What is a postnuptial agreement?
Postnuptial agreements (also called postnups) are written agreements, entered and signed by both spouses after the wedding. A postnuptial agreement can address how the parties will treat their income and assets during the marriage, and how the property will be distributed in the event of divorce. However, the courts highly scrutinize the validity of a postnuptial agreement, because married people owe each other fiduciary duties (the highest duty of good faith and fair dealings to act in the other party’s best interest). Because of this high scrutiny, it is highly recommended that the couple enter into a prenuptial agreement (before the wedding) instead of a postnuptial agreement (after the wedding).
Generally, a postnup must meet the following criteria:
• Written and signed by both spouses (the signatures must be notarized);
• Voluntary (the agreement must be entered into freely, without force or threats);
• Fair (the agreement cannot be extremely one-sided);
• Full disclosure of assets and liabilities (both spouses must disclose their financial information, including income, assets, and debts);
• Attorney representation (each spouse must be represented by an independent counsel or waive such right in writing).
Postnuptial agreements are a new area of the law. The rules are complex. Additionally, if you are contemplating entering into a postnuptial agreement, it is highly recommended that you contact a competent attorney, as each postnuptial agreement must be narrowly tailored to meet each couple’s specific needs.