OCTOBER 13, 2003 VOLUME 11, NUMBER 15
Reported court cases involving prenuptial agreements sometimes seem to be confused and contradictory. State laws governing such agreements vary somewhat, but the outcome of a challenge is almost always dependent on the peculiar facts in each case.
Consider the prenuptial agreement signed by John and Erin Hollett on the morning of their 1990 wedding. They had dated for six years and had discussed prenuptial agreements in concept—in fact they had at least one heated argument about the idea two years before they got married. They had not, however, discussed whether or not they would sign one—until two days before the wedding date.
John Hollett was thirty years older than his new wife. He was a successful real estate developer in New Hampshire, and worth about six million dollars. She, on the other hand, was worth about five thousand dollars, had dropped out of high school and had worked as a bartender and cashier.
Mr. Hollett’s lawyers knew state law would require that Mrs. Hollett have independent legal advice before signing any agreement. They contacted Brian Shaughnessy, who had been a lawyer for just one year at that point, and asked if he would be willing to represent the soon-to-be Mrs. Hollett. They promised to pay his legal fees, and he called and invited her to his office.
The day before the scheduled wedding, with 200 guests invited, Mr. Shaughnessy met with his client for the first and only time. Although he was not very experienced, Mr. Shaughnessy could see that the proposed agreement was not very favorable to his client and that the financial disclosure from Mr. Hollett was sketchy. His efforts resulted in an agreement that guaranteed Mrs. Hollett up to one-sixth of her husband’s estate upon divorce or his death, and the agreement was signed on the morning of the wedding.
The couple lived together for over a decade, until Mr. Hollett’s death in 2001. Mrs. Hollett then moved to have the agreement declared invalid, arguing that she had signed it under duress. The New Hampshire Supreme Court agreed, ruling that the sharp disparity in bargaining positions, the rushed nature of the agreement and the behavior of Mr. Hollett in secreting his intentions made the agreement unenforceable. Estate of Hollett, September 26, 2003.
The Hollett case is strikingly similar to another case described in Elder Law Issues just two years ago—but with a different outcome. In the earlier case, involving Frances and Eugene Ingmand, the Iowa courts upheld an agreement sprung on Mrs. Ingmand three days before the wedding. The difference is in the facts, and probably in the disparity between the Holletts’ business experience. Prenuptial agreements are enforceable, but only if the rules are carefully followed.