Enforcing a Premarital Agreement in a Divorce in Arizona
The Arizona Court of Appeals made a decision on the validity of a premarital agreement and the division of marital assets in the case of Pownall v. Pownall.
In 1990, shortly after the parties began living together Mr. Pownall purchased a home. He paid the down payment and mortgage using his earnings with the title in his name only. Mr. Pownall and his stepfather opened four pizza franchise locations in which he had a fifty percent interest, using only his earnings to finance the businesses.
Then, in 1994, the parties decided to marry and Mr. Pownall had his attorney create a premarital agreement to keep his interests in the pizza businesses, as well as any future businesses, separate. Both parties met with the attorney, where it was explained to Mrs. Pownall that he would only be representing Mr. Powall’s interests and she had the right to have another attorney review the agreement before she signed it. She declined to hire another attorney and after reading through the document, she signed it. The parties married, but a little over two years later Mr. Pownall filed for dissolution.
During their divorce proceedings, the trial court decided that their premarital agreement was invalid because Mrs. Pownall was unaware of the full extent of the property subject to the agreement. The trial court also concluded that a quasi-marital partnership existed and awarded Mrs. Pownall half of the interest that Mr. Pownall owned in his pizza franchises, less the money he contributed to the franchise fee from his separate property.
Next, the court awarded Mrs. Pownall a sum of money for her share of the income in the year that the parties were separated and awarded Mr. Pownall the residence. The court denied wife’s request for spousal maintenance based on the property already awarded to her, the short length of the marriage, and her current employment.
Mr. Pownall appealed their decisions to the Arizona Court of Appeals arguing that the trial court erred in finding the premarital agreement invalid because Mrs. Pownall failed to meet the burden of proof that it was unconscionable or that she didn’t voluntarily sign the agreement.
The appeals court ruled that not only had the attorney that prepared the agreement given a fair and reasonable disclosure of the property value, but Mrs. Pownall knew the lifestyle that the businesses provided and could have independently assessed their value.
Prenuptial Agreements in Arizona | The Ruling
The Arizona Court of Appeals also commented that since she declined the opportunity to hire a separate attorney to protect her interests, she could not later claim they were not on equal bargaining terms. Also, the Arizona Court of Appeals concluded there is no evidence proving she was unfairly compelled to sign the document and thus ruled the premarital agreement to be valid.
Having declared the premarital agreement valid, the appeals court also reviewed the ruling the trial court made in regard to the division of the business interests. The parties agreed husband purchased his interest in the pizza franchises previous to their marriage, but Mrs. Pownall argued they agreed to combine their efforts to acquire property jointly.
The court found that, although the parties maintained joint checking accounts, Mrs. Pownall’s name did not appear on any of the documents for the residence or the businesses and she did not contribute funds to purchase or maintain either.
The court added that the premarital agreement, signed by both parties, clearly indicated husband’s intention to keep the home and businesses as his sole and separate property. Because the evidence did not support her claims, the appeals court ordered that the home and businesses would remain his separate property.
Mr. Pownall also appealed the trial court’s order to pay the wife a share of his income for the year they were separated. The trial court found that while she had exclusive use of the residence, he was still paying the mortgage. He argued that because she had possession, but was not paying the mortgage for the residence, it would not be fair and equitable to require him to pay her a share of his income during the parties’ separation. The court decided that the reimbursement award was equitable and remanded the decision to the trial court for the adjusted amount to be awarded.
Mrs. Pownall cross-appealed the court’s order denying her spousal maintenance, which had been denied because of the short time the parties were married, her gainful employment, and the property that had been previously awarded to her.
She argued that she lacked sufficient property to meet her reasonable needs and that she was unable to support herself through her employment. Because the appeals court found the premarital agreement to be valid, Mrs. Pownall would not be entitled to receive any portion of the values of the residence or the businesses.
Therefore, they remanded the decision regarding alimony back to the trial court taking into consideration the new circumstances of the marital property that will now not be awarded to her.
This case illustrates the importance of having a premarital agreement reviewed by separate attorneys working on behalf of each party’s interests when entering into a marriage with a premarital agreement so that all parties are aware of all benefits and consequences of signing the agreement.
Also, that property acquired during the marriage that wasn’t expressly agreed by both parties to be community property will, in almost all situations, be awarded to the party who purchased it. Lastly, that the amount of spousal maintenance, if any, to be awarded may be impacted by the amount of marital property each spouse is awarded in the proceedings.
