In Baldwin v. Harris, a surviving spouse, was successful in the interpretation of language in a prenuptial agreement.
Prior to Letetia (“Wife”) marrying Henry (“Husband”), they entered into a prenuptial agreement, which contained a provision stating that, if wife survived husband and was not married to Husband, then Husband would include a provision in his estate planning documents stating that she would receive a monthly payment equal to the monthly payment she was receiving as of Husband’s death.
Husband died. They were not married. Husband provided in his trust that the trustee was to give Wife a monthly payment as provided in the prenuptial agreement. Unfortunately for Wife, Husband did not fund the trust.
Husband’s personal representative and trustee (“PR”) argued that the Husband complied with the plain language in the prenuptial agreement and it did not matter that the trust was not funded. The lower court entered a summary judgement in favor of the PR.
On appeal, Wife argued that the plain language of the prenuptial agreement did not permit Husband “to simply include empty words in his estate planning documents, but rather required that he provide for” Wife “to actually receive a monthly payment, either via his estate planning documents or otherwise.”
The PR argued the Husband complied in the “technical sense” as he did “provide for” the monthly payment in the document but he did not actually have an obligation to ensure that Wife received such amount.
The appellate court easily dismissed that argument in finding that “such an interpretation strains the contractual language well beyond the bounds of common understanding.” The court noted that the payment to Wife was not conditioned on the trust having monies.
The PR also argued that the prenuptial agreement also stated that Husband could retain independent control and management of his own assets. Thus, Husband could choose to not fund the trust.
The appellate court determined that Husband did have the right to manage and control his own assets but that did not negate his obligation to provide for Wife. He was not at liberty to avoid that payment altogether .
ADVICE: In this author’s humble opinion, this was a very weak argument and maybe a “Hail Mary” to avoid the payment, although the argument won at the lower court. Carefully review the prenuptial agreement BEFORE you sign the agreement to be sure that it provides what you want. ALWAYS consult with legal counsel on the drafting of such agreements.
WORD OF THE WEEK: Judgement versus judgment. Most of us know that a judgment is a court order deciding a lawsuit. If a judgment is entered against an individual or company, a debt collector will have stronger tools, like garnishment, to collect the debt evidenced by the judgment.
What is the difference in the spelling of the word? When this author was a CPA with Price Waterhouse in the late 70s, and early 80s we always spelled judgement with an “e”. When entering law school the word was spelled without an “e” for the most part. Why the difference?
Judgement gained frequency in British contexts, and is now the usual spelling in British use. Apparently Webster first recorded the misspelling of judgment in his 1828 American Dictionary of our English Language. However, now ‘judgment” is the standard spelling in British and American legal contexts when used to refer to a judicial decision.
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