Opinion
Index No. 58734/2020
10-28-2021
D.P., Plaintiff, v. C.P., Defendant.
Arthur Davis Ettinger, Esq., Brianne Alaine Copp, Esq., Greenspoon Marder LLP Attorneys for the plaintiff Russ Marnell, Esq., Marnell Law Group, P.C. Attorney for the defendant.
Unpublished Opinion
Arthur Davis Ettinger, Esq., Brianne Alaine Copp, Esq., Greenspoon Marder LLP Attorneys for the plaintiff
Russ Marnell, Esq., Marnell Law Group, P.C. Attorney for the defendant.
Robert S. Ondrovic, J.
The following papers were considered in connection with the defendant's motion to vacate and/or set aside certain provisions of the parties' prenuptial agreement, for an award of pendente lite maintenance in the amount of $3,200 per month retroactive to the date of the application, and an award of interim counsel fees in the amount of $50,000, and the plaintiff's cross motion to declare the prenuptial agreement valid and enforceable, to enforce the terms of the prenuptial agreement, to strike the defendant's affidavit, her attorney's affirmation, and the defendant's memorandum of law for failure to comply with the Westchester Matrimonial Part Rules, an award of counsel fees in an amount not less than $25,000, and to direct the defendant to pay all costs and expenses, including legal fees, incurred by the plaintiff in defending against the defendant's challenge to the validity and enforceability of the prenuptial agreement:
PAPERS NUMBERED
Notice of motion, affidavit, affirmation, exhibits A-O, memorandum of law 1-19
Notice of cross motion, affidavit, affidavit, affirmation, exhibits 1-12, memorandum of law 20-36
Affidavit in reply, affirmation in reply, and memorandum of law in reply, exhibits A-B 37-41
Affidavit in opposition to cross motion, affirmation in opposition to cross motion, and memorandum of law in opposition to cross motion, exhibits A-B 42-46
Affidavit in further support of cross motion, affirmation in further support of cross motion, memorandum of law in further support of cross motion, exhibits 13-14 47-51
Upon the foregoing papers, the decision and order of the Court is as follows:
Relevant Factual & Procedural Background
The parties were married on November 5, 2005, and have four children. Prior to the marriage, on September 21, 2005, the parties entered into a prenuptial agreement which provided, inter alia, that each party waived the right to maintenance and attorney's fees (see Prenuptial Agreement, Article Four and Article Seven, ¶¶ 2 and 3). The agreement also stated, among other things, that "if either party... challenges the validity or enforceability of this agreement such party... shall assume and pay all costs and expenses, including legal fees incurred by the other party in attempting to enforce or uphold the validity of this agreement, and shall indemnify and hold harmless the other party for all such costs and expenses" (Prenuptial Agreement, Article Seven, ¶ 2). The plaintiff was represented by counsel, whereas the defendant "consulted" with her sister and father.
"Schedule A" to the agreement indicated that the plaintiff earned approximately $40,000 in 2004 and $42,000 in 2005, and that his assets included two separate "Glenmede Trust Company" accounts totaling $1,373,412. "Schedule B" to the agreement indicated that the defendant earned approximately $10,000 in 2004, and no income in 2005, and was a beneficiary of "The Schell Children Trust" and the "Mosconi Trust Fund," the amounts of which were "unspecified."
In August 2020, the plaintiff commenced this action for a divorce and ancillary relief. The defendant answered the complaint, and moved to vacate and/or set aside Article Four and Article Seven, paragraphs 2 and 3, of the prenuptial agreement, for an award of pendente lite maintenance in the amount of $3,200 per month retroactive to the date of the application, and an award of interim counsel fees in the amount of $50,000.
The defendant's motion
In a supporting affidavit, defendant asserts that prior to the parties' marriage, she had planned to attend medical school in Boston, but instead, in 2004, moved to Chicago, where the plaintiff was completing his residency program. The defendant states that in the Spring of 2005, she found employment with a psychopharmaceutical research company, but it ended after approximately 15 months. She contends that the parties had agreed that she "would be a full time mother until all the children were in full time school," at which point she "would return to school and pursue a career" (Defendant's Affidavit at ¶ 55). The defendant emphasizes that she moved four times in four years for the plaintiff's career as a colorectal surgeon, that she is a full-time homemaker, and that she "sacrificed [her] career and [her] dreams to be a doctor to support the Plaintiff" (id. at ¶ 122).
