Opinion ID: 1279751
Heading Depth: 1
Heading Rank: 3

Heading: Did the Trial Court Err in Refusing to Enforce the Postnuptial Agreement on the Basis of Fraud, Duress and Estoppel?

Text: Husband argues that the postnuptial agreement is enforceable and the trial court erred by invalidating it because of fraud, duress and estoppel. Wife contends the trial court's findings are supported by the evidence. Paragraph 11 of the agreement provides that it shall be construed under California law. Postnuptial agreements are valid, subject to the rules governing confidential relationships. Tompkins v. Bishop, 94 Cal. App.2d 546, 211 P.2d 14 (1949); Cal.Civil Code § 5103 (West Supp. 1985). [11] When one spouse fails to act in good faith and thereby gains an advantage over the other, he is guilty of fraud. Norris v. Norris, 50 Cal. App.2d 726, 123 P.2d 847, 851-52 (1942); Cal.Civil Code § 2234 (West 1984). [12] Furthermore, when one spouse gains an advantage over the other, the transaction is presumed to be the result of undue influence and without sufficient consideration, thus the advantaged spouse has the burden of proving the transaction was fair, just and reasonable. Morris v. Berman, 159 Cal. App.2d 770, 324 P.2d 601, 613 (1958); Norris, 123 P.2d at 851-52; Cal. Civil Code § 2235 (West 1984). [13] The advantaged spouse meets his burden of proof by showing full disclosure or arm's length bargaining. Norris, 123 P.2d at 851-52. In the case at bar, the agreement was entered during an ongoing marriage. Husband had the burden of proving the agreement was fair, just and reasonable because of arm's length bargaining or full disclosure of marital assets. The trial court found that Husband actively discouraged Wife from consulting with an attorney and repeatedly threatened divorce, therefore there was no arm's length bargaining. It further concluded that Husband did not (and has still never) fully disclosed his assets, therefore there was no full disclosure. These findings are supported by evidence in the record. We presume that the agreement is the result of undue influence and without adequate consideration. Therefore, we conclude that the trial court did not err in refusing to enforce the agreement.