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Evolution of the Postnuptial and Prenuptial Agreement
August 13, 2022
The laws regarding New York prenuptial agreements as well as and post nuptial agreements and the application of these laws continues to evolve in New York State. Post postnuptial and prenuptial agreements are treated in the same way. The case law discussed herein tends to suggest that prior application of reasoning as to enforceability of prenuptial and postnuptial agreements has changed in the last twenty (20) years. In the case of Van KIPNIS versus Van KIPNIS, 11 NY 3rd 573 the Court of Appeals in New York court reiterated the importance of enforcing duly executed agreements because of the strong public policy favoring contracts between spouses. Contracts such as these are favored and encouraged by Public Policy and by the judiciary because agreements such as these between spouses lessen the burden of going through a costly and burdensome divorce. This is because the necessary issues of the agreement between the parties are resolved by the agreement and resolution of those issues are absolutely necessary to obtain a divorce.
As such, said prenuptial or postnuptial agreements must clearly set forth in the four corners of the agreement a resolution of such ancillary issues of equitable distribution, support, child custody and counsel and expert fees. If the Agreement neglects any aspect of those issues, those issues may still be litigated in a divorce action.
Thus, prenuptial agreements are contracts between spouses which are usually presumed valid and enforceable unless there are reasons to challenge them.
However, there are exceptions to the rule. One such important exception is where an agreement was not executed properly. In 2013, the New York Court of Appeals held that any prenuptial agreement must be acknowledged in the manner required for the filing of a deed and that a failure to execute this formality in entering into an agreement will bring into question the enforceability of a prenuptial agreement. That means that if the prenuptial agreement is not executed with all the formalities required for the filing of a deed, then the agreement is unenforceable in a divorce action, and it matters not whether or the parties signed the agreement.
There are other circumstances where a prenuptial agreement may not be enforceable. Some grounds that parties have traditionally used to set aside a prenuptial agreement might be fraud, unconscionability, unfair financial advantage and lack of independent legal advice and involvement. However, things are changing. In a first department case in 2016 coming out of Manhattan, the appellate division found that the prenuptial agreement was in fact enforceable even though it might not have been fair because the wife was not aware of the husband’s income that he was earning at the time she signed it. That case can be found at Gottlieb versus Gottlieb, 138, AD3d 30.
The courts also consider timing of execution of the agreement in evaluating whether they will enforce a prenuptial or post nuptial agreement. This is because courts are always interested in whether or not an agreement was procured by overreaching or duress.
However, recent case law suggests that in the First Department will not always follow these older notions of law. There, where the wife was of the belief that if she did not sign the prenuptial agreement the husband would not marry, and where the wedding was only 2 weeks away, the Court found the contract valid. Surely the Wife in that case must have felt that the husband was putting her under pressure to sign the agreement and that he was overreaching. But the Court felt otherwise, holding that said greement would be enforced even though the husband would get the vast majority of the property of the marriage under the terms of that agreement. You can read more about this in the case of Barocas versus Barocas, 94 AD3d (1st Dept). The Barocas case was decided in Manhattan in 2012 which gives you an indication as to the direction that the courts are taking with respect to the handling of enforcement of prenuptial and postnuptial agreements.
This means that parties residing in Manhattan should retain the very best attorney they can to negotiate their prenuptial agreement because in all likelihood absent extenuating or extreme circumstances the courts will enforce these agreements so long as they are properly executed.
That said, there are always interpretation issues in deciding what the parties meant by the language. This is because if an agreement is challenged in court as to its meaning, then the Court will be charged to apply contract interpretations to the agreement and that interpretation of the language might not be to your liking or might not be that which you anticipated when you signed the agreement.
To conclude, if you are engaging in the negotiation of a prenuptial or postnuptial agreement if would be wise to have your own attorney negotiate and draft it on your behalf so as to cover any contingency which might arise of which you lack awareness.
By Lisa Beth Older
Your Manhattan divorce lawyer