Cole, J. v. Cole, L. ( 2017 )

J-A33029-16
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JACK J. COLE IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellee
v.
LAURA M. COLE
Appellant No. 606 WDA 2016
Appeal from the Decree Dated March 31, 2016
In the Court of Common Pleas of Fayette County
Civil Division at No(s): 812 of 2015 G.D.
BEFORE: LAZARUS, J., SOLANO, J., and STRASSBURGER, J.*
MEMORANDUM BY SOLANO, J.: FILED APRIL 24, 2017
Appellant Laura M. Cole (“Wife”) appeals from the March 31, 2016
divorce decree, which made final the court’s June 30, 2015 order. That
order granted the petition of Appellee Jack J. Cole (“Husband”) to confirm a
settlement agreement and stay Wife’s claim for spousal support. We affirm.
The issue in this case is whether the parties entered into an
enforceable oral postnuptial/marital settlement agreement.1 The trial court
set forth the relevant facts as follows:
In April 2015, Plaintiff Husband met with his attorney,
Michelle Kelley, Esquire, in order to discuss an agreement for the
division of marital property. One week later [on April 8, 2015],
____________________________________________
*
Retired Senior Judge assigned to the Superior Court.
1
Wife refers to the agreement as a postnuptial agreement, while Husband
refers to it as a marital settlement agreement.
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the parties together met at the office of Plaintiff Husband’s
attorney, and they engaged in discussions concerning the
division of their assets, resulting from their separation. During
this meeting, the parties provided Attorney Kelley a handwritten,
two-page document which sets forth a list of various assets and
provisions. The document was prepared in Husband’s
handwriting when the parties met together prior to meeting with
Attorney Kelley, and during the meeting between the parties,
they agreed upon certain assets that would be retained and/or
transferred to each of them. The parties referred to this
document during their meeting with Attorney Kelley, and during
the joint meeting, Attorney Kelley made notes on the document
pertaining to the terms of the parties’ agreement.
During their meeting with Attorney Kelley, the parties
discussed the value of the marital home, for which they had an
appraisal, and they discussed the equity in the home. The
parties stipulated that the furnishings in the marital home are
valued at $40,000.00. According to testimony from Attorney
Kelley, the parties discussed the equity in the vehicles owned by
the parties, their respective retirement accounts, and the
amount and duration of alimony to be paid to [Wife]. The parties
discussed the value of each of their marital assets, as well as the
total asset distribution to Wife and to Husband. It was apparent
to Attorney Kelley that the parties ha[d] previously discussed the
distribution of their assets. Attorney Kelley testified that the
parties knew about and understood each of the assets discussed
at the meeting. Attorney Kelley informed both parties that she
need[ed] to “know clearly” what they [were] agreeing on.
Attorney Kelley testified that the parties had a “meeting of the
minds” as to how each of the assets would be distributed. The
parties discussed the value of each of the assets, and the
distributions set forth pursuant to the handwritten list resulted in
a distribution to Wife in the amount of $230,000 and to Husband
in the amount of $234,500.
Based on the testimony of Attorney Kelley, it is clear that
neither party was under duress, nor was there any coercion by
either party during the joint meeting with Attorney Kelley. In
addition, there was no evidence of any fraud or
misrepresentation.
After the parties reviewed their asset distribution with
Attorney Kelley, it was understood that Attorney Kelley would
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prepare a written agreement to reflect the terms of their oral
settlement, and they would each go back into Attorney Kelley’s
office to sign the agreement the following week.
Subsequent to meeting with the parties, Attorney Kelley
received a phone call to inform her that Defendant Wife
“changed her mind” and would not sign an agreement.[2]
Trial Ct. Op., 6/30/15, at 1-3 (pagination added). After learning that Wife
would not sign the agreement, Husband told Attorney Kelley to not prepare
it. N.T., 6/11/15, at 25, 44, 60-61. As a result of these calls, Attorney
Kelley did not prepare a written agreement. Id. at 25. We further note that
both Husband and Attorney Kelley testified at the hearing. Wife did not
testify or present any evidence contradicting Husband and Attorney Kelley’s
version of the events.
