TCA § 36-3-501 — Enforcement of antenuptial agreements

Notwithstanding any other law to the contrary, except as provided in § 36-3-502 , any antenuptial or prenuptial agreement entered into by spouses concerning property owned by either spouse before the marriage that is the subject of such agreement shall be binding upon any court having jurisdiction over such spouses and/or such agreement if such agreement is determined, in the discretion of such court, to have been entered into by such spouses freely, knowledgeably and in good faith and without exertion of duress or undue influence upon either spouse. The terms of such agreement shall be enforceable by all remedies available for enforcement of contract terms. Acts 1980, ch. 492, § 1; T.C.A., § 36-606. Textbooks. Pritchard on Wills and Administration of Estates (5th ed., Phillips and Robinson), § 832. Law Reviews. Covenant Marriage: Should Tennessee Join the Noble Experiment?, 29 U. Mem. L. Rev. 397 (1999). Family law — Cary v. Cary: Antenuptial Agreements Waiving or Limiting Alimony in Tennessee, 27 U. Mem. L. Rev. 1041 (1997). Family Law — Randolph v. Randolph: Tennessee Requires Full Disclosure or Independent Knowledge for Antenuptial Agreements To Be Valid, 27 U. Mem. L. Rev. 1021 (1997). Marital Property in Tennessee: An Evolution, Not a Revolution (Sheryl S. Scheible), 15 Mem. St. U.L. Rev. 475 (1985). Protection Against Spousal Disinheritance: A Critical Analysis of Tennessee's New Forced Share System, 28 U. Mem. L. Rev. 561 (1998). NOTES TO DECISIONS 1. In General. 2. Property Acquired After Marriage. 3. Alimony. 4. Reconciliation Agreements. 5. Relevance of Duration of Marriage. 6. Enforceable Agreement. 7. Unenforceable Agreement. 8. Duty to Disclose Extent of Estate. 9. Appreciation of Separate Property. 30. Illustrative Cases. 1. In General. This section makes no explicit reference to the requirement in Baker v. Baker, 24 Tenn. App. 220, 142 S.W.2d 737, 1940 Tenn. App. LEXIS 28 (Tenn. 1940) that, where the provision for the wife in an antenuptial agreement is wholly disproportionate to the husband's wealth, a full disclosure of the nature, extent and value of the husband's property is required to sustain the validity of the agreement; however, numerous factual scenarios could occur in which the failure to make a full disclosure of assets, liabilities and values would breach the statutory requirement that the contract was entered into freely, knowledgeably and in good faith. Kahn v. Kahn, 756 S.W.2d 685, 1988 Tenn. LEXIS 163 (Tenn. 1988). Antenuptial agreements regarding marital property do not violate public policy. Perkinson v. Perkinson, 802 S.W.2d 600, 1990 Tenn. LEXIS 487 (Tenn. 1990), rehearing denied, — S.W.2d —, 1991 Tenn. LEXIS 57 (Tenn. Feb. 4, 1991). Binding prenuptial agreement under T.C.A. § 36-3-501 when read as a whole is not ambiguous; trial court properly ordered reimbursement to a former wife where its determination that the wife's payments did not constitute “debts or mortgages” under another section of the agreement was one of fact, and there was nothing to preponderate against trial court's findings on the nature of these expenditures. Ruder v. Ruder, — S.W.3d —, 2008 Tenn. App. LEXIS 555 (Tenn. Ct. App. Sept. 26, 2008). Because the source of tax refunds were traced to the decedent's separate property, under the plain language of the antenuptial agreement, the tax refunds remained the decedent's separate property; under T.C.A. § 36-3-501 , the trial court was bound to enforce the terms of the agreement, which allowed the decedent and his wife to file joint income tax returns as husband and wife without the joint filing affecting the provisions of the agreement concerning separate and marital property. Estate of Hunt v. Hunt, 389 S.W.3d 755, 2012 Tenn. App. LEXIS 172 (Tenn. Ct. App. Mar. 15, 2012), appeal denied, — S.W.3d —, 2012 Tenn. LEXIS 563 (Tenn. Aug. 20, 2012). 