Alimony & Spousal Support

Enforceability of Marital Settlement Agreement- Spouse’s Business And Disclosure-Waiver

In the family law case of McConahy vs. McConahy, PICS Case No. 13-2674 (C.P. Lawrence, Sept. 16, 2013) the wife’s petition to set aside a Marital Settlement Agreement was denied because the wife was fully engaged in the financial affairs of her husbands’ farm business.  The Honorable Thomas M. Piccone ruled that the wife was bound by a waiver in the parties’ marital settlement agreement and she waived any interest in the business by signing the agreement.

The parties were married in 2001.  In 2012, husband filed a complaint in divorce.  On June 5, 2012, the parties filed a marital settlement agreement.  Here, wife moved to set aside the marital settlement agreement.

Wife argued that the court should set aside the agreement because husband did not fully and/or fairly disclose his financial assets.  Absent a full and fair disclosure of the parties’ financial worth, a material misrepresentation in the inducement for entering an agreement may be asserted.

The court noted that where a spouse is fully engaged in the financial affairs and is familiar with a business owned by the other spouse, the court will uphold an agreement even when it contains neither disclosure nor an affirmation that disclosure was made.

Here, wife was employed by husband’s farm.  Through her employment, wife obtained a general knowledge of the daily farming operations.  In fact, she took a class that taught procedures for farming bookkeeping.

The court therefore, found that wife was fully engaged in the financial affairs of husband’s farm and that she waived any interest therein by signing the marital settlement agreement.  Thus, wife was bound by a waiver in a particular section of the agreement, entitled “Business Interest”.

Wife argued that the agreement should be set aside because there was not full and fair disclosure of the parties’ marital assets.  The court found, however, that wife failed to prove that she was deprived of full and fair disclosure of relevant assets at the time the agreement was executed.  Accordingly the court denied her petition.

Reference: Digest of Recent Opinions, Pennsylvania Law Weekly (October 8, 2013)

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