An Overview of Prenuptial Agreements in Colorado
What is a Prenuptial Agreement?
What is a prenuptial agreement in Colorado? This was a conscientious new client that before she married her fiancé, who already had children, she asked me the important question about a prenuptial agreement. She had heard a lot about these in Hollywood with celebrity marriages but honestly knew nothing about what a prenuptial agreement was.
A prenuptial agreement is a contract between two people before marriage. It is sometimes called a prenup or antenuptial agreement, and it sets out what each person will do if the marriage does not work out. A couple comes to look us up when the divorce has started. While we can certainly work with you at that time, the prenup is a lot easier to create when both people want to create the agreement, and one of the parties is not sitting in a whole lot of pain and emotional distress from the breakup.
Most everyone has heard about how Britney Spears was married, got a divorce and had her first marriage annulled. The news was just a short blip but it demonstrates that marital agreements are manageable tools when it comes to divorce if you have the agreement in place well before the divorce even starts.
Some people get conjugal property agreements mixed up with a prenuptial agreement. A prenup is not meant to supersede a convenant marriage. These types of marriages are designed to be more difficult to end , and in some cases, it is difficult to reach an agreement in a conventional divorce because of the need to go through counseling, waiting period, and conditions for divorce.
A premarital agreement is not going to address child custody arrangements, child support, alimony, child relocation, paternity papers, step parent adoption forms, or any family law papers that are related to a child or now adult child. Anything in the premarital agreement that is not about property rights during the marriage, some kind of profit sharing, how debts are going to be handled, which party will pay taxes, or things during the marriage that affect property holds, is outside of the framework of a valid prenuptial agreement.
Prenuptial agreements in Colorado are governed by the Uniform Premarital Agreement Act, found at C.R.S. 14-2-309. These requirements must be followed if you want the prenup recognized by the court.
Essential Elements of a Colorado Prenuptial Agreement
To be enforceable in Colorado, a prenup must contain several key elements: Both parties must enter into the agreement voluntarily: this is relatively straightforward – the agreement needs to be freely entered into without duress. But it may be something the court looks into more deeply. For example, the court may believe there was undue influence if the states an agreement is not signed within 14 days of the wedding. And the parties must agree to the terms without coercion or force from the other party. Disclosure of assets and liabilities: the disclosure is essentially a financial statement that the parties must sign. In fact, Colorado law requires that specific financial data be included. There is a provision for full and fair disclosure, and language to state if the disclosure is absolutely final or perhaps subject to change. It is critical to full financial disclosure in a prenuptial agreement. Missing creditor issues, or not disclosing the full extent of your assets can result in your prenuptial agreement being overturned. The agreement must be in writing: this is pretty self-explanatory. The agreement must be signed: both parties must sign the agreement. A failure to do so can legally void the prenup agreement. Both parties must have an opportunity to have a lawyer: while it is not legally required for parties to have legal representation, the failure to allow either party to have an attorney present is grounds for court dismissal of the agreement. If both parties believe each party got adequate time to have their own attorney examine the agreement, then the courts will likely uphold the pre-nup.
Advantages of a Prenuptial Agreement
In addition to the protection of assets, the elimination of uncertainty is one of the strongest arguments in favor of a prenuptial agreement. Part of that certainty comes from knowing the financial position of both spouse even before the marriage takes place. In fact, there are long-established financial disclosures that must be completed by both parties prior to signing any prenuptial agreement. In some cases, after execution of the prenuptial agreement and prior to the marriage, additional disclosures are exchanged to assure that any unforeseen circumstances (new assets and liabilities) are fully disclosed.
We have found that clients who are considering a prenuptial agreement and are in a good relationship prior to the marriage report feeling even better after the prenuptial agreement is executed. There appears to be a direct link between the commitment of the parties to one another and the recognition that both are willing to fully disclose their assets and debts.
We have also experienced a period of time, typically less than a year following the execution of a prenuptial agreement, when one or both parties suffered a drastic change in circumstances (sudden job loss, unexpected inheritance, or increased business income). Under these circumstances, in some cases both parties agreed that the prenuptial agreement should be modified to address these changes. Even in these limited circumstances, the parties were more willing to approach the modification because it was recognized that the agreement was fair and balanced while addressing the unforeseen changes.
Specifics and Limitations
In Colorado, a prenuptial agreement cannot be used to limit the right of a child to support or otherwise provide for the child’s future. It must be reasonable at the time it is signed (not at the time of enforcement). It cannot restrict any parental rights or duties concerning future children. The agreements are considered contracts and in order to be enforceable must be signed freely and voluntarily. In other words, if you are not allowed to make changes to your prenuptial agreement after you initially sign it then the court may decline to enforce it.
