California Court Says Prenuptial Limitation on Spousal Support Unenforceable
Will a California prenuptial agreement be enforced at the time of divorce even if the judge thinks it was unfair? The answer is unclear because a lot of things are unfair. But if the prenuptial agreement (also known as a premarital agreement) is downright “unconscionable” at the time of the divorce, the judge can refuse to enforce the prenup. This has been the law since 2002, but in a newly published case, Marriage of Zucker (2022) 2022 DJDAR 2296, the unconscionability doctrine was extended to prenuptial agreements that were written even before the 2002 legislation that changed the way such agreements were written.
What does unconscionability mean? In the Zucker case, the parties –Kim and Mark—had “mutually relinquished ‘to the full extent permitted by law any and all right, entitlement or award of spousal support’” in a 1994 prenuptial agreement. The only exception was that there would be some nominal spousal support if the marriage lasted more than two years. The amount of support would depend on the length of the marriage, but it would never be higher than $6,000.00 per month, and even then, the $6,000.00 threshold would not be reached unless the parties were married for 11 years.
At the time of trial, Mark was earning $4 to $5 million per year while Kim was a stay-at-home mom with the parties’ six children and had no employment. Kim’s forensic accountant testified that she would need $86,000.00 per month to meet the marital lifestyle based on an income-available approach and $37,000.00 per month based on an expenditure approach. In an April 21, 2014, statement of decision, the trial judge said that the amount Kim would receive under the prenuptial agreement was merely ten percent of what she would receive under the Court’s probable order. Accordingly, the spousal support provision was ruled unconscionable.
Ruling 3-0, the Court of Appeal agreed, noting that it found “no flaw in the trial court’s reasoning”. The justices reasoned that “6,000 a month in spousal support under the agreement compared to Mark’s monthly earnings of upwards of approximately $250,000 was oppressive. Further, we note as well that Kim had already waived any community property interest in Mark’s income”. (The community property interest waiver was another part of the prenuptial agreement.)
Interestingly, the trial “consumed” 57 days. This is because the trial judge had to first decide whether the prenuptial agreement was valid in whole or in part; and then, having made its decision on those matters, the judge had to make orders on child support, spousal support, and attorney fees. Kim, by the way, was awarded $870,000.00 in attorney fees.
Then, on appeal, even the justices’ decision took up 72 pages (and 31 footnotes).
The appeal itself took a long time to resolve. By April 11, 2019, the lawyers had finished writing their briefs for the Court of Appeal. Oral argument was not until February 9, 2022, no doubt because of the Covid-19 pandemic. The decision was filed on March 3, 2022, with the Hon. Thomas L. Willhite Jr. serving as the authoring justice.
For more information about California prenuptial agreements, check out Family Code section 1615.