Michael O. Hall v. Susan M. Hall

Feb 11 2015, 8:53 am
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Nicole A. Zelin Michael C. Cooley
Pritzke & Davis, LLP. Dawn E. Wellman
Greenfield, Indiana Allen Wellman McNew Harvey, LLP
Greenfield, Indiana
IN THE
COURT OF APPEALS OF INDIANA
In re the Marriage of: February 11, 2015
Court of Appeals Case No.
Michael O. Hall 30A01-1407-DR-311
Appeal from the Hancock Circuit
Appellant-Respondent,
Court
The Honorable Richard D. Culver,
v. Judge
Case No. 30C01-1311-DR-1994
Susan M. Hall,
Appellee-Petitioner
Crone, Judge.
Case Summary
[1] Michael O. Hall (“Husband”) appeals the trial court’s division of property upon
the dissolution of his marriage to Susan M. Hall (“Wife”). Specifically,
Husband challenges the trial court’s conclusion that a written agreement
between the parties providing for certain property rights in the event of the
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dissolution of the marriage constitutes a valid and enforceable reconciliation
agreement. Finding no clear error, we affirm.
Facts and Procedural History
[2] The evidence favorable to the trial court’s judgment indicates that Husband and
Wife married on March 2, 2004. Approximately eight months later, Husband
became incarcerated. In December 2004, Wife sought the advice of counsel to
pursue the dissolution of the marriage. Wife informed Husband that she
intended to dissolve the marriage due to his untruthfulness regarding his
finances and criminal history, and also because of the parties’ separation.
Husband did not want the marriage to be dissolved. Wife was adamant about
dissolving the marriage and conveyed this to Husband. Husband told Wife that
he would do anything to make her more comfortable with him. It was
Husband’s idea that the parties could make an agreement that would give Wife
financial protection in the event of a future divorce. Wife agreed to no longer
pursue a dissolution of marriage in exchange for such an agreement.
[3] Wife asked her counsel to draft the type of agreement that Husband and Wife
had discussed. When counsel was unresponsive for several months, Wife
decided that she would need to draft the agreement herself. Before doing so,
however, Wife had numerous discussions with Husband about each party’s
assets and the type of information that would be included in the agreement.
Thereafter, Wife drafted a document titled “Postnuptial Agreement” (“the
Agreement”), dated April 3, 2005, wherein the parties agreed to a distribution
of real and personal property in the event of dissolution. The Agreement
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provided that the parties “agree to keep separate any properties or assets that
either party brought to the marriage or incur during the marriage in separate
name and/or separate business or farm names.” Appellant’s App. at 37. The
Agreement stated that “[b]oth parties agree to keep properties and assets
separate and lay no claim to the other[’]s property or assets in the event of
divorce or separation or legal action against the individuals….” Id. Further,
“[b]oth parties agree to be jointly responsible for those properties and assets
acquired under joint names of ownership from this time forward.” Id. The
Agreement provided an itemized list of the assets held by each party on the date
of the Agreement.
[4] Wife mailed the Agreement to Husband for his review and signature. Husband
reviewed the Agreement and signed it before a notary public in the Department
of Correction on April 6, 2005. After signing the Agreement, Husband mailed
it back to Wife. Wife signed the Agreement after receiving it from Husband.
After the Agreement was executed, Wife no longer pursued the dissolution of
the parties’ marriage.
[5] While Husband remained incarcerated, Wife assisted him with his financial
affairs, retained his personal belongings at her residence, and continued to visit
him in the Department of Correction. Husband was released from
incarceration in June 2006 and returned to live with Wife. The parties resided
together as a married couple from the date of Husband’s release until they
separated on October 23, 2013. Throughout that time, the parties abided by the
terms of the Agreement by keeping their respective real and personal property
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separate and treating any properties placed in both parties’ names as a joint
responsibility and obligation.
[6] Wife filed a petition for dissolution of marriage on November 5, 2013. The
parties participated in mediation until February 2014, when Wife filed a motion
to enforce the Agreement. Id. at 9. Following an evidentiary hearing, the trial
court entered its findings of fact, conclusions thereon, and judgment
determining that the Agreement was a valid and enforceable reconciliation
agreement “made in contemplation of and in exchange for reconciling the
parties’ marriage.” Id. at 49. Specifically, the trial court concluded in relevant
part,
28. The facts establish that the parties herein were sufficiently
separated and [Wife] was sufficiently furthering her rights to terminate
the marriage, such that the extension of marriage as a result of the
execution of the reconciliation agreement is sufficient and adequate
consideration to make the agreement binding.
29. Sufficient mutual intent exists and is evidenced by the parties
operating their respective businesses and real and personal property
interests in accordance with the terms of the reconciliation agreement
for numerous years following the document[’]s execution.
