Franczak, J. v. Franczak, M.
1892 MDA 2015
| Pa. Super. Ct. | Oct 19, 2016Background
- Married in 1982; separated in late 2008/early 2009. Wife and Husband negotiated and signed a written separation and property settlement agreement on September 13, 2011.
- Agreement awarded Wife the marital home, certain real estate, her retirement account, personal property, and five years of Husband-paid household expenses and insurance in lieu of alimony; Husband awarded other real property and personal property and purportedly assigned his 401(k) to Wife.
- The agreement contained explicit mutual disclosure recitals stating each party had made a full and complete disclosure of all assets and values and that the agreement would not be merged into a divorce decree.
- Wife later challenged the agreement, alleging Husband had depleted his 401(k) before signing (concealing the depletion), and that she signed due to fraud, misrepresentation and duress (including an alleged story that Husband was under criminal investigation).
- A divorce master and the trial court found Husband credible, concluded the disclosure recitals were controlling, rejected Wife’s claims of fraud/duress and dissipation, and upheld the settlement; the Superior Court affirmed.
Issues
| Issue | Wife's Argument | Husband's Argument | Held |
|---|---|---|---|
| Whether Wife lacked full and fair disclosure of Husband’s 401(k) value when signing the settlement | Wife: Husband had liquidated ~ $480,000 from the 401(k) before the agreement and failed to disclose that depletion; she relied on earlier impressions that the account was worth much more | Husband: Wife knew or had access to statements and was told of withdrawals and tax consequences; the agreement recited full disclosure and she had opportunity to verify | Court: Credibility findings favored Husband; presumption of disclosure stood; agreement upheld |
| Whether the agreement was induced by fraud, misrepresentation or duress (including alleged claim Husband was under criminal investigation for bribery) | Wife: Husband told her a fabricated bribery story and pressured her to sign to "protect" assets, plus text messages showed haste and pressure | Husband: Allegations uncorroborated; Wife had opportunity to investigate; no material false representation proved that induced signing | Court: Wife failed to prove the Porreco elements by clear and convincing evidence; credibility findings adverse to Wife; claim rejected |
| Whether Husband dissipated marital assets (401(k)) such that Wife is entitled to equitable reimbursement alimony | Wife: Withdrawals from the 401(k) amounted to dissipation warranting reimbursement | Husband: Even if withdrawals occurred, Wife received substantial financial benefits under the agreement (payments and property); no basis for extra award | Court: Denied equitable reimbursement; agreement provided substantial benefits and no additional alimony warranted |
Key Cases Cited
- Paroly v. Paroly, 876 A.2d 1061 (Pa. Super. 2005) (marital settlement agreements governed by contract principles; review of trial court’s upholding is abuse-of-discretion standard)
- Kripp v. Kripp, 849 A.2d 1159 (Pa. 2004) (contract interpretation: intent from writing; clear terms control)
- Simone v. Simone, 581 A.2d 162 (Pa. 1990) (presumption of full disclosure where agreement recites such disclosure)
- Porreco v. Porreco, 811 A.2d 566 (Pa. 2002) (elements required to void a contract for fraudulent misrepresentation)
- Mackay v. Mackay, 984 A.2d 529 (Pa. Super. 2009) (appellate deference to trial court credibility determinations)
- Ebersole v. Ebersole, 713 A.2d 103 (Pa. Super. 1998) (discussing limits of relying on mere availability of records for disclosure claims)
- Mormello v. Mormello, 682 A.2d 824 (Pa. Super. 1996) (agreement may be invalidated where spouse lacked knowledge of marital estate value)