A post-nuptial agreement, also called a post-marital agreement, is a contract between spouses that is entered into after marriage. Like a prenuptial agreement, a post-nuptial agreement defines the parameters of the relationship and sets forth the expectations when it comes to the financial relationship between the spouses. Postnuptial agreements should not be seen as the beginning of the end of a marriage, and instead should be viewed as a predetermined plan outlining how the process of separating, should it ever be necessary.
At Gearing Rackner & McGrath, LLP, our dedicated team of family law attorneys have extensive experience drafting enforceable post-marital agreements that can help clarify expectations and lay a firm foundation for any marriage. We strongly believe that prenuptial agreements contribute positively to new and not-so-new marriages, and work to create solutions that will provide for our clients in the event of the unanticipated or unthinkable.
Why Create a Portland Post-Nuptial Agreement?
When a couple marries, they are also making the decision to share debts and assets. Even in couples where each spouse earns their own money and maintains a personal bank account, the assets of each spouse are subject to division in the event of a divorce. And under Oregon’s equitable distribution framework, an individual is not necessarily guaranteed to receive half of the couple’s total assets. Instead, courts consider a variety of factors when splitting up assets during a divorce, ultimately determining what would be “fair and equitable.” Oregon law is unique in that it also allows courts to consider the property that each spouse owned before entering into the marriage, rather than only considering marital assets. Relying on the courts to make all property division decisions creates an incredible amount of uncertainty for both spouses. Thus, many couples opt to create a prenuptial or post-nuptial agreement that outlines the couple’s intentions should they ever split up.
Prenuptial agreements and post-nuptial agreements are similar in their purpose. The purpose of both pre- and post-nuptial agreements is to recognize the interests of each spouse, as well as the legal expectations in the event of a subsequent divorce. The main difference between a prenuptial agreement and a post-nuptial agreement is that a post-nuptial agreement is entered into after the couple has been married. Partners in civil unions or registered domestic partnerships can also create premarital and post-marital agreements.
A post-nuptial agreement does not have to be the death knell of a marriage. Many couples rely on post-marital contracts for a variety of purposes, many of which are intended to strengthen a marriage. Couples interested in learning more about Oregon post-nuptial agreements should reach out to a dedicated family law attorney.
When Does an Oregon Post-Nuptial Agreement Make Sense?
Post-nuptial agreements lay out each spouse’s expectations should the marriage end in separation or divorce. By their very nature, these agreements are entered into after a couple is married. Of course, many couples decide to clarify their intentions and expectations before getting married by drafting a Portland prenuptial agreement. Indeed, a prenuptial agreement and post-nuptial agreement effectuate the same goals; however, a prenuptial agreement is not an option for a married couple.
Many couples do not want to deal with the thought of creating a prenuptial agreement while they are planning a wedding. Wedding planning is already a stressful process, and adding lawyers into the mix is not for everyone. Of course, while discussing a prenuptial agreement may initially seem to be an awkward conversation, most couples find that the conversation goes much smoother than anticipated, as prenuptial agreements are really about protecting both spouses. However, because many couples put off getting a prenuptial agreement, it is common for newly married couples to seek a post-nuptial agreement once the wedding-planning stress has subsided.
Couples who created a preputial agreement may decide that the terms of that agreement no longer reflect their intentions. In this case, the couple can create a post-nuptial agreement that overrides the prenuptial agreement, adding new terms. For example, if a prenuptial agreement was created before the spouses finished school and started their careers, it may make sense to revisit some of the issues addressed in the agreement in light of the fact that the couple’s income changed significantly.
Another situation in which some coupes seek a post-nuptial agreement is when they are considering an Oregon divorce or legal separation. By drafting a post-nuptial agreement, the couple can agree on many of the issues that will come up during a divorce. In this manner, spouses can streamline the divorce process while minimizing legal fees down the road.
