Post-nups grow­ing in pop­u­lar­ity to pro­tect as­sets, say lawyers

Vancouver Sun - - FP VANCOUVER - TARA DE­SCHAMPS

TORONTO When Cana­dian heart-throb Justin Bieber se­cretly mar­ried model Hai­ley Bald­win last year, tabloids said they didn’t bother with a fancy cer­e­mony or a pre-nup­tial agree­ment to pro­tect their mil­lions.

“He was an id­iot not to get a (prenup), but we have seen Justin do a lot of stupid stuff,” joked Far­rah Ko­horst, a Cal­gary-based lawyer spe­cial­iz­ing in fam­ily law.

But ac­cord­ing to Ko­horst, 24-year-old Bieber — es­ti­mated to be worth $265 mil­lion — and 22-year-old Bald­win — ru­moured to be worth $3 mil­lion — aren’t out of ways to keep their fu­ture earn­ings pro­tected from each other, if they de­sire.

Ko­horst and other ex­perts say the key to safe­guard­ing as­sets when you didn’t sign a pre-nup lies in a lit­tle-known agree­ment that is grow­ing in pop­u­lar­ity: a post-nup.

Of­ten called a mar­riage con­tract un­der the Fam­ily Law Act, a post­nup can be signed be­fore or af­ter a wed­ding and can in­clude clauses to de­cide what will hap­pen to money, real es­tate, in­her­i­tances and pets if a mar­riage is dis­solved.

Ko­horst and other lawyers say most peo­ple are prompted to sign a post-nup­tial agree­ment at the be­hest of their par­ents or be­cause they want to em­bark on a fi­nan­cial ven­ture their spouse isn’t keen on shar­ing the risk for, they sud­denly snag a large in­her­i­tance or gift they want to keep from their part­ner or they ran out of time to draw up a pre-nup while pre­par­ing for their big day. “I re­ally pump these to my friends and fam­ily be­cause we are look­ing at 40 per cent divorce rate and 60 per cent com­mon-law break­down (in Canada).”

She of­ten rec­om­mends cou­ples who are try­ing to dis­cern what to put in a post-nup fo­cus on their goals and think about whether chil­dren, new busi­nesses or wind­falls are headed their way. If some­one agrees to waive their spousal sup­port and not share jointly held prop­erty, she of­ten sug­gests a set­tle­ment where the amount of money they get for the dis­so­lu­tion of their mar­riage is based on the length of the re­la­tion­ship or is a por­tion of the net value of their as­sets.

She also ad­vises clients to look out for con­duct pro­vi­sions — clauses sur­round­ing in­fi­delity, weight gain and a min­i­mum num­ber of times a week or month a spouse has to agree to sex. They ’re pop­u­lar in the U.S., but are usu­ally frowned upon and of­ten not rel­e­vant to le­gal rights in Canada, she adds.

Ko­horst also said most clients don’t re­al­ize post-nups aren’t boil­er­plate doc­u­ments that can be drawn up in a few days on the cheap. Most take more than one meet­ing and re­quire sev­eral fi­nan­cial dis­clo­sures. “There is a dif­fer­ence be­tween mar­ry­ing some­body you think is worth $1 mil­lion, when they are re­ally worth $50 mil­lion,” she said.

In rush sce­nar­ios, Ko­horst has seen post-nups come to­gether in six to eight weeks and in sit­u­a­tions with prom­i­nent fam­i­lies with plenty to pro­tect, she’s charged up to $60,000 to rep­re­sent her client.

How­ever, most peo­ple will spend a few thou­sand dol­lars for agree­ments that take three to four months to draw up.

Ko­horst pushes her clients to avoid sign­ing them the same month as their wed­ding be­cause if one is signed too close to the wed­ding, it can later be ar­gued the agree­ment was made un­der duress. If clients in­sist, she adds a clause not­ing both par­ties agree they are not com­mit­ting to the agree­ment un­der duress.

Rick Pet­icca, a Toronto-based senior as­so­ciate spe­cial­iz­ing in fam­ily law, said he rec­om­mends post-nups when clients are keen on get­ting a pre-nup but have six months or less un­til their wed­ding, putting them­selves in a dan­ger zone for duress ar­gu­ments.

He sug­gests sign­ing an agree­ment well be­fore the six-month mark to avoid those trou­bles and make use of ne­go­ti­at­ing ad­van­tages you have be­fore ty­ing the knot.

“You have an op­tion not to pro­ceed with the wed­ding,” he said.

He has seen peo­ple pur­su­ing post-nups long af­ter their mar­riage be­gan in hopes of us­ing the agree­ments as a “se­cu­rity blan­ket” against sit­u­a­tions that re­cently arose. “I have a case right now where my client’s spouse was un­faith­ful and while they work things out, they want some­thing in place,” he said, not­ing that post-nups should be made to fit each per­son’s unique sit­u­a­tion and con­cerns.

CHRIS YOUNG/THE CANA­DIAN PRESS

Cana­dian pop star Justin Bieber and his wife, model Hai­ley Bald­win, at­tend a Leafs game in Toronto in Novem­ber. Lawyers say there are still op­tions for cou­ples like Bieber and Bald­win, who didn’t sign a pre-nup­tial agree­ment — a post-nup can be signed be­fore or af­ter a wed­ding that can be a “se­cu­rity blan­ket” or help safe­guard their wealth.

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