The richest man in the state of Illinois, billionaire hedge-fund manager Ken Griffin, recently settled his high-profile and highly contentious divorce case. The settlement with wife Anne Dias Griffin was announced the day after a trial was supposed to begin on the validity and enforceability of their prenuptial agreement. Anne was trying to avoid the prenup as it would have awarded her only 1 percent of Ken’s estimated $6.9 billion net worth (he was worth about $650 million when they were married in 2003).
While the terms of the settlement were not disclosed, Anne would have likely had a difficult time getting out of the prenuptial agreement. In Illinois, as in New York, it takes more than just regret, a change in circumstances, or claims of “unfairness” to have a prenup thrown out.
A “Very High Burden” to Set Aside a Prenup
Under New York law, courts will approach any challenge to a prenuptial agreement with a presumption of that it is enforceable. As one court put it:
“It is axiomatic that a duly executed prenuptial agreement is presumed to be valid and controlling unless and until the party challenging it meets his or her very high burden to set it aside.”
Although “there is a heavy presumption that a deliberately prepared and executed written instrument manifests the true intention of the parties,” a prenuptial agreement may be invalidated if the party challenging the agreement “demonstrates that it was the product of fraud, duress, or other inequitable conduct.” Id. The burden of producing evidence of such fraud, duress or overreaching is on the party trying to get out of the agreement.
A court’s analysis of the validity of a prenup is focused on circumstances that existed at the time of the execution of the agreement, not on how things may stand at the time that the agreement is to be enforced. For example, was the spouse challenging the agreement coerced or pressured into signing it (beyond “sign it or we’re not getting married”)? Did the other spouse fail to fully disclose or misrepresent their financial situation in regards to assets, debts, income, pensions, or other matters?
Maintenance Can Be Modified if “Unconscionable”
One exception to this focus on how things stood at the time the agreement was executed relates to spousal maintenance:
“An agreement concerning the amount and duration of spousal maintenance must be fair and reasonable at the time it is made, and not unconscionable at the time of entry of final judgment in the divorce action… courts have the authority to review maintenance agreements to ensure such agreements are not unconscionable at the time of the entry of the judgment of divorce.”
Whether a given maintenance provision in a prenuptial agreement is unconscionable, or excessively oppressive to the party seeking to avoid the agreement, is an issue decided by courts on a case by case basis.
If you have any questions or concerns about the enforceability of your prenuptial agreement, please contact Clement Law at (212) 683-9551 or fill out our online form to arrange for a consultation