Bonnie Lonardo Talks Prenuptial and Postnuptial Agreements on Morris Law’s “Around The Gavel”
Founding Attorney of LJ Law, Bonnie Lonardo, was interviewed by Sarah Morris of Morris Law Center to talk about Prenuptial and Postnuptial Agreements. Bonnie discusses some of the lesser known facts about pre- and postnuptial agreements and touches on how they impact real estate and estate planning.
Read the full interview below or listen to the podcast on Apple Podcasts.
Sarah Morris: How long have you been practicing?
Bonnie Lonardo: 16 years now.
SM: Can you give me a little bit of background about yourself, how you got into law?
BL: Well, my story’s kind of funny. I must be one of those weird people that knew they wanted to be an attorney at age 11. It’s kind of crazy. I was in a class that was an English class, and the teacher had asked a question about a pencil, and asked the students to describe what the pencil was. And everybody was saying, “Oh, it’s a writing instrument, it’s a pencil.” And I just said, “Well, it’s more than that. It’s kind of like, it’s wood, it’s part of a tree.” And so I went deeper into what it was and he said that is exactly how attorneys thought. And so that just sparked me and I thought, you know what? I like that. I think that’s what I want to do because I like to think that way and just kind of break things down that way.
SM: For the last 16 years what have you been doing?
BL: Well, I have three children, so I was raising children. I had a financial planning business while I was raising my kids and while I was going to school. So that’s why I did the night program at ULV. So I was able to continue running the business, going to school, taking care of the kids. After graduating law school, I started just doing family law just for friends and acquaintances and people that would refer to people, myself and two other of my classmates. We started doing that while I still ran my financial planning business and took care of the kids. Then I got burned out, I think, owning my own business. And so I decided it was time for me to just work for somebody where I could just put in my time and then go home and take care of the family. So I did that for a while, but then of course the “bug” hit again and so I decided, you know what, I want to start my own firm. And so in 2014 I opened up the firm.
SM: And on this podcast, we’ve talked a lot about estate planning and real estate, because those are our big practice areas. So I thought this would be a great opportunity to talk about pre and post nuptial agreements because they relate to both real estate and estate planning. They come up a lot, and I understand that’s definitely something that you do at your firm.
BL: Yes. And actually, yes, it is funny, they do relate more so than people think. The prenuptial and postnuptial agreements are, obviously most of them are done for division of assets after someone’s death or the termination of a marriage. Right? But what most people don’t know about them is that they can be used as part of an estate planning, so far as you’re able to, when you designate your property, you can name your property such as personal property, or community property. And so based on that division and the way that you label that property is how you can then later divide the property upon the termination of the marriage. So that’s really helpful. And a lot of people don’t really understand that that is a really good tool for estate planning. It’s not a substitution for wills, or for trusts. Absolutely not. But it does go hand in hand and it’s really helpful to use both at the same time.
SM: Yeah, agreed. Because I actually had a client come in on Friday for a consult on a trust, and he’s planning on getting married in the next year. And so he did ask me about a prenup and of course I don’t practice in that area, but it came up because he has separate property. He has actually four condos right now that he rents out, and he wanted to make sure that those were kept separate. And of course we talked about how he needs to make sure they’re not commingling. Meaning she’s not paying the bills for the condo, because then it all of a sudden might become a community asset.
BL: That’s so important that you addressed that with him, yeah. Because a lot of people don’t really realize that even though it is separate property, even if you put any money towards any kind of renovations or anything, you could be commingling. So that’s really important. Another really important point. So that was a good thing for you to tell him. Yes. But yeah, so prenuptial agreements are, they’re good, especially in a community property state. Nevada as a community property state, any kind of property, any kind of debt, any kind of assets that you accumulate during your marriage are immediately 50/50 and that’s what a community state looks at, how they look at property. And so if you wish to divide that property any differently, you have to have some sort of agreement between the two people, and so that’s when it prenup or postnup comes in.
SM: Okay. And just to be very clear, if somebody gets married and one of them is the primary breadwinner, and they buy a house and let’s say it’s a man, right? He is paying all the bills for the house. He purchased the house, of course the woman is at home taking care of the children. More like a traditional thing. That house that he purchased, even though it wasn’t purchased with community funds? It is community property. Is what you’re saying?
BL: It depends on how it was purchased. So for example, if the house was purchased while they were married and he used the funds that he earns that he brings home and puts into the joint account. He purchases this house, this house then becomes community property. If for example, he purchases the house during the marriage, but with income that was separate and apart from the marriage prior to the marriage, then it would be considered or could be considered personal property, separate property.
SM: What about businesses? If he owns a business prior to marriage and then he gets married, and there’s no prenup in place, nothing going on. His business interest, his interest in that business, what is that considered?
