delivered the opinion of the Court.
Anne Ridgely Hartz went into the equity court in Montgomery County to have set aside (a) an antenuptial agreement with her late husband, Barge 3b. Hartz, by which each relinquished all rights in the property and estate of the other; (b) certain gifts of stock, some outright, some in trust, which Barge Hartz had made several years before his death; and (c) to procure
Judge Shook hеld that the antenuptial agreement was invalid because there had been no full disclosure of assets by either party to the other, but although Mrs. Hartz won the first battle she in effect lost the war when the chancellor ruled that the ínter vivos transfers of stock were valid and effective. The losing parties appealed (in separate appeals which were argued together) the holdings against them. 1 We have concluded that the antenuptial agreement was valid and effective according to its terms and therefore do not reach the other questions in the appeals.
Qn the evening оf January 23, 1954, Anne Ridgely Offutt, fifty-six years old, whose husband had died in 1951, met Barge Hartz, sixty-one years old, whose wife had divorced him in 1951, at a dinner at a country club in Chevy Chase. A whirlwind courtship of twenty-eight days followed. Hartz was the owner of almost all of the stock of the Colonial Ice Cream Company, which had a plant not far from the Capitol in Washington, and was its president and operating head. Among the assets of the company was a farm of just over a thousand acres in Virginia, partly in Fauquier County and partly in Rappahannock County. It was Hartz’s custom to stay from Friday to Wednesday at the farm, on which was a substantial residence, and then return to Washington to direct his company from Wednesday to Friday. From January 23 to February 20, 1954, when they were married, Mr. Hartz took Mrs. Offutt to lunch
Mrs. Offutt did not then have “everything in the world” but she did have a substantial estate she had inherited from her husband. She owned a store property in Bethesda worth in 1954 some $160,000 which produced for her a net income of $9,600 a year and a two-thirds interest in the Bradley Terrace Apartments in Chevy Chase, her interest being worth some $140,000, and producing from $4,800 to $5,300 a year. Her total income was from $14,400 to $14,900 a year.
Mrs. Offutt supervised both of these income-producing properties, the store with the help of her thirty-year-old son, and the apartments — there w’ere over twenty — with the help of a janitor and an accountant. Mrs. Offutt collected the rents, kept the accounts, summoned the painter, the plumber and other nec
The financial picture of Mr. Hartz in early 1954 showed that he was worth approximately as much as Mrs. Offutt. He owned outright 1,510 share of the common stock of Colonial Ice Cream Company and held 700 shares as trustee under an agreement with his divorced wife, made in 1951, by which she would get the 700 shares or $25,000 in cash within sixty days of his death. There were 2,345 shares outstanding. The company had paid no dividend for many years. After paying Hartz a salary of $27,500 it had a net profit of $26,171.29 for 1952 and $1,527.30 for 1953. Out of his salary Hartz had to pay his divorced wife $9,600 a year. The ice cream plant was appraised by a quаlified witness at $271,500 as of February 1954, which meant a net of $161,500 after deducting a mortgage of $110,000. The only other real asset of any value of the company was the farm which had been appraised in 1956 by three well qualified local appraisers at $150,000. On the testimony of one of these it could be properly found that the farm would have been worth ten per cent less in 1954, or $135,000. The net aggregate value of the real estate was some $296,000.
The book net worth of the holdings of Mr. Hartz and Mrs. Offutt was quite nearly equal in 1954, and their respective net incomes were not far apart. The valuation which Hartz and his first wife put on the stock of Colonial in 1951, when they dealt at arms’ length, was $25,000 for 700 shares, or less than $36.00 a share. On that basis the 1,510' shares Hartz held outright would have been worth $54,300. The book value of Colonial common stock per share as of December 31, 1953, was $229,-680.84, or about $98.00 a share, and this included the farm at a valuation of $136,335.55 as well as the personal property on the farm and in the plant. At $98.00 a share the total worth of 2,210 shares was $216,580 (less $25,000 if the first Mrs. Hartz took cash) or $147,980 if she took the 700 shares. 2
“made a statement of fact to me and asked me certain questions, as a result of which the agreement was prepared. * * * She informed me she wаs contemplating a marriage with Mr. Hartz; that they both had at least one child and that they both wished to protect the interests of their respective children; that Mrs. Hartz told me that she would not marry Mr. Hartz if it would in any way jeopardize her estate going to her son. * * * She told me she had discussed this matter with Mr. Hartz and that Mr. Hartz had indicated that it was acceptable to him to have her estate protected so that he would not have any claim in it.”