The defendant avers that prior to signing the prenuptial agreement, the plaintiff "repeatedly told [her] that the purpose of the [] agreement was only to protect his interest in the Glenmede Trust." (Defendant's Affidavit at ¶ 44). She states that she was not represented by counsel when she was presented with the prenuptial agreement. According to the defendant, she had one, five minute telephone conversation with her father, who "has no experience in matrimonial law" and "did not understand all the language of the agreement," and one telephone conversation with her sister, who "had only been admitted to practice law in Massachusetts for approximately two (2) years" (id. at ¶¶ 45-48). The defendant asserts that Schedule B of the prenuptial agreement is inaccurate since "The Schell Children Trust" and "Mosconi Trust Fund" do not exist, and that they were included "to make it look like [she has] more assets than [she does]" (id. at ¶ 59).
The defendant notes that the plaintiff's income has "drastically increased" since 2005 and claims that he now earns approximately $690,000 a year. She stated that she liquidated an IRA valued at approximately $45,000, to pay a portion of her legal fees and certain other expenses, and that "very little remains" (id. at ¶ 110, fn 3). The defendant contends that the terms of the Article Four and Article Seven, paragraphs 2 and 3, of the prenuptial agreement are "manifestly unfair," that she "had no input regarding the specific language," which was drafted by the plaintiff's attorney, and that when she signed the agreement, she "did not understand or know what maintenance was in the context of a marriage and subsequent divorce" (id. at ¶¶ 113, 114, 117).
The defendant submitted affidavits of her father, Harold Schell, and her sister, Marisa Schell Gregg, both of whom aver that they did not fully understand the prenuptial agreement, but told the defendant that it appeared that she was giving up any claim to the Glenmede Trust accounts. Mr. Schell asserts that, to his knowledge, no trust exists in which the defendant is a named beneficiary. Ms. Gregg contends that her legal career is focused on real estate law, that she never practiced at a matrimonial firm, and that she did not represent the defendant in any "formal capacity" in connection with the prenuptial agreement (Affidavit of Marisa Schell Gregg at ¶ 8).
The plaintiff's cross motion
The plaintiff opposed the defendant's motion and cross-moved to declare the prenuptial agreement valid and enforceable, to enforce the terms of the prenuptial agreement, to strike the defendant's affidavit, her attorney's affirmation, and the defendant's memorandum of law for failure to comply with the Westchester Matrimonial Part Rules, an award of counsel fees in an amount not less than $25,000, and to direct the defendant to pay all costs and expenses, including legal fees, incurred by the plaintiff in defending against the defendant's challenge to the validity and enforceability of the prenuptial agreement.
In an affidavit, the plaintiff avers that the defendant only seeks to set aside the provisions in the prenuptial agreement that "she deems unfavorable to her" (Plaintiff's Affidavit at ¶ 2). He contends that the defendant, who has "multiple advanced degrees" and "receives hundreds of thousands of dollars from her father for spending money," fails to set forth any basis for an award of temporary maintenance given that the parties still reside together in the marital residence, and he "continue[s] to pay everything for [the defendant], the house, and the children, including fulltime childcare and a weekly housekeeper" (id. at ¶¶ 5, 8). The plaintiff asserts that the defendant is "eminently employable," receives support from her father, and is not at risk of becomig a public charge (id. at ¶ 53).
The plaintiff contends that he "always fully supported [the defendant's] schooling and career goals," and that it was the defendant who decided not to enroll in medical school, notwithstanding that "she had graduated near the top of her Master's program class and had been guaranteed admission to medical school" (id. at ¶¶ 11-12). He asserts, among other things, that the defendant "was already voluntarily unemployed before she got pregnant," and that the defendant insisted that the parties reside in Scarsdale, promising the plaintiff that "she would '100%' finally get a job and contribute financially to the marriage" (id. at ¶ 25). The plaintiff claims that throughout the marriage, the defendant "would apply for and receive job offers and not take them" (id. at ¶ 28).
The plaintiff asserts that the defendant read the prenuptial agreement many times, that several drafts were exchanged, and that he had many discussions with the defendant about the agreement. He insists that the defendant "always told [him]... that she was always going to be able to provide for herself" and that "if she were to get divorced, she could pay her legal fees and wouldn't need maintenance" (id. at ¶ 41). According to the plaintiff, the defendant "almost broke off the engagement because of the agreement terms" (id. at ¶ 42). The plaintiff contends that the defendant "certainly understood that [the prenuptial agreement] dealt with more than her giving up a claim to [his] separate, premarital Trusts" (id. at ¶ 43). He maintains that the defendant decided not to retain her own counsel, despite being urged to do so. The plaintiff also states that he accurately disclosed his assets, income, and liabilities, noting that when the parties entered into the agreement, he was in a residency program earning only $40,000, "with every expectation that [he] would complete [his] residency and have increased earnings in the future" (id. at ¶ 49). He contends that the defendant has separate assets and that she provided the information listed on Schedule B to the prenuptial agreement.
