According to the New York Times on December 9, 2007 postnups are becoming more popular. Dr. Phil has featured them on TV, and lawyers belonging to the American Academy of Matrimonial Lawyers who were polled state that they are being asked far more frequently to draft postnups. Usually, say these lawyers, the postnup is entered into after discovery of some marital infidelity and perhaps only props up a marriage for a while. The postnup does allow the parties to define their rights and obligations in the event of a divorce or separation.
Postnups are not exactly like prenups. A prenuptial is entered into prior to marriage. Presumably, the parties have a lesser ability to understand or to discern the true net worth of each other. Often, the parties to a prenup have disparity in their net worth and often in their business acumen. One party may have a far weaker position, and thus, fairness has been interjected into the requirement for enforcement of a prenuptial agreement. Case law in Michigan allows a prenup to be invalidated if the party opposing enforcement can prove that
- It was obtained through fraud, duress, mistake, or misrepresentation or nondisclosure of material fact,
- It was unconscionable when executed, or
- The facts and circumstances are so changed since the agreement was executed that its enforcement would be unfair and unreasonable.
However, enforcement of a post-nup is not so readily avoided. Over a period of about 30 years, Michigan courts had enforced postnuptial agreements upon finding that the contract was fair, equitable, and supported by sufficient legal consideration. This standard changed recently, however, when the court of appeals decided Lentz v Lentz, 271 Mich App 465 (2006). Lentz eliminates the requirement that postnuptial agreements be fair, equitable, and conscionable when they are executed in connection with settling a divorce or separation. The standard may be different if the parties execute the agreement when they intend to continue living together. If the parties are using a post-nuptial agreement to divide assets upon a separation, the court is not to rewrite the contract for them. Thus, the only basis for voiding a postnuptial agreement entered into as a separation agreement is a finding that the agreement was obtained through fraud, duress, or mutual mistake. Lentz, 271 Mich App at 473–474, 478.
This now distinguishes postnuptial settlement agreements from prenuptial agreements, which continue to be subject to a fair and not unconscionable standard under Rinvelt v Rinvelt, 190 Mich App 372 (1991. But see Reed v Reed, 265 Mich App 131, 145-146 (2005). The court in Reed declined to rewrite the parties’ prenuptial agreement to interject a “fairness” inquiry, with a decidedly harsh result.
Another interesting read on this topic is Kuziemko v Kuziemko, an unpublished decision by the Michigan court of appeals that was quoted extensively with approval by the Reed panel.