Chapter 36 INDEPENDENT COUNSEL

JurisdictionNew York

Chapter Thirty-Six

Independent Counsel

I. Effect of Independent Counsel; Counsel Is Not Required For Valid Agreement; Failure To Seek Counsel Does Not Provide Ground For Vacatur

Stipulations of settlement are favored by the courts and are not lightly cast aside, particularly when the parties are represented by attorneys.5980 It is highly advisable for each party to a marital agreement to have the assistance of independent counsel so that their respective interests are fully safeguarded. However, the absence of legal representation, without more, does not establish overreaching or require an automatic nullification of the agreement,5981 especially where a conscious decision was made not to seek counsel.5982

The fact that a party did not have independent counsel, without more, does not constitute grounds to nullify an agreement.5983 An inference of overreaching is not established by the fact that a party was not represented by counsel at the time of the execution of an agreement in the office of the other party's attorney.5984 Courts have focused on the degree of a party's sophistication, such as, if they well educated or experienced in business.5985

Although courts may examine the terms of the agreement as well as the surrounding circumstances to ascertain whether there has been overreaching, generally if the execution of the agreement is fair, no further inquiry will be made. 5986

Ignoring the advice of counsel is not a ground for vacating an agreement.5987

An inference of overreaching is not established by the fact that a party did not have counsel present at the execution of the agreement, when the party had rejected the advice of counsel and, without coercion, signed the agreements after reviewing them and thereafter declined the opportunity to seek legal advice.5988

The fact that a party was not represented by counsel when entering into a stipulation, while certainly relevant, is not sufficient in itself to invalidate a stipulation, particularly where the party was advised to retain counsel and chose not to. 5989 When parties were given an opportunity to have separate counsel review and advise them of their respective legal rights, a party's choice not to consult any attorney before executing the agreement does not undermine its validity.5990 While a party's failure to seek counsel does not, in and of itself, serve as a predicate for vacatur of an agreement, it can, however, be a significant factor.5991

In In re Garbade,5992 the parties signed a prenuptial agreement which included the traditional waivers as well as waivers of rights of election. Notwithstanding her waiver and receipt of assets totaling approximately $340,000 by virtue of the decedent's death, the respondent filed notice of her election to take her share of the decedent's estate pursuant to N.Y. Estates, Powers & Trusts Law 5-1.1. Not surprisingly, the respondent alleged fraud, duress, misrepresentation, and undue influence. The petitioners filed for summary judgment based on the prenuptial agreement. The Appellate Division affirmed the summary relief to the petitioners:

Respondent presented evidence, inter alia, establishing at most that (1) the agreement was prepared by decedent's attorneys, at his request and in accordance with his direction, (2) the prenuptial agreement was executed only a few hours prior to the parties' wedding, (3) respondent did not seek or obtain independent legal counsel and the agreement was not read by her or to her before she signed it, (4) respondent was not specifically advised that the agreement provided for a waiver of her right to elect against decedent's will, and (5) respondent was not furnished with a copy of the agreement.
At the same time, it is uncontroverted that (1) respondent readily acceded to decedent's request that they enter into a prenuptial agreement and willingly signed the instrument because she did not want any of decedent's money or property, she only wanted to be his wife, (2) respondent was advised to obtain the services of independent counsel, (3) respondent was given an adequate opportunity to read the instrument before she signed it, and (4) prior to executing the prenuptial agreement, respondent was provided with detailed disclosure of decedent's $2.5 million net worth.

Noting the absence of any wrongdoing by the decedent, Garbade summed up:5993

[R]espondent has established nothing more than her own dereliction in failing to acquaint herself with the provisions of the agreement 5994 and to obtain the benefit of independent legal counsel. Although this dereliction may have caused her to be ignorant of the precise terms of the agreement, the fact remains that, absent fraud or other misconduct, parties are bound by their signatures. Further, the absence of independent counsel will not of itself warrant setting aside the agreement.

