What Is the Difference Between a Postnuptial Agreement and a Separation Agreement in North Carolina?

Most people know that spouses considering divorce often enter into a separation agreement to address property division and support issues. Some married couples are not aware that North Carolina law also permits spouses to draw up a second type of agreement addressing some of the same matters, commonly referred to as a postnuptial agreement, postnup, or post marital agreement.

There are significant differences between a postnuptial agreement and a separation agreement, including the situations in which they are used. Settlement agreements are more common, but there are times when spouses should consider creating a postnuptial agreement.

What Is a Postnuptial Agreement?

A postnuptial agreement is a legal contract executed by spouses during the marriage, while they are living together. The contract typically addresses matters relating to asset property division and spousal support in the event the couple decides to separate and divorce. To be legally valid, a postnuptial agreement must be in writing and signed by both parties in front of a certifying officer.

One primary difference between a postnuptial agreement and a separation agreement relates to the time of execution. Spouses enter into a postnuptial agreement while they are still living together. If the spouses live apart and intend to divorce, terms relating to property and support will be in a separation agreement, not a postnuptial agreement.

A postnuptial agreement addresses property division, including joint assets that are marital property. The agreement addresses matters that would otherwise be subject to North Carolina’s equitable distribution law. It also can address spousal support in the event of separation. However, a postnuptial agreement cannot include provisions relating to child support and custody.

Postnuptial agreements are used in several different types of situations. Sometimes couples enter into a postnup when they are contemplating separation but attempting to reconcile. A postnup also may be used when a married couple has a prenuptial agreement, and their financial circumstances change significantly — such as one spouse receiving a sizeable inheritance or a business becoming unexpectedly successful. In this situation, the spouses can use the postnuptial agreement to change the terms of the prenuptial agreement.

A postnuptial agreement also may be beneficial when a married couple does not have a prenuptial agreement, but they decide to enter into a property division agreement based on their financial circumstances. In this case, a postnuptial agreement can be used to protect business interests and assets from the potential adverse impact of a future divorce.

Some couples who find their relationship strained by financial matters can strengthen the relationship by entering into a postnuptial agreement that settles disputed money issues. Postnuptial agreements also sometimes address financial issues as part of a reconciliation following infidelity in a marriage. If a married couple creates a postnuptial agreement, the contract can streamline the separation and divorce process, in the event the couple eventually separate.

What Is a Separation Agreement?

Married couples may enter into a separation agreement when they are living apart — or planning to separate in the immediate future — and anticipating a divorce. Because North Carolina law requires a married couple to live apart for a year before filing for divorce, separation agreements are common in the state.

A separation agreement addresses spousal support (also called alimony or post-separation support), as well as property division. Unlike a postnuptial agreement, which cannot include provisions relating to child custody, support, and visitation, a separation agreement may address these matters. A separation agreement can address all matters that arise in a divorce proceeding, if the spouses are able to agree on all the terms.

While it is not always possible for a divorcing couple to agree on everything, there are a number of benefits to negotiating a settlement agreement, rather than having the judge decide issues relating to the divorce. An agreement gives the spouses more control. It also maintains the privacy of sensitive financial information, which becomes public information if a divorce proceeding goes to court. A settlement agreement also saves time and costs by avoiding a court proceeding in which a judge determines the critical issues.

Is a Postnuptial Agreement or Settlement Agreement Required?

North Carolina does not require postnuptial agreements or settlement agreements in any situation, even if a married couple decides to divorce. However, when spouses own joint assets of a personal or business nature or have children together, an agreement is the best way to define each spouse's legal rights and obligations in the event of separation or divorce.

If a postnuptial or separation agreement is properly drawn, it is a legally enforceable contract. Resolving financial and family issues in an agreement can avoid a costly court battle if disagreements arise.

Do You Need a Lawyer for These Types of Agreements?

North Carolina family law is extremely complex. State statutes control many aspects of marital property division, divorce, and matters relating to custody and support of children.

Specific laws govern agreements between spouses relating to property division and support, including postnuptial agreements and separation agreements, as well as prenuptial agreements. Statutory provisions also govern what postnuptial and separation agreements can and cannot address and specify legal requirements for executing the agreements. A prenup, postnup, or separation agreement that does not adhere to the requirements of North Carolina law may not be valid.

If you are contemplating separation or divorce — or if you are considering a postnuptial agreement for other reasons — consulting with an experienced family law attorney is the only way to protect your legal interests and rights. Talking with a lawyer also gives you the peace of mind that comes with knowing you have done everything within your power to look out for yourself and your family.

Talk With a Trusted Family Law Attorney in Northeastern North Carolina

If you are considering a prenuptial agreement, postnuptial agreement, separation, or divorce, our respected domestic and family law attorneys at The Twiford Law Firm are here to help. We advise and represent clients in all aspects of North Carolina law relating to marital and separation agreements and divorce.

With offices in Elizabeth City and Moyock, we serve clients throughout northeastern North Carolina, including the Outer Banks. Contact us today at 252-338-4151 or 252-435-2811 to schedule an initial consultation.