Most people have a general idea of a prenuptial agreement – prior to entering a marriage, parties want to clarify property division and spousal support in the event the marriage ends in divorce. The prenuptial agreement has many advantages, principally the ability to simplify the divorce process by dealing with the most contentious issues before the marriage even takes place. It gives parties a certain degree of comfort that whatever financial concerns they had upon entering marriage have been addressed suitably.
But marriages take a life and course of their own, and sometimes the path a marriage takes moves beyond those expectations that went into a prenuptial agreement. Or, perhaps, the marriage has changed in certain ways and the parties have no prenuptial agreement, and would like to have clarity about property or support given the changes in the marriage.
A postnuptial agreement, in Missouri, works the same way as a prenuptial agreement. It must afford both parties the chance to consult with an attorney, it must include full disclosure of financial resources, it must be voluntary and must not be unconscionable – the law’s favorite word for fundamentally unfair to one party. If the agreement meets these hurdles, our courts will enforce them as a separation agreement upon divorce.
What changes typically trigger a postnuptial agreement?
First, the circumstances in the financial condition of the parties change in a manner not anticipated prior to marriage. For example, the parties did not have a prenuptial agreement and one party comes into a large inheritance. Prior to claiming the inheritance, that spouse may want to protect the inheritance from becoming marital property, and a postnuptial agreement can accomplish that quite clearly. Or, even if parties have a prenuptial agreement, the parties may have changed financial roles during the marriage – one spouse became much more successful than anticipated, making the terms of the property distribution or support no longer relevant or fair. In this situation, the parties renegotiate the terms of the prenuptial agreement to some respect.
Second, the circumstances in the physical condition of one or both parties change. For example, one spouse may become chronically ill and need a form of security that only a postnuptial agreement, together with some financial planning, can provide – health insurance, including long term care; retirement benefits; and hospice care.
Third, the behavior of the parties may change so that one party wants to renegotiate financial terms to continue staying in the marriage. If one spouse cheats, becomes abusive or the parties become estranged but want to remain for the children, a postnuptial agreement can serve as a “pre-divorce” by laying out the future separation terms, including carrots to stay in the marriage, like additional maintenance or retirement funds.
As this article in Bloomberg news notes, postnuptial agreements have grown in popularity and significantly lessen conflict at divorce because the terms become rather ironclad.
If you have questions about postnuptial agreements, contact us – we can help.