Tennessee Court Analyzes Antenuptial Agreement in Divorce Case
Posted by Martin Heller Potempa & Sheppard, PLLC on May 31, 2017
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It is important to understand your rights before signing an antenuptial agreement, as well as the consequences of its execution. In a May 17, 2017 decision, the Court of Appeals of Tennessee reviewed a divorce case involving an antenuptial agreement that the spouses signed before their marriage in 1997. As a result of that agreement, the trial court classified the bulk of the assets as the husband’s separate property, divided the modest amount of assets that were classified as marital property, and awarded the wife alimony in futuro and alimony in solido.
In Tennessee, spouses may control the disposition of property in the event of a divorce with an antenuptial agreement. Antenuptial agreements are valid and enforceable as long as they are entered into freely, knowingly, and without duress or undue influence. The terms of a valid antenuptial agreement will be applied instead of the statutory definitions regarding the distribution of marital and separate property and general principles regarding equitable distribution.
On appeal, the wife argued that property acquired by the spouses after the marriage by means of the husband’s earned income should be classified as marital property. In considering the issue, the appeals court observed that the antenuptial agreement failed to provide a definition of the term “property.” Accordingly, the court construed the agreement as a whole in order to ascertain the parties’ intent from the usual, natural, and ordinary meaning of the language.
The court held that, in applying the plain and ordinary meaning of the term, the spouses intended for “any property” to encompass property of any sort, including earnings from employment, retirement, or elsewhere. As a result, the court found a clear indication that all property acquired after the marriage was to remain separate property, unless the property was acquired jointly or in both parties’ names. In other words, to the extent that the husband made money, that money would be his; to the extent that he converted it into investment instruments or physical, tangible property, it would be his; to the extent that he converted it into property in the joint names of the parties as tenants by the entireties, it would be marital property. The court, therefore, affirmed the lower court’s decision on this issue.
The husband argued on appeal that the antenuptial agreement precluded the court’s consideration of separate property when determining its award of alimony. However, the appeals court noted that the antenuptial agreement expressly provided for alimony in the event of a divorce, “whether by agreement or by the judgment of a court.” The court also explained that although the agreement demonstrated an intention that the spouses’ separate property not be considered in the court’s division of property, no such limit was placed on the court’s ability to consider the separate property of the parties when assessing its award of alimony. As a result, the appeals court held that the lower court properly considered the need of the wife and the ability of the husband to provide such support.
The Nashville family law attorneys at Martin Heller Potempa & Sheppard work hard to protect the interests of our clients. We can represent individuals in divorce litigation involving antenuptial agreements, property division, spousal support, child custody and visitation, and more. To speak with one of our experienced divorce lawyers, call (615) 800-7096 or contact us online and schedule a consultation.
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