Sanford v. Sanford

• Decision Date: 09 March 2005
• Docket Number: No. 23197., No. 23183, No. 23175
• Citation: 2005 SD 34,694 N.W.2d 283
• Parties: T. Denny SANFORD, Plaintiff and Appellee, v. Colleen Anderson SANFORD, Defendant and Appellant.
• Court: South Dakota Supreme Court

694 N.W.2d 283

2005 SD 34

T. Denny SANFORD, Plaintiff and Appellee, v. Colleen Anderson SANFORD, Defendant and Appellant.

Nos. 23175, .

Supreme Court of South Dakota.

Argued January 11, 2005.

Decided March 9, 2005.

Edwin E. Evans, Mark F. Marshall, Mitchell A. Peterson of Davenport, Evans, Hurwitz & Smith, Sioux Falls, for plaintiff and appellee.

Thomas J. Welk, Lisa Hansen Marso of Boyce, Greenfield, Pashby & Welk, Sioux Falls, for defendant and appellant.

GILBERTSON, Chief Justice.

[¶ 1.] T. Denny Sanford filed for divorce from his wife Colleen Anderson Sanford, and sought enforcement of a prenuptial agreement. The prenuptial agreement purported to waive all of Colleen's alimony rights and provided for a single payment structure for alimony, support and property provisions.

[¶ 2.] On competing motions for summary judgment, the circuit court held the single prenuptial agreement provision purporting to waive alimony was void and unenforceable. The circuit court also held the agreement was not unconscionable as to the property provisions, and that the void alimony and support provision could be severed from the remainder of the agreement. Colleen appealed contending the entire agreement was void as the alimony provision could not be severed from the property provisions. Colleen also contended that the entire agreement was unconscionable. Denny filed a notice of review claiming the entire document was valid and enforceable. We affirm.

FACTS AND PROCEDURE

[¶ 3.] Colleen Anderson Sanford and T. Denny Sanford met in Sioux Falls, South Dakota, in 1987 while Colleen was visiting family. At that time, Colleen was living in Indianapolis, Indiana, and was approximately thirty-six years of age. Colleen had previously been gainfully employed as a dental assistant for eleven years, and then had co-owned a home accessory and gift business for eight years. Denny was fifty-two years of age at the time the two met, and had been divorced from his first wife for approximately five years. The two began a romantic relationship and eventually Denny asked Colleen to live with him, and stop working in order to be available to travel with him. Colleen declined an entry-level position with a financial planning firm in Indianapolis and at Denny's request moved to Minneapolis, Minnesota, in order to further the relationship. The couple signed a nonmarital partnership agreement in 1990. After living together for approximately eight years, the two decided to marry. The marriage was the first for Colleen and the second marriage for Denny. Denny had two grown children from a prior marriage, while Colleen had no children. The parties had no children during the marriage.

[¶ 4.] The parties executed a prenuptial agreement dated August 15, 1995, that was drafted by Denny's attorney. Colleen was represented by her own attorney. Each party attached financial disclosures to the agreement that showed a net worth of approximately $55 million dollars for Denny and a net worth of approximately $127,500 for Colleen.

[¶ 5.] Denny's financial disclosure statement was prepared in June 1995 using April 1995 valuations. The statement was not shared with Colleen or her attorney until August 15, 1995, after the wedding invitations had been mailed and two receptions had been planned and scheduled. The agreement was signed the next day, on August 16, 1995.¹ In depositions, Denny admitted a bookkeeper prepared the financial disclosure statement. Colleen and Denny were married on September 23, 1995.

[¶ 6.] The prenuptial agreement provided in part:

Each party has had a full and satisfactory opportunity to inspect, reflect upon, and appraise the property of the other so that each is satisfied that he/she fully understands and appreciates the nature and value of the property of the other and the likelihood of its increasing or decreasing after the date hereof.

The agreement further provided that:

In the event of termination of the marriage between the parties, whether by annulment, divorce or otherwise, Denny agrees that he shall pay to Colleen the sum of One Hundred Forty-four Thousand and No/100 Dollars ($144,000.00) in thirty-six (36) equal installments of Four Thousand and No/100 Dollars ($4,000.00), payable on the first business day of the month following termination of the parties' marriage. If Colleen institutes an action for annulment or divorce and is awarded a decree of annulment or divorce from Denny, she shall be entitled to payments set forth above for a period not to exceed three (3) years from the date of commencement of such action. These payments shall cease in the event of Colleen's death or remarriage or cohabitation with an adult male to whom she is not married. The parties expressly agree that Colleen shall make no other claim against Denny in the event of dissolution of the marriage for any reason in the nature of support, alimony, property settlement or otherwise.

