Decision & Order Pursuant to an order of the Appellate Division, dated June 7, 2017, a hearing was conducted on whether a postnuptial agreement executed by the parties on January 23, 2008 (hereinafter “the postnuptial agreement” or “the agreement”) should be set aside as unconscionable. Defendant, B. B. moved, inter alia, to vacate the postnuptial agreement. By order dated October 14, 2014, the Supreme Court (Reilly, J.) denied that branch of the motion without a hearing. Defendant moved to reargue, and by order dated March 2, 2015, the Court (Reilly, J.) denied Defendant’s motion for reargument. By order dated June 7, 2017, the Appellate Division, Second Department reversed the order dated October 14, 2014, on the law, and remitted the matter to the Supreme Court for a hearing and new determination of that branch of Defendant’s motion which was to set aside the parties’ postnuptial agreement. A hearing was held on May 22, 2019, May 24, 2019, May 30, 2019, May 31, 2019, June 12, 2019, June 18, 2019, July 29, 2019 and July 30, 2019. Both parties testified. This Court observed the demeanor of the parties. FINDINGS OF FACT The parties met in 1998 and began dating in the Summer of 2001. Defendant, whom the Court found credible, had come from Trinidad and was living in an apartment in New Jersey, earning approximately Seven Thousand Dollars ($7,000) per year working as a home health aide, working approximately five (5) to seven (7) days a week. The parties lived together in New Jersey in 2003 after Plaintiff’s ex-wife filed a restraining order against him. Plaintiff was still married at the time. Plaintiff asked Defendant to marry him while they were on a trip to Orlando, Florida and they were married two (2) days later on June 28, 2004 at City Hall while on vacation. Plaintiff was approximately fifty-one (51) years of age and Defendant was thirty-eight (38) years of age. Both parties were previously married and had children from a prior marriage. Plaintiff has two (2) children and Defendant has three (3) children from their prior marriages. There are no children born to their marriage. The parties signed a prenuptial agreement in 2004, two (2) days before the marriage, which was the mirror image of the postnuptial agreement that was later executed. Defendant denied knowledge of the contents of the prenuptial agreement. The parties signed a postnuptial agreement on January 23, 2008. Plaintiff filed for divorce on January 11, 2010. At the time of the marriage both parties were employed. Plaintiff worked for the New York City Department of Environmental Protection. Neither party could recall Plaintiff’s salary at the time of the marriage. He also owned a tax preparation business, wherein Defendant assisted him in preparing tax returns, but Defendant did not receive any income for her work at the time. She also worked as a home health aide in Elizabeth, New Jersey until 2005 when her patient/client passed away. She states that she was commuting to Elizabeth, New Jersey, for her occupation as a home health aide. Defendant avers that Plaintiff planned the trip to Orlando, Florida and while they were there he asked her to get married and she accepted. She affirms that they were married in City Hall. The Defendant testified that the parties resided in New Jersey from 2003 until July of 2004. Defendant moved into Plaintiff’s residence at Freeport, New York (hereinafter the “marital residence”) thereafter. After her patient/client passed away, Defendant states there was a period she was unemployed prior to her attaining new employment. At some point in 2005-2006, Defendant claims that she began working in Brooklyn as an administrative assistant for her sister. She states that she earned Two Hundred Fifty Dollars ($250) net salary per week until 2007. In 2007, Plaintiff fell ill and began experiencing seizures. Defendant testified that as a result, Plaintiff asked her to stop working and to stay home to care for him. Defendant testified to numerous accounts of erratic behavior by Plaintiff caused by the seizures. Defendant testified that Plaintiff would black out during these episodes. She was responsible for taking Plaintiff to all doctors and hospital visits. She testified to him becoming more violent due to his illness, which included verbally degrading Defendant and attempting to force sexual intercourse. Defendant recounted episodes in which Plaintiff would demean her appearance, demand unconsented sex and proclaim that where she lived was not her home, but rather belonged to his daughter. She described a controlling relationship, wherein she would leave at 5:30 a.m. to travel for work to either New Jersey or Brooklyn, but have to return by 4:50 p.m. Otherwise, Plaintiff would question her whereabouts. She testified that Plaintiff had sole access to a locked mailbox, and she never opened his “private mail”. She denied Plaintiff’s testimony that she had online