Insuring the knot: the Massachusetts approach to postnuptial agreements.

• Author: Bruno, Stephanie A.

"Postnups, while much less common than prenuptial agreements, are gaining in popularity. Nearly 50 percent of attorneys polled by the American Academy of Matrimonial Lawyers reported an increase in the number of postnups from 2002 to 2007." (1)

1. INTRODUCTION

   As divorce rates in the United States continue to skyrocket, couples keep searching for new ways to protect their relationships and their wallets. (2) Thanks to the contractual nature of the marital relationship, the wary fiance or exhausted spouse may dictate certain terms relating to his impending marital union or dissolution in the form of a prenuptial or separation agreement. (3) While both agreements are widely accepted options for defining and restricting the rights and liabilities one assumes upon entering or ending a marriage, many jurisdictions recently began entertaining and sanctioning a third method, the postnuptial agreement. (4) The conditions and components required to produce a legitimate postnuptial agreement, however, differ radically from state to state. (5)

   Massachusetts, having declined to address the issue in the past despite acknowledging the opportunity, recently spoke up in the case of Ansin v. Craven-Ansin, (6) rejecting the theory that postnuptial agreements are per se against public policy. (7) Instead, the court held that such agreements are valid, provided, however, that the circumstances prompting the agreement and the terms of the agreement satisfy certain requirements. (8) The Massachusetts standard for upholding postnuptial agreements is moderate as compared to other states' approaches. (9) Ohio, for instance, falls at one end of the spectrum, statutorily abolishing postnuptial agreements as per se against public policy, while Utah takes the opposite position, treating postnuptial agreements no differently than prenuptial agreements. (10)

   This Note will first look at how marital law has evolved, specifically focusing on the Massachusetts law that paved the way for the Ansin decision. (11) It will then address the general policy concerns associated with postmarital contracting, focusing on the differing levels of scrutiny that select state courts and legislatures apply to postnuptial agreements, all while exploring the underlying philosophies fueling these decisions. (12) In doing so, it will also consider how the Massachusetts approach, as reflected in the Ansin decision, comports with not only these assorted viewpoints but also with the state's position on related topics pertaining to marriage, namely, how the judiciary's rationale behind defending same-sex marriage ought to be considered when assessing the appropriateness of its present approach to postnuptial contracting. (13) Lastly, this Note will consider the most effective means of protecting the policy concerns, such as threats of unfair bargaining power and general inequities, ultimately concluding that Massachusetts may wish to bolster its standard of review as the current considerations may not provide adequate protection. (14)

2. History

   1. The Evolution of Marital Contracting

      In order to thoroughly analyze the function and future of postnuptial agreements in Massachusetts, it is helpful to trace the evolution of marital contracting in general. (15) In the early years of the twentieth century, marital contracting, as we know it today, was a foreign concept in Massachusetts because the common law defined a husband and wife as one legal person represented by the husband. (16) The wife was essentially the husband's chattel, with no legal existence of her own, making it impossible for her to contract. (17) Slowly, this common-law concept was modified by statute, as societal changes demanded that a married woman have the ability to retain and dispose of property independent of her husband. (18) It was not until married women secured their independent legal status, and thus their ability to contract, that the validity of marital agreements became an issue. (19)

      1. Premarital Agreements in General

         Forty years ago, in the landmark case of Posner v. Posner, (20) the Florida Supreme Court approved the per se legitimacy of prenuptial agreements, despite a national trend to the contrary. (21) The institution of marriage was no longer the impervious familial and societal cornerstone it had once been. (22) The Posner court recognized that as divorce became an easier, and thus more popular, option for resolving marital strife, the public-policy concerns regarding antenuptial agreements had to adjust to a growing likelihood that marriage would end in divorce. (23) The court's rationale was that an individual's right to protect himself against the real possibility of divorce outweighed the degree to which such an agreement might encourage divorce. (24) Furthermore, the court could not find a real difference between those antenuptial agreements made in contemplation of divorce and those in contemplation of death, which were generally accepted at the time. (25)

