the reconciliation does not work out for them.

Marital Agreements: Are They Really Enforceable? Why Should I Get One?

One major aspect of family law is prenuptial agreements. I have handled divorces where a premarital agreement was involved but for one reason or another it was deemed invalid according to the courts. I have also helped clients prepare their own prenuptial agreement. Clients usually have several questions about premarital agreements, so I’ve decided to list the most asked of these questions with the answers I usually give my clients.

My fiancée/spouse wants me to sign a premarital agreement, does that mean he doesn’t love me?

There are many reasons why a person wants a premarital or prenuptial agreement.  A prenuptial agreement protects the interest of both parties and makes the distribution of property easier during a divorce or upon the death of one of the parties.  There are cases where a spouse may own a business or may have accumulated property which they wish to remain their property in case something happens to them or the parties decides to part ways.

A premarital or post marital agreement may also protect you against claims from a third party.  Many professionals such as doctors or attorneys will have a premarital or post marital agreement in place to protect their spouse against claims arising from their practice.

Does the agreement need to last forever?

There are many couples that enter into agreements which remain valid for a maximum number of years.  There are other agreements which provide for various distributions after various lengths of marriage.  A couple may also wish to dissolve the agreement after they have been married for a certain amount of time. They would sign a separate agreement which would modify or revoke the previous agreement.

What can be in the agreement?

Parties can agree on issues such as the characterization of property, how community property should be handled, ownerships of businesses and all other issues pertaining to either the separate property or community property of the spouses.  Parties may also agree to spousal support payments, minimum or maximum payments, waivers of spousal support and duration of spousal support. 

Agreements which contain provisions for child support or child custody are unenforceable as to any language pertaining to child support or child custody.

Are Post-Marital Agreements Enforceable?

Spouses may enter into an agreement which pertains to rights in property or spousal support or they may enter into an agreement to revoke or modify an earlier prenuptial agreement. These agreements will be enforceable and can be used for the following purposes.

To amend or revoke a premarital agreement. If the spouses had an earlier agreement that limited spousal support they may decide that they want to renegotiate that provision if one spouse is leaving their job to care for the children.  In other cases, they may be investing together in an asset and wish to have a separate agreement pertaining to that asset.

To clarify their ownership of property: In some cases one of the Spouses may inherit from a relative and they wish to use those funds to purchase property.  They do not wish to create a community interest in that property therefore they may wish to have a postnuptial agreement prepared. In other cases the parties may have been keeping the accounts separate without an agreement and they wish to clarify the property interests in those accounts.

To change (transmute) the character of property from separate to community or from community to separate or from separate of one spouse to separate of the other spouse. Property which is purchased prior to the marriage is considered to be separate property while property acquired during the marriage is presumed to be community property.  There may be many reasons why a spouse wishes to change the character of the property therefore the way to accomplish this is through a postnuptial agreement.

Where one spouse wishes to have a premarital or post maritial agreement, it is best to start the conversation before the wedding plans start or if they are married the conversations should start before the agreement is prepared. 

When a premarital or postmarital agreement has been properly prepared and signed, it can save parties a lot of time an expense in the event of a death or divorce.  It can also set forth each party’s expectations prior to the time of the marriage. The agreement may also open discussions which the couple should have before deciding to marry.

Many people think that prenuptial  and post nuptial agreements are unromantic and falsely believe that if their fiancé or spouse wants wants to sign one they aren’t really committed to them, but if done correctly a prenuptial agreement can protect the interests of both parties involved.

Is a Pre-Nuptial Agreement Really Enforceable?

In California, premarital agreements must conform to California Family Code § 1615. In order for an agreement to be valid ALL of the following factors must be met:

The parties must execute/sign the agreement voluntarily. If a party is coerced into signing the agreement, then it would not be voluntary.  The agreement must not be unreasonably unfair to either party.

Both parties must be provided a fair, reasonable, and full disclosure of the property or financial obligations of the other party. If it is found that a party did not have, or reasonably could not have had, an adequate knowledge of the property or financial obligations of the other party, the party may seek to invalidate the agreement based on the non-disclosure of the other spouse.

