Adultery Penalties in Premarital Agreements
“Confronting the Challenges of Tax Reform,” that’s the subject of today’s ACTEC Trust and Estate Talk.
“Adultery Penalties in Premarital Agreements,” that’s the subject of today’s ACTEC Trust and Estate Talk.
This is Doug Stanley, ACTEC Fellow from St. Louis, Missouri. Does cheating in a marriage void a premarital agreement? What is an infidelity clause? ACTEC Fellow Professor Elizabeth Carter from Baton Rouge, Louisiana, explains what the adultery provisions are and are they enforceable? Welcome, Elizabeth.
Hi, thanks, Doug. We often hear about these types of provisions with celebrities, so do people really have these and are they enforceable? I should say at the outset that I’m a little bit biased here, I never recommend these types of provisions. But, just like anyone else, I find them very interesting. So, I’m going to cover three issues: 1) what are adultery provisions or penalties, 2) why do I usually advise against them, and 3) are they enforceable?
Adultery Provisions Explained
So, first, what is an adultery provision? Well, that’s a provision in a premarital agreement, or sometimes in a post marital agreement, that attaches some sort of financial penalty on a spouse who commits adultery. You can draft these provisions several different ways; the provision might be reciprocal, punishing each spouse equally in the event of adultery, or they might be one-sided. So, for example, one agreement that I’ve seen included a provision that said that if it was proven or stipulated that a divorce resulted from the infidelity of either spouse, then the non-offending party is entitled to a lump sum of $50,000. I’ll always wonder how people come up with a value for these things, but they do. Sometimes the money is couched in terms of spousal support. So, for example, I’ve seen an agreement where the spouse has waived spousal support entirely, but then the next provision said that if the husband – who I presume is the wealthier spouse in that case – committed adultery, then he had to pay spousal support to the ex-wife equal to $40,000 a year for each year of the marriage up to a maximum of $200,000. Some others will tie adultery to the division of assets at divorce, which is a similar idea.
Issues with Adultery Provisions
So, that’s what they are. Why do I not recommend them? Well, there are lots of reasons, but the most obvious one is that I believe that these provisions usually run counter to the entire purpose of a premarital agreement. When you decide to have a premarital agreement, one of your primary goals presumably is to set the right to the parties in advance in an effort to avoid expensive, uncertain, and demoralizing litigation. The problem with adultery provisions is that they will tend to do the opposite. In many jurisdictions it’s unclear whether these provisions will be enforced – which I’ll talk about in a minute – that uncertainty will obviously incentivize litigation. But, even if you’re in a jurisdiction that would clearly enforce the provision, the couple is likely going to dispute whether an act of adultery even occurred in the first place, and that opens you up for more amazingly embarrassing and demoralizing litigation.
You might be surprised to learn that the terms adultery and infidelity are actually legal terms with a pretty rich legal history. That history has often been rooted in patriarchal notions about women and their sexuality. Even the concept of what specific sexual acts will constitute adultery for legal purposes is often rooted in sexist and patriarchal notions that view a wife’s body and reproductive system as her husband’s property. Some of that has changed, but you certainly see remnants of it today. So just know that when you use a term like adultery or infidelity in a contract, that that’s actually a legal term whose precise definition may not be entirely clear and probably does not align with an individual’s more personalized views about sexual and emotional fidelity within their marriage.
Enforcement of Adultery Provisions
The third and final issue here, and perhaps the most important one, are these provisions enforceable? Well, maybe, maybe not. There are hardly any cases out there on the issue, so it’s very difficult to say whether some sort of penalty provision for adultery will be enforced by a court. And like I said before, that really opens you up to litigation – and litigating something that is very intimate, private, and embarrassing. A handful of courts have specifically refused to enforce these provisions on public policy grounds, but the cases are few and far between, and the rationale of those cases wouldn’t stand up in all states. The general rule in most states is that spouses can enter into marriage contracts with respect to anything that is not prohibited by public policy. So, for example, Section 3 of the Uniform Premarital Agreement Act gives you a non-exclusive list of things that parties can include in a contract, and specifically allows a couple to contract with respect to “any other matter, including their personal rights and obligations not in violation of public policy or statute imposing a criminal penalty.” Louisiana, where I am, is similar. Louisiana Civil Code Article 2329 says that spouses can enter into a contract, “as to all matters that are not prohibited by public policy.”
