Florida Supreme Court Holds Broad Language of Waiver in Prenuptial Agreement Before it was Sufficient to Waive Spouse’s Claim to Assets Acquired or Enhancement In Value During The Marriage

The Florida Supreme Court held in Hahamovitch v. Hahamovitch, 174 So. 3d 983 (Fla. 2015), that the Fourth DCA correctly ruled that the prenuptial agreement language at issue was broad enough to waive a wife’s right to assets titled in the husband’s name which had been acquired during marriage or which appreciated in value due to marital income or efforts during marriage. In the subject case, Dianne and Harry Hahamovitch entered into a prenuptial agreement in 1986, before their marriage. At the time they entered into the agreement, Harry was forty-six years old and Diane was twenty-eight years old. They married in 1986 and remained married for twenty-two years. They had two children during the marriage. On February 6, 2008, they filed for dissolution of marriage.

The Fourth DCA upheld the trial court’s conclusion that the prenuptial agreement was valid. The court noted in its reasoning that the prenuptial agreement was entered into freely and voluntarily, both parties had legal counsel throughout its preparation and execution stages, there were multiple drafts of the prenuptial agreement prior to signing the final contract, and their lawyers and their accountants spent a long time drafting a prenuptial agreement that was fair, reasonable and that the parties intended to be bound by. Additionally, the Fourth DCA pointed out that the language of the agreement was broad enough to waive the wife’s right to any asset titled in the husband’s name that was acquired during the marriage or that appreciated in value due to marital income or efforts during the marriage.  However, the Fourth DCA noted that other district courts have interpreted prenuptial agreements with substantially similar language to be insufficient to waive a spouse’s claim to the other spouse’s earnings, assets acquired with those earnings, and the enhanced value of the other spouse’s nonmarital property resulting from marital labor or funds.

The wife (“Petitioner”) argued that since the prenuptial agreement makes no specific reference to enhancement in value of nonmarital property attributable to marital labor or funds, the enhanced value is subject to equitable distribution. Petitioner also argued that because the prenuptial agreement did not contain a specific provision that the husband’s earnings will be his separate property, they were not protected assets.  The Fourth DCA certified conflict with decisions in both the Second and Third District Courts of Appeal, and further certified a question pertaining to same to be of great public importance.  The Florida Supreme Court approved the Fourth DCA’s decision in Hahamovitch and answered the certified question in the affirmative.

The Supreme Court of Florida ruled that the broad language in the prenuptial agreement included a waiver and release of all rights and claims to any asset titled in the husband’s name and that appreciated in value during the marriage, as the agreement included a waiver and release of all rights to the other spouse’s non-marital property.  It cited Chapter 61, Florida Statutes which governs the dissolution of marriage. Section 61.079(4)(a) provides that “[p]arties to a premarital agreement may contract with respect to . . . [t]he disposition of property upon . . . marital dissolution.” Section 61.075, Fla. Stat., addresses the “[e]quitable distribution of marital assets and liabilities.” This section describes what constitutes marital assets and liabilities. Nonmarital assets and liabilities include those “excluded from marital assets and liabilities by valid written agreement of the parties.” Section 61.075(6)(b) 4., Fla. Stat.

In the prenuptial agreement in the subject case, Petitioner waived and released any and all rights and claims to all property solely owned by the husband at the time of the agreement or acquired in the future. In particular, the parties contracted that each would “keep and retain sole ownership, control, enjoyment and power of disposition with respect to all property, real, personal or mixed, now owned or hereby acquired by each of them respectively, free and clear of any claim by the other,” that “each party agrees that neither will ever claim any interest in the other’s property,” and if one party “purchases, [a]cquires, or otherwise obtains, property in [his/her] own name, then [that party] shall be the sole owner of same.” Thus, based on the plain meaning of this language, any property the husband (“Respondent”) owned at the time of execution of the premarital agreement and any property the husband acquired in his name after the execution of the agreement, including any enhancement in value or appreciation of such properties, are the husband’s nonmarital assets.

Therefore, the Florida Supreme Court upheld the Fourth DCA’s holding in the subject case on appeal, and noted its disapproval with the decisions from other districts in conflict with it: Irwin v. Irwin, 857 So. 2d 247 (Fla. 2d DCA 2003), and Valdes v. Valdes, 894 So. 2d 264 (Fla. 3d DCA 2004).  It noted the distinctions made in those cases run counter to a prenuptial agreement’s actual language that expressly encompasses all property solely owned by one spouse presently and in the future and that expressly waives all of the other’s spouse rights and claims in such property.

If you or anyone you know is in need of representation in actions involving Guardianship, Probate and/or Trust Disputes, or questions pertaining to such proceedings, please contact The Law Offices of Glenn M. Mednick, P.L., at (954) 315-1154 or gmednick@mednicklawgroup.com.