On April 27, 2015, Husband filed for divorce. On May 6, 2015,
Husband filed the “Petition for Special Relief to Confirm Settlement
Agreement and to Stay [Wife’s] Claim for Spousal Support” that is the
subject of this appeal. In his petition, Husband asked the court to enter an
order confirming the existence of a binding marital settlement agreement
between the parties and to stay Wife’s claim for spousal support.3 On
June 11, 2015, the trial court held a hearing on Husband’s petition.
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2
Attorney Kelley received the message approximately one week after the
joint meeting.
3
According to Husband’s petition, Wife filed a claim for spousal support on
April 24, 2015, at PACSES Case No. 890115268. See Pet. at ¶ 6. Wife’s
claim is not in the certified record for this case.
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On June 30, 2015, the trial court issued an opinion and order granting
Husband’s petition. After the divorce decree was entered, Wife filed a timely
notice of appeal.4 On appeal, Wife presents the following issue:
Whether the terms and conditions of a post-nuptial agreement
can be held valid based upon a purported oral agreement that is
not in written form and formally executed by either party.
Appellant’s Brief at 4.
We review a trial court’s decision to grant special relief in divorce
actions under an abuse of discretion standard as follows:
Judicial discretion requires action in conformity with law on facts
and circumstances before the trial court after hearing and
consideration. Consequently, the court abuses its discretion if, in
resolving the issue for decision, it misapplies the law or exercises
its discretion in a manner lacking reason. Similarly, the trial
court abuses its discretion if it does not follow legal procedure.
An abuse of discretion exists when the trial court has rendered a
decision or a judgment which is manifestly unreasonable,
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4
In the past, we held that an order upholding a marital settlement
agreement is final and immediately appealable. See Nigro v. Nigro, 538
A.2d 910, 913 (Pa. Super. 1988) (citing Laub v. Laub, 505 A.2d 290 (Pa.
Super. 1986)). However, more recently we stated, “[a]lthough neither Laub
nor Nigro has been expressly overruled, their precedential value with regard
to appealability of an order upholding or enforcing a marital settlement
agreement is in doubt.” Sneeringer v. Sneeringer, 876 A.2d 1036, 1038
(Pa. Super. 2005). In Sneeringer, we noted that the Rules of Civil
Procedure have been amended since Laub and Nigro were decided. See
Sneeringer, 876 A.2d at 1038. In light of the current rules, we held in
Sneeringer that an order addressing enforceability of a settlement
agreement was not a final or collateral order, and thus was not immediately
appealable. Id. at 1039-40. We stated that the aggrieved party would have
an opportunity to challenge the order once a divorce decree had been
entered. Id. at 1040. Accordingly, Wife followed the proper procedure in
this case by waiting until the divorce decree was entered to file an appeal.
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arbitrary, or capricious, has failed to apply the law, or was
motivated by partiality, prejudice, bias or ill will.
Prol v. Prol, 935 A.2d 547, 551 (Pa. Super. 2007) (citations and quotation
marks omitted).
Wife argues that the trial court erred as a matter of law by upholding
an agreement that was not in writing and executed by the parties. Wife
contends that the agreement at issue was a postnuptial agreement, and that
oral postnuptial agreements are unenforceable.
In support of the agreement, Husband relied on Luber v. Luber, 614
A.2d 771 (Pa. Super. 1992), appeal denied, 631 A.2d 1008 (Pa. 1993).
See N.T., 6/11/15, at 61-64; Trial Ct. Op., 6/13/16, at 3. In Luber, after
the wife filed for divorce, she and her husband set forth the terms of a
settlement agreement orally, on the record, before a Master. 614 A.2d at
772. “The Master indicated that, following the parties placing their
settlement agreement on the record, a document reflecting that agreement
would be drafted by counsel.” Id. For reasons that are not clear in the
opinion, the agreement was not reduced to writing. Nonetheless, this Court
held that the agreement was enforceable, explaining that, “[w]here parties
have reached an oral agreement, the fact that they intend to reduce the
agreement to writing does not prevent enforcement of the oral agreement.”
Id. at 773. Wife asserts that Luber is distinguishable because (1) it
involved a marital settlement incident to divorce, not a postnuptial
agreement; and (2) the oral agreement in Luber was on the record. See
Appellant’s Brief at 10; N.T., 6/11/16, at 62-63.