More Articles About Divorce in Arizona
- The advantage of Filing Divorce First in Arizona
- Are Prenuptial Agreements Enforceable in Arizona
- Arizona Divorce
- Arizona Divorce Attorney Reviews
- Arizona Divorce Child Custody
- Arizona Divorce Debt
- Arizona Divorce Forms
- Arizona Divorce Laws
- Arizona Divorce Laws Alimony
- Arizona Divorce Laws and Statutes
- Arizona Divorce Laws on Adultery
- Arizona Divorce Papers
- Arizona Divorce Practice
- Arizona Divorce Process
- Arizona Divorce Records Search
- Arizona Marriage Laws
- Asset and Property Search in an Arizona Divorce
- Arizona Divorce When You Can’t Find Your Spouse
- Change to Maiden Name After Divorce in Arizona
- Changing Orders in an Arizona Divorce Decree
- Children and Divorce in Arizona
- College Expenses After Divorce in Arizona
- Complex Divorce Cases in Arizona
- Conciliation Court Services in Arizona
- Consent Required for Marriage of Minors in Arizona
- Considering the Children during a Divorce in Arizona
- Convert to a Covenant Marriage in Arizona
- Coping With Divorce in Arizona
- Court Services to Save a Marriage in Arizona
- Custody of the Family Pet in a Divorce in Arizona
- Dissolution of Marriage in Arizona
- Divorce After Legal Separation in Arizona
- Divorce and Children in Arizona
- Divorce Arizona
- Divorce Case is on the Inactive Calendar in Arizona
- Divorce Court Jurisdiction in Arizona
- Divorce in Arizona Without Children
- Divorce Procedures in Arizona
- Divorce Records in Arizona
- Divorce Statistics in Arizona
- Divorce Support Groups in Arizona
- Domestic Violence and Divorce in Arizona
- Effect of Adultery on an Arizona Divorce
- Effects of Divorce on Children in Arizona
- Enforceable Arizona Prenuptial Agreements
- Failure to Include an Issue in an Arizona Divorce
- Filing for Divorce in Arizona
- Filing for Divorce to Receive Alimony in Arizona
- Guide to Divorce for Men in Arizona
- High Asset Divorce in Arizona
- High Conflict Divorce in Arizona
- High Net Worth Divorce Arizona
- How is a Divorce Finalized in Arizona
- How Long Does a Contested Divorce Take in Arizona
- How Long Does it Take to Get a Divorce in Arizona
- How Long Does it Take to Get Divorced in Arizona
- How Long Does Uncontested Divorce Take in Arizona
- How Long To Be Separated Before Divorce in Arizona
- How long to get Temporary Orders in Arizona
- How Much Does it Cost to Get a Divorce in Arizona
- How to Appeal a Divorce Decree in Arizona
- How To Find Good Divorce Attorney in Arizona
- How to Start a Divorce in Arizona
- Learn About Uncontested Divorce in Arizona
- Legally Separated File Divorce in Arizona
- Marital Settlement Agreement in Arizona
- The merger of the Settlement Agreement in Arizona
- Military Divorce Laws in Arizona
- Misled Into Signing Divorce Settlement in Arizona
- Modifying a Divorce Decree in Arizona
- No Contest Divorce in Arizona
- No-Fault Divorce in Arizona
- Order to Pay Spouses Attorney Fees in Arizona
- Parenting Class During a Divorce in Arizona
- Petition for Dissolution of Marriage in Arizona
- Protect Children in a Divorce in Arizona
- Quick Divorce in Arizona
- Reasons for Divorce in Arizona
- Reasons to File for Divorce in Arizona
- Represent Yourself in Arizona Divorce Case
- Same-Sex Divorce in Arizona
- Sealing Court Records in an Arizona Divorce
- Sell Home During Divorce in Arizona
- Selling Property During a Divorce in Arizona
- Served With Divorce Papers in Arizona
- Serving Divorce Papers by Publication in Arizona
- Should I Keep the House in a Divorce in Arizona
- Social Media Evidence in Divorce in Arizona
- Stop an Arizona Divorce
- Stop an Arizona Divorce if You Change Your Mind
- What Happens at a Resolution Management Conference in Arizona
- What Happens If the Divorce Case Goes to Trial in Arizona
- What Happens Temporary Orders Hearing in Arizona
- What is a Covenant Marriage in Arizona
- What is a Default Divorce in Arizona
- What is a Family Law Master in an Arizona Divorce Case
- What is a Preliminary Injunction in an Arizona Divorce
- What is a Temporary Orders Hearing in Arizona
- What is the Divorce Process in Arizona
- What Reasons Do I Need to Obtain a Divorce in a Covenant Marriage in Arizona
- What to do When Served with Divorce Papers in Arizona
- When Can I File For Divorce in Arizona
Chris Hildebrand wrote this article to ensure everyone has access to information about family law in Arizona. Chris is a divorce and family law attorney at Hildebrand Law, PC. He has over 24 years of Arizona family law experience and has received multiple awards, including US News and World Report “Top Arizona Divorce Attorneys”, Phoenix Magazine “Top Divorce Law Firms”, and Arizona Foothills Magazine “Best of the Valley” award. He believes the policies and procedures he uses to get his clients through a divorce should all be guided by the principles of honesty, integrity, and, quite frankly, actually caring about what his clients are going through in a divorce or family law case. In short, his practice is defined by the success of his clients. He also manages all of the other attorneys at his firm to make sure the outcomes in their clients’ cases are successful as well.
As Seen on CBS News, ABC News, NBC News, and Fox News