Hardee v. Hardee

• Decision Date: 11 August 2003
• Docket Number: No. 25695.,25695.
• Citation: 585 S.E.2d 501,355 S.C. 382
• Parties: Mary F. HARDEE, Respondent/Petitioner, v. Jerry N. HARDEE and Hardee Construction Company, Inc., Petitioners/Respondents.
• Court: South Carolina Supreme Court

355 S.C. 382

585 S.E.2d 501

Mary F. HARDEE, Respondent/Petitioner, v. Jerry N. HARDEE and Hardee Construction Company, Inc., Petitioners/Respondents.

No. 25695.

Supreme Court of South Carolina.

Heard June 24, 2003.

Decided August 11, 2003.

Rehearing Denied September 10, 2003.

James T. McLaren and C. Dixon Lee, III, of McLaren and Lee, and Jan L. Warner, all of Columbia, for Respondent-Petitioner.

Harry C. Wilson, Jr. of Lee, Erter, Wilson, James, Holler, and Smith, LLC, of Sumter, for Petitioners-Respondents.

JUSTICE WALLER:

We granted a writ of certiorari to review the Court of Appeals' opinion reported at 348 S.C. 84, 558 S.E.2d 264 (2001). We affirm as modified.

FACTS

Jerry Hardee (Husband) and Mary Hardee (Wife) met in 1986, while Wife was working as officer manager for the law firm which was handling Husband's second divorce. Both Husband and Wife had children from prior marriages. Wife moved into Husband's home in April 1987, and they lived together until December 24, 1988, when Husband proposed. They planned a March 18, 1989 wedding day. In early February 1989, Husband presented Wife with a prenuptial agreement drafted by his attorney (Miles). Wife showed the agreement to her employer/attorney (Young), who advised her not to sign it. Although Wife was upset about the agreement, she signed it on February 22, 1989. The parties were married on March 18, 1989.

The prenuptial agreement noted that Wife, age 41 at the time, had diabetes and sponge kidneys. It also provided, inter alia:

1. That all properties of any kind or nature, real, personal or mixed, wheresoever the same may be located, which belong to each party, shall be and forever remain the personal estate of the said party, including all interest, rents, and properties which may accrue therefrom unless otherwise so stated in this Agreement.

4. That each party, in the event of separation or divorce, shall have no right against the other by way of claims for support, alimony, attorney's fees, cost, or division of property, except as specifically stated hereinafter.

7. It is specifically understood and agreed that should a separation or divorce occur between the parties, each of the parties would maintain all of their property as if the marriage had never occurred and each of the parties will have no interest whatsoever in the property of the other except as hereinafter provided.

9. The provisions contained herein shall in no way affect the property, whether real, personal or mixed which shall be acquired by the parties, whether titled separately or jointly, subsequent to the date of this Agreement.

10. ... Each party acknowledges that they shall have no right against the other by way of claim for support, alimony, attorney fees, costs or division of property, except as stated within this agreement. (Emphasis added).

In 1995, Wife discovered Husband was having an affair with another woman. As a result, Husband left the marital home. Thereafter, Wife instituted this action seeking a divorce on grounds of adultery, habitual drunkenness, and physical cruelty. She sought alimony, spousal support, equitable distribution of marital property, and attorney's fees. The family court granted Wife a divorce on the ground of adultery. The family court also ruled the waivers of alimony, spousal support and attorney's fees were contrary to public policy and void; it further held the agreement did not bar equitable division of property acquired during the marriage. The court also found that there had been a substantial and material change in circumstances since the execution of the agreement inasmuch as Wife was, at the time of the final hearing, totally disabled and unable to support herself.¹ The family court awarded Wife permanent periodic alimony of $4,250 per month and ruled that property acquired by the parties during the marriage be divided with Husband receiving 70% of the assets and Wife receiving 30%. Lastly, the family court awarded Wife $85,000 in attorney fees and $15,000 in accounting fees and costs.

The Court of Appeals affirmed in part and reversed in part. 348 S.C. 84, 558 S.E.2d 264 (2001). The Court upheld the family court's determination that the prenuptial agreement did not bar the equitable division of property acquired by the parties during the marriage. However, it held the family court erred in finding the waivers of alimony, support, and attorney fees were void and unconscionable. Both parties appeal.

ISSUES

1. Did the Court of Appeals err in upholding the family court's determination that the prenuptial agreement did not bar equitable distribution of property acquired during the marriage? (Husband's Appeal).

2. Did the Court of Appeals err in holding that the prenuptial agreement's provisions relating to alimony, support, and attorney's fees were not unconscionable or contrary to public policy? (Wife's Appeal).