In support of the cross motion, the plaintiff submitted an affidavit of Joanne B. Bruzgul, the attorney who was retained by the plaintiff to prepare the prenuptial agreement. Ms. Bruzgul avers, inter alia, that the defendant "continued to decline to have an attorney present to represent her at the signing" and "represented to [her] that she had consulted with separate counsel about the terms of the [prenuptial agreement] before signing [the agreement]" (Affidavit of Joanne B. Bruzgul at ¶ 11). Ms. Bruzgul states that she, together with the parties, "went through the document beginning to end and made several revisions at [the parties'] request" (id. at ¶ 12). She asserts that the defendant provided her with the information listed on Schedule B.
The parties subsequently filed papers in further support of, and in opposition to, their respective motions.
Although the agreement provides that the interpretation and validity of its provisions are governed under the laws of the State of Illinois, the plaintiff does not oppose the defendant's request made in the supporting memorandum of law to apply New York law. In addition, during a court appearance held on August 30, 2021, the parties stipulated on the record to apply New York law to this dispute.
"'Duly executed prenuptial agreements are accorded the same presumption of legality as any other contract'" (Rosen v Rosen, 192 A.D.3d 710, 712 [2d Dept. 2021], quoting Bloomfield v Bloomfield, 97 N.Y.2d 188, 193 [2001]). "An agreement between spouses or prospective spouses should be closely scrutinized, and may be set aside upon a showing that it is unconscionable, or the result of fraud, or where it is shown to be manifestly unfair to one spouse because of overreaching on the part of the other spouse" (Bibeau v Sudick, 122 A.D.3d 652, 654-655 [2d Dept. 2014]; see Hershkowitz v Levy, 190 A.D.3d 835, 836 [2d Dept. 2021]; Taha v Elzemity, 157 A.D.3d 744, 745 [2d Dept. 2018]). "[W]hichever spouse contests a prenuptial agreement bears the burden to establish a fact-based, particularized inequality before a proponent of a prenuptial agreement suffers the shift in burden to disprove fraud or overreaching" (Matter of Greiff, 92 N.Y.2d 341, 346 [1998]).
"An agreement is unconscionable if it 'is one which no person in his or her senses and not under delusion would make on the one hand, and no honest and fair person would accept on the other, the inequality being so strong and manifest as to shock the conscience and confound the judgment of any person of common sense'" (Sanfilippo v Sanfilippo, 137 A.D.3d 773, 774 [2d Dept. 2016], quoting Label v Label, 70 A.D.3d 898, 899 [2d Dept. 2010]). "An agreement that might not have been unconscionable when entered into may become unconscionable at the time a final judgment would be entered" (Taha v Elzemity, 157 A.D.3d at 745-746; see Domestic Relations Law § 236[B][3]; Mahadeo v Mahadeo, 193 A.D.3d 841, 843 [2d Dept. 2021]). "An agreement, however, is not unconscionable merely because, in retrospect, some of its provisions were improvident or one-sided. The burden of proof is on the party seeking to invalidate the agreement" (Ku v Huey Min Lee, 151 A.D.3d 1040, 1041 [2d Dept. 2017] [internal citations and quotation marks omitted]; see Barnes-Levitin v Levitin, 131 A.D.3d 987, 988 [2d Dept. 2015]).
As a threshold matter, although the plaintiff is correct that the defendant's affidavit, her attorney's affirmation, and the memorandum of law exceed the page limitation set forth in the Matrimonial Part Operational Rules, the Court, in its discretion, declines to disregard those papers on that ground (see generally Macias v City of Yonkers, 65 A.D.3d 1298, 1299 [2d Dept. 2009]).
Turning to the merits, the evidence adduced by the parties in support of their respective motions failed to establish that the prenuptial agreement was the product of fraud, duress, or overreaching (see Hershkowitz v Levy, 190 A.D.3d 835, 837 [2d Dept. 2021]; Kashman v Kashman, 147 A.D.3d 1034, 1035-1036 [2d Dept. 2017]). There is no evidence that the plaintiff attempted to conceal or misrepresent the nature or extent of his assets, or his future earning potential (see Barnes-Levitin v Levitin, 131 A.D.3d at 988; Label v Label, 70 A.D.3d 898, 900 [2d Dept. 2010]), and the circumstances surrounding the drafting and execution of the agreement do not give rise to an inference of coercion or undue influence by the plaintiff (see Forsberg v Forsberg, 219 A.D.2d 615, 616 [2d Dept. 1995]; c.f. Smith v Smith, 129 A.D.3d 934, 935 [2d Dept. 2015]; Kabir v Kabir, 85 A.D.3d 1127, 1128 [2d Dept. 2011]). Furthermore, even assuming that a fiduciary relationship existed between the parties prior to the marriage, the defendant offered no evidence of a breach of fiduciary duty by the plaintiff (see Hershkowitz v Levy, 190 A.D.3d at 838).