2. Property Acquired After Marriage. A $25,000 award to plaintiff wife based on the appreciation of assets that resulted through the joint efforts of the parties during the period of the marriage, where plaintiff had contributed to the appreciation of the parties' assets by furnishing them with a residence during the marriage, offering her services in the family business, and perhaps contributing some personal moneys for the accumulation of joint assets, constituted a division of jointly-held property acquired after marriage, and did not violate antenuptial agreement regarding division of the parties' property. Duncan v. Duncan, 652 S.W.2d 913, 1983 Tenn. App. LEXIS 545 (Tenn. Ct. App. 1983), overruled, Cary v. Cary, 937 S.W.2d 777, 1996 Tenn. LEXIS 362 (Tenn. 1996). By construing the antenuptial agreement as a whole, for purposes of T.C.A. § 36-3-501 , all property acquired after the marriage was to remain separate property unless the property was acquired jointly or in both parties' names; the trial court properly found that personal services income acquired after the marriage was separate property rather than marital property. Seifert v. Seifert, — S.W.3d —, 2017 Tenn. App. LEXIS 325 (Tenn. Ct. App. May 17, 2017), appeal denied, — S.W.3d —, 2017 Tenn. LEXIS 689 (Tenn. Oct. 3, 2017). 3. Alimony. A provision in antenuptial agreement that purports to limit a spouse's liability for alimony is conducive to divorce and, therefore, void. The same rule applies to attorney fees that are normally considered as part of a spouse's alimony. Duncan v. Duncan, 652 S.W.2d 913, 1983 Tenn. App. LEXIS 545 (Tenn. Ct. App. 1983), overruled, Cary v. Cary, 937 S.W.2d 777, 1996 Tenn. LEXIS 362 (Tenn. 1996). The invalidity of a provision limiting alimony does not invalidate the remainder of the antenuptial agreement. Kahn v. Kahn, 756 S.W.2d 685, 1988 Tenn. LEXIS 163 (Tenn. 1988). A voluntary and knowing waiver or limitation of alimony in an antenuptial agreement is not per se void and unenforceable as contrary to public policy, and such provisions will be fully enforced, unless enforcement will render one spouse a public charge. Cary v. Cary, 937 S.W.2d 777, 1996 Tenn. LEXIS 362 (Tenn. 1996). Trial court did not err in finding the parties' prenuptial agreement valid; neither sophistication nor experience in business was needed to understand the terms of the agreement, including the term that neither would be entitled to alimony upon divorce. The parties had lived together for six years before marrying and the wife knew for years that the husband would not marry without a prenuptial agreement, and the attorney who drafted the agreement explained each term to both parties and the wife made no allegation of misrepresentation. Howell v. Howell, — S.W.3d —, 2021 Tenn. App. LEXIS 47 (Tenn. Ct. App. Feb. 9, 2021). 4. Reconciliation Agreements. Reconciliation agreements are in the nature of prenuptial or antenuptial agreements and should be generally governed by the same principles. Gilley v. Gilley, 778 S.W.2d 862, 1989 Tenn. App. LEXIS 486 (Tenn. Ct. App. 1989). Reconciliation agreements are generally governed by the same principles as prenuptial or antenuptial agreements, which are to be interpreted and enforced as any other contract. Minor v. Minor, 863 S.W.2d 51, 1993 Tenn. App. LEXIS 206 (Tenn. Ct. App. 1993). A period in excess of 12 years is not a reasonable time for the enforcement of a reconciliation agreement. Minor v. Minor, 863 S.W.2d 51, 1993 Tenn. App. LEXIS 206 (Tenn. Ct. App. 1993). Even though marriage in and of itself would not be sufficient consideration, the couple's waiver of rights to each other's estate was sufficient to support a postnuptial agreement. In re Estate of Wiseman, 889 S.W.2d 215, 1994 Tenn. App. LEXIS 508 (Tenn. Ct. App. 1994). 5. Relevance of Duration of Marriage. The length of time that the marriage lasted was not relevant to the fairness of the antenuptial agreement. The circumstances that existed at the time the agreement was executed determined if it violated any condition of the statute. Perkinson v. Perkinson, 802 S.W.2d 600, 1990 Tenn. LEXIS 487 (Tenn. 1990), rehearing denied, — S.W.2d —, 1991 Tenn. LEXIS 57 (Tenn. Feb. 4, 1991). 