A Premarital Agreement that Limits Spousal Support and Virtually All Rights Acquired by Marriage is Contrary to Public Policy
Husband and Wife married on February 21, 1949. Two weeks before the wedding, Husband asked Wife to sign a premarital agreement whereby Wife waived her right to seek spousal support and any claim she might have in Husband’s estate. The premarital agreement also provided that Husband would pay only $150 in attorneys’ fees and costs for Wife in the event of a divorce.
At the time Husband presented the premarital agreement to Wife, Husband was an experienced real estate broker and told Wife the premarital agreement meant nothing. Wife did not understand the significance or effect of the premarital agreement, but she trusted Husband and signed it. Wife did not receive a copy of the premarital agreement until it was recorded nine years later in January, 1958. At the time Wife signed the premarital agreement, she was 22 and Husband was 50.
Husband owned a property at the time of marriage, and shortly thereafter completed the development of a 30-unit building on the property. Wife was inexperienced about business matters at the time of the marriage. Husband then taught her about rental management and bookkeeping. Wife worked as Husband’s secretary and managed the apartment building both during marriage and after Husband’s death.
After Husband was admitted to the hospital in 1958, Wife was appointed guardian of Husband’s estate and continued to take care of Husband’s business affairs. Husband frequently referred to the property as belonging to both of them. The couple filed joint federal and state income tax returns. Husband repeatedly expressed his affection for Wife and his intention to provide for her, both orally and in writing.
Husband’s December 30, 1958 will named Wife as sole beneficiary. After Wife filed her petition for the probate homestead, Husband’s sister objected, citing the premarital agreement. The trial court found that the premarital agreement was invalid and the 30-unit building was community property. The trial court also set the building apart as Wife’s probate homestead. Husband’s sister appealed.
Husband’s sister argued the evidence did not support the trial court’s finding that the premarital agreement was invalid. The Appellate Court, however, noted there existed ample evidence that Husband had made misrepresentations to Wife relative to the premarital agreement to Wife when he obtained her signature on the premarital agreement, and he repudiated the premarital agreement by his acts and written deeds thereafter. Since the time the parties were married, they conducted their business as though no such premarital agreement existed.
Additionally, the premarital agreement encouraged divorce and was contrary to public policy. Wife waived all marital rights except the right to get a divorce, while Husband reaped all of the benefits. The mere fact that Wife was so easily persuaded to give away her marital rights suggests that she did not realize the nature and value of her rights and the extent to which the agreement impaired those rights. Wife testified that, had she known she was waiving her marital rights by signing the premarital agreement, she would not have signed it.
The Appellate Court agreed with the trial court that Husband fraudulently obtained Wife’s signature on the premarital agreement, but repudiated it thereafter, and therefore it should be set aside.
In re Nelson’s Estate (1964) 224 Cal. App. 2d 138, superseded by statute on issue of transmutation as stated in In re Marriage of Benson (2005) 36 Cal. 4th 1096