         In upholding the validity of prenuptial agreements governing divorce, the Posner decision represented a growing social and legal trend that defined the marital relationship as contractual in nature, prompting agreements between husband and wife to be judged exclusively using contract principles. (26) The problem with treating marriage as a contractual relationship, which has plagued some decision makers for years, is that the parties to a prenuptial agreement do not stand at arm's length, but rather share "a relation of mutual confidence and trust that calls for the highest degree of good faith." (27) In an attempt to reconcile these two competing ideas, states impose different standards for judging the validity of premarital agreements, often focusing on the reasonableness of the provisions. (28)

      2. Massachusetts Approach to Premarital Agreements

         1. Pre-Osborne (Before 1980)

            Massachusetts has recognized some form of the antenuptial contract since at least the late 1800s. (29) In 1845, Massachusetts passed the Married Women's Property Act, presently codified in chapter 209 of the Massachusetts General Laws, abrogating those common-law principles that prohibited a husband and wife from contracting with one another. (30) As to be expected, the interpretation of the statute has evolved since it was first enacted and presently allows parties to enter into written contracts before marriage that are intended to limit the property interests of each other at the dissolution of the marriage. (31)

            The present-day reading of section 25 of chapter 209 of the Massachusetts General Laws, as it relates to premarital agreements intended to govern in the event of divorce, took over a century to develop because Massachusetts courts traditionally considered such agreements to contravene public-policy goals. (32) For example, in the 1935 case of French v. McAnarney, the Massachusetts Supreme Judicial Court (SJC) held that an antenuptial contract in which the wife promised not to seek support from her future husband, and father of her child, violated public policy because "[t]he interests of society and the public welfare in maintaining unimpaired the integrity of the marriage relation and its essential obligations are superior to the apparent relief gained by the [husband] under such a contract." (33) As such, the court voided the agreement. (34) In 1955, the SJC reiterated its position in Kovler v. Vagenheim, (35) stating that "a contract tending to divest a husband of any obligation incidental to his marriage is invalid." (36) It was not until 1981 that Massachusetts finally directly endorsed and upheld the use of prenuptial agreements, entered into by husband and wife, intended to fix property distributions in the event of divorce. (37)

         2. Osborne v. Osborne (1981)

            Osborne v. Osborne marked the first time that a Massachusetts court agreed to enforce the terms of an antenuptial agreement designed to dictate the distribution of property at the time of divorce. (38) The Osborne court dismissed the opinions found in Fox, considering them either as not controlling or mere dicta. (39) While acknowledging the public-policy concerns that other states relied on to justify prohibiting such agreements, the SJC held that antenuptial agreements were not per se void as against public policy. (40) Instead, safeguards in the form of "guidelines" would be considered before deciding if a particular agreement violated public policy. (41)

            These guidelines placed legal limitations upon antenuptial agreements, whereby a party's ability to waive or limit his legal rights upon divorce was not unrestricted. (42) As was the case with antenuptial agreements drafted in contemplation of death, antenuptial agreements relating to divorce would be judged using "fair disclosure rules" to determine if the agreement was valid when executed. (43) Additionally, the court insisted that the agreements be fair and reasonable at the time of the judgment nisi. (44) It also acknowledged that some situations might allow for the court to modify the agreement. (45) The Osborne court also emphasized that its adoption of Rosenberg and the related guidelines would not negate the possibility of an antenuptial agreement being found unenforceable if it unreasonably encouraged divorce, thereby clearly violating public policy. (46)

         3. Post-Osborne (1981-Present)

            While Osborne represented a relaxation of the Massachusetts approach to marital contracting, in 2002 the SJC decided DeMatteo v. DeMatteo (47) and reminded the legal world that "[m]arriage is not a mere contract between two parties, but a legal status from which certain rights and obligations arise." (48) As such, the court refused to apply the Uniform Premarital Agreement Act's (UPAA) unconscionability standard to antenuptial agreements, primarily because the court considered it inappropriate to use commercial-law standards when reviewing private contracts borne of confidential relationships. (49) In DeMatteo, the husband...