Prenuptial Agreement Dispute Sparks Messy Divorce Battle – In re Marriage of Grubaugh

A prenuptial agreement is a legal contract under which a couple preparing to marry may decide how their assets will be treated and divided in the event that they divorce. As a recent case out of California’s First Circuit Court of Appeals shows, the agreement is likely to dictate the terms of a divorce, even one that happens nearly two decades after the contract was signed.

my-next-trip-1320575-mHusband filed for divorce from Wife in 2012, ending roughly 17 years of marriage. He said the couple, which had been separated since 2001, entered into a prenuptial agreement shortly before they married. According to Husband, they decided to wed in part so that Wife – an artist – and her daughter from a previous marriage could be covered under his health insurance plan. He said Wife had been married twice before, and she made clear to him that she didn’t want to commingle the couple’s assets this time around. He said he understood that the agreement provided that their property would remain separate in the event of divorce. Husband said his assets were minimal at the time, while Wife’s thriving career allowed her to buy a home and cars and to pay for private school tuition for her daughter.

The family moved to Washington when Husband took a job with Microsoft. They bought a home there, using $240,000 from Wife’s savings as a down payment. Husband paid the mortgage and expenses and eventually paid the $240,000 back to Wife when the house was sold in 2012. Wife and her daughter moved back to California roughly 11 years earlier, living in a house that Husband purchased, and the couple lived separately until Husband filed for divorce.

Wife responded by arguing that the premarital agreement was a “false” document. Although her lawyers first acknowledged that she’d signed the document, Wife later fired the attorneys and argued that the agreement had been doctored. Wife said the only document that she signed was a post-marital agreement. The lawyer who prepared that agreement told the trial court that it was the only contract that she drafted for Wife. The lawyer, who had since closed her practice, said she wasn’t able to find a copy of the post-marital agreement. A forensic document examiner retained by Wife testified at trial that he couldn’t conclude whether the signature on the premarital agreement was Wife’s. A notary told the court, however, unequivocally that she had acknowledged and notarized both spouses’ signatures on the document.

The trial court sided with Husband, finding that Wife didn’t prove her claim that the pre-marital agreement was fraudulent. It noted that the document was notarized under penalty of law and that Wife’s expert was unable to conclusively say whether the document had been altered or forged. The court also said it was “odd” that Wife wasn’t able to produce a copy of the post-marital settlement that she argued the parties had entered into. The court concluded that Husband’s version of the events – that Wife didn’t want to commingle assets because she’d been married twice before and had a successful art career – was logical.

Affirming the decision on appeal, the First District said the evidence supported the trial court’s finding that the premarital agreement was valid. “There is no evidence that [Wife]’s initials and signature on the prenuptial agreement were the product of forgery,” the Court said. “[Wife]’s own expert was unable to make such a conclusion.” Meanwhile, the Court said the circumstances of the marriage seemed to support Husband’s narrative. It observed that the couple married “without fanfare” and that Husband had little financial support to offer at the time, except for his company-provided health insurance plan. “It is also reasonable to infer that [Wife], as the party with more to protect, would have wanted a prenuptial agreement in this instance.”

This case is a good example of the trouble that can happen if spouses don’t keep clear and accurate records of agreements and other legal documents. Rather than forcing a court to make assumptions based on the circumstances, a party in a divorce case should provide hard evidence to support his or her position.

If you’re thinking about seeking a divorce or grappling with property division and other issues following a divorce, contact the Bay Area family law attorneys at Kathleen K. Reeves & Associates. From offices in San Leandro and Pleasanton, we represent clients throughout Alameda and Contra Costa Counties with compassion and dedication.

Enforcing Marital Settlement Agreements in California – In re Marriage of Oliverez

A marital settlement agreement is a contract that some divorcing spouses in California choose to sign in order to resolve issues like child custody, support, and property division. It’s a strong alternative to litigation for many couples. As a recent case out of the state’s Sixth District Court of Appeals makes clear, however, it’s important to keep in mind that a settlement agreement is a contract. That means it has to meet certain legal requirements in order to be enforceable.

paperwork-3-488174-mHusband and Wife separated in January 2007, following roughly 14 years of marriage. “Contentious” and “highly litigated” divorce proceedings followed, according to the Court. The parties signed a marital settlement agreement in April 2008, under which they agreed on child custody and support, spousal support, and the division of their property rights, assets, and debts. But Wife later argued that the document wasn’t enforceable, saying that it had only been intended to serve as a preliminary, nonbinding agreement. She also said that the agreement shouldn’t be enforced because she was under duress and undue influence or had been duped by fraud.

A trial judge initially sided with Wife, declining Husband’s motion to enforce the settlement agreement. The judge said there had been no “meeting of the minds,” a legal requirement that the parties to an agreement have the same understanding about just what it is that they are agreeing to. The case was later reassigned to a second judge, who presided over 15 days of trial scattered across nine months. At the close of the trial, however, the new judge decided to reconsider whether the settlement agreement was enforceable. He eventually concluded that the contract should be enforced. The judge granted the divorce and resolved all related issues pursuant to the terms of the settlement agreement.

Reversing the decision on appeal, the Sixth District said that it wasn’t appropriate for the second trial judge to overturn the first judge’s ruling on the settlement agreement. “Generally, one trial court judge may not reconsider and overrule an interim ruling of another trial judge,” the Court explained. Otherwise, parties who don’t like a ruling from one judge could simply seek a different ruling by another judge on the same issue. “To affirm the action taken in this case would lead directly to forum shopping, since if one judge should deny relief, defendants would try another and another judge until finally they found one who would grant what they were seeking,” the Court explained. Although some circumstances might warrant a second look, the Court said a disagreement with the first trial judge’s ruling wasn’t enough. Instead, the disagreeing party can seek appellate review.

The Court also found that it would be unfair to Wife to allow the second judge’s ruling to stand. It noted that the ruling came three years after the first judge’s ruling. “We find that under the circumstances of this case, once the court had determined that the Agreement was unenforceable, wife had the right to believe the ruling was definitive,” the Court said.

Despite this ruling, a marital settlement agreement can often help divorcing spouses resolve some or all of the legal issues related to the split more efficiently than a long, drawn out court battle. If you’re thinking about seeking a divorce or grappling with the enforcement of an agreement following a divorce, contact the Bay Area family law lawyers at Kathleen K. Reeves & Associates. From offices in San Leandro and Pleasanton, we represent clients throughout Alameda and Contra Costa Counties with compassion and dedication.

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