The Second Department seems to have taken another bite out of prenuptial agreements. My March 25, 2013 post asked, Is it Open Season on Prenuptial Agreements? That post discussed the Second Department’s February, 2013 decision in Cioffi-Petrakis v. Petrakis and its December, 2012 decision in Petracca v. Petracca. Both cases affirmed Supreme Court Nassau County decisions setting aside the prenuptial agreements in issue,

Now, in an October 15, 2014 decision in McKenna v. McKenna, the Second Department modified an order of Nassau County Supreme Court Justice Margaret C. Reilly that had granted a husband summary judgment motion declaring the parties’ prenuptial agreement to be valid and enforceable. Justice Reilly had also denied the wife’s motion for an award of pendente lite maintenance and counsel fees.

Holding that summary judgment was not warranted, the appellate court may have increased or changed the burden needed to uphold a prenuptial agreement; changing the role of a contract’s “merger clause.” That clause declares that no factual representations not specifically referenced in the contract may later be used to claim the contract was fraudulently induced. Typically, it is a shield used to protect the agreement from attack.

In McKenna, the Second Department suggests a merger clause may be used as a sword: preventing a court from learning the wife’s actual knowledge of the husband’s finances at the time the prenuptial agreement was entered. As that knowledge could only have come from representations of the husband, the merger clause would bar proof of such representations not referenced by the agreement.Continue Reading It Just Became Tougher To Validate Prenuptial Agreements

The failure of the now-deceased wife to disclose that she was suffering from terminal cancer at the time the parties entered their divorce settlement agreement was not a basis to set aside that agreement. So held the Appellate Division Second Department in its August 28, 2013 decision in Petrozza v. Franzen.

Richmond County Supreme Court Justice John A. Fusco had granted summary judgment dismissing the complaint in the husband’s plenary action to rescind the agreement brought against the executors of the wife’s estate. The husband had alleged that his wife had fraudulently and actively concealed her illness. That illness resulted in the wife’s death after the execution of the settlement agreement, but before the entry of a final judgment of divorce.

Affirming that dismissal, the Second Department noted that to demonstrate fraud, a plaintiff must show that the defendant “knowingly misrepresented or concealed a material fact for the purpose of inducing [him] to rely upon it, and that [he] justifiably relied upon such misrepresentation or concealment to his . . . detriment.”Continue Reading Concealing Terminal Cancer Not Basis to Invalidate Divorce Settlement