A separation agreement is one of the most common ways to resolve the legal aspects of your divorce, particularly here in North Carolina. The reason that separation agreements are so prevalent here is that residents of North Carolina must be separated for at least one year before they can file for divorce in NC.
As a result, many people find themselves in legal limbo, living separate and apart from their spouse while waiting to file for divorce, but at the same time they are considered married under the law.
In order to clarify their rights and obligations as a spouse, many couples will negotiate and enter into a legal separation agreement that will resolve all matters of property, support, custody and much more related to their legal separation.
The purpose of this article is to give you an overview of what a separation agreement is and isn’t, explain why you should or shouldn’t consider negotiating one, and answer some other frequently asked questions that we see from clients who are considering entering into a legal separation agreement in NC.
What is a Separation Agreement?
A separation agreement is a private contract that is negotiated between a married couple that is considering a separation and, potentially, a divorce in North Carolina. Although other states have separation agreements as well, everything in this article pertains to separation agreement in North Carolina.
If you live somewhere other than North Carolina, you will need to hire a local attorney where you live to assist with the drafting of a separation agreement according to the laws of your particular state.
A Separation Agreement frequently contains two separate agreements, one provides for spousal support (also called alimony or post separation support), and the other to divide property. When you enter into a separation agreement in North Carolina, it is frequently called a “separation agreement and property settlement”. The legal reasons for this are complicated and beyond the scope of this article.
What you need to know is that a separation agreement is an important legal document that will spell out your rights and responsibilities in the event that you decide to separate from your spouse. The agreement will outline how your property is divided, how much alimony is paid and for how long, a custody schedule for the children, how much child support will be paid, and much more.
The Separation Agreement will also allow you and your spouse to waive any marital rights, live free from interference of each other, and insure that neither you nor your spouse can file a lawsuit in court for any issues that are resolved in the separation agreement.
When Can You Enter a Separation Agreement?
You can enter into a separation agreement at any time, whether you are separated or not. However, the support provisions of a separation agreement (i.e. alimony or post separation support) are contingent on you actually physically separating from your spouse. So if neither one of you moves out, then the support provisions would be invalid.
We’ve worked with clients who want to enter into a separation agreement before they physically separate, and others who have been separated for many months prior to entering into an agreement.
Benefits of a Separation Agreement
There are a number of benefits to negotiating a separation agreement out of court. These include:
- Control – With a separation agreement, you have complete control over the agreement. You can negotiate any settlement you want, and in fact can agree to things in a separation agreement that a judge would never put in a court order.
- Privacy – A separation agreement and property settlement often contains very sensitive financial information. Most people do not want this information to become public information – but if you decide to go to court, that is what will happen. With a separation agreement, you can keep your affairs private and away from snooping eyes.
- Cost – A family law trial is incredibly expensive, typically running into the tens of thousands of dollars. An uncontested separation agreement, by contrast, is much less expensive.
- Time – Aside from being expensive, a family law trial can also take a long time to be heard by the judge. Some clients are divorced for several years before their case ever comes before a judge. A separation agreement can typically be negotiated in a matter of a few months.
Do You Even Need a Separation Agreement?
Not every divorcing couple needs a separation agreement. If you did not own property together (such as a house), had no kids, and neither of you is dependent on the other, then a separation agreement may not be necessary. However, even in those situations, you may want a simple separation agreement to clearly define your legal rights and obligations as a married couple.
For example, you may want to make sure your spouse has no rights to your estate should you die before you are divorced. Or you may want to ensure that both of you have waived any right to alimony or post separation support. To do those things you would need a separation agreement.
Do You Need an Attorney to Draft a Separation Agreement?
Maybe. In all honesty, it depends on how complicated your personal situation is and the number of assets you will need to divide. However, whether you decide to have an attorney draft your separation agreement or not, we still highly recommend that you have a lawyer look it over before you sign it.
Family law is an extremely complicated area of the law. There are many issues that can arise in negotiating and drafting a separation agreement that can become problematic later on if you don’t have a lawyer review your agreement now.
Remember, a separation agreement is a legally binding contract. While it may seem expensive at the time, hiring a lawyer to review your agreement for you could save you thousands of dollars over the life of your contract.
What Can a Separation Agreement Do?
A separation agreement can provide you with a legally enforceable contract that resolves all the issues related to your marriage. It also allows you to avoid getting involved in in a costly and contentious court battle.
