Gross v. Gross

• Decision Date: 13 June 1984
• Docket Number: No. 83-564,83-564
• Citation: 11 Ohio St.3d 99,464 N.E.2d 500,11 OBR 400
• Parties: , 53 A.L.R.4th 139, 11 O.B.R. 400 GROSS, Appellee, v. GROSS, Appellant.
• Court: Ohio Supreme Court

Page 99

11 Ohio St.3d 99

464 N.E.2d 500, 53 A.L.R.4th 139, 11 O.B.R. 400

GROSS, Appellee, v. GROSS, Appellant.

No. 83-564.

Supreme Court of Ohio.

June 13, 1984.

Syllabus by the Court

1. Antenuptial agreements containing provisions for disposition of property and setting forth amounts to be paid as sustenance alimony upon a subsequent divorce of the parties are not contrary to public policy.

2. Such agreements are valid and enforceable (1) if they have been entered into freely without fraud, duress, coercion, or overreaching; (2) if there was full disclosure, or full knowledge and understanding of the nature, value and extent of the prospective spouse's property; and (3) if the terms do not promote or encourage divorce or profiteering by divorce.

3. Such agreements, if otherwise found to be valid, are not abrogated as to either party for marital misconduct after marriage, in the absence of an express provision in the agreement to the contrary.

4. In a judicial review of such an agreement, upon motion for modification, at any subsequent separation or divorce proceeding of the parties, provisions setting forth maintenance or sustenance alimony must meet the additional test of conscionability at the time of the divorce or separation.

This is an appeal from the court of appeals which reversed the Court of Common Pleas of Franklin County, Division of Domestic Relations, and found that the trial court erred in holding that the antenuptial agreement between the parties was valid and binding.

This case presents significantly important questions previously unanswered by this court, although decided by the highest courts of other jurisdictions. The queries submitted for our determination here are threefold. The first is whether antenuptial agreements which concern divorce or separation and subsequently provide for the disposition or division of property and for sustenance alimony, are invalid as being repugnant to public policy upon the basis of promoting marital discord.

If such agreements are generally held not to be void per se, the second issue is whether they may be enforced at the time of divorce by the party found to be at fault within the marriage. Third, if such agreements are held to be lawful and enforceable even by a party found to be at fault in a divorce, may a trial court modify the division of property between the parties or award sustenance alimony in a different manner than set forth in the antenuptial agreement.

The facts of this case giving rise to the aforestated issues are as follows. In September 1968, Thomas R. Gross, appellant herein, was thirty-two years of age and had previously been married. Appellant had two sons by his prior marriage. Gross was at such time, and still is, part owner of a number of Pepsi-Cola bottling company franchises. Ida Jane Gross, appellee herein, was twenty-seven years of age in September 1968, and had two children by a previous marriage. Mrs. Gross was divorced from her former husband in 1964 and went to work shortly thereafter at the Columbus Pepsi-Cola bottling company as secretary for the marketing manager.

It appears that in time the parties herein became socially involved in addition to their business relationship. Romance blossomed and the parties discussed marriage. One element of these discussions involved a subject often approached by those who have previously been married and are again considering matrimony, i.e., their respective rights to any division of property and support allowances upon a future divorce between the parties. From the record, it is apparent that some of the considerations involved in the discussion and drafting of the agreement herein were that the appellant was a principal in a successful family business, that he had two sons from a former marriage, and that he wanted his sons to follow in control of the family business. Accordingly, the appellant had his attorney draw an agreement and submit it to appellee and her legal counsel. It appears that a number of changes were made in the initial provisions of the instrument occasioned by the advice of appellee's counsel (not the same as counsel herein). It seems, however, that appellee's counsel advised her not to sign the final draft, but that appellee opted to sign the agreement. The contract was executed by the parties on September 4, 1968.

