Marriage of Cohn, In re, 1863-III

• Decision Date: 15 September 1977
• Docket Number: No. 1863-III,1863-III
• Citation: 569 P.2d 79,18 Wn.App. 502
• Court: Washington Court of Appeals
• Parties: In re the MARRIAGE OF Paul D. COHN, Respondent, and Debbie D. Cohn, Appellant.

Page 502

18 Wn.App. 502

569 P.2d 79

In re the MARRIAGE OF Paul D. COHN, Respondent and Debbie D. Cohn, Appellant.

No. 1863-III.

Court of Appeals of Washington, Division 3.

Sept. 15, 1977.

As Modified Oct. 12, 1977.

Phelps R. Gose, Sherwood, Tugman, Gose & Reser, Walla Walla, for appellant.

Diehl R. Rettig, Loney, Westland, Raekes, Rettig & Sonderman, Kennewick, for respondent.

McINTURFF, Judge.

This is an appeal from an order denying appellant Debbie Cohn's motion to vacate a decree of dissolution as it pertains to the division of property. The case turns upon the trial court's failure to set aside both an antenuptial agreement dated January 27, 1972, and a property settlement agreement entered into at the time of the dissolution. Both agreements are attacked on the grounds that the appellant did not sign them on independent advice and with full knowledge of her rights, and that a full disclosure had not been made to her of the amount, character and value of the property involved.

The trial court found that prior to January 27, 1972, Debbie Cohn and Paul Cohn talked about marriage and the execution of an antenuptial agreement; that Paul Cohn advised Debbie Cohn that his property had a total value of approximately $195,000 and she advised him of her potential inheritance from her mother of an interest in a farm. He had his attorney in Washington prepare the agreement which was signed by both parties in California. Some of the provisions of the agreement are set out in the margin below. ¹ The court found that Debbie Cohn did not consult with an attorney before signing the agreement and that no one advised her to do so. At the time she executed the agreement, she was 21 years old, a high school graduate and had completed approximately two-thirds of her college course leading to a bachelor's degree. The trial court found that at the time she signed the agreement she was an adult possessed of average or better mental faculties, not acting under duress, undue influence, or under pressure of Paul Cohn. The court further found that Paul Cohn made a full disclosure to Debbie Cohn of his assets and other material matters. The trial court in arriving at these findings, considered and found that Debbie wanted to marry the "man" and didn't care if he was worth $1.00 or $10 million.

In the fall of 1974 the parties decided to dissolve their marriage, and a list of their community and separate property was prepared. The trial court found that the parties decided that the community property should be divided and that Paul Cohn would take his separate estate as sole and separate property. The trial court further found that Debbie Cohn knew the value of her husband's separate estate at the time the parties reached their agreement, and that since she had worked within the juvenile court with an attorney and since the same attorney had prepared a real estate closing for the parties, they decided to have him handle their dissolution. When they went to his office, he asked whether each was going to have an attorney, to which they responded negatively; and they presented him with the list of all property. The trial court found that the parties decided that Paul Cohn would receive the family home and she would get $2,500 representing one-half of the community equity therein. The balance of the community property was divided in half, and Paul Cohn kept his separate property. The trial court further found that at the time she signed the property settlement agreement, she was aware of Paul Cohn's estate and that at that time she was not acting under duress, undue influence or pressure from him or anyone and was of sound mind and memory. The court found that in all regards Paul Cohn acted in good faith towards Debbie Cohn.

Debbie Cohn assigns error to those findings of fact as well as others, and contends the trial court erred in concluding as a matter of law that Paul Cohn met his burden of showing good faith in his dealings with Debbie Cohn in that he fully disclosed his assets to her and did not make any misrepresentations or practice any fraud upon her.

There is no argument between the parties that the burden of proving good faith in a transaction between a husband and wife is upon the party asserting the good faith in this case Mr. Cohn. ² We agree with the trial court that Mr. Cohn has met his burden, and we affirm the order denying Debbie Cohn's motion for the vacation of the decree of dissolution as it pertains to the division of property. Since the assertions of bad faith and the lack of independent counsel surround the execution of both the antenuptial and property settlement agreements, we analyze both in light of applicable case law. The rules of Friedlander v. Friedlander, 80 Wash.2d 293, 494 P.2d 208 (1972), and Hamlin v. Merlino, 44 Wash.2d 851, 272 P.2d 125 (1954), apply to the agreements in question. As the court said in In re Marriage of Hadley, 88 Wash.2d 649, 654, 565 P.2d 790, 793 (1977):

Although these cases involved prenuptial agreements and the trial court characterized the agreement here as neither prenuptial, nor post-nuptial, nor made in contemplation of dissolution but rather "analogous to a community property agreement," we believe the principles set forth in Friedlander and Hamlin are applicable here. The tests are: (1) whether full disclosure has been made by respondent of the amount, character and value of the property involved, and (2) whether the agreement was entered into fully and voluntarily on independent advice and with full knowledge by the spouse of her rights.

First, the trial court found that both agreements were voluntarily and knowingly signed. There is substantial evidence to support those findings. The antenuptial agreement was signed a few minutes prior to the time the parties signed their application for marriage license. However, there is evidence that the parties discussed the agreement at least several months prior to the time it was prepared. Although Mrs. Cohn testified that she and Paul Cohn had not discussed the matter, the face of the agreement belies her testimony. It includes reference to a potential inheritance of hers in a farm belonging to her mother, and there is no evidence that Mr. Cohn's attorney would have had that knowledge had it not been for the discussion between the parties. Likewise, the evidence surrounding the execution of the property settlement agreement confirms the trial court's finding that it was freely and voluntarily entered into. Although Mrs. Cohn testified that she felt rushed into signing the agreement, she further testified that she did not at any point indicate to the lawyer who had drafted it that she felt she was being rushed or that she was signing anything that she did not fully intend to sign. Ironically, both Mr. and Mrs. Cohn signed the agreement, and Mr. Cohn signed the petition for dissolution, at the attorney's home on their way to see a show and have dinner in Walla Walla. Mr. Cohn testified it was an amicable settlement, and as the trial court noted there was nothing to indicate that the parties were in anything but agreement.

On the issue of whether Debbie Cohn was aware of the amount, character and value of the property involved, the testimony is in direct conflict. On one hand, Mr. Cohn testified that Debbie was fully aware of the extent of his property; on the other hand, she testified that she was never aware, including at the time of the hearing on her motion, of the value of his estate. The requirement of Friedlander that the spouse have full knowledge of the value of her interest in the husband's property is necessary to insure the wife will not be prejudiced by the lack of information, but can intelligently determine whether she desires to enter into the contract. To be avoided is the procurement of the contract "by deliberate concealment of the amount and value of the husband's property."

The Friedlander court did not require that the spouse know the exact financial status of the other spouse. ³ In fact, at one point there is an indication of circumstantial evidence that she reasonably should have known appears to be sufficient. We note that this was a critical point of departure between the majority and minority opinions in Hadley. There the majority found sufficient knowledge by Mrs. Hadley of the amount, character and value of the property because prior to signing the agreements she traveled to each of the major businesses and was kept informed of the developments by her husband. Furthermore, the majority found that she had engaged another lawyer to examine the agreements but that he did not render advice to her because he needed further information which she failed to provide. ⁴

In this case there is sufficient evidence to conclude that while Debbie Cohn...