Premarital and post-marital agreements in Texas have a complex history immersed in the community property presumption, the state constitution, statutes and case law. Originally, such agreements were found to be unenforceable. But with amendments to the Texas Constitution, evolving statutes, recent case law, and improved draftsmanship, such agreements are now enforceable under contract law.
For many Boomer and Senior couples, living together is a precursor to marriage; for others because of family issues or commitments, there is no intent to ever marry. The simple fact is, domestic partnership agreements address a wide variety of circumstances, many involving established adults who want to be together but because of prior financial and family commitments prefer to have an applicable contractual agreement for their legal needs.
Many couples choose to live together so they do not lose certain benefits under current rules of social security, military and insurance disability programs, or to stop those benefits from being taken away from their children. In other cases, couples who are divorced, and who may have children, may want to protect certain assets. In situations such as trust funds or inherited funds, beneficiaries simply do not want to place family money at risk. Other couples choose to shelter their own resources from the real or perceived obligations of their partner.
The marital agreement is considered to be a contract under Texas law. The premarital agreement must be in writing and signed by both parties. No actual consideration is required; however, to conform to contractual law, it may be wise to provide benefits for the non-monied party to avoid a later finding of unconscionably, particularly if the financial or physical condition of the non-monied party under the agreement is poor.
Matters that may be dealt with in a premarital agreement include, but are not limited to, the following:
- the right to buy, sell, use, transfer, exchange, abandon, lease, consume, expend, assign, create a security interest in, mortgage, encumber, dispose of, or otherwise manage and control property;
- The rights and obligations of each of the parties in any of the property of either or both of them whenever or wherever acquired or located;
- The disposition of property on separation, marital dissolution, death, or the occurrence or nonoccurrence of any other event;
- The modification or elimination of spousal support;
- The making of a will, trust, or other arrangement to carry out the provisions of the agreement;
- The ownership rights in and disposition of the death benefit from a life insurance policy;
- The choice of law governing the construction of the agreement; and
- any other matter, including their personal rights and obligations, not in violation of public policy or a statute imposing a criminal penalty.
In post-marital agreements, it has been noted that a fiduciary duty exists that is not present in pre-marital agreements between spouses or prospective spouses. Case law states that a confidential relationship between husband and wife imposes the same duties of good faith and fair dealing on spouses as required of partners and other fiduciaries. However, adverse parties who have retained independent counsel may not owe fiduciary duties to one another. Texas Legislature enacted Section 4.105 with the understanding that married spouses owing fiduciary duties to one another would negotiate and execute post-marital agreements. Notwithstanding these duties, the legislature manifested the strong policy preference that voluntarily made post-marital agreements are enforceable.
Beside a Cohabitation and Domestic Partnership Agreement, what other documents should you supplement for a more complete legal coverage?
- A will with a designated executor to handle execution and distribution of all assets
- A durable financial power of attorney
- A durable medical power of attorney, directive to physicians, and a HIPPAA release form
- Partnership agreement to set out and clarify property rights, define ownership and related issues upon dissolution
Cohabitation, domestic partnership, premarital and post-marital agreements may be as creative as a party determines necessary. However, care must be given to see that such agreements protect the party, keep with public policy, and adhere to current Texas family law and applicable contractual law.
The 2015 Texas Legislature was active on family law bills and changes to the Texas Family Code! These many changes to various provisions of the family code could legally affect you and your family.
