Prenuptial and postnuptial agreements involve California’s community property laws. As a community property state, California’s courts will divide property during a divorce down the middle. The courts will carry out a 50/50 split regardless of any fault for causing the divorce. There are nine community property states, California included. All other states use equitable division laws: the courts will divide property based on what is fair according to the couple’s unique circumstances. This does not necessarily mean a 50/50 split.
The courts will only divide community property in California. They will not touch separate property. Community property refers to all assets, debts, properties, furniture, funds and investments the couple acquired after marriage. Separate property is all assets and debts brought by one spouse or the other into the marriage. Property the couple receives together after marriage will become community property. A gift or inheritance one spouse receives, however, will remain separate property. Property purchased with a spouse’s separate funds will also become separate property. If an asset or debt is both types of property, it has been commingled. Commingled property can be difficult to sort out after a divorce, especially without a prenuptial agreement.
A prenuptial or postnuptial agreement can change the result of property division in a California divorce case. Without a prenuptial agreement, the state’s community property law means you and your spouse will split community property evenly in half. It will not matter who caused the split or who acquired most of the property during your marriage. The terms of a valid prenuptial agreement will overrule the state’s community property laws. You can also use a prenuptial agreement to decide which of your assets qualify as community versus separate property. What you decide in your agreement can nullify California’s community property laws.