By Allison Maxim, Attorney |
2017 has been a prolific year so far for published family law appellate rulings in Minnesota. From the validity of Antenuptial (aka prenuptial) Agreements to calculating the costs of childcare to modification of parenting time – we are less than two full months into the new year and the Minnesota Court of Appeals has made four precedential rulings in family law cases.
As a Minnesota divorce and family law attorney, I found all of this interesting and exciting and I wanted to share how the appellate decisions may affect you if you are involved in negotiating an Antenuptial Agreement, or find yourself a party to a divorce, parenting time, child support, or name change proceeding.
This is the first of several blog posts in which I will deconstruct the appellate rulings and share practical information on how the rulings affect you or your case.
Let’s begin with A for Antenuptial Agreements.
The case is Kremer vs. Kremer, but the parties are far from Dustin Hoffman and Meryl Streep playing characters in a fictional custody dispute (and their names are spelled differently). The main issue in this Kremer vs. Kremer involves the validity of an Antenuptial Agreement.
In general, Minnesota public policy favors the freedom of competent adults to enter into contracts. And, Antenuptial Agreements are typically treated just like other contracts, which bind the parties to its terms. However, Antenuptial Agreements are between two people in an intimate relationship, which makes them a special type of contract. Because partners in an intimate relationship may be prone to a power imbalance, there are built in legal protections for reviewing the validity of Antenuptial Agreements. We will get to those legal protections shortly. Let’s first look at the circumstances surrounding the execution of the Antenuptial Agreement in this particular case (circumstances you may want to avoid so that your Antenuptial Agreement is found to be valid).
The parties to the Kremer case – Robbie and Michelle Kremer – executed an Antenuptial Agreement prior to their marriage in the spring of 2001. At the time, Robbie owned a farm with substantial equity and Michelle worked at a gas station. Before their marriage, Robbie began secretly meeting with a lawyer to draft an Antenuptial Agreement. After Robbie and Michelle already planned their March 6, 2001 destination wedding to the Caribbean (including booking their own tickets, and their friends and family booking tickets and beginning their travels) Robbie “made clear that there would be no wedding if [Michelle] did not sign the agreement.” Michelle was not aware of Robbie’s net worth or assets before receiving the Antenuptial Agreement right before their destination wedding.
So, with wedding plans made and family in route, a young woman in love did what was required – she tried to find an attorney to review the Antenuptial Agreement. Michelle had been married and divorced previously, and she sought the advice of her former attorney. But, likely due to the last minute nature of the appointment request, her former attorney was unavailable. Michelle was able to consult with a different attorney only one day before the parties were to travel to the Caribbean for their nuptials on March 6th. Michelle met with the attorney and signed the Antenuptial Agreement, returned it to Robbie that day, and they were off the very next day for sun, fun, and a wedding celebration in the Caribbean.
After the wedding, Robbie and Michelle returned to Minnesota where Michelle worked on the farm and had a child in 2008. Unfortunately, things went downhill sometime after that and Michelle petitioned for a divorce in 2010. As part of the divorce, Michelle asserted that the 2001 Antenuptial Agreement was invalid and unenforceable because “it was a product of duress and coercion and she did not have sufficient legal advice to fully understand the agreement.” Robbie disagreed and the parties had a court trial on the validity of the Antenuptial Agreement.
After hearing all of the evidence at the trial, the district agreed with Michelle. It concluded that the Antenuptial Agreement was invalid and unenforceable and ordered Robbie to pay Michelle spousal maintenance as well as $750,000 as a property settlement. Robbie appealed the district court’s decision.
Because Antenuptial Agreements, like any other type of contract, is enforceable and typically upheld as valid, Robbie and his attorneys likely thought that the Court of Appeals would reverse the district court on its conclusion that the Antenuptial Agreement was invalid. But the Court of Appeals had something different in mind.
How did the Court of Appeals interpret the Antenuptial statute, you ask? Well, let’s see . . .
First, it identified a “critical initial issue” – the appropriate legal standard for evaluating the validity of Antenuptial Agreements into which couples entered after August 1, 1979. And then in an interesting analysis, the appellate court concluded that the common law (i.e. law derived from custom and legal precedent and what we lawyers call “case law”), not the black letter statute, applies to the validity of post-August 1, 1979 Antenuptial Agreements that address the allocation of marital property in a divorce.
The Court based its conclusion on two Supreme Court rulings – a 1988 case called McKee-Johnson v. Johnson and a 1969 case called Kinney. After analyzing these two cases, the Court determined that the validity of Antenuptial Agreements entered into anytime in the past 37 years must be evaluated under a four-part legal test. I will get into this in next week’s blog post, The Four Factors of Antenuptial Agreement Validity.