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In holding in favor of Husband and agreeing to enforce the parties’
agreement, the trial court noted that both postnuptial agreements and
marital settlement agreements are “subject to the same general contract
principles.” Trial Ct. Op., 6/13/16, at 1-2 (citing Stoner v. Stoner, 819
A.2d 529, 533 n.5 (Pa. 2003); Simeone v. Simeone, 581 A.2d 162, 165
(Pa. 1990); and Luber, 614 A.2d at 773). The trial court looked to the
following general contract principles:
There must be a meeting of the minds, which requires the assent
of both parties to the agreement. City of Erie v. Fraternal
Order of Police, Lodge 7, 977 A.2d 3 (Pa. Commw. Ct. 2009);
Quiles v. Financial Exchange Co., 879 A.2d 281 (Pa. Super.
Ct. 2005). The intent of the parties to be contractually bound is
a question of fact to be determined by the factfinder. Luber,
614 A.2d at 773; see also Johnston v. Johnston, 499 A.2d
1074 (Pa. Super. Ct. 1985). In determining the intent of the
parties, it is their outward and objective manifestations of assent
that matter, rather than their undisclosed and subjective
intentions. As such, it is not necessary for the parties to come
to a “true and actual meeting of the minds” to form a contract,
so long as their manifested intent reasonably suggests their
assent to the agreement. Long v. Brown, 582 A.2d 359 (Pa.
Super. Ct. 1990); Ingrassia Const. Co., Inc. v. Walsh, 486
A.2d 478 (Pa. Super. Ct. 1984). Moreover, although preliminary
negotiations do not constitute a contract, if the parties orally
agree to all of the terms of a contract between them and
mutually expect the imminent drafting of a written contract
reflecting their previous understanding, that oral contract may
be enforceable. Trowbridge v. McCaigue, 992 A.2d 199 (Pa.
Super. Ct. 2010); Storms ex rel. Storms v. O’Malley, 779
A.2d 548 (Pa. Super. Ct. 2001); Kazanjian v. New England
Petroleum Corp., 480 A.2d 1153 (Pa. Super. Ct. 1984).
Trial Ct. Op., 6/13/16, at 2-3. Applying these principles, the trial court held
that the parties’ agreement was enforceable, even though both parties
decided at the last minute not to reduce it to writing. We agree.
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After careful review of the record, the parties’ briefs, and the trial
court’s decision, we affirm on the basis of the June 13, 2016 trial court
opinion by the Honorable Linda R. Cordaro. See Trial Ct. Op., 6/13/16, at 1,
3-4 (holding (1) the distinction between a “post-nuptial agreement” and a
“marital property settlement” is not significant to this case; (2) the parties’
oral agreement was enforceable because “there most certainly was a
meeting of the minds between the parties as to the distribution of marital
assets” despite the parties’ decision not to commit the agreement to writing;
and (3) there was a full disclosure of marital assets and the presence of a
Master was unnecessary).
We add that in her appellate brief, Wife relies on Section 3106 of the
Divorce Code and the Uniform Commercial Code’s Statute of Frauds to
support her argument. Wife did not mention these statutes in the trial
court, and thus the trial court was not given the opportunity to address their
applicability. Even assuming that Wife did not waive her reliance on these
statutes, we conclude the statutes are inapplicable.
Section 3106 of the Divorce Code, entitled “Premarital agreements,”
provides:
(a) General rule.—The burden of proof to set aside a
premarital agreement shall be upon the party alleging the
agreement to be unenforceable. A premarital agreement shall
not be enforceable if the party seeking to set aside the
agreement proves, by clear and convincing evidence, that:
(1) the party did not execute the agreement voluntarily; or
(2) the party, before execution of the agreement:
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(i) was not provided a fair and reasonable disclosure of the
property or financial obligations of the other party;
(ii) did not voluntarily and expressly waive, in writing, any
right to disclosure of the property or financial obligations of
the other party beyond the disclosure provided; and
(iii) did not have an adequate knowledge of the property or
financial obligations of the other party.
