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How much do you really know about postnuptial agreements?

On Behalf of | Mar 22, 2016 | Firm News, High Asset Divorce

While many people view the prospect of executing a prenuptial agreement as decidedly unromantic or altogether unnecessary, the fact remains that it can prove to be incredibly beneficial in the event a couple splits up.

It’s important to understand, however, that the advantages offered by a prenuptial agreement aren’t necessarily a one-time-only deal, as married couples still have the option of executing a postnuptial agreement.

What is a postnuptial agreement?   

A postnuptial agreement functions just like a prenuptial agreement in that it is a legally binding contract — executed after the marriage — that establishes each side’s expectations concerning the division of assets and liabilities in the event of a divorce.

Indeed, the postnuptial agreement can be tailored to the wishes of the couple, such that it covers the entire martial estate or just a single property.

Why is it beneficial to execute a postnuptial agreement?

Aside from protecting their respective interests, a postnuptial agreement can save a couple considerable time and expense in the event of a divorce, as there will be no ensuing legal battle over property division.

Why would people even consider a postnuptial agreement?

There are many reasons why couples decide to execute postnuptial agreements. For example, a postnuptial agreement can serve as a sort of punishment for bad behavior by a spouse (i.e., agreeing to hand over a stock portfolio in a future divorce after being caught having an affair).

Far less salacious reasons include wanting to protect an interest in a family-owned business that has grown in value since the marriage or wanting to ensure that a spouse gets a bigger piece of an asset that has appreciated in value since the marriage.

Are postnuptial agreements something people actually execute?

A 2015 survey by the American Academy of Matrimonial Lawyers found that 50 percent of attorneys reported seeing an increase in the number of married couples looking to execute a postnuptial agreements during the previous three years.

How do courts treat postnuptial agreements?

In general, courts will examine postnuptial agreements more closely than prenuptial agreements given the property at stake and the rights potentially being forfeited. Indeed, those couples that fail to follow some of the basic drafting requirements, such as retaining separate attorneys, will likely see the postnuptial agreement invalidated.

If you would like to learn more about prenuptial agreements, postnuptial agreements or property division, consider speaking with an experienced legal professional as soon as possible. 


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