What is a Postmarital Agreement?
A Postmarital Agreement, sometimes called a Postnuptial Agreement, is a set of rules created by a couple during their marriage for many of the same reasons that an engaged couple creates a Premarital Agreement: to govern their financial lives during their marriage and to determine what will happen in terms of property division and spousal support if they should divorce. They also believe that they can create their own rules to fit their unique situation, rules that will be preferable to those imposed by California Family Law.
There is an additional enforceability hurdle for couples wishing to enter into a Postmarital Agreement: as spouses, they are subject to a set of fiduciary duties that do not exist for fiancés. These, among others, include the duty not to take financial advantage of the other spouse. A Postmarital Agreement, since it usually includes some circumventing of community property law, is going to be subject to a presumption that one spouse is taking advantage of the other.
So while Postmarital Agreements do not appear to be expressly governed by California Family Law section 1600, case law has confirmed that the same rationale applies when enforcing them: each party must sign “freely, voluntarily and intelligently.”
In order to avoid the presumption of unfair advantage, most professionals believe that it is imperative that both spouses be represented by attorneys and that all steps be taken to show that both spouses signed the agreement freely, voluntarily and with full knowledge of rights he or she could be giving up.
Why Have a Postmarital Agreement?
Sometimes there is not enough time before the wedding to create a Premarital Agreement, so the couple waits until the flurry of wedding activity has died down and works on the agreement after their marriage takes place. Sometimes things happen that change a couple’s finances during their marriage; for example, one spouse may wish to protect his or her newly inherited separate property or one spouse seeks to be protected from the other spouse’s debt. Because there may be differences in the enforceability of Premarital Agreements vs. Postmarital Agreements, it is a good idea to get legal advice, if time permits, before choosing to forego a Premarital Agreement in favor of creating a Postmarital Agreement during the marriage.