What was once an open question in New Hampshire—whether or not postnuptial agreements are valid—has now been resolved by the New Hampshire Supreme Court in Estate of Richard B. Wilber, No. 2012-368 (2013).
This case arose out of the 9th Circuit Court—Nashua Probate Division where a wife filed a claim against her late husband’s estate after being cut out of his will. The decedent and his wife had been married for 50 years. A few years before the decedent’s death he and his wife executed an Agreement which agreed to transfer property from one spouse to the other and to a life estate, as well as a reciprocal agreement for each spouse not to make any claims against their respective properties during the spouse’s life or after a spouse’s death.
The question here was whether wife’s request for a spousal share in husband’s estate was valid or if she waived that right by execution of the “Agreement”—determined by this Court to be a postnuptial agreement, and whether postnuptial agreements were valid in New Hampshire absent statutory authority (as exists for prenuptial agreements) or without the Supreme Court recognizing their validity.
The Court defines a postnuptial agreement as “’an agreement that determines a couple’s rights and obligations upon divorce’ or death, but, unlike an antenuptial (prenuptial) agreement, ‘is entered into after a couple weds but before they separate.’” Id. at 2.
In discussing recent trends in the law, the NH Supreme Court discussed the general recognition of postnuptial agreements among courts of different states despite the lack of legislative approval in Kansas, Massachusetts, California, Connecticut and New York. Id. at 3. The Court found no compelling reason to depart from that trend and held that postnuptial agreements may be enforced in New Hampshire.
Interestingly, despite the fact that the trial court had struck down the Agreement, holding it lacked “fundamental fairness in that there is no accompanying financial disclosure document or any indication that one was provided, and there was no indication that Mrs. Wilber was provided with or offered legal counsel,” the Supreme Court reversed and remanded that decision. The Court discussed the legal standard used to invalidate (or attempt to invalidate) a prenuptial agreement, and held that the wife failed to meet her burden to demonstrate that the Agreement was unfair in this case. The Court held that there was no evidence submitted suggesting fraud, mistake, or duress. The Court noted testimony from the husband’s son that the wife had requested the Agreement be drawn up and dictated its terms. Further, the fact that there were no accompanying financial disclosures did not reflect that there was a material fact withheld from wife or that the agreement was obtained through such nondisclosure. Wife was not being provided with or offered legal counsel did not invalidate the agreement, and the Court stated that the husband and wife were free to enter into this contract without hiring counsel (though it noted it may be advisable to do so). Id., at 5-6.
The Court went on to state that there was no indication from the record that the wife did not understand the financial implications of the Agreement, and that she was married to the husband for fifty years and had paid the couple’s bills for some part of the marriage. The Court cited dicta from a Wisconsin decision that “independent knowledge of the opposing spouse’s financial status may be a substitute for disclosure.” (Quotations omitted). Id. at 6. Neither was there any indication based on the record that the agreement was unconscionable. Id.
It appears that not only has the Wilber case provided the asnwer to whether postnuptial agreements are enforceable in New Hampshire, but the Court seems to have relaxed its stance slightly in terms of the requirements to have a valid and enforceable prenuptial or postnuptial agreement.
Nevertheless, particularly when there are a substantial assets at stake, it is always a good idea to have full financial disclosure, an attorney on both sides, and execute the Agreement in sufficient time before a wedding in order to have the strongest case for a prenuptial agreement to be binding and enforceable. Even when a prenuptial agreement has been prepared and signed, it is often the case that in divorce litigation a perceived weakness in the agreement can leave wiggle room for risk, often providing parties with concern about the enforceability of the agreement. As for a postnuptial, they are enforceable in New Hampshire, but it would be advisable to exercise the same precautions in preparing and executing one as one would with a prenuptial agreement.
For more information about prenuptials or postnuptial agreements, contact attorney Jessica L. Ecker, Esq.