Premarital Agreements in Connecticut-where We Are and Where We Are Going
| Publication year | 2021 |
| Pages | 495 |
69 CBJ 495. PREMARITAL AGREEMENTS IN CONNECTICUT-WHERE WE ARE AND WHERE WE ARE GOING
Effective October 1, 1995, premarital agreements made in Connecticut will be subject to the newly-enacted "Connecticut Premarital Agreement Act".(fn1) As the Act does not apply to agreements entered into before its effective date, (fn2) there will be a dual body of law in Connecticut for some time to come. In that light, this article describes the state of law regarding existing agreements and then analyzes the new statute and its effect on agreements made after the statute's effective date. The existing law is addressed in Part 1. In Part 11, the principal significant changes in the law resulting from the Act are discussed and, in Part III, the text of the Act is set forth, with a brief commentary on the provisions not discussed in the earlier sections.
In 1980, the Supreme Court addressed the issue of the validity of premarital agreements in Connecticut in its decision of McHugh v. McHugh.(fn3) In doing so, the Court outlined the basic elements that must be satisfied in order for a premarital agreement to have validity in any context and defined some of the concerns that would be specifically relevant where the agreement was relevant to a marital dissolution action. As comprehensive as the decision was, it did not resolve the issue of whether a premarital agreement could address alimony issues, as that was not raised in the case. The decision, its consequences, and the lingering issues were examined in an article that appeared in this journal in 1983. (fn4)
In Part I of this Article, decisions of the Superior Court examining agreements under McHugh are considered. Although there are a number of unreported opinions that might be enlightening, only decisions that are reported, officially or unofficially, and generally accessible, are used.(fn5)
A. Criteria In General
Under McHugh there are generally nine criteria regarding the recognition and enforcement of a premarital agreement:
(1) Neither the agreement as a whole, nor the specific provision under scrutiny, can violate any public policy or statute of the state;
(2) There must have been full financial disclosure by both parties and, in particular, by the proponent of the agreement;
(3) There must have been full disclosure and understanding of the consequences of the agreement;
(4) If there is a question about the adequacy of the disclosure, the agreement may stand if the opponent had adequate knowledge of the other's finances through means other than specific disclosure;
(5) There must have been no fraud, duress, or overreaching involved in the making of the agreement;
(6) The common basic contractual requirements must have been met, particularly regarding the existence of a writing sufficient to satisfy the Statut-e of Frauds;
(7) Each party must have had an opportunity to consult with an attorney or other advisor of their choosing, or must have clearly chosen not to do SO;
(8) The agreement must have been reasonable when made and the circumstances of the parties could not have changed so substantially since the signing of the agreement as to render its recognition and enforcement inequitable; and,
(9) There could not be any difficulty in the interpretation and application of its provisions.
A failure to satisfy any one of the criteria could result in an avoidance of the agreement or of a specific provision.
B. Criteria Analyzed
1. Public Policy
The principal public policy issue addressed in most reported cases is whether provisions in premarital agreements regarding spousal support should be applied to requests for pendente lite alimony. judge Edgar Bassick took the position in two decisions, Blase v. Blase(fn6) and Bresnan v. Bresnan(fn7) that agreements did not apply during the pendency of a divorce, as pendente lite orders were intended to maintain the status quo, which impliedly meant that the income-earning spouse had to support the othe;. These decisions appear to be consistent with the indication in McHugh that an agreement "relieving one spouse of the duty to support the other during the marriage," would not be permissible.(fn8)
A different approach was taken in Adler v. Adler,(fn9) where the agreement provided for a certain amount to be paid as support in the event of the "separation" of the parties, and also provided that each party waived their rights to seek spousal support orders from the courts. The court found this provision was consistent with the public policies of the state and entered pendente lite orders consistent with the agreement.
