What’s the distinction between a Memorandum of Understanding and a Divorce Settlement?
This is the first article in our series on drafting divorce agreements. A list of upcoming articles can be found at the end of this post. If you’d like to jump straight to our useful resources, try these links: Download a free agreement checklist
Download a free Memorandum of Understanding
Buy a divorce settlement template
We hope you find these resources useful. While we focus on agreements in Massachusetts, many of these tips apply in other states as well. Read on to find out more:
What is the difference between a Memorandum of Understanding and a Divorce Agreement?
To resolve a divorce case in Massachusetts, the probate and family court requires the spouses to file an agreement that sets out all the terms and conditions related to the dissolution of their marriage. This is usually called a divorce agreement or a separation agreement. It is a public document that the judge must review and approve in order for a Massachusetts divorce to be finalized.
To be approved, the divorce settlement must at least contain provisions that relate to:
- Asset & Liabilities department
- Health insurance
- Life insurance
- Legal and professional costs
- Income tax
- Dispute Resolution Provisions
and if there are non-emancipated children, it should also address:
- Parenting plan
- Child support and expenses
A more complete checklist for agreements can be downloaded here.
The divorce settlement is a legal contract that sets out these terms. As with a will or trust, it is best to have an attorney draw up the agreement. A Memorandum of Understanding, on the other hand, is a much simpler document that just describes the terms of the agreement without all of the legal contract language or formalities.
Often times, mediators write a memorandum of understanding to confirm the terms that the spouses agreed upon during the mediation. The Memorandum of Understanding (or MOU for short) must then be converted into a full divorce agreement. In Massachusetts, a mediator, who is also an attorney, can work out the full divorce settlement if both parties agree.
As an example of how different the language can be in each language, a letter of intent might include the following language for child support:
Child benefit is $ 300 per week, which Jamie will pay to Chris starting November 29, 2019. A divorce settlement will be more specific so that the court can understand what additional details are required to enforce and resolve an arrangement in light of the law around child support in Massachusetts. For example, a divorce settlement with the same terms could include the following language for child support: Jamie and Chris now irrevocably waive all rights to previous child support payments from the other party. Jamie pays Chris $ 300 per week as current child benefit, with the first current child benefit payment being made on November 29, 2019 and each subsequent Friday. Payment is made by direct deposit into a current account provided by Chris. The amount of child support corresponds to the guidelines for child support effective September 15, 2018 and the guidelines worksheet submitted herewith. Jamie and Chris acknowledge that child support may be changed if there is an inconsistency between the amount on the existing order and the amount that would result from applying the Child Support Policy. If one parent requests a change in support and an agreement is reached, those changes and agreements will be put in writing and signed by both parents before implementation and presented to the court with a joint request for change at shared cost. If Jamie and Chris cannot agree, they will adhere to the enforcement and dispute resolution provisions in this Agreement. All obligations described in this appendix exist until a further order or decision of the court or until the disqualification of the children through their emancipation. Emancipation is defined by applying the relevant provisions of MGL Chapter 208, Section 28.
Some lawyers and mediators also offer blanket drafting of full separation agreements if you need assistance converting a Memorandum of Understanding into a separation agreement. Skylark Law & Mediation, PC offers these services at a flat rate. You can find our prices online here. Whether you are preparing a letter of intent or the final divorce settlement, it is important that you provide a full description of your intentions. If something is not regulated in the agreement, you may forego your rights to it in the future. So you want to make sure that all typical provisions and anything unique to your family are covered.
In our upcoming series of blogs on severance agreements, we’ll examine the various provisions that are often overlooked or incomplete, including creating contractual provisions that address all of these issues:
- Parental Plan Provisions – How Rigid or Flexible Should You Be?
- Introduction of new significant others for children (and other hard-to-discuss agreements);
- The overlap of technology and parenting plans;
- What’s in a name? – Prepare a divorce settlement for real people
- Draft gender neutral agreement – avoiding pronoun problems
- Checklist to assist children and spouses in drafting agreements
- Getting pension department right in an agreement
- Dealing with Unusual Assets in a Divorce
- Digital Pictures & Divorce – Lost Your Love Library?
- Frozen Embyros & Divorce – What is the Massachusetts Law?
- Health Insurance Options When You Divorce In Massachusetts – Knowing Your Options
- Life insurance protection – Necessary provisions to avoid an inheritance problem
- Share Compensation, Is Baccanti All That It Takes?
- Is a divorce settlement a contract?
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