Opinion
No. 3-784 / 03-0326.
Filed January 14, 2004.
Appeal from the Iowa District Court for ButlerCounty, Gilbert Bovard, Judge.
The executor of the James Maifield estate appeals from the order entered granting Sandra Maifield's petition to dissolve the marriage. AFFIRMED.
Danita Grant of Fuerste, Carew, Coyle, Juergens Sudmeier, P.C., Dubuque, for appellant.
John Hines of Dutton, Braun, Staack, Hellman, P.L.C., Waterloo, for appellee.
Considered by Vogel, P.J., and Hecht and Vaitheswaran, JJ.
The executor of the James Maifield estate appeals from the order entered upon Sandra Maifield's petition for the dissolution of her marriage to James Maifield. We affirm.
Background Facts and Proceedings.
Sandra and James planned to be married on August 22, 1998. The night before the wedding, at a time when Sandra was entertaining guests for dinner, James presented her with a prenuptial agreement that he wished her to sign. Among other things, the agreement provided that property acquired in the future by the parties would constitute the separate property of the party who acquired it, and further that in the event of dissolution the separate property of each party would remain the separate property of that party. Sandra signed the agreement without consulting an attorney, and the parties were married. Only later, after the wedding, did she have an attorney review it.
On May 10, 2002, Sandra filed a petition to dissolve the marriage. Following a November 2002 trial, the district court entered its Findings of Fact, Conclusions of Law, and Decree. It first determined that the prenuptial agreement was unenforceable due to concepts of "basic fairness." The court also divided the assets of the parties, and ordered James to pay Sandra rehabilitative alimony in the amount of $700 per month for twenty-four months.
Approximately two weeks after the court entered its decree, James died. The district court was then asked to decide whether the alimony obligation would continue past James' death. In ruling on the parties' post-trial motions, the court determined that the award of alimony would "survive" James' death and provide Sandra a claim for payment against his estate/personal representative. James' executor appeals.
Following the appeal, our supreme court granted the Estate of James Maifield's motion to substitute itself as a party.
Standard of Review.
Our review of this equitable action is de novo. Iowa R. App. 6.4. We are not bound by the district court's findings of fact, but we do give them deference because the district court had the opportunity to view, firsthand, the demeanor of the witnesses when testifying. In re Marriage of Brown, 487 N.W.2d 331, 332 (Iowa 1992)
Enforceability of the Prenuptial Agreement.
As a general rule, prenuptial agreements are favored and should be construed liberally to carry out the intention of the parties. In re Marriage of Christensen, 543 N.W.2d 915, 918 (Iowa Ct. App. 1995). We treat such agreements in the same manner as ordinary contracts. Id. Because of the relationship of trust and confidence between the parties, the law requires a full and frank disclosure of all matters bearing upon a prenuptial agreement. In re Marriage of Sell, 451 N.W.2d 28, 30 (Iowa Ct. App. 1989). Whether a prenuptial agreement is reasonable is determined at the time the agreement is executed and not when enforcement is sought. In re Estate of Ascherl, 445 N.W.2d 391, 393 (Iowa Ct. App. 1989).
Iowa Code section 596.8 (2001) provides that a premarital agreement is not enforceable if
1. The person did not execute the agreement voluntarily.
2. The agreement was unconscionable when it was executed.
3. Before the execution of the agreement the person was not provided a fair and reasonable disclosure of the property and financial obligations of the other spouse. . . .
The district court noted Sandra's complaint was simply that "it was a rushed and forced signature under the circumstances." The court found significant that James presented the agreement on the eve of the wedding and presented it as a " fait accompli." The decretal court further found that, although James and Sandra may have discussed the general topic of premarital agreements before the document was presented to Sandra for signature, she had not seen the document before the eve of the wedding. Thus the court reasoned that "[b]asic fairness requires . . . the party . . . should be able to have the opportunity to let her own attorney see how accurately the `understandings' have been memorialized." The district court's essential conclusion thus appears to have been that the agreement was not entered into voluntarily. See Iowa Code § 596.8(3).
The person challenging the agreement has the burden to prove it was not a voluntary agreement. Iowa Code § 596.8. In In re Marriage of Spiegel, 553 N.W.2d 309 (Iowa 1996), our supreme court laid out a framework to analyze the enforceability of prenuptial agreements. There, the court discussed notions of both the substantive and procedural fairness of a prenuptial agreement. Spiegel, 553 N.W.2d at 315. The court's procedural fairness test asks whether the prenuptial agreement was "fairly, freely and understandingly entered into," thus reflecting the concern that any waiver of rights be knowing and voluntary. Id.
Although Spiegel did not operate under Iowa Code chapter 596 because that chapter only applies to agreements executed on or after January 1, 1992, we conclude the court's discussion of "procedural fairness" in Spiegel is instructive in our assessment of the voluntariness of Sandra's execution of the agreement in this case.
