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VALIDITY OF PROPERTY SETTLEMENT - FAIRNESS
© 1998 National Legal Research Group, Inc.
FLORIDA: Petracca v. Petracca, 706 So. 2d 904 (Fla. Dist. Ct. App. 1998).
An agreement settling marriage dissolution litigation is not subject to a "fair and reasonable" determination by the trial judge.
This case basically adopts the view that spouses engaged in dissolution litigation must look out for themselves and cannot seek help from the trial court after the fact if they strike a bad bargain. A litigation settlements in a dissolution case is enforceable without judicial inquiry into the reasonableness or fairness of the agreement in the absence of fraud, misrepresentation, or coercion, the court decided.
Even in this day of overheated divorce litigation, the battle between the parties was fierce. During the two years following the filing of the dissolution petition, the parties filed nearly 70 substantive motions, many of which related to discovery. The case was set for trial on five separate occasions. Just two weeks before the final date set for trial, the parties announced a settlement on the record.
Within a few weeks, the wife replaced her lawyer and filed a motion to invalidate the agreement. A line of Florida cases empowers judges to set aside settlement agreements that make unfair or unreasonable provisions for the challenging spouse, the wife contended. The trial court denied the wife's motion, however, and left the parties with their bargain. The Florida appeals court acknowledged that some Florida case law supports the idea of a fairness inquiry where the challenging spouse shows a reasonable lack of sufficient knowledge of the parties' financial resources. But that line of cases applies only in the prelitigation context when there is some reason to suppose from the relationship of mutual trust and confidence that the parties were not dealing at arm's length and that the agreement resulted from inadequate disclosure of financial resources, the court decided.
Those cases do not apply, the court held, when the challenging spouse has had the benefit of litigation discovery through independently chosen counsel to learn the full nature and extent of the finances of the other spouse. After resorting to litigation over marital property rights, neither party can be thought of as dealing with a fiduciary or as inadequately informed about financial affairs.
On the contrary, the court noted, the law presumes that a litigation settlement made after discovery and just before trial was done with full knowledge by the challenging spouse. This presumption arises from the special treatment that courts give to voluntary settlements of lawsuits. Under the rule for consent judgments, an agreement settling litigation cannot be opened, changed, or set aside in the absence of fraud, mutual mistake, or the actual lack of consent. Therefore, if parties choose to settle a marriage dissolution case without fraud or coercion after adequate opportunity to engage in discovery, they cannot assail the relative fairness of the bargain.
The court observed that to allow a "reasonableness" challenge to a litigation settlement threatens the likelihood of settlement in many cases and thus would require more trials on the merits. If the trial judge could be called on after a settlement to decide what is fair anyway, settlement would be a waste of time, the court noted.
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