30. In furtherance of public policy of this State, the amicable
settlement by written agreement of the property rights of those citizens
whose marriage is being dissolved should be strictly enforced to the full
extent of the agreement; therefore, the [Agreement] in this case should
be strictly enforced and neither party shall claim a right or interest in
the other parties[sic] assets which are titled or deeded in his or her
name, solely.
Id. at 48-49 (internal citation omitted).
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[7] Husband filed a motion to certify the order for interlocutory appeal, which was
denied by the trial court. A final dissolution hearing was held on June 16,
2014, and a decree of dissolution was entered on June 24, 2014. Among other
things, the dissolution decree provided for the division of property in
accordance with the Agreement. This appeal ensued.
Discussion and Decision
[8] Husband asserts that the trial court erred in concluding that the Agreement is a
valid and enforceable reconciliation agreement. In making its decision, the trial
court entered findings of fact and conclusions thereon pursuant to Indiana Trial
Rule 52(A). Our two-tiered standard of review is well settled:
[F]irst we determine whether the evidence supports the findings, and
second, whether the findings support the judgment. In deference to
the trial court’s proximity to the issues, we disturb the judgment only
where there is no evidence supporting the findings or the findings fail
to support the judgment. We do not reweigh the evidence, but
consider only the evidence favorable to the trial court’s judgment.
Those appealing the trial court’s judgment must establish that the
findings are clearly erroneous. Findings are clearly erroneous when a
review of the record leaves us firmly convinced that a mistake has been
made. We do not defer to conclusions of law, however, and evaluate
them de novo.
Mysliwy v. Mysliwy, 953 N.E.2d 1072, 1076 (Ind. Ct. App. 2011) (citations
omitted), trans. denied.
[9] Other panels of this Court have recognized that “public policy favors the
amicable settlement by written agreement of the property rights of citizens
whose marriage is being dissolved.” Gaskell v. Gaskell, 900 N.E.2d 13, 17 (Ind.
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Ct. App. 2009) (citing Flansburg v. Flansburg, 581 N.E.2d 430, 433 (Ind. Ct.
App. 1991), trans. denied (1992)). It has long been held that antenuptial
agreements are valid and binding “so long as they are entered into freely and
without fraud, duress, or misrepresentation and are not, under the particular
circumstances of the case, unconscionable[,]” In re Marriage of Boren, 475
N.E.2d 690, 693 (Ind. 1985), and we have concluded that the same should
apply to reconciliation agreements made between parties in order to preserve
the marriage. Flansburg, 581 N.E.2d at 436. As Husband challenges the
validity of the Agreement here on several grounds, we will address each
challenge in turn.
Section 1 – The Agreement was supported by adequate
consideration.
[10] Husband first argues that the Agreement is not a valid reconciliation agreement
because it lacked adequate consideration. We have stated that “the extension
of a marriage that would have otherwise been dissolved but for the execution of
an agreement to reconcile has been deemed adequate consideration” to support
a reconciliation agreement. Id. at 434.
[11] Both Husband and Wife testified that, although Wife had sought counsel and
was adamant about pursuing the dissolution of the parties’ marriage, she
decided not to pursue the dissolution only after and because the parties
executed the Agreement. Indeed, the evidence indicates that the Agreement
was originally Husband’s idea and that both parties fully intended and accepted
that the purpose of the Agreement was to preserve a marriage that otherwise
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would be dissolved. The parties remained married for an additional eight years
after execution of the Agreement and abided by the terms of the Agreement
during that time. This evidence supports the trial court’s findings and
conclusion that the Agreement constituted a reconciliation agreement
supported by adequate consideration.
[12] Husband maintains that “[a]t no time did the parties, in any legal sense,
separate or move to dissolve the marriage,” and therefore the record does not
support a conclusion that the marriage would have been dissolved but for the
Agreement. Appellant’s Br. at 8. Husband points to language used by this
Court in our prior opinions and argues that a valid reconciliation agreement
may only be made between parties who have legally “separated or filed for
dissolution.” See Gaskell, 900 N.E.2d at 17 (quoting Flansburg, 581 N.E.2d at
436). Husband claims that Wife’s mere contemplation of dissolving the
marriage was not sufficient.
[13] We acknowledge the language used in Gaskell and Flansburg and recognize that,
most often, the initiation of dissolution proceedings will in fact precede the
execution of a reconciliation agreement as it did in those cases. Nevertheless,
we disagree with Husband that such is a condition precedent to a valid and
enforceable reconciliation agreement. The proper inquiry is whether the
agreement was executed in order to preserve and extend a marriage that
otherwise would have been dissolved but for the execution of the agreement, see
Flansburg, 581 N.E.2d at 434, regardless of whether formal separation has
already occurred or legal proceedings initiated. Based upon the evidence
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referenced above, the trial court concluded that “the parties herein were
sufficiently separated” and Wife was “sufficiently furthering her rights to
terminate the marriage, such that the extension of marriage as a result of the
execution of the [Agreement] is sufficient and adequate consideration to make
the agreement binding.” Appellant’s App. at 49. This conclusion is supported
by the trial court’s findings of fact and, under the circumstances presented,
Husband has not convinced us that a mistake has been made.
