Sophisticated Businessman Cannot Invalidate Prenuptial Agreement

Tennessee case summary on prenuptial agreement in divorce.

James Mason Yates v. Sally Jo Seitz Yates

The husband and wife in this Tennessee divorce case were married in 2010 and had one child, who was born prior to the marriage.  Before the marriage, the wife told the husband that she wanted a prenuptial agreement, which they discussed.  The husband had one prepared, and he presented it to the wife before the marriage, and the wife signed.

When the husband filed for divorce, the wife argued that the agreement was not valid.  The court initially agreed, but reversed the ruling after trial, after determining that the wife would not have married without the agreement.  The husband appealed various issues, including the validity of the agreement.

At trial, both parties had testified as to the reason for the prenuptial agreement.  The wife had owned a home prior to the marriage which was refinanced shortly before the marriage.  Since the title would be in both spouses’ names, she wanted clarified that the residence constituted her separate property.  She also owned stock which she wanted protected completely.

The wife had not actually signed a hard copy of the agreement prior to the marriage, since she had been traveling at the time the husband had it prepared.  However, she had indicated in an e-mail that she intended to sign.

The appeals court noted that antenuptial agreements are favored in Tennessee, as long as the are entered into voluntarily and knowledgeably.

In this case, there was testimony by the husband that supported the trial court’s ultimate conclusion that he considered the agreement to be in force as soon as the wife e-mailed her assent.

The husband pointed to some assets he did not know about, and argued that the agreement was not valid for this reason.  However, the court noted that he, as a real estate agent, was a sophisticated businessman, and these relatively minor omissions did not invalidate the agreement.

The appeals court went on to modify the trial court’s order in other respects, but affirmed the validity of the agreement.  But other than modifying the value of the marital residence slightly, it affirmed the lower court’s order.

No. M2015-00667-COA-R3-CV (Tenn. Ct. App. Feb. 24, 2016).

See original opinion for exact language.  Legal citations omitted.

To learn more, see Prenuptial Agreement: Pros and Cons in Tennessee Divorce Law.