Finally, the court may decline to enforce a prenuptial agreement if the party against whom enforcement is sought proves that, before execution of the agreement, that party:
- (1) Was not provided a fair and reasonable disclosure of the property or financial obligations of the other party;
- (2) Did not voluntarily and expressly waive in writing any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided; or
- (3) Did not have, or reasonably could not have had, adequate knowledge of the property or financial obligations of the other party.
These agreements can be problematic in front of a judge who lacks a full understanding of the parties at the time of the enforcement request. Kept in place, the provisions established in a prenuptial agreement can lead to unfair decisions that may not comply with the law.
Drafting a Prenuptial Agreement in Colorado
Under Colorado law, a prenuptial agreement is valid if the following conditions are met: (a) the agreement is executed voluntarily; (b) the agreement was not unconscionable when assessed against the facts at the time that it was executed; and (c) the party against whom enforcement of the agreement is sought was given a reasonable disclosure of the property or financial obligation of the other party; (d) the party against whom enforcement of the agreement is sought did not have , or reasonably could not have had, adequate knowledge of the property or financial obligations of the other party; and (e) the agreement was entered into the full knowledge that after marriage neither party would have any right to spousal support. (Section 14-2-309 C.R.S.) It is generally advisable for each party to be represented by an attorney to insure that the agreement meets the statutory requirements, to negotiate the terms of the prenuptial agreement and to draft the agreement.
Varying and Revoking Prenuptial Agreements
After a prenuptial agreement is entered into it may be amended, revoked or renegotiated. A mutual agreement to amend or adjust the pre-nup terms can be made by the couple, but it is not enforceable until a formal document is prepared, signed and notarized. The amendment document must be filed with the county court clerk and a copy provided to both parties. In situations where one spouse becomes seriously ill or disabled the court may allow for a modification of the pre-nup to provide for care of that spouse. Another circumstance under which the prenuptial agreement may be modified is if one party commits a crime and it retroactively or prospectively changes the outcome of spousal support, inheritance or the division of property upon divorce. In cases where a party can demonstrate that a prenuptial agreement is based on lies or unfairness, or that it was caused by fraud, duress or undue influence it may be declared invalid. If the agreement is the product of mistaken facts, mistakes about characterizations of property and is not made under proper legal processes it may be voided in court. Finally, a prenuptial agreement may be declared invalid if a party waives or gives up their right to spousal maintenance.
Common Misunderstandings
A common misperception is that only the wealthy have these contracts. There can be a lot on the table for both spouses in a second or third marriage, especially if you have children from a prior marriage, and it can be a very important contract. If you do have assets, it is a good idea to get it in writing, even if you are on the same page with your spouse.
Another misperception is that these contracts are for people who have already made up their minds to divorce. It’s really upfront planning to cover things that may happen down the line in the event of divorce.
Another common misperception is that it’s an indication of distrust. Getting one can actually show that you trust your spouse completely and that you are willing to be honest about your assets.
Resources and Assistance
Colorado residents seeking legal assistance or more information regarding prenuptial agreements prior to marriage can access a number of resources to guide them in the formation of a prenup and to retain legal representation for prenuptial matters.
The Colorado Bar Association maintains a "Lawyer Referral Services" page on its website that allows residents to search for attorney members based on practice areas and location. This service is offered through the Colorado Network Lawyer Referral Service, and allows users to request a consultation with a local attorney who handles prenuptial agreements.
The Rocky Mountain Chapter of the American Academy of Matrimonial Lawyers, which serves Colorado, Montana and Wyoming, also offers access to the members of their organization for attorney referrals. In addition, the highly respected committee publishes a "Guide to the Specialization of Matrimonial Law," which provides information regarding who best to contact for various matters .
The Colorado Judicial Branch website provides a number of resources for those in need of legal assistance or information. The Family Law Self Help Center page contains a number of resources for information about Colorado prenuptial agreements, and links to assisting organizations that may help for parties who cannot afford representation or do not know where to start for legal help or representation.
For those who wish to proceed pro se with a prenuptial agreement, the state judiciary website provides Richlieu’s Colorado Prenuptial Agreement. Richlieu’s Colorado Prenuptial Agreement contains stipulations that meet Colorado law requirements, and allows a party to add some additional terms to cover aspects of a potential divorce if it were to occur.
Based on the facts and circumstances of each particular situation, help regarding prenuptial agreements may also be found by contacting local colleges and universities that offer degree programs or continuing education courses in family law or helping professionals.