The agreement, which was in consideration of the marriage between the parties and their mutual promises, provided, in part, at Section 13, that:

"Jane shall after the consummation of the marriage between the parties hereto, in the event of the separation or divorce of the parties be entitled to receive as alimony or separate maintenance the maximum sum of $200.00 per month for a period of 10 years, from the time of such separation (either by legal action or by actually living apart) or from the date of a divorce action being filed, if a court of competent jurisdiction will award Jane any alimony. This shall be the maximum amount Jane shall be entitled to receive under any and all circumstances and conditions, and Jane shall not be entitled to any division of the property of Thomas nor to any expense money or counsel fees in connection with any separation or divorce, and Jane agrees to waive any and all such rights or claims. Further, Jane specifically releases all her rights of dower in the property of Thomas."

Additional provisions relating to a possible divorce between the parties were the following:

"16. In the event of a divorce the personal residence of the parties shall be sold and the equity therein realized, shall be divided equally between the parties.

"17. In the event of a divorce the personal property and possessions of the parties located in their residence shall be the property of Jane with the exception of Thomas' clothing, sports equipment and other purely personal items. Jane shall be entitled to the ownership of one automobile out of Thomas' property."

The antenuptial agreement also contained provisions relative to payments that would be disbursed from Thomas' estate to Ida Jane. Such provisions provided for the establishment of a trust in the principal sum of $200,000, or twenty percent of his net estate, whichever was lesser. The income derived from the trust was to be paid to Mrs. Gross for life and upon her death to provide education for her children by her previous marriage.

Attached, and made a part of the antenuptial agreement, was a statement of the assets owned by each party. At the date of the agreement, most of appellant's assets were his interests in the family Pepsi-Cola bottling franchises located in a number of cities. There were additional stocks in other companies, as well as an interest in a real estate partnership. The value of Mr. Gross' assets at the time was listed in the proximity of $550,000. The appellee disclosed assets of household goods and effects, an automobile, and $1,000 cash for what is alleged to be a total of approximately $5,000.

The parties were married in September 1968. A son was born of the marriage in 1970. The marriage lasted nearly fourteen years when the appellant filed for divorce. However, this action was dismissed by the appellant. Subsequently, the appellee filed for a divorce which was granted on grounds of extreme cruelty being found attributable to appellant. At trial there was evidence adduced that Mr. Gross had increased his total assets to some $8,000,000 with a net equity of $6,000,000. His gross income for the year 1980 was approximately $250,000. The trial court found the antenuptial agreement to be valid and enforceable in that it had been fairly entered into since there was no evidence of fraud, duress, or misrepresentation, and there had been a full disclosure of assets. The court entered an order in accordance with the terms of the agreement.

The court of appeals, by way of a majority opinion, opted for the position that antenuptial agreements were not void per se, but that such contracts were not enforceable by a party found to be at fault in a divorce proceeding. The court ruled that such fault was a breach of the terms of the antenuptial agreement. Thus, the court of appeals held that inasmuch as the divorce had been granted upon the trial court's finding that Mr. Gross had been guilty of gross neglect of duty, he had thereby breached the antenuptial agreement and could not enforce its provisions against Mrs. Gross. Mr. Gross subsequently appealed the decision.

The cause is now before this court pursuant to the allowance of a motion to certify the record.

Brownfield, Bowen & Bally, C. William Brownfield and William H. Arnold, Columbus, for appellee.

Murphey, Young & Smith Co., L.P.A., Alan L. Briggs, Geoffry V. Case and George W. Gross, Columbus, for appellant.

HOLMES, Judge.

An antenuptial agreement is a contract entered into between a man and a woman in contemplation, and in consideration, of their future marriage whereby the property rights and economic interests of either the prospective wife or husband, or both, are determined and set forth in such instrument. These agreements may include: provisions concerning the disposition or devolution of property and payments for sustenance upon the death of one of the spouses; provisions for the distribution of property and the sustenance or maintenance of one or other of the spouses, most usually the wife, upon a separation or divorce; or a combination of all of these concerns between the parties. ¹

Historically, there has been a notable contrast between the views taken by courts in this country of provisions within antenuptial agreements setting forth the division of property and other rights and interests upon the death of one of the parties, contrasted to provisions in such agreements providing for, or affecting, property rights or conjugal and marital rights in the event of divorce. ² In the majority of jurisdictions, prospective spouses could contract as to the division of their...