6. Enforceable Agreement. Antenuptial agreement was enforceable where the purpose for which the agreement was executed was clearly stated, that purpose was lawful, and the parties freely, knowledgeably, in good faith and without exertion of duress or undue influence by either, determined the terms of the agreement. Perkinson v. Perkinson, 802 S.W.2d 600, 1990 Tenn. LEXIS 487 (Tenn. 1990), rehearing denied, — S.W.2d —, 1991 Tenn. LEXIS 57 (Tenn. Feb. 4, 1991). Enforcement of a prenuptial agreement would not change living expenses into a species of marital property subject to division, the absence of a prenuptial agreement so providing; agreements waiving or limiting alimony are enforceable, so long as the prenuptial agreement was entered into freely and knowledgeably, with adequate disclosure. Soloman v. Murrey, 103 S.W.3d 431, 2002 Tenn. App. LEXIS 734 (Tenn. Ct. App. 2002). Court erred in finding that a wife signed an antenuptial agreement under duress where the wife was represented by independent legal counsel throughout the process, her attorney had a draft of the antenuptial agreement six weeks before the wedding, and he went over it with her line by line in his office three weeks before the wedding. Boote v. Shivers, 198 S.W.3d 732, 2005 Tenn. App. LEXIS 661 (Tenn. Ct. App. 2005), appeal denied, In re Estate of Boote v. Shivers, — S.W.3d —, 2006 Tenn. LEXIS 354 (Tenn. 2006). Court erred in finding that a wife did not enter into an antenuptial agreement knowingly because the decedent prepared a financial disclosure statement for attachment to the antenuptial agreement to the wife's lawyer six days before she signed the antenuptial agreement, and the knowledge of the wife's lawyer of the contents of the disclosure statement could be properly imputed to the wife. Boote v. Shivers, 198 S.W.3d 732, 2005 Tenn. App. LEXIS 661 (Tenn. Ct. App. 2005), appeal denied, In re Estate of Boote v. Shivers, — S.W.3d —, 2006 Tenn. LEXIS 354 (Tenn. 2006). Trial court did not err in upholding an antenuptial agreement that a widow had entered into freely and the fact that there was no value listed for one particular asset of the husband's, even though it was significant, did not invalidate the agreement. The widow did not avail herself of the opportunity to ask her husband the value of the stock or make any independent investigation, and she had not had her counsel investigate. Reece v. Elliott, 208 S.W.3d 419, 2006 Tenn. App. LEXIS 441 (Tenn. Ct. App. 2006), appeal denied, — S.W.3d —, 2006 Tenn. LEXIS 1123 (Tenn. 2006). There was no basis upon which to declare a divorce decree void because the divorce court maintained general jurisdiction over the subject matter, including how to interpret and whether to enforce the parties' antenuptial agreement, and it had the authority to find that the parties' antenuptial agreement could be enforced. In re Estate of Lewis, — S.W.3d —, 2016 Tenn. App. LEXIS 120 (Tenn. Ct. App. Feb. 18, 2016). Trial court properly determined that the issue of enforceability of an antenuptial agreement had been previously litigated and ruled upon in the divorce action because the divorce court exercised proper jurisdiction over the parties and the subject matte; the divorce court's determination that the antenuptial agreement would be enforced as written became final, no action for relief from the judgment was ever filed in the divorce court, and the determination was not appealed. In re Estate of Lewis, — S.W.3d —, 2016 Tenn. App. LEXIS 120 (Tenn. Ct. App. Feb. 18, 2016). Divorce court was enforcing the parties' antenuptial agreement as written by recognizing that the wife was entitled to life insurance benefits, and thus, it was not punishing the decedent for contempt; because the divorce court's judgment regarding the antenuptial agreement and its life insurance provision was never appealed and became final, the trial court properly enforced it by allowing the wife to file a claim against the decedent's estate. In re Estate of Lewis, — S.W.3d —, 2016 Tenn. App. LEXIS 120 (Tenn. Ct. App. Feb. 18, 2016). In a divorce case, a former wife's disclosure of her assets provided a former husband with