Prenuptial agreements in Colorado help couples define financial expectations before marriage. These legal contracts set terms for property, debts, and potential support obligations. While once common mainly among the wealthy, these agreements are now used by people across various income levels to gain more control over their financial futures.
It’s important to understand how these agreements work under Colorado law, as the state has specific rules for their validity and enforcement.
Formal Requirements
For a prenuptial agreement to be valid in Colorado, it must meet requirements from the Colorado Marital Agreement Act.1Justia Law. Colorado Uniform Premarital and Marital Agreements Act (C.R.S. Title 14, Article 2, Part 3) The agreement must be in writing and signed by both individuals before marriage. Oral prenuptial agreements are not valid.
The agreement becomes legally effective once the marriage occurs, and its terms apply in case of divorce or the death of a spouse.2Colorado Revised Statutes. C.R.S. 14-2-307 – When Agreement Effective
Notarization or witnesses are not required for the agreement’s basic validity, though notarization can help confirm identities and voluntary signatures if the agreement is contested later.
Voluntariness and Full Disclosure
The circumstances of a prenuptial agreement’s creation are important in Colorado. Both parties must enter into it voluntarily, without duress, coercion, or undue influence. For instance, presenting an agreement with an ultimatum right before a wedding could challenge its voluntariness.
Each person should have a reasonable chance to review the agreement and consult with their own lawyer. While not required for validity, lacking independent legal advice might cause courts to look more closely to confirm each party understood the rights they were giving up.
Full and fair financial disclosure is also necessary. Both individuals must provide a clear and accurate summary of their assets, debts, and income. Hiding assets or misrepresenting financial status can risk the agreement’s enforcement because it undermines informed consent.
Property Classification
A Colorado prenuptial agreement defines how assets and debts are classified as either separate or marital property. This classification affects financial management during marriage and how assets are divided if the marriage ends, allowing couples to establish rules different from Colorado’s standard legal approach.
Under state law, marital property includes assets acquired after marriage, excluding gifts or inheritances to one spouse. Property owned before marriage is separate. However, Colorado Revised Statutes 14-10-113 states that any increase in the value of separate property during marriage is considered marital property, unless a prenuptial agreement says otherwise.3Colorado Revised Statutes. C.R.S. 14-10-113 – Disposition of Property Many couples use prenuptial agreements for this reason.
Prenuptial agreements let couples change these default rules. They can define separate property to include pre-marital assets and any income or appreciation from them. The agreement can specify that appreciation of separate property remains separate, which is useful for those with significant pre-existing assets or business interests.
These agreements can also set rules to prevent separate property from becoming marital property through commingling (mixing assets) or transmutation (changing property character, like through title changes). Clear guidelines, such as keeping separate assets in separate accounts, help maintain their status.
Precise language in defining property classifications is important. Clearly stating what is separate or marital property, and how future acquisitions and appreciation are handled, creates a transparent financial plan.
Common Clauses
Asset Division
Prenuptial agreements specify how assets will be divided if the marriage ends. While property classification defines what is separate or marital, asset division clauses outline the distribution. Colorado Revised Statutes 14-2-304 allows couples to contract about their rights and obligations in any property.4Colorado Revised Statutes. C.R.S. 14-2-304 – Governing Law This lets them decide in advance how assets, including those acquired during marriage, will be divided, such as by a specific ratio or by assigning items to one spouse.
These terms can provide an alternative to Colorado’s equitable distribution standard for marital property, which requires a fair, though not always equal, division by courts. Defining these terms in advance can increase predictability and reduce potential conflict during a divorce.
Debt Allocation
Allocating debts, both pre-existing and those incurred during marriage, is common in prenuptial agreements. The same statute (Colorado Revised Statutes 14-2-304) that applies to property also covers obligations, allowing couples to assign responsibility for premarital debts. This protects each person from liability for the other’s prior financial commitments.
The agreement can also establish rules for managing and dividing debts accumulated during the marriage, whether jointly or individually. For example, it can clarify if debts linked to a separate asset are the owner’s responsibility or how non-marital credit card debts will be treated. This planning helps protect financial well-being and prevent future disputes.
Spousal Support
Prenuptial agreements can address spousal support, called maintenance in Colorado. Couples can agree to change or eliminate spousal support, allowing them to waive it, define amounts or duration, or set conditions for payment.
However, if a clause eliminating or modifying support would make one party eligible for public assistance upon divorce, a court may override that part of the agreement. The court can order support to prevent reliance on public assistance. This fairness aspect is assessed by courts at the time of enforcement.
Modifications or Revocations
Changing life circumstances may lead couples to reconsider the terms of an active prenuptial agreement. Colorado law allows for the modification or complete revocation of these agreements. However, altering or canceling a prenup must follow specific legal standards.
Under Colorado Revised Statutes 14-2-307, after marriage, a prenuptial agreement can only be amended or revoked by a written agreement signed by both parties. Oral agreements to change or cancel the terms are not legally binding.
Both spouses must act together to alter or nullify the agreement; one person cannot change it unilaterally. Any amended or revocation agreement must also meet the same standards of voluntariness and fair disclosure as the original agreement.
Enforcement Considerations
When a prenuptial agreement’s terms are applied, such as during a divorce or after a spouse’s death, it is not automatically enforced. A Colorado court may review the agreement for legal validity. The person challenging the agreement must prove why it should not be upheld.
Colorado Revised Statutes 14-2-309 lists conditions for unenforceability.5Colorado Revised Statutes. C.R.S. 14-2-309 – Enforcement One main challenge is proving consent was not voluntary. If a party shows they signed unwillingly due to duress (like insufficient review time before a wedding) or coercion, the court will not enforce it. The court looks at the overall situation, including access to independent legal counsel, though lack of counsel alone does not void consent.
Inadequate financial disclosure at signing is another major factor. The statute states an agreement is not enforceable if the challenging party proves they did not receive fair and reasonable disclosure of the other’s property or financial obligations. However, the agreement might be enforced if the challenging party knowingly waived further disclosure in writing, or if they had, or could have reasonably obtained, adequate knowledge of the other’s finances.
Unconscionability also impacts enforcement. An agreement, or parts of it, can be deemed unconscionable if it was extremely unfair when signed. If a court finds a provision unconscionable at the time of signing, it may refuse to enforce that provision, enforce the rest of the agreement, or limit the provision’s application to avoid an unfair outcome. This is decided by the court based on all circumstances, including bargaining power and how one-sided the terms are.