(b) Definition.—As used in this section, the term “premarital
agreement” means an agreement between prospective spouses
made in contemplation of marriage and to be effective upon
marriage.
23 Pa.C.S. § 3106. By its express terms, Section 3106 applies only to
agreements “between prospective spouses made in contemplation of
marriage.” 23 Pa.C.S. § 3106(b). There are no such statutory regulations
addressing postnuptial agreements. Lugg v. Lugg, 64 A.3d 1109, 1112-13
(Pa. Super. 2013). Moreover, Section 3106 deals only with actions to “set
aside” a premarital agreement. Section 3106 therefore has no possible
application to the agreement in this case. We note that the definition of
“premarital agreement” in § 3106 is based on the definition in the Uniform
Premarital Agreement Act. See 23 Pa.C.S. § 3106 cmt. This Uniform Act
has not been enacted in Pennsylvania and, in any event, it does not apply to
postmarital or settlement agreements. See Unif. Premarital Agreement Act
§ 1 cmt.
Wife argues that the requirement of a written waiver of disclosure in
Section 3106(a)(2)(ii) is relevant because “post-nuptial agreements are to
be reviewed under the same principles as a prenuptial agreement.”
Appellant’s Brief at 9. But the “same principles” that apply in this context
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are the general contract principles described by the trial court. See Stoner,
819 A.2d at 533 (“traditional contract rules should be applied to marriage
agreements”). Wife has not identified, and we have not found, any authority
to support the proposition that statutes expressly applicable to premarital
agreements also apply to postnuptial agreements. See Lugg, 64 A.3d at
1112-13. We therefore find Wife’s reliance on Section 3106 misplaced.
We are also unpersuaded by Wife’s argument based on the Uniform
Commercial Code’s Statute of Frauds, 13 Pa.C.S. § 2201, et seq.5 The
Commercial Code applies only to contracts “for the sale of goods.” 13
Pa.C.S. § 2201(a); see id. §§ 2105 (defining “goods” as including all things
movable), 2106(a) (defining “sale” as “the passing of title from the seller to
the buyer for a price”).
Based on the foregoing and the trial court’s well-reasoned analysis, we
affirm. In the event of further proceedings that reference this Court’s
memorandum, the parties shall attach a copy of the trial court’s June 13,
2016 opinion.
Order affirmed.
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5
Wife included an incorrect citation to the statute on page 11 of her brief,
making the identity of the statute on which she relied unclear; but Wife’s
table of citations makes clear that she is relying on the Commercial Code
provision.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/24/2017
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Circulated 04/18/2017 03:21 PM
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RULE 1925(b) OPINION
LINDAR CORDARO,J.
This Court entered an Order and Opinion in the above matter on July 1, 2015,
granting Plaintiffs Petition for Special Relief to Confirm Settlement Agreement and to
Stay Defendant's Claim for Spousal Support. Counsel for Appellant-Defendant filed an
appeal on April 27, 2016, after which this Court directed Appellant-Defendant's counsel
to file a Concise Statement of Matters Complained of on Appeal. The Concise Statement
was subsequently filed on May 20, 2016.
This matter centers on the enforceability of an oral agreement between the parties
as to the distribution of marital property. Appellant-Defendant's counsel insists on
making the distinction that this agreement was in the form of a "post-nuptial agreement"
rather than a "marital property settlement agreement." The Court does not find there to
be any significance to this distinction, as either variation is subject to the same general
contract principles. Simeone v. Simeone, 581 A.2d 162, 165 (Pa. 1990) ("Prenuptial
agreements are contracts, and, as such, should be evaluated under the same criteria as
are applicable to other types of contracts"); Stoner v. Stoner, 819 A.2d 529, 533 n. 5 (Pa.
,(
2003) ("the principles applicable to antenuptial agreements are equally applicable to
postnuptial agreements, although the circumstances may slightly differ"); Luber v. Luber,
614 A.2d 771, 773 (Pa. Super. Ct. 1992), citing Lipschutz v. Lipschutz, 571 A.2d 1046 (Pa
Super. Ct. 1990) ("A property settlement agreement is enforceable by utilizing the same
rules of law used in determining the validity of contracts"); See Also Horowitz v.
