Earlier last month, a California court ruled that the postnuptial agreement entered into by Frank and Jamie McCourt, best known in their roles as owners of the Los Angeles Dodgers baseball team, was invalid. The invalid postnuptial agreement was alleged to have given Frank McCourt sole ownership of the LA Dodgers.
The court held that this agreement was invalid because when the contract was signed, there was not a mutual understanding between the parties regarding the contents of the agreement. The court supported its decision by noting that two conflicting versions of the postnuptial agreement were signed by the spouses, and both Frank McCourt and Jamie McCourt admitted they had not read the agreement.
For those individuals who are not familiar with the term “postnuptial agreement,” it is a contract that is entered into by married spouses during marriage. The agreement typically addresses issues relating to asset protection, debt division, and spousal support.
The fiduciary duty obligations that apply to the execution of a postnuptial agreement do not apply to the execution of a prenuptial agreement. Unlike a prenuptial agreement, which is executed prior to marriage, a postnuptial agreement must be executed within the parameters of the parties’ fiduciary obligations. Specifically, the California Family Law Code explains that spouses entering into postnuptial agreements must act with the “highest good faith and fair dealing” towards each other and must not “take any unfair advantage of the other.” Although the prospective spouses entering into a prenuptial agreement do not owe each other fiduciary obligations, many other requirements must be met in order for a prenuptial agreement to be enforceable.
This ruling serves to highlight the importance of selecting a qualified family law attorney who is experienced in drafting effective postnuptial and prenuptial agreements. For more information about these types of agreements, please contact the Family Law attorneys at Lonich Patton Erlich Policastri. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.