1. EQUITABLE DISTRIBUTION

Husband argues the Court of Appeals erred in holding the prenuptial agreement allowed for equitable distribution of assets acquired by the parties during the marriage. We disagree.² As noted previously, paragraph 9 of the agreement provides:

9. The provisions contained herein shall in no way affect the property, whether real, personal or mixed which shall be acquired by the parties, whether titled separately or jointly, subsequent to the date of this Agreement.

(Emphasis added). We agree with the Court of Appeals that this provision patently and unambiguously allows Wife equitable distribution of any and all property acquired by the parties during the marriage, whether titled in Husband's name, Wife's name, or both.

When a contract is unambiguous, clear, and explicit, it must be construed according to the terms the parties have used. B.L.G. Enterprises, Inc. v. First Financial Ins. Co., 334 S.C. 529, 514 S.E.2d 327 (1999). The judicial function of a court of law is to enforce a contract as made by the parties, and not to rewrite or to distort, under the guise of judicial construction, contracts, the terms of which are plain and unambiguous. S.S. Newell & Co. v. American Mut. Liab. Ins. Co., 199 S.C. 325, 19 S.E.2d 463 (1942). Accordingly, we affirm the Court of Appeals' ruling concerning the equitable distribution of property acquired during the marriage.

2. ALIMONY, SUPPORT & ATTORNEY'S FEES

The issue we must decide is whether a prenuptial agreement purporting to waive alimony, support, and attorney's fees is void and unenforceable as against the public policy of this state.

Recent case law of this Court supports Husband's contention that parties are free to contractually alter the obligations which would otherwise attach to marriage. In Stork v. First Nat'l Bank of South Carolina, 281 S.C. 515, 516, 316 S.E.2d 400, 401 (1984), this Court held that antenuptial agreements "will be enforced if made voluntarily and in good faith and if fair and equitable.... Such contracts are not opposed to public policy but are highly beneficial to serving the best interest of the marriage relationship." Similarly, in Moseley v. Mosier, 279 S.C. 348, 306 S.E.2d 624 (1983), we addressed a family court's jurisdiction over a separation agreement which had not been merged into the parties' divorce decree. This Court directly acknowledged that, although subject to family court approval, that the parties may contract concerning their property settlement, and alimony, and that "they may agree to any terms they wish as long as the court deems the contract to have been entered fairly, voluntarily and reasonably." 279 S.C. at 353, 306 S.E.2d at 627. More recently, in Gilley v. Gilley, 327 S.C. 8, 488 S.E.2d 310 (1997), the husband brought an action for an order of separate maintenance and support, equitable distribution, and attorney's fees. Although the validity of the prenuptial agreement was not at issue in Gilley, this Court affirmed the family court's finding that husband's action did not belong in family court since the prenuptial agreement provided neither party could claim alimony or separate maintenance.

As noted by the Court of Appeals in this case, "[t]he current trend and majority rule allows parties to prospectively contract to limit or eliminate spousal support." 348 S.C. at 94, 558 S.E.2d at 269, citing Pendleton v. Fireman, 24 Cal.4th 39, 99 Cal.Rptr.2d 278, 5 P.3d 839, 845-46 (2000); Allison A. Marston, Planning for Love: The Politics of Premarital Agreements, 49 Stan. L. Rev. 887, 897-99 (1997). As noted in Richard A. Lord, 5 Williston on Contracts § 11:8 (4th ed.) (May 2003):

In the past two decades ... the courts have reconsidered... public policy in light of societal changes, and today, premarital agreements, so long as they do not promote divorce or otherwise offend public policy, are generally favored as conducive to the welfare of the parties and the marriage relationship as they tend to prevent strife, secure peace, and adjust, settle, and generally dispose of rights in property.

Accord Cary v. Cary, 937 S.W.2d 777, 782 (Tenn.1996) (declaring agreements waiving or limiting alimony enforceable, "so long as the antenuptial agreement was entered into freely and knowledgeably, with adequate disclosure, and without undue influence or overreaching"); Marriage as Contract and Marriage as Partnership: The Future of Antenuptial Agreement Law, 116 Harv. L. Rev. 2075 (May 2003) (noting that states have shifted from holding antenuptial agreements per se invalid as contrary to public policy to holding them judicially enforceable). We concur with the majority of jurisdictions which hold that prenuptial agreements waiving alimony, support and attorney's fees are not per se unconscionable, nor are they contrary to the public policy of this state.³ The Court of Appeals adopted the following test, to determine whether a prenuptial agreement should be enforced: "(1) Was the agreement obtained through fraud, duress, or mistake, or through misrepresentation or nondisclosure of material facts? (2) Is...