an essentially accurate understanding of her financial holdings, and the husband knowledgeably entered into a prenuptial agreement; the husband's primary argument was that the trial court should not have reversed its earlier ruling that the prenuptial agreement was not valid without providing notice of this to the parties until after the close of evidence. However, when the trial court entered its earlier order in July 2014 finding that the parties' prenuptial agreement was not valid, the court had not heard all of the parties' evidence. Yates v. Yates, — S.W.3d —, 2016 Tenn. App. LEXIS 144 (Tenn. Ct. App. Feb. 24, 2016). 7. Unenforceable Agreement. Antenuptial agreement entered into by the wife and the decedent was invalid and unenforceable because the evidence presented by the executors was insufficient to establish that the wife had the requisite independent knowledge of the full nature, extent, and value of the decedent's assets at the time she entered into the agreement as required by T.C.A. § 36-3-501 . The evidence only showed that the wife was aware of the nature of the decedent's business affairs and had a general knowledge of his financial assets. In re Estate of Baker v. King, 207 S.W.3d 254, 2006 Tenn. App. LEXIS 294 (Tenn. Ct. App. 2006), appeal denied, In re Estate of Baker, — S.W.3d —, 2006 Tenn. LEXIS 930 (Tenn. 2006). Husband unilaterally procured the antenuptial agreement and presented it to the wife either the day before or the day of the wedding ceremony, with no prior discussion, and although the husband knew the wife could not speak or read English, he did not provide her with a Spanish version; the wife did not enter into the agreement knowledgeably, in good faith, or have adequate knowledge of the marital property, and thus the agreement was invalid and unenforceable. Hollar v. Hollar, — S.W.3d —, 2015 Tenn. App. LEXIS 944 (Tenn. Ct. App. Nov. 30, 2015). Trial court properly found that the antenuptial agreement was unenforceable because the husband did not enter it knowledgeably, as he first saw this agreement one day before the wedding, he did not have the independent advice of counsel, and while the husband was aware that the wife had greater earning capacity than he did, this kind of general knowledge did not satisfy the statutory requirement that agreements be entered knowledgeably. In re Estate of Hillis, — S.W.3d —, 2016 Tenn. App. LEXIS 148 (Tenn. Ct. App. Feb. 25, 2016), appeal denied, — S.W.3d —, 2016 Tenn. LEXIS 479 (Tenn. June 23, 2016). Because a husband failed to prove an antenuptial agreement was entered into in good faith as required, the agreement was unenforceable; the evidence did not preponderate against the trial court's finding that at the time the antenuptial agreement was negotiated and executed, the husband knew he owned a condominium with his former girlfriend and deliberately withheld that fact from the wife. Walker v. Walker, — S.W.3d —, 2020 Tenn. App. LEXIS 47 (Tenn. Ct. App. Jan. 31, 2020), appeal denied, — S.W.3d —, 2020 Tenn. LEXIS 394 (Tenn. July 20, 2020). Because a husband failed to prove an antenuptial agreement was entered into in good faith as required, the agreement was unenforceable since the husband failed to disclose a condominium he owned with his former girlfriend before execution of the antenuptial agreement; assuming that ratification applied, the conduct did not evidence ratification because none of the wife's actions evidenced an intent to affirm the antenuptial agreement. Walker v. Walker, — S.W.3d —, 2020 Tenn. App. LEXIS 47 (Tenn. Ct. App. Jan. 31, 2020), appeal denied, — S.W.3d —, 2020 Tenn. LEXIS 394 (Tenn. July 20, 2020). 