[¶ 7.] The agreement also provided that in the event that Denny should institute action for divorce or annulment and be awarded a decree of annulment or divorce from Colleen, he would be required to make the above payments to Colleen for no more than three years, and provide her with a condominium at Westward Ho Townhomes in Sioux Falls. In the event Colleen initiated such action, she would be entitled to remain in the marital residence following the grant of the annulment or dissolution for "a period of six (6) months plus one (1) year for each full year that the parties shall have been married prior to such action."

[¶ 8.] Denny filed a petition for divorce on January 28, 2003. Colleen filed an answer and counterclaim, alleging adultery and extreme cruelty. Denny moved for summary judgment on the issue of the validity and enforceability of the prenuptial agreement as to both the property settlement and spousal support provisions. Colleen moved for partial summary judgment, arguing the prenuptial agreement was invalid and unenforceable both as to property and spousal support.

[¶ 9.] The circuit court held the prenuptial agreement provision purporting to waive alimony was void and unenforceable. The circuit court also held the agreement was not unconscionable as to the property provisions, and that the property provisions could be severed from the invalid portions of the agreement.

[¶ 10.] Colleen and Denny both appeal. Their issues can be addressed as follows:

1. Whether a prenuptial agreement that provides, under its terms, a single payment structure for all support, alimony and property obligations is void and unenforceable as to both property and alimony.

2. Whether the circuit court erred when it concluded the property settlement portion of the prenuptial agreement was not unconscionable.

STANDARD OF REVIEW

[¶ 11.] Summary judgment is authorized when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." SDCL 15-6-56(c). We will affirm the circuit court only when there are no genuine issues of material fact and the legal questions have been correctly decided. Titus v. Chapman, 2004 SD 106, ¶ 13, 687 N.W.2d 918, 923 (citing Holzer v. Dakota Speedway, 2000 SD 65, ¶ 8, 610 N.W.2d 787, 791) (additional citations omitted). All reasonable inferences drawn are viewed in favor of the non-moving party. Id. (citing Morgan v. Baldwin, 450 N.W.2d 783, 785 (S.D.1990)). The moving party has the burden to clearly show the absence of any genuine issue of material fact and entitlement to judgment as a matter of law. Id.

[¶ 12.] The construction and interpretation of a contract is a question of law. Prudential Kahler Realtors v. Schmitendorf, 2003 SD 148, ¶ 7, 673 N.W.2d 663, 665 (citing Kimball Investment Land, Ltd. v. Chmela, 2000 SD 6, ¶ 10, 604 N.W.2d 289, 292) (citations omitted). Likewise, the construction and interpretation of a statute is a question of law. Zoss v. Schaefers, 1999 SD 105, ¶ 6, 598 N.W.2d 550, 552 (citing Satellite Cable Srvs. v. Northern Electric, 1998 SD 67, ¶ 5, 581 N.W.2d 478, 480). We review question of law under the de novo standard. Therkildsen v. Fisher Beverage, 1996 SD 39, ¶ 8, 545 N.W.2d 834, 836 (citing Stang v. Meade Sch. Dist., 526 N.W.2d 496, 498 (S.D.1995)).

[¶ 13.] Statutory construction is used to discover the true intent of the legislature in enacting laws, which is ascertained primarily from the language employed in the statute. State v. Myrl & Roy's Paving, Inc., 2004 SD 98, ¶ 6, 686 N.W.2d 651, 653 (citing Martinmaas v. Engelmann, 2000 SD 85, ¶ 49, 612 N.W.2d 600, 611). We give words their plain meaning and effect, and read statutes as a whole, as well as enactments relating to the same subject. State v. I-90 Truck Haven Service, Inc., 2003 SD 51, ¶ 3, 662 N.W.2d 288, 290 (citing Martinmaas, 2000 SD 85, ¶ 49, 612 N.W.2d at 611) (additional citations omitted).

ANALYSIS AND DECISION

[¶ 14.] 1. Whether a prenuptial agreement that provides, under its terms, a single payment structure for all support, alimony and property obligations is void and unenforceable as to both property and alimony.

[¶ 15.] This Court previously held in Connolly v. Connolly, 270 N.W.2d 44 (S.D.1978), that provisions in a prenuptial agreement purporting to limit alimony obligations are against public policy and therefore not enforceable. In that case, the parties entered into a prenuptial agreement that purported to relinquish and release the other "from any and all claims of support and of any and all interest in the property of the other" except as provided by the agreement. Id. at 45. The agreement provided one single payment vehicle in the event of a divorce or legal separation: an annuity for the benefit of the wife in an amount designed to yield income equal to the benefits the wife would have received from her widow's pension, which she forfeited by...