A postnuptial agreement, also called a post-marital agreement, is a contract between spouses. Some uses of a postnuptial agreement are
- to specify ownership of certain assets in the event of a divorce (in the absence of a prenuptial agreement),
- to amend an existing prenuptial or postnuptial agreement,
- to make arrangements for financial support of children from previous marriages,
- to specify who is responsible for paying off debt, and
- to address and resolve areas of property and financial concern between the spouses.
Sometimes a postnuptial agreement provides an opportunity for a married couple to discuss problems (often centered around money) that have lingered in the marriage for years. These might be concerns over spending habits, management of the family business, or financial support of relatives. A married couple might use a postnuptial agreement to convert community property to separate property or vice versa. Oftentimes, working out the spouses’ concerns clears the air, relieving pressure on the marriage and allowing it to continue.
What Are the Legal Requirements?
A postnuptial agreement must meet the following five basic requirements:
- The postnuptial agreement must be in writing. Oral promises are not acceptable because they cannot be enforced and can easily be refuted.
- The agreement must be executed voluntarily and intentionally. No coercion or threat of any kind by one spouse is allowed. Any indication that threat or coercion was used makes the agreement null and void.
- There must be a full and fair disclosure of assets, liabilities, and income at the time of execution. Nothing must be hidden and/or ambiguous. The agreement cannot be enforced if the information provided is incorrect.
- The agreement must not be unconscionable. It must be fair to both parties. It cannot be enforced if it is deemed to be unjust to one party.
- The agreement must be signed by both parties in the presence of witnesses. If either party refuses to sign it, then it will not be considered legal.
What Is Included in a Postnuptial Agreement?
What can and cannot be included in a postnuptial agreement is governed by state law. In Texas, the law allows:
- How the couple’s assets will be divided after the divorce or death of one of the spouses. Assets include house, bank balance, cars, etc.
- Whether one spouse will be required to pay spousal support, how much, and for how long in the context of a divorce.
- How the couple’s debts will be divided after the divorce. Debts include mortgage, credit card debts, auto loans, and other loans. Keep in mind that agreements between the parties will not limit the rights of a particular creditor.
- To whom the couple’s assets will go to if either spouse dies during the marriage. The postnuptial agreement does not replace a will and should be used in conjunction with that estate planning document.
- Provision for the custody and support of minor children in the event of a divorce.
Given its many uses, a postnuptial agreement can be a useful document for any married couple. Should a post-marital agreement be part of your property and financial plan or your estate plan? Renowned Texas family-law attorney Mary Ann Beaty has many years of experience in writing postnuptial agreements and can help you with all types of family law matters.