8. Duty to Disclose Extent of Estate. Where husband did not disclose full extent of his estate prior to executing ante-nuptial agreement, the agreement was ineffective and widow was entitled to take elective share as surviving spouse. Williams v. Williams, 868 S.W.2d 616, 1992 Tenn. App. LEXIS 609 (Tenn. Ct. App. 1992). The knowledge element of this section means that the spouse seeking to enforce an antenuptial agreement must prove, by a preponderance of the evidence, either that a full and fair disclosure of the nature, extent, and value of his or her holdings was provided to the spouse seeking to avoid the agreement, or that disclosure was unnecessary because the spouse seeking to avoid the agreement had independent knowledge of the full nature, extent, and value of the proponent spouse's holdings. Randolph v. Randolph, 937 S.W.2d 815, 1996 Tenn. LEXIS 541 (Tenn. 1996). Disclosure or full knowledge is required in all cases, not just those which involve an agreement in which the provision for one spouse is wholly disproportionate to the means of the other spouse. Randolph v. Randolph, 937 S.W.2d 815, 1996 Tenn. LEXIS 541 (Tenn. 1996). Husband's disclosure of his holdings was sufficient where, even though he inadvertently omitted two assets comprising ten to fifteen percent of the total value, the omission was partially offset by his mistaken overvaluation of other assets. Wilson v. Moore, 929 S.W.2d 367, 1996 Tenn. App. LEXIS 264 (Tenn. Ct. App. 1996). Where widow had received list of decedent's property before signing the prenuptial agreement, but did not bother to carefully read the list, it could not be said that the extent of the decedent's assets were not disclosed to her. Cantrell v. Estate of Cantrell, 19 S.W.3d 842, 1999 Tenn. App. LEXIS 873 (Tenn. Ct. App. 1999). Trial court erred by determining that an antenuptial agreement executed by a widow was valid and governed by Florida law, because despite the generally applicable lex loci rule of contracts, Tennessee law applies under circumstances where the law of another jurisdiction contravenes Tennessee public policy and enforcing the widow's antenuptial agreement would violate Tennessee public policy requiring full disclosure. The court noted that under Florida law, a distinction is made as to antenuptial agreements made in a marriage dissolution versus a probate context; however, in Tennessee, no such distinction is made and full and fair disclosure is required in both contexts as provided in T.C.A. § 36-3-501 . In re Estate of Davis, 184 S.W.3d 231, 2004 Tenn. App. LEXIS 585 (Tenn. Ct. App. 2004), cert. denied, Davis v. Davis, 126 S. Ct. 550 , 163 L. Ed. 2 d 460, 546 U.S. 977 , 2005 U.S. LEXIS 7873 (U.S. Oct. 31, 2005). Probate court erred in finding that a wife had made a full and fair disclosure of her substantial assets and holdings to her husband prior to their entering into a pre-T.C.A. § 36-3-501 antenuptial agreement because, inter alia, the wife's list of assets could not be located and, assuming the list had existed, the appellate court could not determine if it had been sufficiently detailed and knowledge could not be imputed to the husband. In re Estate of Davis, 213 S.W.3d 288, 2006 Tenn. App. LEXIS 532 (Tenn. Ct. App. 2006), appeal denied, — S.W.3d —, 2006 Tenn. LEXIS 1217 (Tenn. 2006). 9. Appreciation of Separate Property. Although antenuptial agreement provided that property owned “partially or wholly” by either party would not be subject to division, that phrase in an antenuptial agreement cannot overcome the statutory definition of marital property, which includes the increase in value of separate property during the marriage if each party substantially contributed to its preservation and appreciation. Wilson v. Wilson, 987 S.W.2d 555, 1998 Tenn. App. LEXIS 612 (Tenn. Ct. App. 1998), rehearing denied, 987 S.W.2d 555, 1998 Tenn. App. LEXIS 630 (Tenn. Ct. App. 1998), rev'd, 984 S.W.2d 898, 1998 Tenn. LEXIS 744 (Tenn. 1998). 30. Illustrative Cases. Because a husband failed to prove an antenuptial agreement was entered into in good faith as required, the agreement was unenforceable; the evidence did not preponderate against the trial court's finding that at the time the antenuptial agreement was negotiated and executed, the husband knew he owned a condominium with his former girlfriend and deliberately withheld that fact from the wife. Walker v. Walker, — S.W.3d —, 2020 Tenn. App. LEXIS 47 (Tenn. Ct. App. Jan. 31, 2020), appeal denied, — S.W.3d —, 2020 Tenn. LEXIS 394 (Tenn. July 20, 2020).