Marital Settlement Agreements in California

Marital Settlement Agreements in California

This blog post will discuss the use of a marital settlement agreement (MSA) in California. MSA’s are widely used in uncontested divorces in California in order that the divorce can be entered without either party actually having to appear in Court.

An MSA in California is used by spouses in a dissolution (divorce) action in an attempt to resolve their contested disputes and claims. A comprehensive marital settlement agreement usually provides for all of the following:

Characterization of property interests and characterization and division of the community estate (assets and debts);

Adjustment of reimbursement claims and income tax issues;

Payment of child support, spousal support and attorney fees and costs;

Child custody and visitation; and

Certain waivers and indemnification agreements between the spouses.

Exchange of statutorily-required “preliminary” and “final” “declarations of disclosure”

(Ca Fam § 2100 et seq.) is an essential step toward the consummation of an effective MSA and entry of judgment thereon.

An exchange of prescribed “preliminary” disclosure declarations is mandatory and nonwaivable. (Ca Fam § 2104).

And, unless excused by the court for good cause, “final” declarations of disclosure must be exchanged before or at the time the parties enter into an agreement resolving property or support issues (Ca Fam § 2105(a). If the mandatory declarations of disclosure are not exchanged the MSA is invalid and will not be accepted by the Court. This cannot be stressed enough.

While, subject to statutory conditions, the parties may stipulate to a waiver of the final declarations of disclosure, the waiver does not limit their underlying fiduciary disclosure obligations–i.e., it simply amounts to a representation that those disclosures have been made (see Ca Fam § 105(d).)

Since the facts and circumstances of each case vary, where the issues involved include, custody, visitation, support, property division, debt division, or other similar issues,  a marital settlement agreement should be carefully drafted to meet the needs of the particular parties involved.

The typical contents of an MSA include:

Identity of parties and recital of facts (including statistical facts of the marriage).

Identity of property, distribution of community estate, and confirmation of separate property.

Provision for payment of debts and adjustment of reimbursement claims.

Custody of children and visitation rights.

Child support, including provision for medical, dental, and special educational or other needs (if any); and, if applicable, including agreementas to the support of adult children.

Spousal support (including, as applicable, provisions for life insurance, survivor annuities, and the like); or waiver of spousal support.

Attorneys’ and experts’ fees and costs.

Tax provisions.

Effect of reconciliation.

Judicial action contemplated.

Warranties.

After-discovered property.

Waiver of rights, including rights in deceased spouse’s estate.

Modification, revocation or termination.

Costs of enforcement.

Execution of related documents.

Effective date.

Choice of law.

“Severability” clause.

Execution by parties.

Marital settlement agreements are consider to “occupy a favored position” in California law. Generally, therefore, an MSA that is “not tainted by fraud or compulsion or is not in violation of the confidential relationship of the parties is valid and binding on the court.” However there are some limitations which must be kept in mind when drafting an MSA.

Child Support:

 

Marital settlement agreements cannot abridge the parents’ mutual statutory child support obligation or impinge on the court’s jurisdiction to award child support. This means that an MSA cannot contain a provision in which one party “waives” child support. The issue of child support can be “reserved” which means that the Court retains jurisdiction to order child support in the future, but it can never be waived.

Child Custody:

 

Marital settlement agreements cannot limit a court’s exercise of custody jurisdiction over the minor children of the marriage.

Religious Upbringing:

 

To the extent a marital settlement agreement purports to prescribe the religious upbringing of the parties’ minor children, it is probably unenforceable. Marriage of Weiss (1996) 42 Cal.App.4th 106, 114-115, 118.

Spousal Support Waivers:

 

There is no prohibition against a waiver of post-dissolution spousal support. If the spouses separate by agreement, neither owes the other a duty of support unless they otherwise agree (Ca Fam § 4302); and any right to support after dissolution exists, if at all, only under the terms of the judgment. Thus, a voluntary, knowing and intelligent waiver of support in a marital settlement agreement will be enforced according to its terms. Note that a waiver of spousal support for a “long-term” marriage of ten years or more must be clear and unequivocal.

Fiduciary Obligations Of The Parties Must Be Respected:

 

The “confidential relationship” between spouses carries attendant fiduciary obligations in intraspousal transactions and in the management and control of the community estate (Ca Fam § 721(b), 1100(e).  All “confidential relationship”/fiduciary duties (including broad disclosure obligations) continue postseparation until the community estate is distributed and support and professional fee issues are resolved.  Ca Fam § 2102, 1100(e).

Compliance With General Contract Law:

 

Subject to limited statutory exceptions, marital settlement agreements (like all spousal contracts) must comply with general principles of contract law. The contract law defenses include (among other things) mistake, failure of consideration, unlawfulness of the contract and prejudice to the public interest (Ca Civil § 1689).  Other general contract concepts which may be relevant in drafting or enforcing a marital settlement agreement are:

Voluntary And Knowing Consent:

Each party’s consent must be voluntary and knowledgeable, given free of fraud, undue influence, duress, menace, or mistake. (Ca Civil § 1566-1579).

Leave a Reply