Also referred to as a post-marital agreement, a post nuptial agreement is a legal document that sets forth the conditions about how a couple’s assets will be divided in case of legal separation or divorce. It also indicates the amount of financial support (if any) that one spouse will provide the other at the dissolution of marriage agreement.
The stipulations in a post nuptial agreement are basically the same in a prenuptial agreement, except that in the former, the marriage takes place first before the document is drawn up.
Unlike prenuptial agreements, however, post nuptial agreements were practically unenforceable before the 1970s. This is due to the idea that the law views a married couple as a single entity and as such, cannot enter into a contract with itself. Things began changing in the ’70s when divorce became more and more common, and states started enacting “no fault” divorce statutes.
When is it a good idea to enter into a post nuptial agreement?
Not all couples who enter into a post-marital agreement do so with the intent of getting divorced. There are many practical reasons why married couples would want this contract between them.
⦁ A post nuptial agreement can be drawn as a way of avoiding inheritance conflicts if there are children from a previous marriage.
⦁ When one spouse receives a significant increase in his or her assets or earning capacity, a postnuptial agreement can help protect the assets from uncertainties in the future.
⦁ Couples can use a post nuptial agreement to set clear boundaries about each other’s plans for the assets they brought into the marriage.
⦁ A post nuptial agreement can ensure that the spouse who decides to quit his/her job to stay home and care for minor children will have the financial resources to support themselves in the event of a divorce.
⦁ If one spouse has come across legal problems during the marriage or if he/she turns out to be financially irresponsible, a post nuptial agreement can protect the assets of the other spouse.
Requisites for a valid post-marital agreement
Like all contracts, a post nuptial agreement needs to meet the following requisites in order to be binding:
⦁ All post nuptial agreements must be in writing to be valid.
⦁ The spouses must sign the agreement voluntarily. If there is evidence of coercion or threat from one party to get the other to sign, the contract is void.
⦁ For a post nuptial agreement to be valid and enforceable, both spouses must make a full and fair disclosure of their assets, liabilities, and income.
⦁ The contract must be fair. In other words, it must not blatantly favor one spouse over the other.
⦁ A post nuptial agreement must be validly executed by having the signatures of both spouses notarized. Moreover, depending on the state where the spouses reside, there may be additional requirements that must be met.
Inclusions in a typical post nuptial agreement
While provisions included in a post nuptial agreement often depend on the governing state laws, the following are common:
⦁ How the properties and other assets will be divided when the marriage is dissolved
⦁ How marital debts, such as credit card liabilities and mortgage loans will be divided in case of separation or divorce
⦁ As part of estate planning, how assets will pass if either spouse dies while still married to each other
⦁ Whether one spouse should pay for spousal support and the length of time the support is to be given, which is important in the determination of income tax of ex-spouses in 2019
⦁ How custody and support of minor children will be determined in the event of a divorce
Discussions about the possibility of a marriage ending in divorce is often difficult. However, the intricacies of post nuptial agreement can be even more so. In this instance, marital mediation can help.