Postnuptial Agreements can be Useful in Financial Planning
A postnuptial agreement is a contract entered into between two people during the course of their marriage. Celebrities, Hollywood-types and business moguls appear to have pioneered the use of postnups. For example, according to Psychology Today, businessman and celebrity Donald Trump reportedly had his former wife Ivana sign an entire series of postnups prior to their divorce.
According to media sources such as the Huffington Post and Fox News Magazine, postnups have now gone mainstream. Indeed, the Daily Beast reports that postnups are now popular among all income brackets. Their popularity appears to have grown significantly during and following the recent economic downturn. Fox News Magazine says that one survey showed that 51 percent of family law attorneys are reporting increases in the number of clients making inquiries about postnuptial agreements.
A Huffington Post article says that postnups can cover any number of issues arising during a marriage including those pertaining to finances, assets, and property and probate matters. Such agreements can serve as a tool to help prevent marital "trouble spots" from escalating into conflict that might pose dangers to the long term viability of the marriage.
A postnup can be entered into at any age and at any point during a marriage. Often, postnups are simply just another type of financial planning instrument. For example, in the 1984 decision of Matter of Estate of Beesley, a series of four postnuptial agreements entered into between a husband and wife were essentially used by the parties as a means of estate planning in the event that the husband predeceased his wife. There, the Utah Supreme Court upheld the postnuptial agreements in question.
Fox News Magazine advises that before a postnup is entered into, it is wise if both spouses are represented by legal counsel. Moreover, both husband and wife should make a complete and full financial disclosure to each other. No relevant information should be left out or omitted that might form the basis of a claim that the agreement was flawed by the withholding of key financial data.Postnups in Utah
Based upon decisions rendered by the Utah Supreme Court, a postnuptial agreement, in order to be valid, must meet the following requirements:
- The agreement must be based upon "consideration" in the sense that both parties must agree to give up something in the exchange.
- The agreement must be free from fraud.
- The agreement must be free from any coercion.
- The agreement must be marked by good faith, honesty and candor by each spouse.
Keep in mind that a husband and wife are not strangers haggling "at arm's length" such as the type of negotiations one might expect to see at a car dealership. Being married, spouses owe each other a fiduciary duty of acting in the utmost good faith and candor. Undoubtedly, if a postnuptial agreement is tainted by some type of unscrupulous behavior, such as a failure to fully disclose one's financial situation, that agreement would not be enforced by the Utah courts.Drafting Postnups to Conform to Utah Law
It might not be the wisest course to attempt a "do it yourself" postnup. Postnups will not be enforced unless they comply with the requirements of Utah law. If you believe that a postnup would be useful in your financial planning, perhaps to nip in the bud potential marital conflicts, you should contact an attorney who has experience in handling family law matters. The attorney will be glad to discuss with you the advisability of a postnuptial agreement.