Howell v. Landry
| Citation | 386 S.E.2d 610,96 N.C.App. 516 |
| Decision Date | 19 December 1989 |
| Docket Number | No. 8910DC217,8910DC217 |
| Court | Court of Appeal of North Carolina (US) |
| Parties | Steven G. HOWELL v. Mary F. LANDRY. |
Womble Carlyle Sandridge & Rice by Carole S. Gailor and Hoyt G. Tessener, Raleigh, for plaintiff-appellant.
Johnny S. Gaskins, Raleigh, for defendant-appellee.
Plaintiff husband appeals from an order declaring a premarital agreement invalid and dividing the property according to the Equitable Distribution Act. The husband and the defendant wife met in the summer of 1978 and began cohabiting in July or August, 1979. The wife has a Bachelor of the Arts degree in accounting and was employed by Gray Inc., the husband's business, as its corporate accountant and financial officer beginning sometime in 1979. In August 1979, she acquired about five percent of the outstanding shares of Gray Inc. stock.
The parties married on December 31, 1979 and separated on August 14, 1984. A divorce judgment was entered September 24, 1985.
Some disagreement exists as to the facts, but the trial court made the following findings of fact:
4. In early December, 1979, Landry and the defendant agreed to be married and agreed to marry in Las Vegas, Nevada at the end of the month because both of their divorces with their previous spouses would have been completed by that time and they were in love. Howell, at the beginning of December, 1979, indicated to Landry that he would like to enter into a premarital agreement. Landry indicated that she would be more than willing to look at an agreement but did not give any indication as to whether or not she would sign one. Howell never mentioned anything about any premarital agreement until the night before they were to get married.
5. In the meantime, both parties were telling their close friends that they would be getting married in Las Vegas at the end of December. Consequently, Landry made all of the arrangements to go to Las Vegas to get married on New Year's Day.
6. The next time that Howell mentioned anything about the premarital agreement was at approximately 8:00 p.m. on the evening before they were to go to Las Vegas the next day to get married.
7. Howell, unknown to Landry, had asked his lawyer to prepare a document entitled Premarital Agreement without consulting with Landry or asking her advice. The night when they got home from work, Howell in the kitchen, pulled two duplicate original documents from his suit pocket and showed them to Landry for the first time.
8. He told her that she was to sign the agreement and that if the agreement was not signed, they would not get married. Landry had no time to discuss the agreement with an attorney or anyone else because of the late time.
9. Landry had never seen a premarital agreement and did not know what should be in one. She told Howell that she felt that she should have an attorney of her own choosing look at it because the person who wrote it was Howell's personal attorney.
10. She indicated she did not want to sign the agreement but that because she very much wanted to get married and because of her financial involvement with the company, including lending the company money to survive and because the company was then her job, she, after making two minor adjustments to the agreement, signed it.
11. The agreement was not dated although it stated that it was made "on the date set out below." The agreement was not acknowledged by a Notary Public in accordance with NCGS 50-20(d), 52-10 or 52-10.1.
12. The document attempts to preclude the parties' right to receive alimony if otherwise eligible under the laws of North Carolina. The law of North Carolina is that alimony cannot be waived by a document in that such attempt by a party to force another to waive her rights is against public policy and as such any such attempt or document is therefore void.
13. The document in question does not contain a severability clause and, because the document contains a section that is void, the document as a whole is therefore also void.
14. The language of the document relating to separate property simply states that the parties would own their separate property. However, the language relating to separate property does not contain language in essence different than that found in the North Carolina Equitable Distribution Act, NCGS 50-20, et seq. As such, the court could still determine under the Equitable Distribution Act the separate and marital property of the parties and distribute the marital property as required by law notwithstanding the wording of the document.
15. The fair market value of the business in the form that it was at the time that the parties married on December 31, 1979, was zero. While the corporation did have assets of $500,000, it also had debts in the amount of $500,000. The total cash equity in the business was approximately $25,000, the amount of the money that Landry had put into the company.
16. Landry continued to take an active role in the company until the defendant fired her from her job as the financial controller of the company in January, 1984. She continued to work at home for the business until approximately July, 1984. The parties ultimately separated on or about August 15, 1984.
17. At all times during the course of marriage and for approximately one year prior to the marriage, Landry took an active role in the business as an employee and as a stockholder and as the wife of the major stockholder in the corporation. The business has appreciated in value from the net value of zero in December, 1979, to a net value of more than zero, the exact amount to be determined after further hearings.
18. Even if the business was separate property at the time of the marriage, Landry was actively involved with the business and is entitled to a marital share of the net value of the increase in the business worth from date of marriage to the date of separation.
The premarital agreement in pertinent part states:
It is therefore agreed:
1. Separate Property. After the solemnization of the marriage between the parties, each of them shall separately retain all rights in his or her own property, whether now owned or hereafter acquired, and each of them shall have the absolute and unrestricted right to dispose of such separate property, free from any claim that may be made by the other by reason of their marriage, and with the same effect as if no marriage had been consummated between them.
.... 4. Support Claims. In the event of a separation of the parties that would constitute grounds for divorce, and in the event of a divorce, each of the parties agrees to make no claim against the other for alimony, support or costs of any action to enforce such a claim.
The trial court's conclusions of law stated in pertinent part:
2. The document entitled Premarital Agreement was signed under undue influence and duress of the defendant Howell and is therefore void and of no effect.
3. The document entitled Premarital Agreement was not executed in accordance with the requirements of NCGS 50-20(d), 52-10 or 52-10.1 and is therefore not validly executed and is void and of no effect.
4. The document entitled Premarital Agreement was on its face to be effective "on the date set out below" and because the document was never dated, it is void and of no effect.
5. The document entitled Premarital Agreement contained a paragraph relating to waiver of alimony but did not contain a severability clause indicating that if one paragraph was void, the remaining paragraphs would not be void. As such because the alimony section is and was void as against public policy and there was no severability clause in the document, the entire document is void and of no effect.
6. The document entitled Premarital Agreement, even if it is valid, on its face does nothing more than recite the language of the North Carolina Equitable Distribution Act, NCGS 50-20, et seq., and, as such, the court may still determine what is separate and marital property under the law of North Carolina. Furthermore, even if the property in question as of the date of marriage was separate property, any increase in the value of the property in question may be marital property because of Landry being actively involved in the business of which she is entitled to an equitable share under the North Carolina law.
____________________
The issues presented are: I) whether the evidence supports the factual findings; II) whether the trial court erred in finding the premarital agreement invalid because of (A) the circumstances of its execution, (B) a lack of acknowledgment or (C) illegal alimony provisions; and III) whether the trial court erred in applying the Equitable Distribution Act because of its supposed similarity to the provisions of the premarital agreement.
The husband argues that the trial court's findings of fact are not supported by the evidence. We disagree. Fairchild Realty Co. v. Spiegel, 246 N.C. 458, 465, 98 S.E.2d 871, 876 (1957) (citations omitted). Although we may not question the facts found which were supported by the evidence, we are not bound by the conclusions or inferences drawn by the trial court. Heath v. Kresky Mfg. Co., 242 N.C. 215, 218, 87 S.E.2d 300, 302-03 (1955).
The husband assigns error to "finding of fact" No. 8 in which the trial court stated "Landry had no time to discuss the agreement with an attorney or anyone else because of...
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