Section Review

Eyster v. Pechenik — A Miranda warning for prenuptial agreements?

Miranda warnings are the procedural safeguards that the police must give a suspect before any questioning can take place. As we all learned in Criminal Procedure (or are reminded when watching various television shows), they are:

1. You have the right to remain silent

2. Any statement that you do make may be used against you in a court of law

3. You have the right to the presence of an attorney, and

4. If you cannot afford an attorney, one will be appointed for you prior to any questioning, if you so desire.

These same procedural warnings could be said to apply to anyone wishing to ensure that a prenuptial agreement is valid when executed, and enforceable if disputed, particularly in light of the recent Appeals Court decision, Eyster v. Pechenik, 71 Mass. App. Ct. 273 (2008).

The facts of the case can be summarized as follows: at the time of execution of the agreement and subsequent marriage, the husband, Jan A. Pechenik, was 32 years old and a biologist. He had obtained a bachelor’s, masters and Ph.D degree. Linda Sue Eyster was 29 and in the process of getting her Ph.D in biology, having already received her bachelor’s and master’s degrees. Pechenik drafted his own prenuptial agreement which was only one page long, based on information he obtained from newspapers, magazines and one book. The agreement did not contain a schedule of the assets of either party. It also did not contain any express reference to the marital rights the parties would have under M.G.L. c. 208, § 34 (2006). The agreement consisted mostly of both parties renouncing claims to any financial assets of the other party, and a schedule of how Eyster’s ownership interest would accrue over time in the condominium that echenik had purchased. The parties had one son, Oliver. After 22 years of marriage, Eyster filed for divorce.

1) Miranda warning part I — You have the right to remain silent

A prenuptial agreement may be expansive enough to address issues such as property division and alimony. It may also be narrowly drawn to only address property the parties each held separately before marriage. Both have been upheld by the court.

But if the agreement does not contain an express waiver of whatever the rights of the parties are, then the court will hold that the agreement was invalid at the time of execution. In Eyster, the court held that as there was no express waiver by the wife at the time of execution of the agreement as to her marital rights, the agreement was not valid.

The court applied the “fair disclosure” rules articulated in Rosenberg v. Lipnick, 327 Mass. 666 (1979) to determine if the prenuptial agreement was valid at the time of execution. Those rules are: (1) the agreement contained a fair and reasonable provision as measured at the time of its execution for the party contesting the agreement, (2) the contesting party was fully informed of the other party’s worth prior to the agreement’s execution, or had, or should have had, independent knowledge of the other party’s worth, and (3) a waiver by the contesting party is set forth.

Eyster’s appeal in the matter focused on the third Rosenberg rule, and that is where the court began its analysis. The court held that there was no informed waiver of marital rights because the agreement did not contain any express provisions regarding what the rights of the parties would be under M.G.L. c. 208, § 34 and how the disposition of the assets and property in the prenuptial agreement could be very different from how they might be divided in a divorce proceeding.

2) Miranda warning part II — Any statement that you do make may be used against you in a court of law

The court also held that the prenuptial agreement was invalid because the husband’s limited research and one-page agreement suggested that he also did not fully understand what his marital rights were. The agreement did not mention either party’s total net worth, and there were no schedules outlining their respective assets. While the agreement did address gifts and inheritance that either party might receive during their lifetime, there was no provision for assets acquired during the marriage.

3) Miranda warning part III ­— The right to the presence of an attorney

Another factor the court considered was that neither party had retained counsel to represent them in the matter, and neither party had counsel review the agreement before its execution. While the court points out that having an attorney review the document is not a requirement for it to be valid, in this case, where the agreement fell short of meeting the Rosenberg fair disclosure rules, both parties would have benefitted from having an attorney familiar with prenuptials review the agreement to ensure it was valid before it was executed. For example, it is very likely that an attorney would have specified the rights of the parties, identified the purpose of the agreement, defined separate property, defined marital property, attached M.G.L. c. 208, § 34 as an exhibit, and attached schedules of the each party’s assets, liabilities and income.

4) Miranda warning part IV — If you cannot afford an attorney, one will be appointed for you prior to any questioning, if you so desire.

While the right to have an attorney retained to represent one’s interests in a prenuptial agreement is certainly not a protected right under the Constitution, in this case, the lesson seems to be that when it comes to prenuptial agreements, one cannot afford not to have counsel at least review the agreement and ensure its validity prior to execution. The parties would have better spent their time and resources obtaining counsel prior to execution, rather than having the agreement declared invalid by the court when the husband sought to enforce it. By not retaining counsel during the drafting, review and execution stages, the parties essentially created a document that had no effect when needed. While this worked to the advantage of the wife, as she did not want the agreement to be enforced, it went against the entire purpose of the agreement that Pechenik had in mind and left him in the exact same position as if the document had never been signed in the first place, a mistake most people cannot afford to make when drafting prenuptial agreements. Certainly the legal fees associated with the drafting of the prenuptial agreement would have been a very small percentage of the attorney fees associated with the litigation in the Probate and Family Court and the Massachusetts Appeals Court.

Eyster’s lesson

So what is the lesson to take away from Eyster? What are the warnings to be heeded?

1. Do not remain silent as to an express waiver of marital rights. Be sure to include both the marital rights that the parties acquire under M.G.L. c. 208, § 34 and those which the parties are waiving in the agreement, and even attach an exhibit outlining M.G.L. c. 208, § 34.

2. Be sure that the terms are clear, that complete schedules of assets, income and liabilities of both parties are attached to the agreement, and that each party has received full and complete disclosure of other party’s net worth prior to execution.

3. Retain counsel to ensure the terms of the agreement are fair, and that each party understands their rights under the agreement, and their right not to sign the agreement if there is any lack of clear understanding on the matter.

4. Do not wait until you are in court under a divorce proceeding to see if the agreement will be enforced by the court. Hire counsel at the outset and ensure that the agreement meets the Rosenberg rules before execution so that validity is less likely to be questioned at the time of enforcement.

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Thomas J. Barbar is a principal with the Family Law Department at Deutch/Williams, Boston. He is he 2008-09 co-chair of the MBA’s Family Law Section Council and a member of the Boston Bar Association. He holds a bachelor’s degree from Villanova University and a J.D. from the New England School of Law. 

 

 

 

 

Connolly, Liza bw.jpg Liza M. Connelly is an associate at Deutch/Williams, Boston. She is a member of the Massachusetts Bar Association and its Animal Law practice group. Connelly is also a member of the Boston Bar Association and the Boston Estate Planning Council. She received her J.D. from Suffolk University Law School.

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