Unless Adler is to be ignored as an anomaly, any reconciliation of these opinions turns on a comparison of the particular agreement provisions involved. In Adler, the provision specifically referred to the "separation" of the parties and the court appeared to treat the terms as if they were part of a valid "separation agreement", which can address spousal support.(fn10) On the other hand, it appears that the agreements in Blase and Bresnan either addressed only the final alimony amount or provided for no alimony at all, and were silent concerning any interim support. If that is so, then Adler is an important ruling; however, the opinions in Blase and Bresnan are not clear on this point.
The more general issue of whether a provision setting "final" alimony terms (amount and duration) violated public policy was touched on in Levin,(fn11) where the court noted that the issue was raised, but did not directly address it, finding no problem with the terms in light of the facts of the case.(fn12) Thus, there is no clear precedent on the viability of alimony provisions.
2. Financial Disclosure
This has been the biggest stumbling block to the recognition of agreements, as proponents of agreements seem to be unable to make adequate financial disclosure. In Cole v. Cole,(fn13) Krawczynski v. Krawczynski, (fn14) DeFusco v.DeFusco, (fn15) and Wolfgang v. Wolfgang, (fn16) the agreements were found invalid because the proponent failed to make any disclosure of his assets. In Lord v. Lord,(fn17) the husband claimed that the wife knew of his assets and their values from her attendance at discussions be had with his financial manager. This was not adequate disclosure, since the meetings addressed only financial management issues and not the nature, extent and value of the husband's assets. The court also concluded that the meetings had not been intended to accomplish the disclosures related to the agreement, which was actually presented and signed several months later.
In contrast, in Ashton v. Ashton,(fn18) the court found that the disclosure of assets was adequate where disclosure consisted of the statement that the would-be husband had assets valued in the "upper middle six figures," which the court interpreted to mean between six and eight hundred thousand dollars, which was consistent with the husband's testimony that he had assets worth $690,000. In addition to Ashton, the asset disclosure in Murzyn v. Murzyn,(fn19) was adequate, where the wife knew that the husband owned the house in which they lived, and he provided a listing of his bank accounts, showing the most recent posting, and a listing of the stocks he held, showing the number of shares in each company.
The adequacy of income disclosures were considered in Ashton and Levin. In Ashton, the precise inadequacy of the disclosures is not recited, but the inference is that there was no explicit income disclosure, and that resulted in the court declining to enforce an alimony provision. However, while a similar lack of explicit disclosure appeared in Levin, it did not lead to a rejection of the alimony terms recited in the premarital agreement. The trial court found that the disclosures provided by the husband "revealed that he had cash and retirement assets worth in excess of One Million Six Hundred Thousand ($1,600,000.00) dollars" and that since the wife had lived with him for two years before the marriage "she knew him to be a man of substance and substantial cash flow", all of which combined to create adequate knowledge of his finances and income.
3. Nonfinancial Disclosure
Only one case seems to have addressed the issue at all, and that is DeFusco (fn20), where the court noted that no one had explained to the wife what the significance of the agreement was and what rights she was waiving. What is significant about the holding of this case is that the lack of disclosure was a result of confusion and oversight by the lawyers who prepared the agreement, and was not a result of any effort to leave her uninformed or to deprive her of the opportunity to seek counsel.
4. Knowledge
In none of the cases in which there was inadequate disclosure! was the agreement saved by the fact that the opposing party had adequate independent knowledge about the relevant financial information. In two cases, the courts explained the basis for their findings of inadequate knowledge. In Krawczynski, the court held that the fact that the parties had lived together prior to the marriage did not establish that there was knowledge about each other's financial circumstances. Further, even if the wife knew that the husband held certain real estate, she could not be presumed to know its value in light of the luncheonette, apartments and offices that were located on it. Similarly, in Cole, the court found that the wife did not have sufficient knowledge to be able to value the husband's antique business: even if she could arrive at some value by looking at the price tags on the pieces in the shop, she was not required to do that, and she would know only the value of those pieces. In contrast, in Murzyn, the fact that the wife clearly knew...
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