Some of the more important 2015 Family Laws, Amendments, and Revisions:
House Bill 826 amends the Family Code to require a child support order to contain a specified statement regarding the circumstances under which a court may modify a child support order. Effective: 9-1-15
House Bill 1447 amends the Code of Criminal Procedure to expand the persons authorized to file an application for a protective order for certain victims of sexual assault or abuse, stalking, or trafficking and to entitle victims of those offenses or the victim’s parent or guardian to additional crime victims’ rights relating to the protective order to provide the notice in the prescribed manner a Class C misdemeanor. Effective: 9-1-15
House Bill 1500 amends the Family Code to require a person who files a motion for a temporary order in a suit for modification of the parent-child relationship to execute and attach to the motion an affidavit that contains facts that support the allegation that the child’s present circumstances would significantly impair the child’s physical health or emotional development. The bill establishes a court’s duty to schedule a hearing if those facts are adequate to support the allegation. Effective: 9-1-15
House Bill 1782 amends the Family Code to establish, for purposes of a family violence protective order, the presumption that family violence has occurred and is likely to occur in the future if the respondent has been convicted of or placed on deferred adjudication community supervision for an offense involving family violence against the child for whom the petition is filed, the respondent’s parental rights with respect to the child have been terminated, and the respondent is seeking or attempting to seek contact with the child. Effective: 9-1-15
House Bill 1923 amends the Civil Practice and Remedies Code to include a retired or former statutory probate court judge among the judges eligible to serve as a special judge in certain civil or family law matters. Effective: 9-1-15
Senate Bill 206 amends the provisions of the Education Code, Family Code, Government Code, and Human Resources Code relating to the functions and administration of the Department of Family and Protective Services (DFPS). The bill revises and streamlines agency procedures involved in adoption cases and child protective services cases by changing various record keeping, notification, and casework documentation requirements and provisions governing the investigation of a report of abuse, neglect, or exploitation of a child and by condensing and updating provisions governing procedures in a child protection suit, including adversary and permanency hearings, and the performance of a child placement review for a child under DFPS care. The bill establishes annual reporting requirements for DFPS regarding key performance measures and data elements for child protection and sets out notification requirements relating to significant events for a child in DFPS conservatorship involving the child’s placement, medical condition, prescribed drugs, and school performance; revises provisions governing foster care, including requirements that foster children be provided access to certain personal information and documents; and sets out requirements for implementing foster care redesign. The bill consolidates and restructures provisions regarding prevention and early intervention services, including the child abuse and neglect primary prevention program, and requires the development and implementation of a strategic plan for those services within DFPS. The bill revises provisions relating to public school admission and attendance of, and eligibility for an exemption from tuition and fees for, students under DFPS conservatorship.
The bill broadens the authority of DFPS to obtain criminal history record information regarding certain persons; authorizes the executive commissioner to adopt rules regarding the purpose, structure, and use of advisory committees by DFPS; and requires the development and implementation of an annual business plan for the child protective services program to prioritize the department’s activities and resources to improve the program. The bill provides for an enforcement policy for the regulation of certain child-care facilities, homes, and agencies and revises provisions governing administrative remedies for those regulated entities.
The bill requires DFPS to study whether provisions governing authorization agreements between the parent of a child and a nonparent relative should be expanded to include authorization agreements between a parent of a child and a person who is unrelated to the child. Effective September 1, 2016, the bill updates provisions governing the licensing and certification of certain child-care facilities, homes, and agencies. Effective: 9-1-15
Senate Bill 314 amends the Family Code to detail what information the Department of Family and Protective Services and a court appointing a nonparent as managing conservator of a child must provide to the nonparent. Effective: 9-1-15
Senate Bill 550 amends the Family Code, Government Code, Insurance Code, and Labor Code to establish a court’s duty to render an order for the dental support of a child in a suit affecting the parent-child relationship or in a proceeding under the Uniform Interstate Family Support Act. Effective: 9-1-15
