Fletcher v. Fletcher

628 N.E.2d 1343, 68 Ohio St. 3d 464
Ohio Supreme Court·Decided March 23, 1994·No. No. 92-2117·Published·Cited by 136 cases

Opinions

Moyer, C.J.

It is well settled in Ohio that public policy allows the enforcement of prenuptial agreements. Gross v. Gross (1984), 11 Ohio St.3d 99, 11 OBR 400, 464 N.E.2d 500, paragraph one of the syllabus. “Such agreements are valid and enforceable (1) if they have been entered into freely without fraud, duress, coercion, or overreaching; (2) if there was full disclosure, or full knowledge and understanding of the nature, value and extent of the prospective spouse’s property; and (3) if the terms do not promote or encourage divorce or profiteering by divorce.” Id. at paragraph two of the syllabus. These conditions precedent to the enforcement of a prenuptial agreement arise in part from the fact that parties who have agreed to marry stand in a fiduciary relationship to each other. Id., 11 Ohio St.3d at 108, 11 OBR at 409, 464 N.E.2d at 509; Juhasz v. Juhasz (1938), 134 Ohio St. 257, 12 O.O. 57, 16 N.E.2d 328, paragraph one of the syllabus.

Long before Gross, this court held that prenuptial agreements controlling the distribution of assets upon the death of a spouse may be enforceable. Juhasz, supra; Hook v. Hook (1982), 69 Ohio St.2d 234, 23 O.O.3d 239, 431 N.E.2d 667. In Juhasz, this court held that when a prenuptial agreement provides that one spouse shall receive an amount that is wholly disproportionate to the amount he or she would take under the law, the spouse asserting the validity of the contract bears the burden to show that it was executed after full disclosure of the nature, value and extent of the proponent’s property or that there was full knowledge thereof. Id., 134 Ohio St. 257, 12 O.O. 57, 16 N.E.2d 328, paragraph three of the syllabus. Under Juhasz, a prenuptial contract would be enforced upon the death of a spouse if it was voluntarily entered into and if the provision for the surviving spouse was fair and reasonable under all the circumstances. Id. at paragraph two of the syllabus. If the provision is “wholly disproportionate,” the agreement will still be enforced if it was voluntarily entered into with full disclosure or knowledge. Id. at paragraph four of the syllabus.

In determining the enforceability of prenuptial agreements upon separation or divorce, the Gross court refined and elaborated on the Juhasz voluntariness test. The court acknowledged that modern trends in marriage and divorce and changing social attitudes compelled the conclusion that these types of agreements tend to promote marriage, rather than encourage divorce. 11 Ohio St.3d at 105-106, 11 OBR at 405-406, 464 N.E.2d at 505-506. Nevertheless, we forged a three-part test for enforceability, set forth supra, to ensure that the economically [467]*467superior party, who typically proposes the antenuptial agreement, does not take unfair advantage of his or her prospective spouse.

The first element of the Gross test requires that the agreement be freely entered into without fraud, duress, coercion or overreaching. Those terms were defined according to their generally accepted meanings. Id., 11 Ohio St.3d at 105, 11 OBR at 406, 464 N.E.2d at 506. “Overreaching” was specifically defined as one party outwitting or cheating the other “by artifice or cunning, or by exploiting a significant disparity in understanding the nature of the transaction * * *.” Id. The Gross court applied its newly announced test to the facts before it and held the agreement enforceable. The evidence in Gross was that the wife, who challenged the agreement, had had benefit of counsel, and that there had been full disclosure of the husband’s assets. In a case decided on the same day, this court held invalid a prenuptial agreement on the basis that there had not been a full disclosure of the proponent’s financial worth. Zimmie v. Zimmie (1984), 11 Ohio St.3d 94, 11 OBR 396, 464 N.E.2d 142.

Antenuptial agreements are contracts and generally the law of contracts applies to their interpretation and application. 2 Williston on Contracts (3 Ed.1959), Section 270B. Nevertheless, this court has recognized that these agreements constitute a special type of contract to which certain special rules apply. See Gross, supra. In Juhasz, for example, this court held that an agreement to marry gives rise to a confidential relationship between the parties, and that an antenuptial agreement that creates a disproportionate allocation of property upon death shifts the burden of proving full disclosure onto the party claiming the validity of the contract. This burden shifting is in derogation of traditional contract principles because ordinarily a party asserting the invalidity of a contract bears the burden of proving a defense to it. See Ohio Loan & Discount Co. v. Tyarks (1962), 173 Ohio St. 564, 20 O.O.2d 168, 184 N.E.2d 374, paragraph two of the syllabus.

The first justification for this burden shifting is the fiduciary relationship of the parties. The second justification is that antenuptial agreements negate the statutorily defined presumptive rights of a spouse to an equitable distribution of marital assets upon divorce. R.C. 3105.171. Thus, paragraph three of the syllabus in Juhasz remains good law and applies to prenuptial agreements made in contemplation of divorce. When an antenuptial agreement provides disproportionately less than the party challenging it would have received under an equitable distribution, the burden is on the one claiming the validity of the contract to show that the other party entered into it with the benefit of full knowledge or disclosure of the assets of the proponent. The burden of proving fraud, duress, coercion or overreaching, however, remains with the party challenging the agreement.

[468]*468This court will not reweigh the evidence introduced in a trial court; rather, we will uphold the findings of the trial court when the record contains some competent evidence to sustain the trial court’s conclusions. Ross v. Ross (1980), 64 Ohio St.2d 203, 18 O.O.3d 414, 414 N.E.2d 426. In addition, we will indulge all reasonable presumptions consistent with the record in favor of lower court decisions on questions of law. In re Sublett (1959), 169 Ohio St. 19, 7 O.O.2d 487, 157 N.E.2d 324. When a trial court, sitting without a jury, determines an issue but does not make separate findings of fact and conclusions of law, a reviewing court will presume the validity of that judgment as long as there is evidence in the record to support it. Scovanner v. Toelke (1928), 119 Ohio St. 256, 163 N.E. 493, paragraph four of the syllabus.

On August 27, 1990, the trial court in the instant case rendered its decision upholding the parties’ prenuptial agreement. This decision summarized pertinent testimony, but lacked specific findings of fact. This court must therefore affirm the trial court’s determination if there is some evidence in the record to establish that the elements of Gross have been satisfied. Although certain critical facts were in dispute, we must presume that the trial court believed the testimony that supported the enforceability of the agreement.

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Fletcher v. Fletcher, 628 N.E.2d 1343, 68 Ohio St. 3d 464 (Ohio 1994).

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