access to his accounts. She also stated that the parties filed joint tax returns which were prepared by Plaintiff, but she did not review or sign them because they were electronically filed. Defendant stated that Plaintiff used her daughters as a tax credit from 2004-2010, but that he didn’t tell her how much he received as a tax refund. She recounted a grim picture which depicted her reliance on Plaintiff because of her lack of employment, her children being dependent on her and her fear of being homeless. Defendant testified that her children came to live with her in 2007 to help her with Plaintiff’s care and were told by Plaintiff to stay in the basement while he was present. Plaintiff started to feel better in 2008. Thereafter, Defendant was asked to go to an attorney’s office to sign a postnuptial agreement. Defendant testified that there were never any discussions between the parties about executing the prenuptial or postnuptial agreement. She was never given any documents from Plaintiff or his attorney with respect to the prenuptial or postnuptial agreement and the parties never exchanged any financial statements prior to signing the prenuptial or postnuptial agreement. With regard to the postnuptial agreement, Defendant testified that on January 23, 2008, Plaintiff told her that they were going to the office of a Mr. Davis, who is a lawyer. They drove to the attorney’s office together from Freeport to Mineola. Defendant stated that they did not discuss the reason for their trip other than for Plaintiff to visit his attorney. She believed that Mr. Davis was an attorney for Plaintiff. She also stated this was the first time she met Mr. Davis. She stated that Plaintiff did not bring a file or any papers with him to the office. Defendant testified that, at the attorney’s office, the parties were placed in a conference room for an extended period of time. She claims that the attorney entered the conference room with a document flipped to the signature page. She could not recall who crossed out her maiden name, “LeBlanc,” and changed it to “Barclay” on the document. Defendant testified that she did not read the document; she signed it and left the office without receiving a copy. She stated that Plaintiff left with a copy. She stated that neither the parties nor the attorney had any conversations while she was there. She denies ever having possession of a copy of the postnuptial agreement from January 2008 to December 2012. She admits to reading the document for the first time in its totality three (3) weeks before this hearing. Defendant acknowledges to filing a motion in 2014 to set aside the postnuptial agreement, however she does not recall the contents of her sworn affidavit which refers to the postnuptial agreement. She alleges that her attorney prepared the affidavit. Defendant testified that Ms. Condello, attorney for Defendant, received a copy of the postnuptial agreement when she received a copy of the complaint from Mr. Davis (attorney for the Plaintiff at the commencement of this action). She alleges that Ms. Condello read the agreement and explained its contents to her for the first time. She is unaware if payment was made to the attorney for his services in connection with the agreement. Defendant testified that she was unaware as to where Plaintiff found the information about her assets. She denies having a conversation with Mr. Davis about her assets. At the time of the execution of the agreement, Defendant was unemployed, not receiving benefits and did not own any assets or real estate. She described the dire circumstances of being unemployed, living with her two (2) children at the marital residence and feeling that she did not have “any option” other than to sign the document. She claims that Plaintiff continuously made degrading comments about her employment and educational status prior to the signing of the post nuptial agreement. Defendant states that this made her feel as though she had no choice but to sign the document, even though he did not threaten divorce. She conceded that she was not physically forced to sign the document, however, she believed that she would be evicted if she did not sign it. Defendant states that she was unaware of most of Plaintiff’s assets or liabilities and she was unaware of the nature of Plaintiff’s interest in the marital residence or of his property located in Brooklyn. Defendant claims that she paid the utility bills for the marital residence from 2005, when she moved in, until 2008, when she stopped working. Defendant denies receiving a Five Hundred Dollar ($500) monthly allowance from Plaintiff as required in the prenuptial and postnuptial agreements. She testified that Plaintiff gave her some money from time to time and permitted her to use a credit card (Citibank) which she would use for groceries, toiletries and things for the home. She testified that she would write a check back to