History of Premarital Agreements in Colorado

In its broadest sense, a premarital agreement is a contract. However, Colorado, like the majority of other jurisdictions, views premarital and marital agreements differently than a normal contract between two parties in an arm’s-length transaction. Until 1970, premarital agreements that addressed issues relating to divorce were void as against public policy. The Colorado Legislature ultimately passed the Colorado Marital Agreement Act (“CMAA”) for agreements entered into on or after July 1, 1986. The CMAA codified several common law requirements for an enforceable premarital agreement:

1. a premarital or marital agreement must be in writing and signed by both parties (CRS §§ 14-2-302(1) and -303))
2. a premarital or marital agreement must be entered into voluntarily (CRS § 14-2-307(1)(a));
3. each party must provide to the other a fair and reasonable disclosure of his or her property or financial liabilities before executing the agreement (CRS § 14-2-307(1)(b));
4. a premarital or marital agreement may not violate public policy (CRS § 14-2-304(1)(i)); and
5. a premarital or marital agreement may not adversely affect the right of a child to child support (CRS § 14-2-304(3)).

The Current Law on Colorado Premarital Agreements

In 2013, the Colorado Legislature enacted the Uniform Premarital and Marital Agreements Act (“Uniform Colorado Act”). The Uniform Colorado Act repealed and reenacted with amendments the CMAA, CRS §§ 14-2-301 et seq. It became effective July 1, 2014. The Uniform Colorado Act memorialized procedural due process requirements for premarital agreements to be deemed enforceable. These requirements for procedural due process were already being used in the best practices of Colorado estate planning and domestic relations attorneys, and were also consistent with many other states’ requirements regarding premarital agreements. These best practices and the requirements under the Uniform Colorado Act are discussed in more detail below.

Underpinning the Uniform Colorado Act, CMAA and the common law is the expectation that parties signing a premarital agreement are in a “confidential relationship” and fiduciaries to one another.

Confidential Relationship

Several Colorado cases addressing premarital agreements have noted the special “confidential relationship” involved in signing a premarital agreement. In Newman v. Newman, the Colorado Supreme Court stated that parties to a premarital agreement are in a fiduciary relationship with one another and “must act in good faith, with a high degree of fairness and disclosure of all circumstances which materially bear on the premarital agreement.” Disclosure is important because it underscores that each party is exercising a meaningful choice when he or she agrees to give up certain rights found in statutes protecting married persons.

In another Colorado case, Lewis v. Lewis, the court stated, “Such a [confidential] relationship exists when one party justifiably reposes confidence in another such that the parties drop their guard and assume that each side is acting fairly.” A confidential relationship between dealing parties may “impel or induce one party to relax the care and vigilance one would and should ordinarily exercise in dealing with a stranger.” Colorado is in line with the majority of other jurisdictions with its expectation that parties signing a premarital agreement are in a confidential relationship. Although no Colorado case has dealt with the burden of disclosure of information that materially relates to a premarital agreement, courts in the majority of jurisdictions hold that the burden is not on either party to inquire, but on each to inform. A fiduciary who benefits in a transaction bears the burden of establishing that the transaction did not violate his obligations.

Requirements for a Colorado Premarital or Marital Agreement

The below are the key components to a Colorado premarital (aka prenup) agreement.

1. In writing and signed by both parties
2. Voluntary (one party cannot force the other into the contract)
3. Disclosure of assets and liabilities
4. Cannot limit or waive child support
5. May not violate public policy

Choice of Law

Many of us living in the mountains, as the corny saying goes, came for the skiing, but stayed for the summers. With so few Colorado natives, and most of us transplants, what happens when you and your spouse move to Colorado and separate? Will your choice of state law contained in your prenuptial agreement be honored when divorcing?

To answer that question the first step is to determine when it was written and executed. Prenuptial agreements in Colorado have undergone three different phases over the past half a century. If your prenuptial agreement was drafted prior to July 1986 general contract rules regarding choice of law determine which state’s law is to be used.

The majority of individuals divorcing in Colorado will have a prenuptial agreement that was written and signed between July 1986 to June 2014. During that period the Colorado Legislature governed that adults could contract which state’s law controlled their prenuptial agreement. See C.R.S. § 14-2-304(1)(h).  In other words, if you signed a prenuptial agreement that included a provision that California law is to be used when interpreting and enforcing the prenuptial agreement, then a Colorado court will apply California law.

However, on July 1, 2014, Colorado took further action to protect individuals at risk of being harmed at the time of enforcement of their prenuptial agreement. Today, in a prenuptial agreement two people can still contract on choice of law. If you and your spouse had stipulated that California law controls your prenuptial agreement, then a Colorado court will apply California law, if the State of California has a significant relationship to either you, your spouse or the agreement itself. See C.R.S. § 14-2-304(1)(a).

If your prenuptial agreement meets those factors then a Court will then check to see if applying California law would be contrary to the fundamental policies of Colorado or unconscionable to any person at the time of enforcement. A prenuptial agreement is unconscionable if it is “not fair, reasonable, and just.” In re Marriage of Christen, 899 P.2d 339 (Colo. App. 1995). Therefore, while you can move to Colorado with a prenuptial agreement and choose the law that controls your prenuptial agreement, after 2014 the State will decide based on its notion of fairness if your choice is honored.

Attacking & Defending Agreements

We have experience litigating prior premarital and marital agreements. To read more, click here.