On March 23, 2023, Ohio joined 48 other states in allowing married partners to enter into postnuptial agreements that alter their marital legal rights. The newfound legality of postnuptial agreements increases the tools available to both domestic relations and estate planning attorneys. Such agreements will undoubtedly be useful for settling potential family law issues, as spouses can now modify outdated prenuptial agreements to account for changed circumstances, and married couples can divide their assets and agree to financial support if they should ever separate or divorce.

Postnuptial agreements will also prove incredibly useful for estate planning. Spouses can provide themselves and their heirs certainty and control over the fate of their assets and wealth upon their death by declaring assets to be either marital or individual separate property in an enforceable postnuptial agreement. Clearly assigning ownership of an asset that would otherwise be considered marital property to only one spouse in an enforceable postnuptial agreement can preclude a future ownership claim by the other spouse. For example, a wife who inherits antique earrings may want to ensure that the jewelry stays in her family after her death. This objective can be accomplished with a properly worded postnuptial agreement declaring the earrings to be separate property belonging to the wife.

A postnuptial agreement can also be used to disclaim a surviving spouse's statutory right to the deceased spouse's estate. This aspect of such agreements will be particularly useful for families with children from prior relationships. In second or subsequent marriages, one spouse is often concerned that pre-existing children will be denied a desired share of their parent's estate if the surviving spouse elects to exercise his or her statutory rights. Spouses can gain certainty that identified assets and wealth will pass to their children rather than their surviving spouse by executing a properly worded and enforceable postnuptial agreement.

Postnuptial agreements will also be an especially useful tool for succession planning of closely held or family businesses, such as a family farm. Spouses can agree that one's business interest is a separate asset belonging individually to that person. The non-owner spouse will thus have no claim of ownership based on the martial relationship. Such provisions will enable families to bring a junior member into the family business without risking loss of that share to the junior's spouse in the event of a divorce or his death. Simply put, by allowing spouses to identify the nature of assets as marital or separate and to disclaim rights to a decedent spouse's estate, Ohio has given its citizens another means to control the composition and distribution of their personal estates.

To ensure that postnuptial agreements are enforceable, however, certain requirements must be met. Consistent with the directives for prenuptial agreements set forth in Gross v. Gross, 11 Ohio St.3d 99 (1984), postnuptial agreements must be:

(a) in writing and signed by both spouses;

(b) entered into without fraud or duress;

(c) entered into with full disclosure and complete knowledge of the extent and value of each spouse's property; and

(d) absent of any promotion or encouragement of divorce.

ORC §3103.061. If any of these elements are missing, a postnuptial agreement is susceptible to challenge and nullification.

To ensure that all requirements for an enforceable postnuptial agreement are met, including the heightened fiduciary duty that spouses owe each other, both parties should have separate legal counsel, and the agreement should be drafted by a knowledgeable estate planning attorney. Moreover, estate planning documents should be reviewed and amended as needed to harmonize with the postnuptial agreement.

Contact any of Brouse McDowell's skilled estate planning attorneys to review your options or to update your estate plan now that Ohio has expanded spouses' contractual rights.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.