BL: Well, again, it goes back to how involved is she with the business? Is she playing any role in the business? Is she contributing anything to the business? If it is solely separate and it had nothing to do with community funds from the marriage, everything was separate prior to the marriage and she has no involvement in it, then there’s a good case for him having that as a separate property. But again, there have been cases where we have argued that even though she had nothing to do with the business and it was purchased prior to the marriage, the fact that his time was taken away from the community to go work towards the business, and the fact that she then had to make up his share of maybe being a dad or taking care of the household or something like we have to help him do his business. We have seen cases where we can argue that her time could be considered to have some part of that business. So it depends on the situation. Every situation is different. We would obviously have to look at every issue and every fact in every case, but there are arguments to be made. So that’s why it’s important, I think. I’m a big proponent of the prenuptials and the postnuptials, because it just alleviates a lot of the arguments, the hassle, during the marriage as well, because both parties know exactly where they stand. And so there’s not… There’s a lot of arguments as to monetary issues in marriages, as you know. And this kind of alleviates a lot of that because everyone in the marriage has then come to an agreement, knows what they’re saying, and there’s no arguments there. And also later on in the division of the assets, it’s much easier with your will and with your trust.
SM: And then let’s talk about postnuptial agreements because they are, to me, at least in my line of practice, more rare. So can you tell me just what a postnuptial agreement is?
BL: It’s basically the same thing as a prenuptial. You still want to have your assets protected in the event that the marriage is dissolved by either divorce or death, but you enter into this after the marriage. And because it is entered after the marriage, you want to make sure that you get an attorney who really knows what they’re doing to make sure that they follow the laws of each state. Each state has different laws and so you don’t want to do or make an agreement that is going to be invalidated later on because different laws were not followed. For example, when you’re doing a prenuptial agreement, let’s just use that as an example. When you give the prenuptial agreement to your spouse, one, you have to make sure that all the assets have been disclosed. Two, you have to make sure that your spouse has ample opportunity to review this and sign it before the marriage. You don’t want to say, “Oh, by the way, we’re getting married tomorrow. Here’s prenup. Why don’t you read it and sign it?” They want to have an opportunity to be able to review it, to have separate counsel so that it is not a coercion so to speak. So that it’s not invalidated later on. So there are things that you must follow to make sure that it’s done correctly.
SM: Okay. And in these pre and postnuptial agreements, because of course I’ve seen some, it seems like there’s generally a schedule A or an exhibit A that lists the separate property.
BL: So that is a way to be upfront in good faith, you’re labeling everything so that everybody’s aware of what the other party has. So later on they can’t say, I wasn’t aware of it, he didn’t disclose everything. And so it would be a way to invalidate that agreement. So full disclosure, very important.
SM: Okay if you are doing a prenup or a postnup and like you said, you want to make sure that the other side, whoever has retained you, the other spouse has an opportunity to have this reviewed by outside counsel. If they decline then of course they’re going to sign a waiver that they’re declining, but I think you probably really urge them to do it?
BL: I do. I think it’s important. Again, I’m always thinking ahead. The couple are doing this because they want their wishes to be followed, and if we don’t take into consideration what could happen if things are not done correctly, then it’s really for naught if we don’t do it correctly at the beginning. So yes, I’m a big proponent of please go see an outside counsel, independent counsel and just have him review it.
SM: Okay. Yeah, and I mean when I do estate planning, that’s one of the things we immediately ask for is if there is a pre or postnuptial agreement, because of course that is going to factor into any kind of an estate plan.
BL: That’s correct.
SM: So I need to know exactly what the assets are and who owns them and how they’re held, and what we’re going to do with them to potentially protect them or just make it so that they don’t have to go through probate court. And the other thing I didn’t mention in the beginning is, Bonnie speaks Spanish.
BL: Yes, I do have quite a bit of a Latino following in my practice.
I want to talk about foreclosure defense, which is real estate, right? You were talking about just to, can you explain what foreclosure defense is?
BL: What I handle in foreclosure defense is primarily foreclosures of properties, or residential homes. So I defend against people who are behind in their loans, in their payments from getting foreclosed upon. So I do a lot of loan modifications and I do a lot of foreclosure defense in the sense that I go before the state to have the lender come to the mediation, and sit with the people and try to come to some sort of solution to be able to save their homes.
I really am glad that we sat down and talked about this. Because I want people to understand and to be aware that prenuptial/postnuptial agreements do really go hand in hand with estate planning. And it’s really important for couples who are contemplating wills, trusts, prenuptial agreements, to work with them together because they really do benefit each other.
SM: Right. And you know, let me just say this, I also had a couple that came in last week, an older couple and I incorrectly mistakenly assumed they were married and they weren’t, which I was actually happy to hear because good for them. You know, you don’t have to be married. But they were living together, both of their spouses had passed away. So they were neighbors apparently and they got together. So in that scenario, what happens since they aren’t married? Is there stuff just considered separate?
BL: We’re not going to fall into the marriage part family law because there it would be more like in a contract or an agreement between two parties and two…
SM: Because we don’t have common law marriage?
BL: No common law in Nevada. So therefore we won’t be able to yeah. In other stays there are. And that then could take, you can then participate in pre and a post nuptial after. I believe it’s seven years in those states, but don’t quote me, I’m not sure. But Nevada, no. So I think we would look at it more as a contract here in Nevada.
SM: But you would have to have a contract?
BL: Yes. You would have to write a contract and you would have to define exactly what assets and how they’re going to be held. And we’re seeing that more and more where couples are not married and now they’re combining things, or they want to keep them separate, or however they want to do it. But still, that’s also an important, maybe another topic for a different podcast for you to cover. How do you do when you are not married and how do you protect your assets when you’re not married?
SM: Good idea. Well, thank you so much, Bonnie.
BL: Thank you for having me. I had a good time.