Here are some of the issues that can be resolved in a separation agreement:
Custody – If you have minor children, you can include a visitation schedule in your separation agreement, as well as determine who will have primary physical and legal custody of your children. You may also determine an appropriate holiday visitation scheduled for your kids.
Child Support – In North Carolina, child support is typically calculated according to the income of the parents, the number of children, the percentage of overnights with each parent, as well as some other variables. In a separation agreement you can agree to follow the North Carolina Child Support Guidelines, or you can do something entirely different. Regardless, you can include this information in your separation agreement.
Property Settlement – One of the largest and most complicated areas of a separation agreement is the section that divides up your financial assets (including bank and retirement accounts), real estate assets, vehicles, and other personal property. This is a section where many people make mistakes and it is wise to have an attorney review your property settlement before you sign your agreement.
Alimony and Post Separation Support – In this section you may outline how much alimony will be paid and for how long. You can also address such issues as who will pay for health insurance and unreimbursed medical expenses, and for how long.
Other Important Provisions – In other sections of the separation agreement you can contractually terminate many marital rights that you would otherwise have, as well as include special language that will allow you and your spouse to buy and sell real estate as if you were not married. In essence, you can divorce each other contractually until you have been separated for one year and are ready to file for an absolute divorce.
How Do You Enforce a Separation Agreement?
A separation agreement is a legal contract, and as such, it can only be enforced in the same ways that a contract can be enforced. Typically this means filing a breach of contract action in civil district court.
Although it is rare to do so, some people will have their agreement “incorporated” into their divorce judgement, making everything that is in their separation agreement part of a court order. By doing this, your separation agreement becomes enforceable through the contempt powers of the court. This is a much more serious enforcement option, as the offending party could be incarcerated for failure to adhere to the agreement.
Sometimes, people will pull out the support and custody provisions of their separation agreement and place those sections into a “consent order” that is then filed with the court. In this way, if the person who is supposed to pay support stops doing so, they could be held in contempt of court. However, the property settlement provisions of the separation agreement would remain in a private contract.
There are positives and negatives to having your agreement be enforceable as either a contract or a court order, and you should speak to an attorney to determine which option is best for you.
Will I Still Have to Go to Court if I Have a Separation Agreement?
Typically no. The whole point of negotiating and entering into a separation agreement is that you can keep all of your affairs private and outside of the public eye.
For people with significant marital estates or alimony obligations, they may not want this information becoming public in a court proceeding. Having a private separation agreement is a perfect solution in this scenario.
However, if your agreement breaks down or you or your spouse violate the terms of the separation agreement, then you may still have to file an action in court to enforce your agreement.
Although you are not guaranteed to stay out of court, most people, after signing a separation agreement, will not need to go to court.
Can I Modify My Separation Agreement?
It depends on what the agreement says. In most situations, separation agreements are not modifiable without the written consent of both parties.
However, some people will insert modification provisions in their agreement. Most often, the modification will concern the payment of alimony. People who are paying alimony want to know whether their payment can change or terminate if the dependent spouse gets a job or if their income goes down.
However, if you make your alimony modifiable, it also means that the dependent spouse can ask for an increase or to extend the term of the alimony. For these reasons, many couples elect to a certain amount of alimony for a certain period of time, and make the payment non-modifiable.
Incidentally, if alimony is placed in a court order it can always be modified if there is a “substantial change in circumstances”.
Frequently Asked Questions about Separation Agreements
The following questions are ones that frequently come up when clients are negotiating a separation agreement. We may supplement and add to this section from time to time.
Can I be separated if I don’t have a separation agreement?
Yes! You do NOT need a separation agreement to be separated in North Carolina, although for most cases we highly recommend that you consider executing an agreement. The peace of mind that comes with knowing you can’t get sued while you are separated and the certainty of knowing what your rights and obligations are until you get divorced and major benefits to having a separation agreement drafted.
Can I settle all issues related to my divorce in a separation agreement?
Yes. You can settle all issues related to your divorce in your separation agreement, as well as many more. Many couples will agree to things in a separation agreement that they could never do in a court proceeding.
As an example, you may want to negotiate who will pay for college for your children. You can include this in a separation agreement whereas a court does not have the legal authority to obligate either spouse to pay for college for your adult children.