Family Law Outline

Family Law Outline

Chapter 1: Marital & Cohabitation Agreements

I. Marriage as a contract – Prenuptial Agreements
a. Marriage is an institution with a set of legal consequences and relationship – both contract (1st) and a status (2nd).
b. Prenuptial Agreement = antenuptial agreement
i. An attempt to negotiate what will happen in the event of a death or divorce
ii. Legal test for validity of a prenuptial:
1. agreement is valid and enforceable if:
a. it was entered into freely w/o fraud, duress, coercion, or overreaching (burden is on the party claiming these defenses);
b. there was full disclosure, or full knowledge and understanding of then nature of the value and extent of the prospective spouse’s property; and
c. the terms do not promote or encourage divorce of profiteering by divorce. Fletcher.
2. Disadvantaged party must have a meaningful opportunity to consult with counsel. Fletcher.
3. Consider substantive fairness issues.
c. Fletcher v. Fletcher (SC Ohio, 1994) pg 12
i. Facts: W and H divorcing; W is fighting a prenup signed the day before the wedding. W didn’t have independent council.
ii. Court: upheld the prenup, despite last-minute signing before wedding.
1. Asked how much duress? wedding was small, so could be rescheduled w/ minimal embarrassment.
2. RULE: When the prenup gives the party disproportionately less than the party would have received under an equitable distribution, the party financially disadvantaged must have a meaningful opportunity to consult with counsel.
3. Burden of proof:
a. A prenup that creates a disproportionate allocation of property upon death places the burden of proving full disclosure onto the party claiming validity of the prenup.
i. Full disclosure is required b/c parties aren’t dealing at arms’ length, and b/c of special fiduciary relationship. BUT, here the W had been divorced before, so court felt she should understand her rights better.
iii. Dissent:
1. timing of the agreement (day before wedding) indicates duress and overreaching, so set agreement aside. Terms are unclear – does this apply to divorce, and does this apply to property acquired during the marriage?
2. Feels a party must appreciate the rights he or she is forfeiting, and must nonetheless agree to give up those rights
iv. NOTES
1. Statutory rights may give a forced share (prenup could agree to wave this forced share)
2. Statute of Frauds
a. Requires promises made in contemplation of marriage (other than the promise to marry) to be in writing and signed by the party to be charged
3. Oral agreement to keep finances separate, and evidence that they did so, was enforced under the “part-performance” exception to the statute of frauds.
4. Inheritance Issues
a. When a prenup agreement doesn’t include the necessary language, it will not be effective as a waiver of inheritance rights
d. Simeone v. Simeone (Penn SC, 1990) pg 22
i. Facts: classic prenup example – he’s 39, neurosurgeon, she’s 23 – nurse. W argues no full disclosure, no counsel, inaccurate disclosure re: car collection.
ii. Court: upheld prenup.
1. Women are equal, No need to protect
2. No requirement for counsel;
3. There is a presumption of full disclosure when the agreement provides for it. Therefore, the burden of proof is on the party attempting to void the agreement that there was not full disclosure. (Full disclosure = fair disclosure)
iii. Treated the prenup like a contract
1. Only fraud, misrepresentation, or duress should void the contract
2. Doesn’t matter if terms were not fully understood by Mrs. P
3. A prenup’s reasonableness (at time of signing or divorce) isn’t subject to judicial review. A party enters into marriage believing it to be reasonable
4. Parties have contracted to bear the risk of events that alter the value of their bargains
iv. Dissent:
1. look at circumstances at time of divorce, is the prenup now inequitable and unfair
v. NOTES
1. Today many states require a certain time (7 days 30 days) between being presented with a prenub and requiring it be signed
2. Right to child support can’t be adversely affected by a prenup
3. Conflict of Laws
a. The state laws that govern the prenup could change if the couple changes states during the marriage
b. Best (but not perfect) method is to name which state laws are to govern the prenup
e. Uniform Premarital Agreement Act (UPAA) § 6: (IA has adopted)
i. Premarital Agreement is not enforceable if party against whom enforcement is sough proves that:
1. the party did not execute the agreement voluntarily; or
2. the agreement was unconscionable when executed, and before execution, that party:
a. was not provided a fair and rsnble disclosure of the property;
b. did not voluntarily and expressly waive any right to disclosure of the property or financial obligations of the other party; and
c. did not have, or rsnbly could not have had, an adequate knowledge of the property or financial obligations of the other party.
ii. If a provision in the prenup modifies or eliminates spousal support, courts might require the other party to provide support necessary to avoid that eligibility for public assistance.
iii. An issue of unconscionability of a premarital agreement shall be decided by the court as a matter of law.
iv. Problem 7(a), p. 25. R & C met on a blind date; C becomes pregnant. Several days before the wedding, R has his atty draft a prenup, and C signs it. C was suffering from morning sickness. Agreement released all claims to property, worth 150,000. R’s atty did not tell C the effect of the agreement. R died intestate. C fights prenup.
1. Fight the prenup as an atty
a. duress – pregnant, 18 yrs old, maybe did not know what she was signing
b. C has a right to alimony & child support
2. Common counsel for prenup not allowed b/c of conflicting interests
v. Problem 7(b), p. 25. B did not disclose on the prenup that she is the only living relative of a wealthy aging uncle. Agreement says neither will make a claim against the other party in reliance on the marriage. Uncle dies and leaves all to B. B is killed 1 yr later. Is the agreement valid? Should A inherit B’s interest in the property?
1. Should this be included in a prenup?
a. one possibility is to state that any assets acquired in the future are also free from claims.
b. does not say that B ever anticipated anything, only that she was the only living relative. Maybe A can’t release rights to something he doesn’t know exists.
vi. Problem 7(d), p. 25. H and W sign a prenup agreement stating that in the event of divorce, any child will spend = residential time with each parent. W has a child and sues for divorce, decides to move to another state. H wants to enforce prenup and say she can’t move b/c impossible for = residential time.
1. Parents don’t have the right to contract away the BIC.
f. Steps to draft an enforceable prenup:
i. Counsel – recommend that both parties have counsel
ii. Timing – draft document as far in advance as possible. Do ASAP if marriage is in 1 wk. If