The lawyer was then asked: “* * * do you mean to infer that the initiative of this agreement was with Mrs. Hartz?” He answered: “That was my understanding * * *. Mrs. Hartz told me they both had an estate * * * that they wished to рrotect for their respective children, and that she would not marry him unless it could be done * * *. It was that simple.” The lawyer knew nothing of the estate of Mr. Hartz except what Mrs. Offutt told him. She told him Mr. Hartz was the “owner or part owner or operating head” of the Colonial Ice Cream Company and had a farm near Culpeper where she expected to go to live. The agreement contained the clause:
“It is further agreed that this agreement is entered into by each party with a full knowledge on the part of each as to the extent and probable value of the estate of the other аnd of all the rights conferred by law upon each in the estate of the other by virtue of said proposed marriage, but it is their desire that their respective rights in each other’s estate shall be determined and fixed by this agreement * *
The lawyer said that clause was put in the agreement because
“Mrs. Offutt told me they both had estates they wished to protect, and that the estates were such they would not contemplate the marriage without protecting the estate, particularly Mrs. Offutt would not * * I was led to believe that they both had estates that were substantial.”
The lawyer first drafted an agreement to be executed by Mr. Hartz only. He then received a call from a lawyer who represented Mr. Hartz informing him that the agreement was to be executed by both. He then conferred with Mrs. Offutt by telephone and with her consent drafted the agreement that later was signed, and he mailed a copy to Mr. Hartz’s lawyer. Thereafter, on February 17, 1954, three days before they were married, Mr. Hartz and Mrs. Offutt came to her lawyer’s office and signed and swore to the agreement. The lawyer recorded it in the land records in August 1955.
The agreement recites that it is to bar the right of each in and to the property and estate of the other “in order that the proposed marriage may take place, with the respective children, heirs and devisees of the parties being protected from any possible claim of the surviving party * * Each agrees to make no claim given by law or statute on the estate of the survivor, and each agrees that he or. she will join in any conveyance of the real or personal estate of the other necessary to make the conveyance effectual. Finally, as was said earlier, each agrees that he or she has “full knowledge” of the “extent and probable value of thе estate of the other and of all rights conferred by law upon each in the estate of the other. * *
The law on the point in Maryland is clear and well established. The validity, propriety and, indeed, favor in the eyes of the law of antenuptial agreements settling or barring property rights of the parties is recognized.
Naill v. Maurer,
The Court held there had been no disclosure of worth despite a recital in the agreement that the woman knew the value of the man’s property and concluded that what the wife was to receive was greatly disproportionate to what she otherwise would have been entitled, and was not on its face fair and reasonable. It further concluded that the personal representative of the husband had not met the burden of proof cast upon the estate in such case to show that the woman actually knew, un
Levy
was followed by
Ortel v. Gettig,
The Court said the real question on the merits was “whether the case is controlled by Levy v. Sherman, or falls outside of its operation because the marriage was one of convenience.” The Court held that as in Levy a confidential relationship existed and that the facts were sufficiently аnalogous to those in Levy to require it to control. The Court noted that the wife acknowledged that she knew the husband had an electrical business and owned several shorefront houses in Baltimore County, but found she knew nothing of his intangible property or the value of the business or real estate, and held that “such indefinite knowledge or information falls far short of actual knowledge of his worth.”
Levy
and
Ortel
establish the law of Maryland to be that there is a confidential relationship- between a man and a woman who are about to enter into an antenuptial agreement whether or not they are then engaged and whether or not the marriage is to be one of convenience; that this confidential relationship calls for frank, full and truthful disclosure of the worth of the property, real and personal, as to which there is a waiver of rights in whole or in part, so that he or she who waives can know
The real test in a determination of the validity of an ante-nuptial agreement is whether there was overreaching, that is, whether in the atmosphere and environment of the confidential relationship there was unfairness or inequity in the result of the agreement or in its procurement. Frank, full and truthful disclosure of what is being relinquished (or in lieu thereof actual knowledge otherwise available or obtained) is the key that turns the lock of the door leading to impregnable validity. 4
In determining whether or not the one who waives was prejudiced or unfairly or unreasonably treated, either in result or in being induced to enter into the contract to waive, the courts have weighed and assessed various pertinent and relevant factors, including the situation of the parties, their ages, their re
Mrs. Offutt and Mr. Hartz were of mature and comparable age, each was in apparent good health, each moved in the same general social strata as the other, each had been previously married and had one adult son to whom presumably would pass at the death of his parent, by intestacy or by will, the property worth approximately $300,000 which each parent possessed (and which produced comparable incomes for each). Each released all claims during life and at death to the principal of the other. The rights released by each were the same and of an almost equal value. For example, under Code (1957), Art. 93, § 136, whichever spouse survived the other would have a right to claim the same proportionate share in the estate of the decedent. Each kept approximately the same amount, and the result was a mutual allowance or benefit to each. This apparently was recognized in Ortel, where the Court decided that the same rules were to be applied where the prospective wife got nothing under the agreement as where she was to receive a small allowance, and then emphasized “that there was a great disparity between the values of the estates of the prospective husband and wife.” The opinion in Levy noted several times that the wife in that case had no property.
