Spector v. Spector

• Decision Date: 30 January 1975
• Docket Number: No. 1,CA-CIV,1
• Citation: 23 Ariz.App. 131,531 P.2d 176
• Parties: Dorothy Greenberg SPECTOR, Appellant, v. Albert B. SPECTOR, Appellee. 2116.
• Court: Arizona Court of Appeals

Page 176

531 P.2d 176

23 Ariz.App. 131

Dorothy Greenberg SPECTOR, Appellant, v. Albert B. SPECTOR, Appellee.

No. 1 CA-CIV 2116.

Court of Appeals of Arizona, Division 1, Department C.

Jan. 30, 1975.

Rehearing Denied March 6, 1975.

Review Denied April 22, 1975.

Shimmel, Hill, Bishop & Gruender, P.C. by James W. Hill, Robert C. Hackett, Phoenix, for appellant

Burns, Ferrin & Ehrenreich by F. Britton Burns, Phoenix, for appellee.

OPINION

FROEB, Judge.

Dorothy Greenberg and Albert B. Spector were married January 15, 1965. Each had been previously married. At the time of this marriage, Dorothy Greenberg was 45 years old and had moved to Arizona from Ohio, following the death of her first husband. She had a married daughter and four grandchildren. Albert Spector was 49 years old and had lived in Phoenix, Arizona, for many years, pursuing both the practice of law as well as making and managing investments in various properties. He had been divorced from his previous wife by whom he had three children. All of his children were themselves married. After almost seven years of marriage, Dorothy Greenberg and Albert Spector separated and thereafter were divorced on September 17, 1971. The key issues in the case are financial; there is no question on appeal concerning the propriety of the divorce itself.

Appellant Dorothy Greenberg ('Greenberg') contends that (1) the antenupital agreement between her and appellee Albert B. Spector ('Spector') is invalid and should not be enforced; (2) the trial court erred in not following the findings of the jury; (3) certain property was partially community property of the parties and not wholly the separate property of Spector; and (4) the trial court's order relating to alimony, division of property, and attorneys' fees was inequitable.

The trial of the case began on August 30, 1971, before a jury, and required six days to complete. There were many exhibits. It was vigorously contested. At the conclusion, eleven interrogatories were submitted to and answered by the jury. Thereafter, the court heard and considered objections to proposed findings of fact and conclusions of law, entered its own findings and conclusions on February 4, 1972, and ultimately entered written judgment on March 7, 1972. Greenberg appeals from the court's order dated July 26, 1971, denying her motion for partial summary judgment, from the findings of fact, conclusions of law and judgment of the court entered March 7, 1972, and from the order of the court dated June 20, 1972, overruling objections to form of judgment, findings of fact and conclusions of law and order denying motion for new trial. A cross-appeal filed by Spector was later withdrawn.

THE ANTENUPTIAL AGREEMENT AND PUBLIC POLICY

Since the antenuptial agreement ('agreement') between the parties was found by the trial court to be a valid, binding and enforceable contract, it was determinative of many of the financial issues in the case. We therefore consider it first.

The agreement is broadly challenged by Greenberg on the ground that it violates public policy of Arizona. We find this contention cannot be sustained.

Arizona Revised Statutes § 25--201, specifically relating to antenuptial contracts, was in effect in Arizona when the agreement was made. The relevant portion, paragraph A, then read:

'Parties intending to marry may enter into agreements not contrary to good morals or law. They shall not enter into an agreement or make a renunciation the object of which is to alter the law of descent of property either with respect to themselves or inheritance by their children or posterity which either may have by any other person, or with respect to their common children.' ¹

Clearly, the first sentence is intended to sanction such agreements so long as they are not contrary to good morals or law, whereas the second sentence imparts a specific restriction against agreements which purport to affect the law of descent of property.

The Arizona Supreme Court has previously had occasion to consider certain issues relating to antenuptial agreements. It has held that an antenuptial agreement which purported to discharge a husband's duty of support following divorce for a sum fixed at $500 was contrary to public policy and void. Williams v. Williams, 29 Ariz. 538, 243 P. 402 (1926). In another case an agreement which purported to alter, by its own terms, statutory provisions concerning descent of property at the death of the marital parties was held to violate A.R.S. § 25--201 and was declared invalid. In re Mackevich's Estate, 93 Ariz. 129, 379 P.2d 119 (1963). The court in these cases however was not called upon to consider the specific issues which are before us in this case, nor is there to be found in them any blanket disapproval of antenuptial agreements from the standpoint of public policy.

