A recent decision of the Connecticut Appellate Court in the case of Felicia Pierot Brody vs. Cary Brody illustrates what can happen when the focus of a divorce case shifts from the issues in the marriage to the credibility, or lack thereof, of one of the parties to the case. In the Brody case, one thing that happened was that a lot of personal information became public – e.g., the husband’s awkward excuse for stashing condoms in his travel bag. Another consequence: Brody was ordered to pay $2.5 million in lump sum alimony even though his prenuptial agreement was meant to prevent that and even though the court was unable to ascertain his income. The trial took place in 2010. Recently the Appellate Court has ruled against Brody on all six issues he raised in his appeal.
For all most of us know, Mr. Brody might have told the truth from start to finish. However, the judge found him not to be credible which, as the finder of fact in a civil case, she was privileged to do.
Any judge will tell you that the best way to appear to be truthful is simply to tell the truth. Still, any divorce lawyer who’s practiced as long as I have, has encountered more than one client who is shocked to learn that their lawyer expects them to be honest.
What kind of lawyer wouldn’t help you hide your assets, understate your income or cover up your extramarital affairs? The answer: any good one. Yet, despite our best efforts, there are plenty of folks who remain unconvinced that honesty is the best policy even when the truth isn’t pretty.
The fact is, there isn’t much that happens in a marriage that the judge hasn’t heard before. Also, there can be two very different sides to every story even when the story is told by honest people. Your secret spending or infidelity might have led to enormous drama in your household, but in divorce court, might barely cause a ripple. Unless, that is, you deny the deed and the judge isn’t buying it.
Brody was not a divorce between members of the 99% although the basic issues were fairly universal. There was an issue of irresponsible spending — in this case buying one too many Ferrari automobiles , a wine cellar, and an airplane. There was an issue of suspected infidelity with no proof other than a few unused condoms. There was a business purportedly in decline — in this case the Defendant’s hedge fund. There were some “he-said-she-said” claims of verbal abuse. All matters divorce judges deal with day in and day out.
No case in Connecticut goes to trial without first going through at least one formal attempt at settlement usually with the assistance of a judge or court-appointed Special Master. Most cases settle before trial. Of the small percentage that do not, only a handful are appealed and those few find little success in overturning the decision of the trial judge.
In this case, the Defendant raised a number of issues that might have served him well during settlement negotiations. His business really had been embroiled in litigation with the SEC, for example, and the prenuptial agreement arguably offered him protection from a lump sum alimony award that would have to be funded by liquidating personal assets.
At trial, however, the judge found him not to be a credible witness. For one thing, he had admitted testifying falsely under oath in an earlier divorce proceeding that his wife had commenced but later dropped. Back then he had denied removing his wife’s jewelery from a safe, but had later come clean. Added to that was the finding that the Defendant had stonewalled during the discovery phase of the trial pretending that certain documents sought by the Plaintiff didn’t exist. With those two strikes against him, the case was pretty much over. The Plaintiff, whose personal net worth at the time of the marriage had been 29 million, and whose dividend income from her separate property was approximately $100,000 annually was awarded alimony and, tacitly, the designation of honest litigant.
According to a recent article published in USA Today, a study of over 7000 individuals conducted by researchers at the Ohio State University found that 79% of marital separations end in divorce.
The study found that the average length of separations that resulted in reconciliation was two years, while the average of those ending in divorce was three years. Surprisingly, the chances of reconciliation virtually disappeared among this group beyond the three-year mark. While many couples who lived apart for three or more years eventually divorced, others simply continued the separation indefinitely.
The study found that women with children under 5 years old were more likely to separate from their husbands rather than to divorce immediately.
All of this means that a great number of couples either delay or forego altogether the protection of laws designed to shield them financially in the event their marriage comes apart. These include laws governing the division of marital assets as well as laws regarding spousal and child support.
In a relatively new trend, some couples seriously contemplating trial separation begin the experiment by negotiating a formal post-marital agreement that sets out their respective financial obligations while still legally married and also in the event of an eventual divorce. In this way, they are able to enter into a trial separation — or in some cases even continue living under the same roof — with the security of an agreed-upon set of rules. This provides each of them with a degree of certainty about their financial future that would not otherwise be possible absent divorce litigation. With financial issues resolved, they are better able to understand the choices they face and to focus on other issues in their relationship.
Just like prenuptial agreements, post-marital agreements must meet certain standards in order to be enforceable. These standards are governed by the laws of individual states, but certain features are universal. First, they must be accompanied by full mutual disclosure of financial information. Second, they must be entered into voluntarily and both parties must have had at least the opportunity to have the agreement reviewed by independent counsel. All courts reserve the right to review both prenuptial agreements and post-marital agreements for fairness, but, provided there are no egregious flaws in the contract, courts generally support and enforce them as a matter of public policy.
Impending separation is not the only reason to consider a post-marital agreement. Events such as the birth of a child, a return to school, or the launch of a business can be good reason for couples to consider adding a post-marital agreement to their financial plan.