Mrs. Hartz conceded in her testimony that she signed the agreement voluntarily and intended to be bound thereby, and the chancellor so found, saying: “the contract was voluntarily entered into between the parties, each of whom had independent legal advice.” There can be no doubt that Mrs. Offutt knew and understood that by virtue of the terms and provisions of the agreement Mr. Hartz had no legal right to any part of her property during her life or after her death and that she knew and understood that when she signed the agreement she was waiving, giving up and relinquishing exactly the same rights and claims as had he, with the result that she would have no legal right to any part of his principal during his life or at his death.
The chancellor found as a fact “that Mr. Hartz and Mrs. Hartz considered the agreement to be valid during the ten years of their married life.” Mr. Hartz gave his wife $500 a month for about a year after their marriage but stopped doing so after their first joint income tax return was sent to him by his accountant (perhaps he felt that he was making an equivalent allowance by paying the tax attributable to her income). Mrs. Hartz said from the stand that she first became “dissatisfied” with the antenuptial agreement when the $500 a month payments stopped. The record is barren as to any demand therefor or assertion that the agreement was invalid for failure of consideration or otherwise during the remaining nine years of their
In 1959 Mrs. Hartz found and read a will in which Mr. Hartz recited that “My dear wife * * * and I entered into a prenuptial agreement under date of February 17, 1954,” and provided that “Notwithstanding the provisions of said agreement, I give * * * to my wife * * * ($15,000) if she survives me.” Mrs. Hartz did nothing to dispel her husband’s belief in and reliance on the validity of the agreement or to show that she did not think it valid. In 1956 and again in 1959 Mrs. Hartz executed deeds of trust on her properties by her sole signature in reliance, the instruments reсited, on the antenuptial agreement of February 17, 1954. 6
Coming to the test listed last, it appears that the wife’s ability to live as comfortably after the death of her husband as she did before the marriage and during the marriage was not prejudiced or substantially altered by the agreement. She retained as her own her income producing estate and may well have been able to save each year of her marriage a significant part of her annual income.
Order dismissing the amended and supplemental bill of complaint affirmed, costs to be paid by Anne Ridgely Hartz.
Notes
. Mrs. Hartz moved to dismiss the appeal from the finding that the antenuptial agreement was invalid on the ground that the order of appeal was in the name of John, D. Hartz (the son of Barge Hartz by a prior marriage) without the designation of “Executor of Barge Hartz.” We think that if, as hеre, the record as a whole makes plain the representative capacity of the party appealing even though he does so without designation, C. J. S.
Appeal and Error
§ 416; Niosi v. Aiello (D. C. Mun. Ct. App. 1949),
. Several years after the marriage, Colonial sold its ice cream business at a good profit over book value and leased its plant for
. The careful practitioner has often caused to be prepared an, itemization of the property covered by the agreement with appraised values and caused it to be made a part of the agreement.
. In spite of her testimony that she did not know, there is in the record much which could have led the chancellor to find that Mrs. Oifutt knew or should have known that Mr. Hartz had property worth at least as much as, if not considerably more than, she had — that is, the testimony of her sister-in-law, Mrs. Ridgely, the testimony of her lawyer as to his knowledge of the assets of Mr. Hartz, his two-day work week, his desire to give his prospective wife $500 a month “pin money,” and other indications.
These sources of information well may have led Mrs. Offutt to
Mrs. Offutt, a literate and intelligent woman, signed and swore to the statement put in the agreement by her lawyer as a result of what she had told him about the extent, nature and general value of her intended husband’s property and resources. It has been held that such a formal recital is prima facie evidence that the man has made full disclosure of his worth or that she otherwise had adequatе knowledge and that the burden is then upon the wife to disprove this. In re Snyder’s Estate (Pa.),
. Mrs. Hartz says that in March 1964 Mr. Hartz, without cause or justification, suddenly said he wanted nothing more to do with her. Mr. Hartz had a prostate operation in 1959 and in 1964 was forced to undergo an orchidectomy. In his last months he suffered badly from enuresis and needed much physical care and attention. Mrs. Hartz left him with his consent to go on a visit to Boston. When she returned, she says he told her that he wanted nothing more to do with her and rejected her efforts to care for him and help him for three weeks. Then on her physician’s advice she went to Florida. His lawyer testified that Mr. Hartz told him this made him “hurt and discouraged * * * his wife had abandoned him when he had become physically incapable and a burden upon her and he was quite resentful of that fact.” This was the reason, according to the lawyer, that he made no provision for Mrs. Hartz in his last will executed on March 30, 1964.
. The chancellor would not admit the proffered deeds of trust. Mrs. Hartz conceded they were made and contained the recital as to reliance on the agreement but denied their relevance and materiality. We think they should have been admitted.
. Recent cases in which the situation of the parties was analogous, to that in the case before and in which the Court sustained the antenuptial agreement include In re Stever’s Estate (Colo.),