On our de novo review we concur in the district court's conclusion the agreement is not enforceable here. Importantly, Sandra was provided no meaningful opportunity to seek counsel. The prenuptial agreement is couched in legalistic terms and would not necessarily be understandable to a lay person. James presented the agreement to Sandra for signature on the eve of the wedding when she was entertaining dinner guests. She was thus effectively precluded by temporal considerations from seeking competent advice on the legal implications of the agreement. Under these procedurally unfair circumstances created by the conduct of James, we are unable to conclude Sandra understood the import of the document when she signed it. See In re Marriage of Gonzalez, 561 N.W.2d 94, 97 (Iowa Ct. App. 1997) (holding former wife did not knowingly and voluntarily sign a prenuptial agreement). Accordingly, we hold the premarital agreement in this case was unenforceable as it was not entered into voluntarily. See Iowa Code § 596.8(3).
Division of the Parties' Debts.
We next address the executor's claim that the district court inequitably divided two of the parties' debts. Specifically the executor contends the estate should not be responsible for two particular debts: income tax debts owed to the Federal and State governments and a Dillard's credit card debt. We apply our usual rules pertaining to property division. It is a fundamental principle that parties to a marriage are entitled at the time of a divorce to a just and equitable share of the property accumulated from their joint efforts. In re Marriage of Wiedemann, 402 N.W.2d 744, 747 (Iowa 1987). The division of marital debts inheres in the property division. In re Marriage of Johnson, 299 N.W.2d 466, 467 (Iowa 1980).
On our de novo review, we conclude the district court's treatment of the Dillard's and income tax debts is equitable, and therefore affirm the portion of the decree ordering James to assume these obligations. James clearly came into the marriage in an economically superior position and even under the district court decree, which did not enforce his prenuptial agreement, he left in a position far superior to Sandra. See In re Marriage of Sigler, 555 N.W.2d 846, 849-50 (Iowa Ct. App. 1996) (noting the ability of a party to meet the financial obligations imposed by a dissolution decree is a relevant in determining an equitable division of property). Regarding the Dillard's credit card, James argued Sandra should pay the debt because "most of it was used for buying things for herself and for her children, women's clothing." The purchase of clothing can hardly be considered an unnecessary indulgence such that the debt may only, by rule or reference to equitable considerations, be assigned to Sandra. The income from Sandra's recruiting business, upon which the tax debts were generated, was placed in a joint family account. Funds from that account were used for, among other things, improvements in James' home and other family needs. Accordingly, after de novo review and consideration of the factors listed in Iowa Code section 598.21(1), we find the district court's division of property including the allocation of debts to be equitable.
Alimony.
As noted, the district court ordered James to pay Sandra $700 in alimony for twenty-four months. On appeal, the executor asks that we reverse this award. The purpose of rehabilitative alimony is "to support an economically dependent spouse through a limited period of education and retraining." In re Marriage of O'Rourke, 547 N.W.2d 864, 866 (Iowa Ct. App. 1996) (citing In re Marriage of Francis, 442 N.W.2d 59, 63-64 (Iowa 1989)). The goal of rehabilitative alimony is self-sufficiency. Francis, 442 N.W.2d at 63-64. Sandra left the marriage at a substantial economic disadvantage, her health situation affected her economic prospects, and income from her recruiting business had recently declined. Under the circumstances, we conclude the amount and duration of the alimony award was equitable and we therefore affirm it.
In addition, the executor contends the district court should not have ordered the alimony obligation to continue beyond James' death. The general rule in Iowa is that alimony payments are presumed to terminate at the death of the payor. In re Roberts' Estate, 257 Iowa 1, 4, 131 N.W.2d 458, 460 (1964). However, Iowa common law establishes the district court's authority to order the continuation of alimony after the payor's death. In re Marriage of Debler, 459 N.W.2d 267, 270 (Iowa 1990); In re Estate of Jones, 434 N.W.2d 130, 131 (Iowa Ct. App. 1988) ("The decree must clearly provide for the continuation of alimony beyond the obligor's death."). In this case the decretal court's intention that alimony should continue beyond James' death was clearly expressed in a ruling on the parties' post-trial motions. On de novo review, we adopt as our own the district court's conclusion that James' alimony obligation should extend beyond his death. Accordingly, we affirm on this issue.
Attorney Fees.
Sandra requests an award of $5000 in appellate attorney fees. An award of attorney fees is not a matter of right, but rests within the court's discretion and the parties' financial position. In re Marriage of Kern, 408 N.W.2d 387, 390 (Iowa Ct. App. 1987). We are to consider the needs of the party making the request, the ability of the party to pay, and whether the party making the request was obligated to defend itself on appeal. In re Marriage of Castle, 312 N.W.2d 147, 150 (Iowa Ct. App. 1981). We award Sandra $2500 in attorney fees for this appeal.
Conclusion.
The parties' prenuptial agreement is unenforceable. We affirm the district court's division of the tax and credit card debts as well as its orders with respect to the award of alimony. James' executor shall pay $2500 toward Sandra's attorney fees in connection with this appeal.