So, is adultery or fidelity a public policy issue? Well, it depends. In many states adultery remains an independent basis for divorce. Even though these states have no-fault divorce, you can also obtain a divorce based on adultery. Adultery can also affect spousal support or property division in some states. Criminal statutes for a shocking number of states continue to exist for adultery; even though these might not withstand constitutional scrutiny today, they’re still on the books. And so, in states like this, the states have clearly taken an anti-adultery stance, and penalty provisions could conceivably be enforceable. It seems clear that a prohibition on adultery or a penalty provision for adultery might not be counter to state public policy, because state public policy itself takes an anti-adultery view. Other states, however, view no-fault divorce as the exclusive basis for divorce. So, in some states adultery really can’t be considered at all for divorce purposes. It’s not a basis for divorce, it’s not a basis for awarding or denying spousal support, it’s not a factor that can be considered for dividing property. Perhaps the public policy in those states suggests that adultery penalties are not enforceable.
California as a No-Fault Divorce Example
Well, California is one of those states with that type of no-fault stance. And there’s a somewhat famous 2002 California Appeals Court case called Diosdado v. Diosdado where the court refused to enforce an adultery provision in a postnuptial agreement. The agreement was signed after the husband had had an affair, the agreement imposed a financial penalty if he did it again, and – spoiler alert – he did it again. Well, the couple gets divorced, wife sues, shockingly husband now contests the enforceability of that provision. Well, ultimately the California Appeals Court holds that the provision is unenforceable under California law because it ran counter to the public policy as set forth in California is no-fault divorce laws. But that rationale would not hold up in states that still permit adultery to be considered for any reason in a divorce. So, the California case made it really clear that by enacting this no-fault divorce regime, California had made a public policy stance that any type of marital fault was just no longer relevant for divorce purposes, and, in the view of the court, that extended to agreements reached by couples in matrimonial agreements. But that might not hold up, even in other states with laws similar to California’s. There’s an unreported 2020 Hawaii case called Crawford v. Adachi which specifically disagrees with the California case. The court there said that although marital fault is not a basis upon which courts could divide up marital property, that that did not preclude a couple from freely entering into an enforceable agreement to the contrary.
Given the lack of definitive legislation or case law, the enforceability of these provisions around the country is an open question. I think it’s always also a fair question to ask our clients, if they’re really adamant about one of these provisions, what their concern really is. Will money really heal you from the harm caused by the adultery, and if you’re this concerned that your spouse is going to commit adultery, do you think that the financial penalty is enough to prevent it? These provisions are definitely interesting, but they’re also generally inadvisable in my view because of the legal uncertainty regarding their enforceability. A client who insists on one of these provisions is basically asking for litigation down the road.
Thank you, Elizabeth, for your insightful presentation.
You may also be interested in Spousal Support Provisions in Premarital Agreements.
This podcast was produced by The American College of Trust and Estate Counsel, ACTEC. Listeners, including professionals, should under no circumstances rely upon this information as a substitute for their own research or for obtaining specific legal or tax advice from their own counsel. The material in this podcast is for information purposes only and is not intended to and should not be treated as legal advice or tax advice. The views expressed are those of speakers as of the date noted and not necessarily those of ACTEC or any speaker’s employer or firm. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. The entire contents and design of this Podcast, are the property of ACTEC, or used by ACTEC with permission, and are protected under U.S. and international copyright and trademark laws. Except as otherwise provided herein, users of this Podcast may save and use information contained in the Podcast only for personal or other non-commercial, educational purposes. No other use, including, without limitation, reproduction, retransmission or editing, of this Podcast may be made without the prior written permission of The American College of Trust and Estate Counsel.
If you have ideas for a future ACTEC Trust & Estate Talk topic, please contact us at ACTECpodcast@ACTEC.org.
© 2018 – 2022 The American College of Trust and Estate Counsel. All rights reserved.
Latest ACTEC Trust and Estate Talk Podcasts
An overview of how wealth planners and T&E practitioners can comply with the proposed anti-money laundering rules of the Corporate Transparency Act.
Celebrating 200 podcasts, two ACTEC leaders discuss issues and forces shaping the future of the practice and the ability of practitioners to impact lives.