The defendant emphasizes that she was not represented by counsel in connection with the agreement, however, the evidence demonstrates that she was afforded the opportunity to obtain counsel, yet voluntarily declined to do so, instead choosing to rely on the advice of her father and her sister, who is an attorney (see Hershkowitz v Levy, 190 A.D.3d at 837; Barnes-Levitin v Levitin, 131 A.D.3d 987, 988 [2d Dept. 2015]; Forsberg v Forsberg, 219 A.D.2d at 616). Moreover, while the defendant claims that she was told by the plaintiff that the only purpose of the agreement was to protect his interest in the "Glenmede Trust Company," the agreement itself recites that the defendant entered into the agreement freely, voluntarily, and with full understanding of all of its provisions. The defendant, though not an attorney, is highly educated, and there is no indication that she was unable to understand the plain language of the agreement.
Notwithstanding the above, the Court finds that the defendant met her burden of demonstrating that the provisions in the agreement waiving the right to seek an award of maintenance and counsel fees, though perhaps not unconscionable when entered into, have become unconscionable given the nature and magnitude of the rights she waived and in light of the vast disparity in the parties' net worth (see Maddaloni v Maddaloni, 163 A.D.3d 794, 795-796 [2d Dept 2018]; Taha v Elzemity, 157 A.D.3d 744, 746 [2d Dept. 2018]; Gardella v Remizov, 144 A.D.3d 977, 980 [2d Dept. 2016]; Lombardi v Lombardi, 127 A.D.3d 1038, 1041-1042 [2d Dept. 2015]; Kessler v Kessler, 33 A.D.3d 42, 48-50 [2d Dept. 2006]). The evidence demonstrates that the defendant has been unemployed for approximately 15 years, is a full-time homemaker, and is largely without assets, notwithstanding that she may receive some support from her father, whereas the plaintiff's statement of net worth indicates that he earns $600,000 per year as Chief of Colon and Rectal Surgery at St. Francis Hospital, and has significant assets totaling over $1 million.
Under these circumstances, the provisions in the agreement waiving the right to maintenance and counsel fees are unenforceable.
The defendant also seeks an award of interim counsel fees in the amount of $50,000, emphasizing in her affidavit (filed five months ago), that she paid her attorney a $7,500 retainer, that she owes her attorney $22,000, that she was forced to liquidate her IRA to pay for certain expenses, including legal fees, and that she has no income or assets to cover the cost of further litigation. "The purpose of interim counsel fees is to ensure that the less monied spouse will be able to litigate the action on equal footing with the monied spouse" (Duval v Duval, 144 A.D.3d 739, 742-743 [2d Dept. 2016]). "In determining whether to award counsel fees, the court should review the financial circumstances of both parties together with all the other circumstances of the case, which may include the relative merit of the parties' positions" (Lugo v Torres, 174 A.D.3d 594, 595 [2d Dept. 2019]). "[T]here is a statutory rebuttable presumption that counsel fees shall be awarded to the less monied spouse" (Carlucci v Carlucci, 174 A.D.3d 495, 496 [2d Dept. 2019], quoting Domestic Relations Law § 237[a]). Here, considering the equities and circumstances of the case, including that the plaintiff paid his attorney a $20,000 retainer, the disparity in the financial circumstances of the parties, and the non-complexity of the issues presented, the defendant is awarded interim counsel fees in the amount of $35,000, to be paid by the plaintiff to the defendant's attorney within 30 days of the date of this decision and order.
That branch of the defendant's motion which was for an award of pendente lite maintenance in the amount of $3,200 per month retroactive to the date of the application is denied. "The purpose of pendente lite maintenance is to ensure that a needy spouse is provided with funds for his or her support and reasonable needs pending trial" (Jin C. v Juliana L., 137 A.D.3d 1063, 1064 [2d Dept. 2016]). Here, the defendant continues to reside in the marital residence with the plaintiff, who bears the responsibility for paying the parties' living expenses and child care expenses, and there was no showing that the defendant's reasonable needs are not being met or that she is unable to meet her current financial obligations.
Accordingly, it is, ORDERED that the branch of the defendant's motion which was to set aside article four and seven, paragraphs 2 and 3 of the agreement, on the ground of unconscionability is granted; and it is further, ORDERED that the branch of the defendant's motion which was for an award of interim counsel fees is granted to the extent that the plaintiff is directed to pay the amount of $35,000 to the defendant's attorney within 30 days of the date of this decision and order; and it is further, ORDERED that the remaining branches of the defendant's motion are denied; and it is further, ORDERED that the plaintiff's cross motion is denied; and it is further, ORDERED that all other relief requested and not decided herein is denied.