In our survey of public policy of the State of Arizona as it pertains to antenuptial contracts, we must consider the Arizona cases and legislative pronouncements both before and after 1965, the year in which the agreement under review was made.

In a 1966 case the Supreme Court held that a family allowance and probate homestead may be waived by an antenuptial agreement. Smith v. Tang, 100 Ariz. 196, 412 P.2d 697 (1966). Later, in a 1969 case, the Arizona Supreme Court observed that married women today are capable of contracting with their husbands in their own best interest. In re Estate of Harber, 104 Ariz. 79, 449 P.2d 7 (1969). Thirty-two years earlier it had said that either spouse could convey his or her community interest to the other and thus dissolve the community. Estate of Baldwin, 50 Ariz. 265, 71 P.2d 791 (1937). The principle of contractual freedom of the spouses was recognized in Spanish community property law, demonstrating that the roots of modern public policy toward antenuptial agreements reach well back in time.

'From the earliest inception of the Spanish statutory law governing marital community property, it was permitted to the spouses to contract, agree, or stipulate as between themselves, either before, at the time of or even during marriage, as to the manner in which they wished to share the property earned or gained during the marriage. That is, if they did not wish to be governed by the statutory provisions regulating the division of such earned or gained property, they might elect by virtue of agreement, contract or stipulations to divide it upon some other basis or to allow each spouse to keep as his or her own separate property that which he or she earned or gained during the marriage . . ..' de Funiak and Vaughn, Principles of Community Property, § 135 at 333--334, (2d ed. 1971).

In 1973, the Arizona Legislature enacted an extensive revision of the law of marital and domestic relations, sometimes referred to as 'no-fault divorce,' which recognizes to a significant extent, the equality of the marriage partners. See A.R.S. § 25--311 et seq. At the same time the statute specifically relating to antenuptial agreements was also amended to allow prospective spouses a wider latitude in their contractual relations. See A.R.S. § 25--201, as amended, Footnote 1, supra. In addition, the Legislature enacted A.R.S. § 14--2204 as part of a new Probate Code effective January 1, 1974, which significantly broadened the right of both spouses to contract with one another concerning their property, both before and after marriage, including their respective rights in and to community property. ²

Thus, the public policy of Arizona is not violated by the enforcement of an antenuptial agreement involving the present or future property of the prospective spouses, whether that property be community or separate. The institution of marriage is of vital interest to the state and nation since our family and social organization is built upon it. If agreements between spouses provided for or tended to induce divorce or separation, they would be contrary to public policy. But where the prospective marriage partners wish to consider and adjust by legal agreement their respective rights in advance of marriage, we believe that the institution of marriage is thereby strengthened, not weakened. Under such circumstances such agreements are consistent with public policy, not contrary to it. While some courts, perhaps notably Texas, have held to the contrary, we note that even in Texas recent constitutional and statutory changes have validated contractual dealings between present and prospective spouses. ³

SPECIFIC PROVISIONS OF THE ANTENUPTIAL AGREEMENT

Paragraphs 1(c), 3(e) and 3(g) of the agreement read:

'1(c) The parties have agreed that only earnings from the practice of law by SPECTOR and only earnings from work by GREENBERG shall be community property.

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'3(e) GREENBERG specifically agrees with SPECTOR that she shall not be entitled to any contributions, either during his lifetime or after his death, arising from the use of community earnings in connection with any payments, including sales price or mortgage payments, relating to the sole and separate property of SPECTOR.

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'3(g) As a specific inducement to marriage, GREENBERG agrees that SPECTOR may use any of his community earnings after marriage to make payments to any creditors which he now has or may have in the future, whether transactions with said creditors have arisen from sole and separate property or from community property, and that said SPECTOR is released from any obligation to account to said GREENBERG for the use of any such community funds for any such purpose.'

Greenberg contends that these provisions are contrary to A.R.S. §§ 25--201(A) and 25--211(A) ⁴ and therefore void. While it is true that § 25--211(A) establishes the community character of certain property acquired during marriage, it does not, as Greenberg suggests, prevent the parties from entering into a valid agreement concerning their present and prospective property rights. The same may also...