Prenuptial Agreement

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For 13 years, Mr. De Niro and Ms. Hightower failed to account annually for their commingled separate and marital property when making investments or acquiring assets as required by their 2004 Prenuptial Agreement (PNA). In effect, the decisions in their 2018 divorce action have now interpreted this annual accounting requirement as an agreement to forever arbitrate and not litigate the marital and separate property issues of the divorce.

In his March 15, 2023 decision in Anonymous v. Anonymous, Supreme Court New York County Justice Ariel D. Chesler directed the parties to immediately provide to the parties’ chosen accountant those 13 years of disclosures . The accountant, and not the Court, would make the separate/marital property determinations. In doing so Justice Chesler applied the 2021 Appellate Division affirmance of a 2021 Order of now-retired Justice Matthew F. Cooper.Continue Reading Lessons to be learned from the De Niro/Hightower divorce and prenuptial agreement

Two days before the parties were married in February, 2011, they executed a prenuptial agreement. In it the wife accepted an agreed-upon maintenance provision. The husband commenced a divorce action in 2019. The wife counterclaimed, seeking an award of maintenance and a judgment setting aside the agreement as invalid.

The husband moved for summary judgment requesting the court deem the agreement valid. The wife opposed the husband’s motion and cross-moved for an award of temporary maintenance and counsel fees. Acting Clinton County Supreme Court Justice Keith M. Bruno partially granted the husband’s motion and dismissed the wife’s second counterclaim disputing the validity of the agreement. Justice Bruno also denied her cross-motion seeking temporary maintenance.

In its June 9, 2022 decision in Spiegel v. Spiegel, the Appellate Division, Third Department, reversed, finding various issues of fact raised by the circumstances surrounding the execution of the agreement that precluded an award of summary judgment. The Court reported the wife’s allegations concerning the husband’s controlling conduct leading to the execution of the prenuptial agreement. The Court concluded:

We find that the foregoing facts, if established, raise issues concerning whether the wife was meaningfully represented during the abbreviated negotiations, and also raise an inference that the husband did not intend on engaging in a good faith negotiation of the agreement from the outset, which, if true, would be sufficient to establish overreaching on his part.

The Court also found that the wife was improperly denied temporary maintenance, invalidating the maintenance provision of the agreement for failing to comply with the requirements of Domestic Relations Law former §236(B)(5-a)(f).Continue Reading Temporary maintenance provisions in prenuptial agreements entered 2010 to 2015 must contain CSSA-type formula recitation

In its December 16, 2021 decision in Anderson v. Anderson, New York’s highest court ruled that the parties to a prenuptial or postnuptial agreement must acknowledge their signatures within a reasonable time of their signing. In a second appeal in Koegel v. Koegel, the Court of Appeals in its same decision also held that if the agreement is acknowledged by the parties at or within a reasonable time after signing, a defect in the acknowledgment certificate form may be cured at a later time by extrinsic proof.

In Anderson, the wife had signed and acknowledged the nuptial agreement the month after the wedding. Regardless of when the husband signed the agreement, his signature was not acknowledged until nearly seven years later, shortly before he commenced a divorce action and in anticipation of his wife’s imminent divorce filing.

In Koegel, the parties executed a nuptial agreement approximately one month before their marriage. The agreement provided that neither party would claim any part of the other’s estate, with both waiving their respective elective or statutory shares. Both parties signed the agreement, and their signatures were acknowledged, each by his or her own lawyer. The acknowledgment followed the statutory requirements in all but one respect: both lawyers failed to attest that the signer was known to them.Continue Reading Delayed Acknowledgment Invalidates Nuptial Agreement; Defective Form Does Not

The prospective husband’s attorney who drafted a couple’s prenuptial agreement was not disqualified from representing the husband in the couple’s divorce action, nor in the action to set aside the prenuptial agreement that had been joined for trial. So held the Appellate Division, Second Department, in its August 15, 2018 decision in Lombardi v. Lombardi. Moreover, it was held that an interim award of counsel fees to the wife was improper.

In 2004 the parties entered into a prenuptial agreement setting forth their rights and obligations in the event of a divorce. The wife commenced this action for a divorce in 2011.

Approximately one year later, the wife commenced a separate action to set aside the prenuptial agreement on the grounds of duress, coercion, undue influence, and unconscionability, and to recover damages for legal malpractice against the husband’s attorney, Dorothy Courten, who had drafted the prenuptial agreement on the husband’s behalf.

On a prior motion, Supreme Court, Suffolk County, Justice Hector D. LaSalle granted the husband’s motion to dismiss the complaint in the second action. On appeal, the Second Department modified that order by denying those branches of the motion which were to dismiss the causes of action alleging fraudulent inducement against the husband and seeking to set aside or rescind the prenuptial agreement on the basis of duress, coercion, undue influence, and unconscionability (see, Lombardi v. Lombardi, 127 A.D.3d 1038, 7 N.Y.S.3d 447 [2015]). However, the award of summary judgment dismissing the complaint insofar as asserted against Ms. Courten was affirmed.

Thereafter, the wife moved to consolidate this divorce action with the second action, to disqualify Ms. Courten and her law firm from representing the husband, and for an award of interim counsel fees. Justice James F. Quinn joined the two actions for trial, disqualified Ms. Courten and her law firm from representing the husband, and awarded the wife $10,000 interim counsel fees.Continue Reading Attorney-Draftsman of Prenuptial Agreement Not Disqualified; No Interim Counsel Fee

Marital and divorce agreements have to be “notarized.” But does the notary have to be present and witness the actual signing?