Horowitz, 600 A.2d 982 (Pa. Super. Ct. 1991). As such, the only relevant inquiry as far as
this Court is concerned is whether an enforceable agreement was created between the
parties.
The general framework of an enforceable agreement is surely well known to any
legal professional. There must be a meeting of the minds, which requires the assent of
both parties to the agreement. City of Erie v. Fraternal Order of Police, Lodge 7, 977 A.2d
3 (Pa. Commw. Ct. 2009); Quiles v. Financial Exchange Co., 879 A.2d 281 (Pa. Super. Ct.
2005). The intent of the parties to be contractually bound is a question of fact to be
determined by the factfinder. Luber, 614 A.2d at 773; See Also Johnston v. Johnston, 499
A.2d 1074 (Pa. Super. Ct. 1985). In determining the intent of the parties, it is their
outward and objective manifestations of assent that matter, rather than their undisclosed
and subjective intentions. As such, it is not necessary for the parties to come to a "true
and actual meeting of the minds" to form a contract, so long as their manifested intent
reasonably suggests their assent to the agreement. Long v. Brown, 582 A.2d 359 (Pa.
Super. Ct.1990); Ingrassia Const. Co., Inc. v. Walsh, 486A.2d478 (Pa. Super. Ct. 1984).
Moreover, although preliminary negotiations do not constitute a contract, if the parties
orally agree to all of the · terms of a contract between them and mutually expect the
imminent drafting of a written contract reflecting their previous understanding, that oral
contract may be enforceable. Trowbridge v. McCaigue 992 A.2d 199 (Pa. Super. Ct.
2010); Storms ex rel. Storms v. O'Malley, 779 A.2d 548 (Pa. Super. Ct. 2001); Kazanjian
v. New England Petroleum Corp., 480 A.2d 1153 (Pa. Super. Ct. 1984).
Both parties refer only to Luber as legal authority in their oral arguments. In
Luber, the Petitioner-Wife sought an order requiring Respondent-Husband to comply
with the terms of an oral settlement agreement that was made before a Master, but never
reduced to a writing. The agreement was enforced by both the trial court and Superior
Court, as the record before the Master indicated an understanding and assent to the
agreement on the part of both parties. Id., at 773. Appellant-Defendant in the instant
matter argues that Luber should be distinguished from this case, as the agreement here
was not made before a Master, nor was it on the record. Further, Appellant-Defendant
argues that there was not a full disclosure of the marital assets, which would be necessary
if the agreement were characterized as a postnuptial agreement. This Court found no
merit to Appellant-Defendant's argument, as the undisputed evidence of record
demonstrated full disclosure through a two-page list of assets used by the parties and a
calculation of assets made by Attorney Michelle Kelly,who was present for the settlement
discussion. Additionally, there was a clear agreement upon value and distribution of
those assets, and nothing in Luber persuaded this Court that the presence of a Master is
determinative as to whether a contract was formed between the parties.
Lastly, Appellant-Defendant's Concise Statement also provides that the parties
subsequently withdrew from the agreement, but the evidence of record does not support
this conclusion. It was undisputed that Appellant-Defendant left a voicemail for Attorney
Kelly that she no longer wished to sign the agreement, and later, Respondent-Plaintiff
requested that she not draft the agreement. However, the language of that conversation
is telling, as Attorney Kelly indicated on record that Mr. Cole "didn't want to pay for it if
(
I\,
it wasn't going to serve any purpose at this point." Petition for Special Relief Proceedings,
p. 25 (June 11, 2015). Counsel for Respondent-Plaintiff further clarified this statement
by asking Attorney Kelly if Mr. Cole indicated simply that he did not wish to pay for a
written agreement, rather than that he had changed his mind, and Attorney Kelly
confirmed that this was in fact the case. Proceedings, p.44; This Court finds that there
most certainly was a meeting of the minds between the parties as to the distribution of
marital assets by way of an oral agreement made before Attorney Michelle Kelly, and as
such, that agreement is legally enforceable.
The Court respectfully submits the aforementioned reasoning for its order and
opinion in this matter for the Superior Court's consideration.
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LINDA R. CORDARO, JUDGE