Plaintiff for whatever she used on the credit card. Defendant testified that when she moved to Freeport, she closed her bank account and opened a joint account with Plaintiff, to which only he had the account numbers. She testified that her money went into that account. Defendant was not aware of any other joint bank accounts that may have been opened. Defendant testified that any money Plaintiff gave her was deposited into the joint account. She states that she did not keep track of these deposits and payments in any formal way, such as a ledger. She concedes that Plaintiff paid the down payment for her school tuition in the amount of $2,725.00. She alleges that she is unaware how much Plaintiff contributed towards the tuition. Defendant states she began attending the Long Island Technical Institute in January 2008 and completed her schooling in May 2009. While in school, Defendant states that she did not pay towards the mortgage. Defendant claims she has been able to support herself since attaining a degree. Defendant reviewed the Bank of America statements for the years 2005-2008. She states that notations were made in 2013 by her to indicate what represented a utility bill payment, what represented a credit card reimbursement, and what represented her contribution to the mortgage. Plaintiff claims that they did not live together when they married in June of 2004, but rather he lived with his brother in an apartment in Brooklyn, New York, while staying weekends at Plaintiff’s apartment in New Jersey. He testified that he had a key to Defendant’s apartment in New Jersey. Plaintiff confirmed that Defendant had no assets and was not self-supporting in January 2008 and he claimed to provide a variety of support to her from September 2007 to January 2008. He claims that he paid for her to go to school, purchase all the groceries, paid for all the utilities, and paid for the mortgage, taxes and insurance on the Freeport residence. He testified that he gave Defendant cash “on many occasions” to obtain things for herself. He testified that he would give her between $200 to $300 and sometimes $500, depending on her needs. Plaintiff confirmed that he never deposited money into the party’s joint bank accounts. Plaintiff testified that he did not use an attorney to draft the post nuptial agreement. He stated that he drafted the agreement himself using a program called “Family Planner” and did not pay Mr. Davis. He stated that he revised the party’s prenuptial agreement to create the post nuptial agreement. He testified that he did not discuss the terms of the agreement prior to its execution. He affirms that the only discussion they had was three (3) or four (4) months prior to its execution when Plaintiff asked why they needed to enter into a postnuptial agreement when they already had a prenuptial agreement. Plaintiff claims that he gave Defendant a copy of the postnuptial agreement. Plaintiff testified that the reason for the postnuptial agreement was because the prenuptial agreement might not be valid in New York since it was executed in New Jersey. Plaintiff also recounted that on the day of the execution, he drove Defendant to sign the agreement at the office of Mr. Davis, an attorney in Garden City. He also testified that they did not discuss the agreement with each other, nor with Mr. Davis, on the day of the execution. Plaintiff testified that neither he nor Defendant met or spoke with Mr. Davis prior to its execution and the sole purpose for the visit was to notarize the document. CONCLUSIONS OF LAW In general, a postnuptial agreement is presumptively valid. “A postnuptial agreement which is regular on its face will be recognized and enforced by the courts in much the same manner as an ordinary contract.” (Petracca v. Petracca, 101 AD3d 695, 697 [2d Dept 2012]; Levine v. Levine, 56 NY2d 42, 47 [1982]). However, marital agreements, unlike ordinary business contracts, “involve a fiduciary relationship requiring the utmost of good faith.” (Christian v. Christian, 42 NY2d 63, 72, [1977]). This fiduciary relationship effects close judicial scrutiny of postnuptial agreements, and courts will more readily set them aside under circumstances that would be insufficient to nullify an ordinary contract. (See Petracca v. Petracca, supra). Courts will set aside a postnuptial agreement if the challenging party shows it to be the product of fraud, duress, or overreaching resulting in manifestly unfair terms. (See Christian v. Christian, 42 NY2d 63, 72 [1977]; Gottlieb v. Gottlieb, 138 AD3d 30, 36 [1st Dept 2016]). Because no actual fraud or duress need be shown to set aside a postnuptial agreement, courts may determine the validity of the agreement by looking at the surrounding circumstances of the agreement, as well as its terms, to see if there is an inference, or even a negative inference, of overreaching. (Christian v. Christian, 42 NY2d at 73). The general