New York’s Domestic Relations Law §236B(3) states “[a]n agreement by the parties, made before or during the marriage, shall be valid and enforceable in a matrimonial action if such agreement is in writing, subscribed by the parties, and acknowledged or proven in the manner required to entitle a deed to be recorded.”

What does “acknowledged or proven in the manner required to entitle a deed to be recorded” mean.

In her June 1, 2016 decision in B.W. v. R.F., Westchester County Supreme Court Justice Linda Christopher upheld a prenuptial agreement in which the notary’s “acknowledgment” used the wrong wording.Continue Reading Do Marital and Divorce Agreements Have To Be Signed in the Presence of the Notary?

Once again, it has been made clear that where either or both spouses have assets or liabilities at the date of marriage, it is foolhardy (or at least imprudent) to enter the marriage without a prenuptial agreement and/or the assembly of proof of the extent, nature and value of those assets or liabilities.

Take the January 8, 2015 decision of the Appellate Division, Third Depatrtment, in Ceravolo v. DeSantis. In that case, the parties were married in July, 1996. The wife commenced the action for divorce in June, 2010. Acting Albany Supreme Court Justice Kimberly O’Connor determined, among other things, that the marital residence, which had been purchased by the husband prior to the marriage, was marital property and awarded the wife, among other things, half of its value. The husband appealed.

The Third Department agreed with the husband that Justice O’Connor erred in classifying the marital residence as marital property. Marital property is defined as “all property acquired by either or both spouses during the marriage” (Domestic Relations Law §236[B][1][c]), while “property acquired before marriage” is separate property (D.R.L. §236[B][1][d][1]).

Title is a critical consideration in identifying the nature of real property acquired before the marriage. The circumstances surrounding the purchase of the residence and the parties’ intent relative thereto are irrelevant to the legal classification of the residence as separate or marital property.

Here, the husband purchased the marital residence in January 1994 — 2½ years prior to the parties’ marriage — paying $130,000 of his own funds and borrowing an additional $100,000 from his father, secured by a note and mortgage. Although the wife contributed $30,000 of her separate funds to the initial purchase of the residence, the husband took title to the property in his name alone.Continue Reading Title Controls Premarital Contributions To The Acquisition and Expenses of Property

The November 12, 2014 decision of the Appellate Division, Second Department, in Bibeau v. Sudick reversed the granting of summary judgment upholding the validity a 2000 prenuptial agreement, remanding the matter for a hearing on that issue.

In September 28, 2000, two days before their wedding, the 70-year old future husband and the 38-year old future wife executed a premarital agreement. It provided that in the event of a divorce, the wife would receive, in lieu of maintenance, support, and equitable distribution, the sum of $25,000 for each year of the marriage. The parties also agreed to waive their interest in the elective share of each other’s estate, and to make no claim to property titled in the other’s name.

According to financial statements attached to the premarital agreement, the future husband had assets of more than $10,000,000, while the future wife had assets of approximately $170,000. The agreement was signed in the office of the husband’s attorney, in the presence of another attorney who was purportedly representing the wife.

At the time of the marriage, the wife, who had a background in marketing works of fine art to corporations, had recently opened an art gallery in California. She closed this business and relocated to Pine Bush, New York, in order to reside with the husband in preparation for their marriage, and assist him in his business endeavors. These included real estate development, as well as breeding thoroughbred horses and managing polo ponies.

In October, 2010, within days of New York’s adoption of no-fault divorce, the husband commenced this action for divorce. There were no children of the marriage.Continue Reading Another Prenup Bites the Dust, Maybe

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 second of four decisions this month with an international flavor was also decided by New York County Supreme Court Justice Ellen Gesmer.

In M v. M, 2014 N.Y.Misc. Lexis 3201, decided July 3, 2014, Justice Gesmer again voided a marital agreement, this time applying the laws of Spain and the Dominican Republic.

On June 27, 2001, one year and five months before their marriage, the parties signed an Agreement in Madrid, Spain, that purported to govern the disposition of property in the event of marriage and divorce. As with the Agreement in J.R. (see yesterday’s blog post), it provided that the parties would marry in a system of absolute separation of property.

At the time of the Agreement, the wife, born in the Dominican Republic, had Italian citizenship and was a domiciliary of Spain. The Husband is a citizen of Spain.

The parties were married in the Dominican Republic on December 12, 2002. Their marriage certificate, and the certification issued by the Office of Vital Statistics from the local government district, so listed the husband as a Spanish citizen, domiciled in Spain, and the wife as an Italian citizen, domiciled in Spain.

The wife commenced this divorce action in New York in 2012. Seeking now to invalidate the Agreement, the wife alleged that she never read the Agreement before signing it, that no one else read it to her, and that no formalities, particularly an oral recitation of the Agreement, were conducted when it was signed. She claimed that the husband brought her to the office of his attorney, and asked her to sign an accounting document drafted by his attorney to help him protect assets from business dealings. She claimed she never saw the document before the evening she signed it, and never saw or discussed it with the husband again until he raised it after commencement of this action. The husband disputed the wife’s claimed lack of awareness of the contents and significance of the Agreement.Continue Reading Melting Pot (Part 2 of 4): Prenuptial Agreement Voided Applying the Laws of Spain and the Dominican Republic