Senate Bill 813 amends the Family Code to establish that a digitized signature on a pleading or order in a proceeding involving the marriage relationship, the child in relation to the family, or a protective order satisfies the requirements for and imposes the duties of signatories to pleadings, motions, and other papers identified under the Texas Rules of Civil Procedure. Effective: 9-1-15
Senate Bill 814 amends the Family Code to establish the authority of a party to a suit to remove the disabilities of minority, a suit to change a person’s name, or a suit affecting the parent-child relationship to waive the issuance or service of citation. The bill revises requirements for a waiver of service in a suit for dissolution of a marriage. Effective: 9-1-15
Senate Bill 815 amends the Family Code to expand the types of activities a court may prohibit by temporary restraining order in a suit for the dissolution of marriage. Effective: 9-1-15
Senate Bill 818 amends the Family Code to require a court to order that each conservator of a child has the duty to inform the other conservator of the child of certain information regarding the conservator’s involvement with a person who is the subject of a final protective order or if the conservator is the subject of such an order. The bill establishes deadlines for providing the notice and makes a conservator’s failure to provide the notice in the prescribed manner a Class C misdemeanor. Effective: 9-1-15
Senate Bill 1726 amends the Estates Code, Family Code, and Government Code to revise and clarify provisions relating to suits affecting the parent-child relationship, including provisions relating to Class 4 claims against an estate, the conditions under which a court is authorized to order that certain information not be disclosed to a party to a suit, notice requirements regarding enrollment in or termination of benefits under an employer’s health insurance plan, and notice requirements and enforcement mechanisms for certain child support orders. Among other provisions, the bill provides for electronic notarization of required signatures in a proceeding filed under provisions relating to the parent-child relationship. Effective: 9-1-15
To view more information on the 2015 Texas family law bills, amendments, and revisions go to Texas Legislature Online @ http://www.capitol.state.tx.us/
A divorce can be grueling is transformed by law, probate, and insurance decisions made prior to divorce. It is important to know exactly what will happen to your will and life insurance if this misfortune happens to befall your family. The family unit is important and if it is fractured the question of what happens to “my will”, “my life insurance”, or “my trust” is a relevant and important one that needs to be answered.
If you are divorced from your spouse then your previous will may be in many aspects considered revoked automatically. Under the Texas Estate Code § 123.001 after a valid divorce, all provisions in a will, including all fiduciary appointments, shall be read as if the former spouse and each relative of the former spouse who is not a relative of the testator failed to survive the testator, unless the will expressly provides otherwise. The translation of this states: if you receive a valid divorce then your will is in many respects revoked and your spouse and stepchildren will receive nothing from the previous will. The one exception is if the will explicitly states that in case of divorce the previous spouse or children will still inherit. This revocation applies to fiduciary appointments as well. For instance if you have a trust and your spouse is the trustee, then she will be revoked from the trust in its entirety.
If you divorce your spouse, then your spouse’s beneficiary status pertaining to your life insurance will be automatically revoked. Texas Family Code § 9.301 states an automatic revocation upon divorce and lists three exceptions:
- If the divorce decree names the former spouse as a beneficiary
- The individual adds the divorced spouse as a beneficiary to the policy after the divorce
- The former spouse receives the life insurance as a “guardian” of the children
These are the exceptions for life insurance. If you decide to divorce your spouse unless further action is taken, the spouse will not benefit from your death regarding the life insurance.
Finally, the inheritance of a divorced spouse in reference to a trust depends on whether the trust is revocable or irrevocable. If you have set up a Revocable Trust then after the divorce your prior spouse will automatically lose his/her beneficiary status within the trust. On the other hand, if you set up an Irrevocable Trust then regardless of a divorce the prior spouse will still inherit and be considered a valid beneficiary. A divorce will have no effect on an Irrevocable Trust. If you decide to create an irrevocable trust, be sure to understand that your spouse will inherit the assets in the trust even after a divorce.
In a Texas divorce, the law protects you from unchecked gifts to your prior spouse and stepchildren with regard to your will, life-insurance, and revocable trusts. The prior spouse will not take from these unless one of the few exceptions apply. Divorces are riddled with complexities and it is prudent to seek advice from an experienced Texas divorce attorney during these proceedings to ensure that the divorced spouse is removed completely from your will and does not reserve an argument to acquire your assets post-divorce .
