Overview of Postnuptial Agreements
In the context of marriage, very few things are more emotionally charged than the prospect of getting a divorce. This is why divorce is something best reserved until absolutely necessary. Yet in some cases, a postnuptial agreement can be an effective way to provide clarity in the event of a future divorce without the need for a costly and emotionally charged divorce proceeding at the present moment.
As the name implies, a postnuptial agreement is very similar to a prenuptial agreement in its purpose. Like a prenuptial agreement, a postnuptial agreement is a contract between two parties that are already married that sets expectations with regard to ownership of certain property in the event of a divorce.
In Washington state , a postnuptial agreement is permissible, and may cover topics such as: the division of debt that was acquired during the marriage; the custody of children from a prior marriage; and the division of assets in the event of death, divorce, termination of a domestic partnership or separation. If the terms of a postnuptial agreement do not seem fair, or appear to be the product of coercion, they may not be enforceable.
It’s also worth noting that the terms of a postnuptial agreement may not alter each party’s child support or alimony obligations.
Postnuptial Agreement Requirements
For a postnuptial agreement to be legally enforceable in Washington State there are several legal requirements. These include mandatory disclosures, the requirement of voluntary informed consent, and witness requirements.
Mandatory Disclosures: The parties must make a fair disclosure to each other (unless fairly and reasonably indicated to waive disclosure) of:
– The property or financial obligations of that party; and
– The right of each party to consult with legal counsel.
Voluntary Informed Consent: If the parties have relied on the representation of a spouse in agreeing to enter into a postnuptial agreement then they have presumedly given up their right to consult with an independent lawyer. However, in this case the parties must be advised to do so and they must acknowledge their awareness of this advice before signing the agreement.
Witnesses: To be valid, a postnuptial agreement must be signed by three witnesses, one of whom is a notary.
Postnuptial Agreement Benefits
An author once said, "Hope for the best, prepare for the worst." No one assumes the end of a marriage, yet roughly half of all marriages enter into dissolution. A happy, successful marriage is what any couple dreams of, but life is uncertain and divorce might be a possibility for even in the happiest of couples. For this reason, Washington State offers each married resident a postnuptial option – an agreement that can provide benefits for self and others.
One common benefit to the postnuptial agreement is protecting what belongs to each spouse. It safeguards assets made before the wedding and any property gained after that as long those assets and property are specified by agreement. It can also address other financial agreements and/or conditions such as whether to separate or divide a specific bank or investment account to be moved to separate accounts. Also included might be provisions for when and how joint assets are liquidated in preparation for a divorce.
Any postnuptial agreement clarifies the expectations each spouse has regarding finances. Financial issues have often been cited as the number one reason a couple divorces, so specifying each party’s role can reduce financial disagreements. It can help clearly define the amount of child support each is expected to pay, who has which tax liability, what type of debt each owes, etc.
Another benefit—the amount of relief a postnuptial agreement provides: If your marriage is struggling and there has been the threat of divorce, just knowing you have a clear and quick financial exit plan if necessary can provide relief and peace.
Postnuptial Agreement Essentials
The key elements of a postnuptial agreement will often revolve around similar, if not identical, functional considerations of a prenuptial agreement. As such, the following are common elements which are typically considered in the creation of a postnuptial agreement.
Property Division: Often, the terms of the postnuptial agreement will involve the provisions which will control the division of community property in the event of a divorce or death. The allocation of real property and business interests is a primary focus, but also other items of personal property and specific accounts.
Debt Liabilities: A postnuptial agreement may also involve declarations controlling who will be responsible for the payment of debt after divorce, including liabilities incurred during marriage, and other such matters.
Spousal Support Provisions: A postnuptial agreement may control the provision of spousal support (also known as alimony) after divorce. This may also include waivers of interest in the estate of the other spouse. In Washington, spousal support is sometimes a less frequent consideration in postnuptial agreements as it is seen as less common than other forms of protections.
Postnuptial Agreement Template
While a great deal of inherent flexibility exists when drafting a postnuptial agreement, a basic template can be used to form a foundation for many agreements. The following is a sample outline of what many postnuptial agreements might contain . While this is by no means a complete or exhaustive list of provisions to include in a postnuptial agreement, it is a jumping off point for a discussion with an experienced family law attorney.
Postnuptial Agreement Mistakes
Common mistakes to avoid when creating a postnuptial agreement include using vague or ambiguous terms. These can lead to confusion interpretation down the line if the agreement must be enforced or litigated. Another mistake is failing to seek legal assistance, especially if one spouse likely has a much greater earning potential than the other. Even in a postmarital setting when there’s a generally higher degree of trust between spouses, a high-earning spouse can keep his or her bargaining power out of reach if the other spouse doesn’t have access to legal counsel and representation.
Under the revised laws of 2017, postnuptial agreements are now required to be accompanied by mandated disclosures. Those disclosures are meant to level the field by requiring both spouses to be open about their personal, business, and corporate assets, as well as debts, mortgages and other liens. Failure to comply with these mandated disclosure provisions can lead to the loss of the postnuptial agreement in any future lawsuit or legal action to enforce its terms.
Although Washington State courts have not yet specifically addressed the issue of what happens next if an agreement is lost due to noncompliance with the new disclosure provisions, the language is clear: both spouses must specifically comply with the mandated disclosure provisions, in either the pre or postmarital context, or the agreement may be deemed invalid.
When You Need to Contact a Lawyer
While it may be tempting to think that a postnuptial agreement can be easily devised without the assistance of an attorney, the stakes are significant if something goes terribly wrong later on. A postnuptial agreement is, for all intents and purposes, a business contract between spouses that dictates what will happen in the event that the contract "fails" or is terminated. The best way to ensure that spouses are protected and that a correct agreement is devised is to consult with an attorney who specializes in family law.
Even in Washington State , where "common law" marriage is not recognized, premarital or postnuptial agreements are often not signed under the most ideal of circumstances, which can lead to mistakes, omissions and disputes. If an agreement is devised without a lawyer’s advice, it is even harder to rectify issues after the fact. Consulting a family law attorney will not only help ensure that your agreement is legally binding, but also that you have discussed all of the relevant issues that may arise later on.