rule, however, is that if the execution of the agreement is fair, no further inquiry will be made. (Id. at 73). Overreaching may be found in the agreement’s execution based on evidence which shows the concealment of facts, misrepresentation, cunning, cheating, sharp practice or some other form of deception. (Gottlieb v. Gottlieb, 138 AD3d at 57 [1st Dept 2016][Saxe, J. dissenting]). For instance, evidence that one spouse was not represented by counsel is a significant consideration when determining overreaching in a martial agreement’s execution. (Kavanagh v. Kavanagh, 2 AD3d 688, 689 [2d Dept 2003]; See Jaus v. Jaus, 168 AD2d 487, 488 [2d Dept 1990]). Accordingly, this Court has considered the following four factors to analyze overreaching in the execution of a martial agreement: Whether each spouse retained a lawyer of his or her own choosing; Whether each spouse was provided with a proposed agreement with sufficient time to give due consideration to the serious consequences of the proposed terms; Whether each spouse was given fair and adequate disclosure; and Whether each spouse is presented with an agreement that does not scream inequity or will leave one party practically destitute. C.S. v. L.S., 41 Misc 3d 1209[A], 1209A, 2013 NY Slip Op 51624[U], [Sup Ct, Nassau County 2013]). LEGAL REPRESENTATION It is evident to the Court that Defendant was not represented by counsel with respect to the execution of either the prenuptial or postnuptial agreement. Plaintiff’s claim that he was not represented or guided by counsel is unconvincing. The parties appeared in the office of a well known attorney to execute the agreement, the very attorney who commenced the divorce action on Plaintiff’s behalf two (2) years later. It is suspect that Plaintiff would have Defendant sign the document in counsel’s office, rather than a notary public, if he had not sought his counsel. Furthermore, Defendant was not aware of, nor did she receive a copy of the agreement prior to its execution. As both parties stated they did not discuss it during the car ride to the attorney’s office, nor were the contents discussed at the attorney’s office. Defendant did not have an opportunity to review the document and reflect on its impact. THE AGREEMENT Attached to the postnuptial agreement are financial statements for both parties, signed by each of them. Under the terms of the agreement, each party was to contribute Five Hundred Dollars ($500) per month to a joint checking account for living expenses, which Plaintiff states included groceries, utilities, cable television, fitness club membership, clothing and income taxes. They were also each obligated to pay twenty percent (20 percent) of the cost of maintenance for the home. Plaintiff initially testified that maintenance costs meant those associated with emergency repairs to the home. However, the agreement (at paragraph two (2)) outlines maintenance costs as including payments for the mortgage, real estate taxes, and insurance on the property. The agreement states (in the same paragraph) that Defendant is required to contribute twenty percent (20 percent) of the cost of such maintenance. Defendant, however, waived all rights to any interest in the marital premises. Additionally, Defendant waived her rights to any portion of Plaintiff’s business under the terms of the agreement, despite her helping him in his business at no compensation. Defendant also waived any right to property, pension benefits, spousal support, inheritance rights, equitable distribution of all assets purchased during the marriage, the increase in value of Plaintiff’s separate property or any rights thereunder. Plaintiff included, on page six, paragraph fourteen (14) of the agreement that “[e]ach of the parties…has full knowledge of the other party’s property, debts and income….” Plaintiff, however, testified that the parties did not have full financial disclosure at the time they executed the agreement. Attached to the agreement is Exhibit A, entitled “S. B. Financial Information” which indicates a total net worth of $924,661.00, with “Annual Income of $98,000.00″ which includes, wages, rental income and accounting and tax consulting. Defendant’s financial statement, Exhibit B to the agreement, indicates Assets of zero and Income of $7,000. Plaintiff did not seek out full disclosure of Defendant’s assets and liabilities nor provide Defendant with full disclosure of his own assets and liabilities prior to the agreement’s execution. Plaintiff wrote in the agreement that Defendant had zero assets and zero liabilities. He also wrote in the agreement that Defendant was self-employed and receiving an annual income of $7,000. Defendant testified that Plaintiff was neither self-employed nor receiving a $7,000 annual income on the day of the execution. Moreover, Plaintiff included in the agreement that “Each of the parties has income from individual property interests