Both parties must voluntarily and expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided.

Both parties must be represented by independent legal counsel at the time of signing the agreement or, after being advised to seek independent legal counsel, expressly waived, in a separate writing, representation by independent legal counsel.  This means that each person should have their own attorney review the agreement prior to the time that they sign the agreement. If they choose not to have an attorney review the agreement, they must state in writing that they do not wish to have their own attorney.

Both parties must have at least seven calendar days between the time they are shown the finalized agreement and advised to seek independent legal counsel and the date that they sign the agreement.  If you attempt to present your future spouse with the agreement the night before your wedding, then it will likely be deemed to be invalid.

The parties must be fully informed of the terms and basic effect of the agreement as well as the rights and obligations he or she was giving up by signing the agreement, and was proficient in the language in which the explanation of the party’s rights was conducted and in which the agreement was written. If one spouse does not read or write English, the agreement must be provided in their native language.

The explanation of the rights and obligations MUST be in writing and the writing must be delivered to the party prior to the time that they sign the agreement. The  party shall, on or before the signing of the premarital agreement, execute a document declaring that he or she received the information required by this paragraph and that document must clearly state who provided that information.

 

The agreement and the writings executed pursuant must not be signed under duress, fraud, or undue influence, and the parties did not lack capacity to enter into the agreement (meaning they were of the proper age and mental capacity to sign the agreement.

In my practice, I have seen many prenuptial agreements be deemed invalid because one or more requirement was not satisfied.  Therefore it is important to make sure that both spouses are represented and they fully understand the agreements that they are making with each other.

Are Post-Marital Agreements Enforceable?

The first defense against a long-term spousal support award is that the requesting party does not need support because his or her estate after judgment is sufficient to meet her needs. There are several cases which deal with the sufficiency of a spouse’s separate property to eliminate any support entitlement. 

Courts have that in assessing whether a supported spouse’s separate estate was sufficient to meet their needs and eliminate a support order, the court could consider the principal of the estate, not just the interest or other income earned from the assets.

 

To clarify their ownership of property: In some cases one of the Spouses may inherit from a relative and they wish to use those funds to purchase property.  They do not wish to create a community interest in that property therefore they may wish to have a postnuptial agreement prepared. In other cases the parties may have been keeping the accounts separate without an agreement and they wish to clarify the property interests in those accounts.

To change (transmute) the character of property from separate to community or from community to separate or from separate of one spouse to separate of the other spouse. Property which is purchased prior to the marriage is considered to be separate property while property acquired during the marriage is presumed to be community property.  There may be many reasons why a spouse wishes to change the character of the property therefore the way to accomplish this is through a postnuptial agreement.

Where one spouse wishes to have a premarital or post maritial agreement, it is best to start the conversation before the wedding plans start or if they are married the conversations should start before the agreement is prepared. 

When a premarital or postmarital agreement has been properly prepared and signed, it can save parties a lot of time an expense in the event of a death or divorce.  It can also set forth each party’s expectations prior to the time of the marriage. The agreement may also open discussions which the couple should have before deciding to marry.

Many people think that prenuptial  and post nuptial agreements are unromantic and falsely believe that if their fiance or spouse wants wants to sign one they aren’t really committed to them, but if done correctly a prenuptial agreement can protect the interests of both parties involved.

Marital Agreement Review

In order to be enforceable in the event of divorce or death, it is imperative that BOTH spouses have an attorney to represent their interests and advise them on their rights and any changes to those rights by signing the agreement. Generally, the attorney will also certify the Marital Agreement for the clients and may negotiate additional terms that are favorable to their client or clear up any ambiguities.  Our office prepares agreements and we also work with other counsel on review of agreements prepared by a spouses attorney.

We will also certify the agreement and review the terms that are set forth in the agreement with our client.  A marital agreement is a collaborative process and we work with your spouse’s attorney to insure that both parties goals are reached through the agreement. 

For more information please call our offices at (949) 891-0091