Separation Agreements

Separation Agreements

North Carolina is one of the few states that allow the parties to a divorce to keep alimony agreements, division of marital property, division of debts, custody and child support agreements private. These issues can be settled privately in North Carolina if the husband and wife agree and each voluntarily executes an agreed to separation agreement or contract. To be valid in North Carolina the separation agreement must be notarized. Once signed and notarized it can be enforced as a contract in any court.

No law requires a couple to execute a separation agreement however it is a good idea if you have a separation agreement to make the agreement in writing since oral agreements between spouses are unenforceable.

You might also agree to have all or part of your settlement agreement entered into a consent order by the court as part of your divorce. By incorporating the settlement agreement into a consent order the agreement becomes enforceable through the court’s contempt powers as well as through contract law.

Most married partners in North Carolina choose to execute a private settlement regarding custody, alimony and child support and the division of property and debts without the intervention of the court. Some couples begin with litigation and then enter into a settlement prior to trail.

Why do so many couples prefer a settlement to litigation?

A settlement agreement is almost always less costly, quicker and less emotionally stressful than litigation. Another disadvantage of litigation is the judge and not the parties determine the final order. Once you litigate you lose control over the outcome of the case. Everyone suffers in an adversary proceeding, the parties and the children. A settlement on the other hand can be tailored to meet your family’s best interests. A court will not be capable of developing creative solutions that you and your spouse can create if you are flexible and willing to negotiate. Litigation should only be sought as a last resort when all other avenues have been exhausted.

How do you prepare a separation agreement?

Never try to write a separation agreement yourself. Hire an attorney who specializes in domestic practice to prepare the separation agreement for you. It is always best to have two attorneys, one to advise each spouse as to what is in their best interests. This will avoid a situation where a conflict of interest can arise when one attorney is trying to represent both parties. Most domestic attorney will not agree to represent both parties to a separation agreement.

How do you negotiate a separation agreement?

Although North Carolina law allows parties to a separation agreement to handle property, custody, child support, and alimony agreements separately there is a strategic advantage to dealing with all these issues at the same time.

Dealing with all issues of a settlement at once allows the spouses to compromise on items in one area for something that the other spouse wants in another area. If the five agreement areas are dealt with separately you lose that ability to trade or make compromises across areas.

When negotiating focus your attention on the issues that are most important to you and make concessions on areas that matter less to you. If you decide to try to negotiate without a neutral party begin by discussing all the points on which you and your spouse agree. Make a list of areas where there is disagreement, Try to understand the points of disagreements without arguing the points. Look for areas of compromise.

The keys to successful negotiations are to keep your emotions under control try to keep your objectivity and understand what you most need and want and what your spouse needs and wants. It is important to know what the law says each of you is entitled to. Have a realistic understanding of what your family income and expenses are now and what your and your spouse’s income and expenses will be post-separation. No couple will live as cheaply separately as they did when they were living together so expenses will increase after you separate and income will likely remain the same so expect to make economic compromises.

If you determine you can not reach agreement without help ask an attorney or mediator to step in and facilitate your settlement discussions. Remember that most couples are able to reach a settlement agreement at some point in the divorce proceedings.

What can a separation agreement include?

The separation agreement can include the division of real property, tangible property like cars, jewelry and furniture, intangible property like stocks and bonds, vested pensions and life insurance. The agreement can also specify who will pay what debts. It is important to note that any agreement to pay joint debts is enforceable between the parties but does not relieve the other spouse from the legal obligation to pay the debt to the bank or financial institution.

While you can agree on custody and child support in a separation agreement any agreement as to custody or child support is subject to modification by the court if the determine the agreement is not in the best interest of the children. In the absence of proof to the contrary, however, there is a presumption that the terms concerning the children in your agreement are fair, reasonable and in the best interest the children.

The separation agreement can also determine who claims the tax exemption for the children.

One advantage of a separation agreement is the parties can agree which party is responsible for the costs of a child’s college education. The court cannot order one spouse to pay the costs of a child’s college education so this is an important consideration in determining if a settlement agreement is a better option than litigation.

If you are going to include an agreement to pay for a child’s college education consider putting restrictions on the payment. For example should the obligation last a specific number of years, should the obligation be triggered only if the child attends an accredited institution or if the child maintains a certain grade point average, should there be a cap on the costs covered or should the costs be defined – for example only cover tuition or tuition and room and board.

The separation agreement can also provide for alimony support. And these agreements cannot be modified by the court except in very limited circumstances for example – a substantial change of circumstances. The only other way an agreement with regard to alimony or property division can be overturned by a court is if it can be shown the agreement was signed due to fraud, under coercion, in ignorance or with a lack of mental capacity.

The North Carolina courts will do everything possible to lessen the emotional trauma children of a divorce may experience. This includes referring the spouses to counseling or mediation in an attempt to resolve custody and visitation disagreements cooperatively in a structured, non-adversarial environment. If the parents cannot come to an agreement regarding the issues involving the children, the court will establish the custody order at its discretion.

When considering a custody arrangement, parents need to consider both legal and physical custody. Legal custody includes the decision making ability regarding your child’s education, health and religious upbringing. Physical custody means the physical care and supervision of your child.

An order for custody issued by the court will consider what is in the best interests of the child including acts of domestic violence and the safety of the child. Custody can be granted to any person, agency or organization the court determines will provide for the best interests of the child. Joint custody must be considered if requested by either parent.

The custody order may allow the custodial parent to take the child out of state however if there is a fear of flight or kidnapping, a party may not be allowed to leave the state with the child.

A temporary custody order is modifiable at any time based upon what the court determines is in the best interest of the minor child. A permanent custody order may only be modified based on a showing of a substantial change in circumstances. A permanent custody order is harder to modify than a temporary custody order because the burden of proof to modify is greater.

The court can always modify a separation agreement’s custody schedule based upon what is in the best interests of the minor child. However, if the separation agreement is also a court order (i.e. signed by a judge) then the custody provisions are only modifiable based upon a substantial change in circumstances. Whenever custody is considered, we always advise that the custody schedule be in the form of a court order.

Thus, when preparing a separation agreement that involves custody, it is always important to have the agreement signed by a judge.