“Mediation” is a process to aid parties in finding a fair and equitable settlement of disputes without unnecessary court intervention. Most Texas district and county courts require pretrial mediation for a variety of cases in order to help the parties resolve their problems while avoiding extensive court procedures and expenses
Mediation is a process in which the parties, under the guidance of a Mediator, agree upon a legally binding settlement the disputes in issue without a trial. Meditation can take many forms and the process may produce creative solutions without the direct rulings of the court. Courts usually encourage the opposing lawyers to first mediate a dispute and if no progress is made then continue the normal judicial process.
The Mediator that helps bring both sides to an agreement usually is a lawyer, ex-judge, or other specialist who has experience or expert training in the specific areas related to the dispute. A Mediator fees may range anywhere from $160-$500 dollars an hour depending on the case and the complexity of the issues in dispute. Mediators attempt to work with each side to find a reasonable middle ground to which a fair agreement can be structured.
An experienced lawyer is a valuable tool to advance favorable terms of any agreement during a mediation. During a mediation a Mediator will likely place the parties into separate “Caucus” areas, splitting the parties into different rooms to negotiate individually with each party to understand the positions and interests. Once the Mediator has talked to each party he will attempt to discover a common grounds that will fairly or smoothly serve both parties’ interests. If an agreement is reached that neither side is overly happy about, it is often likely that a reasonable compromise has been reached.
The important point of a mediation is to express your concerns and attempt to reach a compromise that is mutually acceptable, smart and fair to both sides. Many courts support this type of dispute resolution because it frees up the courts dockets and allow the parties to consider compromise first without involving the courts. Mediation maybe a cost saver, as the dollars you spend on an attorney for trial can be reduced significantly if a compromise is reached.
Make sure you have an attorney who is experienced in the Mediation process and knows how to craft a smart, fair deal which will result in significant cost savings.
Now that the Texas Legislature has ended, we will review some of the bills passed that will affect our Family Law Cases.
S.B. 814 Waivers of Citations in Certain Family Law Suits
Currently, the state of Texas allows for a parties involved in a divorce to waive service. Loosely translated, that means that the person named in the divorce suit can sign a paper which proactively tells the relevant court that they are officially aware their spouse is filing for divorce. This waiver means they don’t have to physically be served with the divorce papers by their spouse or a process server, potentially saving everyone involved a bit of time, money, and maybe some emotional pain
S.B. 814 was introduced to further the use of such waivers to apply to other common family law matters.
The waiver should also be used for:
- Suits to remove disability of a minor (commonly referred to as emancipation)
- Suits to change the name of an adult or child
- Any suits relating to a parent-child relationship
The bill passed and will take effect on September 1, 2015.
S.B. 817: Issuance of a protective order and appointment of a managing conservator in certain family law proceedings.
S.B. 817 proposes that the state change the language on applications for protective orders (restraining orders, etc.) by switching the word “victim” with the phrase “applicant for a protective order.” Specifically, this change is meant to help those people who are applying for the protective order on behalf of the actual victim of the abuse or violence.
Some judges are currently reluctant to sign orders which list the applicant as a “victim” because doing so indirectly endorses the allegations of abuse as being true without a trial. With the label change, it removes that concern and will enable judges to issue more orders to protect those in need.
The bill passed virtually unopposed, and will take effect on September 1, 2015.
S.B. 314: Appointment of a non-parent as managing conservator of a child.
This law addresses a growing number of complaints by relatives who assume custody of children removed from their parents’ homes by CPS (Child Protective Services). This type of custody is called “permanent managing conservatorship,” or PMC. It is not adoption and does not carry the same legal meaning, but many relatives claim that these differences are not clarified by CPS.
As a result, the bill requires a court awarding custody to specifically explain 3 common misunderstandings to the relatives or non-parents assuming PMC.
- PMC rights are specified by the court, and are not the same as rights associated with adoption
- The parent(s) can still request visitation, and can request to become the managing conservator
- PMC does not qualify nor disqualify the relative or non-parent for/from post-adoption benefits
The bill states that if the non-parent assuming PMC does not appear in court, the court must then have evidence that they were advised of this information.
The bill passed without opposition, and will take effect on September 1, 2015.