Other common reasons why couples opt for a post-nuptial agreement include:
- Clarifying each parties’ wishes as they pertain to assets that were owned by each spouse individually before the marriage;
- Ensuring that children from a previous marriage will be provided certain assets through inheritance;
- Addressing one spouse’s decision to take on significant debt or otherwise financially irresponsible behavior;
- Addressing a situation where one spouse leaves an outside-the-home job to care for minor children.
Of course, there are potentially infinite reasons why a couple may wish to create a Portland post-nuptial agreement. For the most part, these agreements can cover any issue that the couple wants to address. Of course, there are specific topics that cannot be included in a post-marital agreement. Couples considering the need for a post-marital agreement should discuss their intentions with a knowledgeable Portland divorce lawyer for immediate assistance.
What Can Be Included in an Oregon Post-Nuptial Agreement?
A post-nuptial agreement can cover a wide range of topics, making them very useful to clarify each spouse’s intentions in the event of a divorce. However, by law, specific issues cannot be included in a post-nuptial agreement. For example, depending on a couple’s needs, a post-nuptial agreement may address the following issues:
- Division of each spouse’s separate assets
- Division of the marital assets
- Division of marital and separate debt
- Ownership or management of a family business
- Whether a spouse will remain as a beneficiary on the other’s life insurance policy
- Whether spousal support will be sought, and if so, in what amount
- A spouse’s ability to buy, sell or take a loan out on the couple’s property
Conversely, the issues that cannot be covered in a Portland post-nuptial agreement are those involving the children of a marriage. For example, a couple cannot include an agreement as to child custody matters because Oregon family court judges make these decisions based on what is in the best interests of the child. Similarly, child support matters cannot be included in a post-nuptial agreement because the right to child support is technically held by the child, rather than the parent who receives the payments.
Enforceability of Oregon Post-Nuptial Agreements
While many states explicitly recognize post-marital agreements, Oregon does not. However, this does not mean that all post-marital agreements are invalid. Because a post-marital agreement is technically a contract, courts rely on basic principles of contract law when determining if a post-nuptial agreement is valid and enforceable. As a result, special care must be taken when drafting Oregon post-nuptial agreements.
Certain issues, if present, can result in a post-marital agreement being declared void or unenforceable by the court. For example, if a marriage was void from its inception, any post-nuptial agreement would not be enforceable. Similarly, a court would not enforce an agreement if one spouse forced the other to sign it. Of course, these issues are relatively rare.
The Doctrine of Unconscionability
More often, courts are asked to determine whether a post-marital agreement is unconscionable. The doctrine of unconscionability refers to a contract that is unenforceable based on the fact that it is severely unfair. Courts will not typically find that a post-marital agreement is unconscionable just because it awards more to one spouse. Typically, when a court determines that a postnuptial agreement is unconscionable, the court must find:
- One of the spouses failed to fairly disclose either their debts or assets;
- The aggrieved spouse did not waive their right to know the other spouse’s financial situation; and
- The aggrieved spouse did not have actual knowledge of their spouse’s financial situation, and could not have reasonably obtained such knowledge.
While courts will not invalidate a post-marital agreement based on it proving more to one spouse than the other, it is important that the agreement not be so one-sided as to appear unfair. Because there is no statutory authority for post-marital agreements, extra care must be taken when drafting these contracts.
Consult with a Dedicated Portland Post-Nuptial Agreement Lawyer
If you were married without a prenuptial agreement, and want to know that you will be secure in the event of death, divorce or legal separation, contact the dedicated Portland family law attorneys at Gearing Rackner & McGrath, LLP. Our Oregon divorce attorneys have been drafting post-nuptial agreements for clients since 2005, and understand what to include in an agreement to protect our client while taking every precaution to ensure that the agreement is enforceable. To learn more, and to schedule a confidential consultation to discuss your situation with one of our attorneys, call 503-222-9116. We represent clients throughout Oregon and Southwest Washington, and have convenient offices in Portland and Astoria.