Casto v. Casto

• Decision Date: 04 June 1987
• Docket Number: No. 66325,66325
• Citation: 508 So.2d 330,12 Fla. L. Weekly 279
• Parties: 12 Fla. L. Weekly 279 James D. CASTO, Petitioner, v. Donna L. CASTO, Respondent.
• Court: Florida Supreme Court

Page 330

508 So.2d 330

12 Fla. L. Weekly 279

James D. CASTO, Petitioner, v. Donna L. CASTO, Respondent.

No. 66325.

Supreme Court of Florida.

June 4, 1987.

Rehearing Withdrawn June 30, 1987.

DuBose Ausley, Timothy B. Elliott and Emily S. Waugh of Ausley, McMullen, McGehee, Carothers & Proctor, and Talbot D'Alemberte, Tallahassee, for petitioner.

S. Robert Zimmerman, Pompano Beach, Edna L. Caruso, West Palm Beach, and Joseph C. Jacobs of Ervin, Varn, Jacobs Odom & Kitchen, Tallahassee, for respondent.

OVERTON, Justice.

James D. Casto, the husband in a dissolution proceeding, petitions for review of Casto v. Casto, 458 So.2d 290 (Fla. 4th DCA 1982), affirming the trial court's setting aside of a property settlement agreement. We find apparent conflict with Cowen v. Cowen, 95 So.2d 584 (Fla.1957), and Bubenik v. Bubenik, 392 So.2d 943 (Fla. 3d DCA 1980). We have jurisdiction, article V, section 3(b)(3), Florida Constitution, and address the requirements of postnuptial agreements in dissolution proceedings. In approving the district court decision, we reaffirm our prior decisions that competency of counsel is not a ground to vacate postnuptial agreements.

Petitioner and respondent were married in 1964. The marriage was dissolved in 1966, and the parties remarried in 1967. During the remarriage, the husband successfully developed shopping centers. The wife was not employed outside the home, and no children were born of the marriage. In 1977, the parties signed a postnuptial agreement. The agreement provided that: (1) the wife would receive the parties' Fort Lauderdale home and $100,000; (2) the husband would make the mortgage payments on the home for one year and pay for seawall repairs up to $5,000; (3) the wife would receive other incidental benefits, including health insurance, club memberships, and credit card memberships; (4) each party waived any right to alimony, support, or further distributions of property; (5) each party would continue ownership of any separately held assets; and (6) each party would pay his or her attorney fees in any forthcoming dissolution proceeding.

Approximately one year after the agreement's execution, the husband filed a dissolution petition and requested approval of the postnuptial agreement. The wife answered alleging invalidity of the agreement. She claimed that she executed the document because of duress and overreaching conduct, and that she was unfamiliar with the husband's assets and income at the time of the agreement. She counterclaimed for permanent and lump sum alimony, attorney's fees, and costs.

The record reflects the following evidentiary facts. First, the wife had some knowledge of dissolution proceedings, having been married three times prior to the two marriages to her husband in the instant case. Second, prior to execution of the agreement, she prepared a written list of her husband's properties and knew generally of her husband's business interests in shopping centers. Third, before signing the agreement, she discussed it with two attorneys. The wife provided the first attorney with a written list of the husband's assets, and, after reviewing the information, the attorney advised the wife not to sign the agreement. The second attorney counseled the wife on the form--not the content--of the agreement. Fourth, the husband did not advise the wife on the value of his assets. Fifth, the wife testified the husband told her that, unless she signed the agreement, she would lose the Fort Lauderdale house and furniture. Sixth, medical experts testified that the wife was deeply depressed the week before signing the agreement.

The trial court invalidated the separation agreement, stating:

The Court finds ... that the Separation and Property Settlement Agreement ... is invalid and is hereby set aside for the following reasons:

(a) That the Wife was not adequately advised of the Husband's assets and income prior to or at the time she signed the Separation and Property Settlement Agreement and had no independent knowledge of the extent of the Husband's assets and income.

(b) That the Wife did not have competent assistance of counsel at the time of the signing of said Separation and Property Settlement Agreement.

(c) That the Separation and Property Settlement Agreement ... is basically unfair and inequitable to the Wife.

The trial court awarded the wife lump sum alimony of $1.5 million to be paid in installments over five years, with credits for the amounts already paid under the separation agreement. The district court affirmed the final judgment, holding:

There is competent evidence to support the appellant's contentions that the wife entered into the agreement freely and voluntarily, with independent advice, and with a general and approximate knowledge of the extent of the husband's net worth. However, there is also substantial competent evidence to support the trial judge's findings on these scores and, thus, for us to reverse this judgment on that basis would be the rankest form of appellate substitution of judgment.

458 So.2d at 292. In its decision, the district court quoted the above trial court findings. Id. at 291-92.

In this opinion, we will attempt to clarify the grounds on which a trial court may vacate or modify a postnuptial agreement in a final dissolution proceeding. Presently, some district court judges disagree on the principles for enforcing these agreements. See Hahn v. Hahn, 465 So.2d 1352 (Fla. 5th DCA 1985); O'Connor v. O'Connor, 435 So.2d 344 (Fla. 1st DCA 1983).

Postnuptial agreements regarding alimony and marital property are properly enforceable in dissolution proceedings. There are, however, two separate grounds by which either spouse may challenge such an agreement and have it vacated or modified.

First, a spouse may set aside or modify an agreement by establishing that it was reached under fraud, deceit, duress, coercion, misrepresentation, or overreaching. Masilotti v. Masilotti, 158 Fla. 663, 29 So.2d 872 (1947); Hahn; O'Connor. See also Del Vecchio v. Del Vecchio, 143 So.2d 17 (Fla.1962).

The second ground to vacate a settlement agreement contains multiple elements. Initially, the challenging spouse must establish that the agreement makes an unfair or unreasonable provision for that spouse, given the circumstances of the parties. Del Vecchio, 143 So.2d at 20. To establish that an agreement is unreasonable, the challenging spouse must present evidence of the parties' relative situations, including their respective ages, health, education, and financial status. With this basic information, a trial court may determine that the agreement, on its face, does not adequately provide for the challenging spouse and, consequently, is unreasonable. In making this determination, the trial court must find that the agreement is "disproportionate to the means" of the defending spouse. Id. This finding requires some evidence in the record to establish a defending spouse's financial means. Additional evidence other than the basic financial information may be necessary to establish the unreasonableness of the agreement.

Once the claiming spouse establishes that the agreement is unreasonable, a presumption arises that there was either concealment by the defending spouse or a presumed lack of knowledge by the challenging spouse of the defending spouse's finances at the time the agreement was reached. The burden then shifts to the defending spouse, who may rebut these presumptions by showing...