Violating the Terms of a Property Settlement Agreement

Authored by , LegalMatch Law Library Managing Editor and Attorney at Law

Find a Lawyer

What is a Property Settlement Agreement?

A property settlement agreement is a written agreement between two spouses addressing the division of property that the couple obtained before or during marriage. Settlement agreements operate much like a contract when it comes to enforcing or modifying the writing. Its primary focus is on the division of property upon divorce or separation, though it can include other issues such as alimony payments and child custody.

Property settlement agreements can either be formed before the marriage (prenuptial document) or during marriage (postnuptial agreement). Some jurisidictions interchangeably use the phrases “property agreement”, “settlement agreement” or “separation agreement”, though they all refer to the same idea. 

Alternatively, property settlement agreements are often classified under the category of “Spousal Agreement”. However, the term spousal agreement is much broader in scope and can include other subjects besides those relating to divorce.

In order to be valid, a property settlement agreement should be in writing, and both spouses need to fully and honestly disclose their financial resources and assets. The agreement must not encourage divorce, and must be mutually agreed upon (i.e., the agreement cannot be formed under circumstances of duress or coercion).

What if the Terms of the Property Settlement Agreement are Violated?

Property settlement agreements are legal documents and therefore must be honored by both spouses. The spouses are generally free to include whatever provisions they deem appropriate in the settlement agreement. However these must be adhered to as if they were a contract. 

Failure to honor a property settlement agreement can result in legal penalties for the spouse who is in violation. For example, the court may order the spouse to hand over property that belongs to the other spouse, if this is the appropriate remedy. Further violation can even result in criminal penalties such as fines. 

A common point of dispute with regards to settlement agreements is when one spouse conceals the existence of assets from the other spouse. On the one hand, a spouse is generally free to handle assets independently as they please, such as investing it or making improvements on it. However, property settlement agreements require that the spouse at least inform the other spouse of the existence of any such assets. 

Another way that a settlement agreement can be violated is when one spouse falsifies information regarding their financial resources or assets. For example, a party can fraudulently overvalue or undervalue the estimated cost of a particular asset. Or, they may falsify statements concerning the amount of money they actually have. Such violations are considered to be serious offenses and can possibly result in criminal charges. 

How does a Court Interpret Property Settlement Agreements?

If there is any dispute over the terms of the agreement, the court will seek to determine the parties’ intent based on the specific language contained in the written agreement. The writing is the clearest evidence of the couple’s intent. Thus, property settlement agreements should be drafted as clearly as possible so as to avoid any misunderstandings. It is best if an attorney drafts and reviews the settlement agreement. 

Do I Need a Lawyer for Property Settlement Agreements?

If you are considering drafting a property settlement agreement, it is highly beneficial for you to have an attorney draft and review the agreement. Also, if any legal disputes arise over the terms of the agreement, an attorney can represent you in a court of law. If approved by a judge, property settlement agreements are binding by law and must be strictly followed by both parties.

Consult a Lawyer - Present Your Case Now!
Last Modified: 03-19-2013 03:45 PM PDT

Find the Right Lawyer Now

Did you find this article informative?

Link to this page

Law Library Disclaimer

Violating the Terms of a Property Settlement Agreement, property,agreement,settlement,spouses,division,violate,violation,spousal,lawyer,attorney