Section 2 – Husband was not under duress when he signed the
Agreement.
[14] Husband next asserts that the Agreement is unenforceable because he signed
the document under duress. On this issue, the trial court specifically found that
“[n]either party was under duress or undue influence prior to or during the
signing” of the Agreement. Id. at 47. Husband maintains that he was under
duress because he was incarcerated, without access to legal counsel, and
because Wife threatened to divorce him if he did not sign the Agreement.
[15] “‘In order to avoid a contract on the basis of duress, there must be an actual or
threatened violence [or] restraint of a man’s person contrary to law, to compel
him to enter into a contract or discharge one.’” Youngblood v. Jefferson Cnty. Div.
of Family & Children, 838 N.E.2d 1164, 1170 (Ind. Ct. App. 2005) (quoting
Carrasco v. Grubb, 824 N.E.2d 705, 711 (Ind. Ct. App. 2005), trans. denied), trans.
denied (2006). “In deciding whether a person signed a document under duress,
‘the ultimate fact to be determined is whether or not the purported victim was
deprived of the free exercise of his own will.’” Id. (quoting Raymundo v.
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Hammond Clinic Ass’n, 449 N.E.2d 276, 283 (Ind. 1983)). There is no evidence
in the record that Husband was deprived of the free exercise of his own will
regarding the execution of the Agreement. Husband’s reliance on the mere fact
of his incarceration as clear evidence of duress is unpersuasive. Husband’s
further argument that he was under duress because Wife was threatening to
divorce him if he did not sign the Agreement is similarly unpersuasive and begs
the question of the entire purpose of any reconciliation agreement. The trial
court’s finding on this issue is not clearly erroneous.
Section 3 – A meeting of the minds occurred.
[16] Husband maintains that the Agreement is unenforceable because, although
both parties signed the document, Wife’s signature was neither notarized nor
dated, and therefore there is insufficient evidence that a “meeting of the minds”
occurred. “A meeting of the minds of the contracting parties, having the same
intent, is essential to the formation of a contract.” Zimmerman v. McColley, 826
N.E.2d 71, 77 (Ind. Ct. App. 2005). The intent of the parties to a contract is a
factual matter to be determined from all the circumstances. Id. Husband
directs us to no authority, because there is none, that a notarized and dated
signature is required to effectuate a meeting of the minds of the contracting
parties. Significantly, the trial court made numerous findings of fact regarding
the authenticity of the parties’ signatures and their mutual intent in contracting,
and Husband makes no argument that any of those findings are unsupported by
the evidence. Husband essentially requests us to reweigh the evidence in his
favor, which we may not do. We find no error.
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Section 4 – The trial court did not abuse its discretion when it
admitted parole evidence.
[17] Finally, Husband contends that the trial court abused its discretion when,
during the hearing on Wife’s motion to enforce the Agreement, it admitted
parole evidence regarding Wife’s “intent behind the creation of the
[Agreement].” Appellant’s Br. at 10. We disagree.
[18] We review the admission or exclusion of evidence only for an abuse of
discretion. Reed v. Bethel, 2 N.E.3d 98, 107 (Ind. Ct. App. 2014). It is well
settled that parole evidence “may be considered if it is not being offered to vary
the terms of the written contract[.]” Goodrich Quality Theaters, Inc. v. Fostcorp
Heating & Cooling, Inc., 16 N.E.3d 426, 439 (Ind. Ct. App. 2014) (citation
omitted). Among other reasons, parole evidence may be considered to “show
the nature of the consideration supporting a contract” and “to shed light upon
the circumstances under which the parties entered into the written contract.”
Id. Our review of the record reveals that these are precisely the reasons that the
trial court admitted Wife’s testimony and her testimony was in no way offered
to vary the terms of the Agreement. The trial court did not abuse its discretion
in admitting Wife’s testimony.
Conclusion
[19] In sum, the trial court’s conclusion that the Agreement is a valid and
enforceable reconciliation agreement is not clearly erroneous. Therefore, the
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trial court did not err in distributing the marital estate in accordance with the
Agreement. As our supreme court has eloquently observed,
The truth is, it is exceedingly difficult to imagine why, in any case
where there is no fraud, courts should displace the judgment of
contracting parties and substitute their own. No persons in the world
can so well and so justly judge as the contracting parties themselves,
and it is only in the strongest and clearest cases that courts should
disregard their judgment, and never where there is neither positive
wrong nor fraud.
Boren, 475 N.E.2d at 694. We affirm the decision of the trial court.
[20] Affirmed.
Friedlander, J., and Kirsch, J., concur.
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