Model Answer to MPTE

MULTI-STATE
PERFORMANCE TEST 2
FEBRUARY 1997
In Re Hayworth and Wexler

To: Ellen Levine
Re: Hayworth and Wexler Prenuptial Agreement

 

Two Part Test

1. The Draft Prenuptial Agreement May Not be Enforceable Since It Does Not Fully Disclose the Amount, Character and Value of Mr. Hayworth's Property to Ms. Wexler and Because Ms. Wexler May Not be Found to Have Acted Intelligently and Voluntarily.

In re Marriage of Watson, the court set forth a two-part test to determine whether a prenuptial agreement is fair to the party who is not seeking enforcement of the agreement.

A) Whether full disclosure has been made by the parties of the amount, character, and value of the property involved, and
B) Whether the agreement was entered into intelligently and voluntarily on independent advice and with full knowledge by both spouses of their rights.

The court stated independent representation is not determinative as to the enforceability of the agreement, but depends on the facts in each case. Factors that favor enforceability, even where the spouse was not independently represented include:

Factors favoring enforceability

(1) Advice well in advance of marriage that a premarital agreement would be sought. Here, the wedding is two weeks away. So this factor cuts against enforceability.


(2) Spouse sought to be bound was given a copy of the agreement well in advance of the wedding. This cuts against enforceability for the same reason.


(3) Spouse was advised on numerous occasions to seek independent counsel. We have not yet advised Wendy that we cannot represent her and there is little time left before the wedding. This also works against enforceability.


(4) Spouse sought to be bound had independent knowledge of the nature and extent of assets. While Wendy does not work in Hank's business as did the spouse in the case, she has been dating him for at least two years. She may have independent knowledge of his assets, but at this stage we don't know how this factor would cut.

Factors against enforceability

 On the other hand, factors that have voided a premarital agreement include:
(1) Attorney never advised spouse that he was representing only husband. While there is still time to do this, it must be done with precision and force. You have represented Wendy in the past in a personal injury matter and it may be hard to disabuse her of the belief that you are acting in her best interests, especially given the harsh terms of the draft

.
(2) Attorney did not advise spouse that the practical effect of the agreement was to eliminate any rights she may have in the accumulation of property. While Wendy probably has some knowledge of community property law because she is divorced, this provides a flimsy excuse for not explicitly cautioning her. It is still possible to give Wendy this advice and it should definitely be done.


(3) Disparity in business experience and assets mandates a more vigorous urging to seek independent advice. While Wendy and Hank have the same level of education, their degrees and experience are vastly different. Wendy has an advanced nursing degree, while Hank has an MBA. Further, Wendy has limited assets while Hank is a businessman and has extensive real estate holdings.


(4) The timing of the agreement negated any inclination she might have had to seek independent advice. Hank andWendy are planning to be married in two weeks. This factor inescapably cuts toward voiding the prenuptial agreement.


In conclusion, the agreement as it is now drafted may not be enforceable because Wendy's rights have not been sufficiently protected.


2. Wendy's Being Unrepresented Requires You to Make It Clear That You Are Not Representing Wendy and That You Are Not Disinterested.

Not related to past representation of Wendy

You are quite correct that you should not represent Wendy nor act as an intermediary. However, your past representation of her in an unrelated personal injury case place a heavier burden on you to conform to the Rules of Professional Conduct.


Rule 1.9 covers conflicts of interest concerning former clients. It prohibits representing someone against a former client in the same or substantially related matter.

In our case, Wendy's personal injury settlement is not substantially related to the prenuptial agreement. Therefore, you are not in violation of Rule 1.9.

Wendy may believe you would protect her interests

Rule 4.3 states that when dealing with an unrepresented person, the lawyer shall not state or imply that she is disinterested. The comment to Rule 4.3 cautions the lawyer where the unrepresented person is not experienced in legal matters. The lawyer must offer no advice other than to obtain counsel and must make clear she is not acting in behalf of the unrepresented person.

Wendy is a nurse whose only experience with lawyers may have been her own divorce and her personal injury suit. She is probably inexperienced in legal matters.

There is a greater danger that she may believe you are disinterested or even that you are acting in her interest because you represented her in the past in the personal injury matter.

Therefore, you must take pains to make sure she understands you represent only Hank's interests. Because of her relative lack of sophistication and your past representation, I strongly advise that you insist that she obtain independent counsel. Otherwise, the validity of the agreement may be in jeopardy.

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