In Bradley v. Bradley,5995 the Appellate Division affirmed Supreme Court's denial of the wife's motion to set aside the open-court stipulation of settlement. The wife was represented by able and experienced counsel, had been involved in negotiations for a period of time, came close to an agreement two weeks prior to reaching settlement, spent the entire day negotiating the final terms of the settlement, and had been properly allocated. Her submission of two unsworn letters from physicians was insufficient to establish that she was so incapacitated as to warrant setting aside the stipulation, particularly where she was observed by the court to be fully engaged in the negotiations and testified emphatically during the allocution.5996 She also ratified the agreement by accepting its benefits.

A hearing was not required, in Markovitz v. Markovitz,5997 where defendant was represented by counsel and the agreement, which was not unconscionable, was negotiated over several months. Significantly, the parties stated that the agreement was fair, entered into voluntarily without coercion or duress with a waiver to financial disclosure.

In Bronfman v. Bronfman,5998 the plaintiff was young and a college graduate when she entered into the agreement. She was represented by her own counsel, admittedly read the agreement, exchanged financial disclosure prior to its execution, and her attorney received a copy of the defendant's net worth statement. The plaintiff did not meet the very high burden of showing that it was manifestly unfair and that the unfairness was the result of overreaching.

Doppelt v. Doppelt5999 affirmed a finding of the absence of fraud in the inducement and coercion when the wife was represented by counsel and voluntarily and knowingly entered into the stipulation of settlement, notwithstanding her suspicions that her husband had converted certain marital property to personal property.

In Tremont v. Tremont,6000 the plaintiff-wife commenced an action for divorce. In connection with a purported reconciliation, the defendant asked her to cosign a business loan, using jointly owned property as collateral. The plaintiff agreed to cosign the loan documents and discontinue her matrimonial action only if the defendant signed a postnuptial agreement. After reviewing the first copy of the agreement (drafted by the wife's attorney) with his own attorney, he decided not to sign it. The parties privately discussed further changes to the agreement. The wife alleged that her husband told her he could not afford an attorney and would deal with her directly. The wife's attorney revised the agreement per the defendant's suggestions to his wife and allegedly instructed her to deliver the new agreement to her husband, which she did five days before the closing on the business loan. The agreement stated that the husband's attorney had explained to him the law governing matrimonial agreements and the effects thereof. A copy of the amended agreement was not sent to the defendant's attorney. On the day of the loan closing, the defendant signed the postnuptial agreement. The wife discontinued her first action but commenced a later action when the defendant returned to his old ways and refused to comply with the agreement. The Appellate Division affirmed the supreme court's grant of summary judgment to the wife to dismiss the husband's counterclaim to vacate the agreement.

II. Self-Representation, Agreement Binding, No Overreaching

Self-representation without any wrongdoing by the other party does not invalidate an agreement.6001 A layperson who signs a settlement agreement "is conclusively bound by the terms"6002 even if he has not read the agreement.6003 A party may not refuse to retain counsel and then be heard to attempt rescission on the grounds of an unawareness of his or her legal rights, because such ignorance is nothing more than a conscious choice and exercise of free will.6004

Since there is no right to counsel in a matrimonial action, a court need not advise a party of a right to counsel.6005 It is well established that a party is entitled to self-representation once the court determines that the decision to do so is knowingly, intelligently and voluntarily made,6006 and an agreement is not subject to challenge simply because the defendant proceeded with it pro se.6007

"A 'searching inquiry' does not have to be made in a formulaic manner" in order to determine that a decision to proceed pro se was made knowingly, intelligently and voluntarily. "There is no rigid formula to be followed in such an inquiry, and the approach is flexible," although "the record must demonstrate that the party was aware of the dangers and disadvantages of proceeding without counsel."6008 The court must also make certain that the party seeking self representation "has not engaged in conduct which would prevent the fair and orderly exposition of the issues."6009

A party may discharge counsel as a matter of public policy, with or without cause, and represent himself or herself.6010 A party who waived the right to counsel may properly be permitted to proceed pro se and "may not...

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