• Prenuptial and Postnuptial Agreements
  • August 21, 2003 | Author: Delano M. Lantz
  • Law Firm: McNees Wallace & Nurick LLC - Harrisburg Office
  • This article briefly summarizes the purpose and importance of Prenuptial and Postnuptial Agreements. A Prenuptial Agreement is made before the date of marriage. A Postnuptial Agreement is made after the date of marriage. The purpose of Prenuptial and Postnuptial Agreements is to vary by contract the matrimonial laws that otherwise apply to the marriage relationship. The basic rights, duties and obligations between married couples under Pennsylvania law absent a Prenuptial or Postnuptial Agreement are as follows:

    Marital Property - Except for the value of gifts and inheritances at the time received, all property acquired during the marriage is considered marital property. This includes retirement benefits. Titling of property acquired during the marriage in the name of one spouse will not exclude it from marital property. Property acquired before the marriage is not marital property. With respect to gifts and inheritances, the increase in value of any gifts or inheritances from the date of receipt until the date of final separation (if ever) becomes part of the marital property. For example, if a spouse received a $10,000 gift, the $10,000 gift is not marital property. However, if the $10,000 gift increases in value to $15,000, then the $5,000 increase in value is part of the marital property. Marital property also includes property placed in joint names, even if the property was originally received by one party as a gift or inheritance, or was brought into the marriage by that party. Therefore, if one party receives a $10,000 gift or brings $10,000 into the marital relationship, and places it in joint names, it becomes marital property.

    Non-Marital Property - Non-marital property includes any property owned before the date of marriage and any gifts or inheritances received during the marriage. However, any increase in value of any such property is considered marital property.

    Commingling of Separate Property and Marital Property - Under Pennsylvania law, if non-marital property is commingled with marital property, then the property will be presumed to be marital property. The party claiming otherwise must prove its status as separate property. If the property is placed in joint names, the jointly titled property will be considered marital property.

    Division of Marital Property - In the event of a separation and divorce, the Court divides the marital property equitably among the parties based upon various factors set forth in the Divorce Code. One of those factors is the nonmarital property set aside to either party. Thus, the greater the value of non-marital property set aside to a party, the more likely the Court may be to apportion a greater share of the marital property to the other spouse.

    Spousal Support, Alimony Pendente Lite and Alimony - Under the Divorce Code, a dependent spouse is entitled to claim alimony pendente lite (APL) where a divorce action is pending. Alimony pendente lite can be obtained by the dependent spouse irrespective of any "fault" on the part of that spouse. The dependent spouse could be living in another relationship and still receive APL. A dependent spouse may seek spousal support under the support statutes even though a divorce action has not been filed. The dependent spouse who is "at fault" may not be entitled to receive spousal support, but upon the filing of a divorce action, can seek alimony pendente lite which is not subject to any fault defense. The amount of APL or spousal support generally is based on a formula and may be as high as 40% of the difference in net incomes. Upon entry of a divorce decree, a dependent spouse may be entitled to receive alimony, depending upon the economic circumstances at the time of the divorce. Alimony is awarded where necessary and the duration and amount of alimony is determined by the Court. Alimony ends upon remarriage or cohabitation. No formal guidelines are used for determining the amount of alimony.

    Attorneys' Fees and Expenses - Under the Divorce Code, a party in a divorce proceeding may make a claim for attorneys' fees and other expenses incurred in litigation. The Court may award all, some or none of such attorneys' fees and expenses, depending upon a variety of factors.

    Rights of Inheritance - Under Pennsylvania law, a spouse has a right to elect against a will and receive a statutorily determined portion of the estate of the deceased spouse, generally one-third of the probate estate. If there is no will the spouse is entitled to the share of the estate set forth in the Probate, Estate and Fiduciaries Code.

    Importance of Prenuptial or Postnuptial Agreements - A Prenuptial or Postnuptial Agreement allows the parties to modify by agreement their rights, duties and obligations in some or all of the above areas. In the absence of such an agreement, the parties' rights will be governed by laws which may or may not achieve the parties' personal and business goals. A nuptial agreement (pre or post) can be an important part of planning for wealth and business succession. The provisions of a Prenuptial or Postnuptial Agreement can vary substantially in order to achieve the objectives of the parties to the Agreement. Under current Pennsylvania law, where the parties make a full disclosure of assets and income and there is no undue influence, fraud, mistake or the like, the Courts should enforce the Prenuptial or Postnuptial Agreement as made by the parties. Both parties to the agreement should be separately represented by counsel. This article provides only a brief summary of Pennsylvania Matrimonial Law and the effect of a Prenuptial or Postnuptial Agreement relative to the rules of Pennsylvania law that would otherwise apply. There are various nuances and details that cannot be adequately explained in this article.