sufficient to provide for his or her respective support.” What is evident to the Court is that on the day of the execution of the agreement Defendant was not self-supporting. To the contrary, she was reliant upon, and supported by Plaintiff. The parties did not exchange copies of their bank statements when they executed the agreement on January 23, 2008. As a result, Plaintiff did not know whether Defendant, on January 23, 2008, had earnings, salaries, or funds available to pay twenty percent (20 percent) of monthly maintenance costs. He testified that he believes that Defendant had unknown amounts of interest-accruing funds held in savings accounts. Plaintiff does not substantiate or provide explanation for this belief and further testifies that it “can be an assumption.” On the other hand, Plaintiff had accounts kept with MCU and Citibank which he did not disclose to Defendant. Plaintiff had approximately twelve (12) accounts which were not all included in the agreement. He testified that Defendant should have been able to see his Bank of America business account balances because she had access to that account (but not his personal accounts) during her time assisting Defendant with his tax consulting business from the time the parties married through the date of the agreement’s execution. Furthermore, the agreement did not include Plaintiff’s retirement benefits information, bonds, or the two (2) real properties he owned. Plaintiff testified that Defendant was not aware of all his assets at the time that she executed the agreement. In January 2008 at the time of the agreement’s execution, Defendant had neither employment nor any income. Plaintiff was aware of this, and aware that Defendant had not been employed since September 2007. However, under the terms of the agreement, Defendant was to pay a contribution toward income taxes as part of her $500 monthly living expenses. The Plaintiff concedes that he was the only spouse employed in January 2008. UNCONSCIONABILITY OF THE AGREEMENT In general, postnuptial agreements are subject to ordinary principles of law. (O’Malley v. O’Malley, 41 AD3d 449 [2d Dept 2007]). Furthermore, this Court recognizes that the very purpose of a postnuptial agreement is to protect assets of each individual going into a relationship. Such agreements are especially important in order to protect assets from a prior marriage and even more so when children from a prior marriage exist, as in this case. However, this Court must evaluate the totality of the circumstances surrounding not only its purpose, but the relationship itself, the execution of the agreement and whether the agreement was an unconscionable bargain surrounded in inequity. An unconscionable bargain has been regarded as “one such as no [person] in his [or her] senses and not under delusion would make on the one hand, and as no honest and fair [person] would accept on the other” (Hume v. United States, 132 US 406, 411 [1889]), the inequality being “so strong and manifest as to shock the conscience and confound the judgment of any [person] of common sense.” (Mandel v. Liebman, 303 NY 88, 94 [1951]). During this trial this Court heard numerous days of testimony and was able to examine the demeanor of the witnesses for their credibility. Although Plaintiff would like this Court to believe that Defendant had experience in these types of agreements because she had been previously married and had entered into a prenuptial agreement and therefore, must have had full knowledge of the type of agreement she had entered into, what is evident to this Court is that Defendant, with a GED, entered into a one sided relationship, wherein she gave up all her rights while providing and contributing to her family and receiving nothing in return. It is evident that Plaintiff did everything in his power to deprive Defendant of any benefits of their marriage, knowing that Defendant was not in a position to evaluate the circumstances. What is more troubling, are apparent undertones of control and power on behalf of Plaintiff due to the disparate financial and economic status and disturbing behaviors that permeated this relationship. These very control issues are the underlying reason that Defendant signed the agreement. Analyzing the execution on its own without the facts surrounding this relationship, this Court finds the execution troubling. Based upon the foregoing standard, the instant agreement is patently unconscionable, unfair and unreasonable at the time of its execution. Pursuant to the agreement, Defendant waived all her rights to property, income and Plaintiff’s estate upon his death. CONCLUSION Viewing the agreement in its entirety, hearing the testimony and finding Defendant to be credible, this Court determines that the agreement is null and void and is hereby set aside. The foregoing constitutes the decision and order of this Court. Dated: November 6, 2019 Mineola, NY
