If you’re debating on getting a postnup, you might be thinking about whether or not they even work. Is the juice worth the squeeze? And it’s a great point. The good news is that if you follow your state laws, make sure your agreement is reasonable, and neither party is signing under duress or coercion, you have pretty good odds of your postnup holding up in many states. However, keep in mind that there are several things that will invalidate a postnup. Below, we show real case law where postnuptial agreements were set aside by a court and the reasons why. You can learn a lot from other people’s mistakes! So, let’s dive into real-life examples of failed postnups.
Don’t threaten your spouse to sign the postnup
Back in the ’80s, a Florida court invalidated a postnuptial agreement where the husband threatened to “blow up the house” and pour Clorox all over the wife’s clothes if she didn’t find a lawyer who would allow her to sign the prenup. So, the wife technically did have legal advice, but the court said this advice was negated due to the threatening behavior of the husband. While this is an extreme case, it still highlights the importance of ensuring both parties are entering into the agreement voluntarily. Threatening your partner with violence in exchange for signing a postnup will get your agreement sent right to the trash bin.
Casto v. Casto, 508 So. 2d 330, 333 (Fla. 1987).
Oral agreements are not enforceable postnups
A 2021 Colorado case demonstrates how postnuptial agreements that are “executed” verbally are not enforceable. A couple, back in 2007, verbally agreed to keep their individual retirement accounts and inheritances as separate property. They also acted on this verbal arrangement by creating an amendment to their revocable living trust (which was their estate planning vehicle) to exclude their retirement accounts, pensions, and inheritances from their trust.
However, as of 2007 the Colorado’s Uniform Premarital and Marital Agreements Act was in effect, which means it was a formal requirement that any agreements between spouses be put into writing and signed by both spouses. (Colo. Rev. Stat. § 14-2-306). Since this verbal agreement between spouses was only verbal and not signed or put into writing, it was not a valid agreement.
There was an argument made that the fact that the couple acted upon their verbal agreement by excluding certain assets from their trust constituted writing and signature, but the court disagreed.
Moral of the story? Do not verbally agree with your spouse on certain financial terms and expect that to be considered a valid and enforceable postnuptial agreement.
In re Marriage of Zander, 480 P.3d 676, (Colo. 2021)
Don’t induce your spouse to sign a postnup under false pretenses
A recent case stemming from Georgia demonstrates to us that “tricking” your spouse into signing a postnup will not do you any good. Even if that “trick” doesn’t seem that bad. A married couple (married for 34 years) were on the rocks and began discussing the possibility of divorce. However, the wife desperately wanted to stay in the marriage, so she wrote a letter to the husband renouncing her rights to any of the marital estate (which, by law, both spouses have a right to). Wife claims she did this at the husband’s request, promising her that he would tear it up as soon as it was signed. The husband took that letter and had it drawn up into a formal postnuptial agreement by a lawyer.
Several months later, the wife ended up filing for divorce, despite attempts to keep it together. The husband tried to enforce the postnup, but the wife argued it was created fraudulently–she claimed she signed it merely as a gesture of love and that she thought he was going to rip it up. Husband countered that he would only rip it up if “they were in love again.”
The result? The court said this was sufficient evidence to show that the agreement was created through fraud on the husband’s part. The court emphasized that because of the confidential relationship between spouses, Wife was entitled to trust Husband’s words and actions.
Bottom line? Do not try to trick (no matter how coyly) your spouse into signing a postnup. There’s a good chance that it’s going to get thrown out if a court finds that the situation rises to the level of illegal fraud.
Murray v. Murray, 299 Ga. 703 (2016)
Postnuptial agreements must not be overly unfair or one-sided
One of the landmark cases on postnuptial agreements comes out of Arizona in 1969. This case demonstrates how postnups should work and what the requirements for a valid agreement are in Arizona, though the postnup in the case itself was thrown out. Some states outside of Arizona even use this case an example for how postnups should work.
The case was simple: The couple signed a postnup in 1938 which stated that husband would keep all of his existing and future property separate and, in exchange, the wife would receive $100,000 and some AZ real estate. Once the husband died in 1962, the wife argued that all of his property was community property and she should get half of it. This prompted a legal battle over whether or not the postnup was valid.
The result? The court ruled that the agreement was invalid BUT that postnups are generally enforceable documents as long as they meet certain heightened contract criteria:
- There must not be any fraud, coercion, or duress
- The agreement terms must be fair and reasonable
- Each party must understand what they’re signing
- Each party must understand the full scope of their spouse’s finances
The court explained that in this case, there was evidence of inequity such as:
- The wife did not have an attorney
- There was evidence that the husband took control over his wife’s bank account so she was not able to have financial independence
- She was promised $100,000 but was never given it.
- There was a large disparity in assets between the husband and wife
- The husband stated that a woman was only entitled to $500 a month and a home to live in, but nothing more
The takeaway from this case is that the several factors listed above, together, created an unfair, inequitable postnup that was not enforceable. However, the court made sure to note that spouses should be able to make contracts with one another—there just must be certain safeguards in place to protect each person.
In re Harber’s Est., 449 P.2d 7, 13 (1969)
Each party should receive some benefit from the postnup
A case stemming from New York in 2017 illustrates how postnuptial agreements should provide at least one benefit to each spouse. While this is specific to New York, it’s a good rule of thumb to apply to all states. In this specific case, a postnup was remanded for further examination because it did not award a single benefit to the wife– it was totally one-sided in favor of the husband. She signed away rights to the marital estate, rights to inherit from her spouse upon death, and rights to alimony. The court explained that when a postnup is so one-sided that no rational person exercising common sense would make it, and no fair and honest person would accept it, it shouldn’t be enforced.
Bottom line? In New York, make sure each spouse has at least one provision in their favor. And while this may not be the rule in every state, it is a good rule of thumb to follow anyway. It doesn’t need to be 50-50 by any means but it should at least allow each person to walk away with something.
Barclay v. Barclay, 56 N.Y.S.3d 257 (2017)
The bottom line on examples of postnups that failed
As you can see from the cases above, sometimes, postnups are not enforced by a court for one reason or another. Typically, the only reasons a postnup will be invalidated is if there is evidence of some bad behavior like fraud, coercion, tricking, manipulation. In addition, agreements that are generally unfair and overly one-sided may also be thrown out. So, what can you do to avoid it? Make sure your postnup is created in a fair environment without force, lies, deceit, etc. Make sure each party has at least one favorable provision (doesn’t mean it needs to be 50/50). And make sure it’s in writing and follows all of your state’s formality requirements! But don’t be too dissuaded from getting a postnup. Here are real-life examples of postnups that have been successful.
Nicole Sheehey is the Head of Legal Content at HelloPrenup, and an Illinois licensed attorney. She has a wealth of knowledge and experience when it comes to prenuptial agreements. Nicole has Juris Doctor from John Marshall Law School. She has a deep understanding of the legal and financial implications of prenuptial agreements, and enjoys writing and collaborating with other attorneys on the nuances of the law. Nicole is passionate about helping couples locate the information they need when it comes to prenuptial agreements. You can reach Nicole here: Nicole@Helloprenup.com
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