For Richer, Not Poorer: Premarital Waivers of Spousal Support in California

Loyola of Los Angeles Law Review Loyola of Los Angeles Law Review

Volume 49 Number 4 Article 4

2016

For Richer, Not Poorer: Premarital Waivers of Spousal Support in For Richer, Not Poorer: Premarital Waivers of Spousal Support in

California California

J. Nicholas Marfori

Loyola Law School, Los Angeles

Follow this and additional works at: https://digitalcommons.lmu.edu/llr

Part of the Contracts Commons, and the Family Law Commons

Recommended Citation Recommended Citation

J. Nicholas Marfori, For Richer, Not Poorer: Premarital Waivers of Spousal Support in California, 49 LOY.

L.A. L. REV. 843 (2016).

This Developments in the Law is brought to you for free and open access by the Law Reviews at Digital Commons

@ Loyola Marymount University and Loyola Law School. It has been accepted for inclusion in Loyola of Los

Angeles Law Review by an authorized administrator of Digital Commons@Loyola Marymount University and Loyola

Law School. For more information, please contact [email protected].

For Richer, Not Poorer: Premarital Waivers of Spousal Support in California For Richer, Not Poorer: Premarital Waivers of Spousal Support in California

Cover Page Footnote Cover Page Footnote

J.D., May 2016, Loyola Law School, Los Angeles. Thank you to Professor Jan C. Costello, whose expertise

and advice made this Article possible, and to the editors and staff of the Loyola of Los Angeles Law

Review for their hard work and dedication. A special thank you to Lindsey and my family and friends for

their continual support and encouragement.

This developments in the law is available in Loyola of Los Angeles Law Review: https://digitalcommons.lmu.edu/llr/

vol49/iss4/4

843

FOR RICHER, NOT POORER:

PREMARITAL WAIVERS OF SPOUSAL

SUPPORT IN CALIFORNIA

J. Nicholas Marfori

California law is fairly straightforward with respect

to premarital agreements that seek to alter community

property rights in the event of a divorce. But it is unclear

and unsettled with respect to those agreements that seek to

limit or waive spousal support. Although California

prohibits courts from enforcing premarital waivers of

spousal support if it would be unconscionable to do so at

the time of enforcements, courts have not articulated a clear

standard for what that means. California made its first

attempt to do so in In re Marriage of Facter. This Article

considers that decision in illustrating how current law,

which does not clearly define unconscionability, allows

courts to arbitrarily decide when such a waiver is fair. This

Article argues that, instead, courts must consider the

balance between freedom of contract and public policy

embodied in the California Family Code. Finally, this

Article concludes by proposing a set of policy-based

guidelines that courts and the legislature can consider in

determining the enforceability of such waivers under

existing law.

∗ J.D., May 2016, Loyola Law School, Los Angeles. Thank you to Professor Jan C.

Costello, whose expertise and advice made this Article possible, and to the editors and staff of the

Loyola of Los Angeles Law Review for their hard work and dedication. A special thank you to

Lindsey and my family and friends for their continual support and encouragement.

844 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

TABLE OF CONTENTS

I. INTRODUCTION ............................................................................. 845

II. THE EVOLUTION OF CALIFORNIA LAW ON SPOUSAL SUPPORT

WAIVERS ................................................................................ 848

A. Early Case Law on Spousal Support Waivers ................. 848

B. The Uniform Premarital Agreement Act and Pendleton . 850

C. The Pendulum Swings After Pendleton ........................... 853

III. IN RE MARRIAGE OF FACTER: PAINTING A PICTURE OF THE

UNCONSCIONABLE WAIVER ................................................... 855

A. The Agreement, the Disagreement, and the Decision ..... 855

B. The Facter Aftermath ...................................................... 858

IV. PUBLIC POLICY VS. FREEDOM OF MARITAL CONTRACT............. 859

A. Public Policy in Favor of Marriage ................................. 860

B. Policy of Protecting Spousal Support .............................. 861

C. Public Policy Considerations in the Facter Decision ...... 862

V. ALTERNATIVE APPROACHES TO ENFORCEABILITY ...................... 863

A. The Uniform Premarital and Marital Agreements Act:

An Incomplete Solution .................................................. 864

B. Proposed Guidelines: A Comprehensive Approach ........ 866

1. A Policy-Based Threshold Requirement ................... 868

2. A Clear Set of Factors ................................................ 869

C. Applying the Guidelines to Facter .................................. 870

VI. CONCLUSION ............................................................................. 872

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 845

I. INTRODUCTION

California law has evolved to become fairly straightforward with

regard to premarital agreements

that seek to alter community

property rights in the event of divorce.

Prospective spouses are

generally free to decide which spouse would get the house, the car,

the dog, etc., if the marriage were to end in dissolution.

What

remains unclear and unsettled, however, in California premarital

agreement law, is the enforceability of those provisions that seek to

limit or waive spousal support

upon dissolution of marriage.

Section 1612(c) of the California Family Code

prohibits

enforcement of premarital waivers of spousal support if it would be

“unconscionable at the time of enforcement,”

but courts have yet to

articulate a clear standard for what that actually means. To illustrate,

suppose George and Jane decide to get married in anticipation of

having a child. Concerned about the wealth he had accumulated over

the years (and Jane’s lack thereof), George conditions the marriage

1. A premarital agreement, also referred to as a prenuptial agreement, is “[a]n agreement

made before marriage [usually] to resolve issues of support and property division if the marriage

ends in divorce or by the death of a spouse.” Prenuptial Agreement, B

LACK’S LAW DICTIONARY

(9th ed. 2009).

2. California law “freely permits contractual variation of the community property regime.”

RACE GANZ BLUMBERG, COMMUNITY PROPERTY IN CALIFORNIA 68 (6th ed. 2012); see also

Pre-Marital Agreements: Hearing on SB 78 Before the Assemb. Comm. on the Judiciary, 2001–

02 Reg. Sess. 4–5 (Cal. 2001), http://www.leginfo.ca.gov/pub/01-02/bill/sen/sb_0051-0100/

sb_78_cfa_20010625_102529_asm_comm.html [hereinafter Hearing on SB 78] (For over 150

years, “California has recognized the right of parties to agree to marriage terms at variance with

[community property] law through pre-marital agreements.”).

3. See Fahi Takesh Hallin, Strategies for Successfully Representing California Clients and

Overcoming Challenges in Family Law Cases, in S

TRATEGIES FOR FAMILY LAW IN CALIFORNIA:

EADING LAWYERS ON UNDERSTANDING DEVELOPMENTS IN CALIFORNIA FAMILY LAW 73

(2013 ed.) (“Generally, there is no or very little limitation on parties contracting away their right

to community property during the marriage . . . .”).

4. Spousal support, often referred to as maintenance or alimony, and can be defined as “[a]

court-ordered allowance that one spouse pays to the other spouse for maintenance and support

while they are separated, while they are involved in a matrimonial lawsuit, or after they are

divorced.” Alimony, B

LACK’S LAW DICTIONARY (9th ed. 2009). The duty to support one’s spouse

is statutory. See C

AL. FAM. CODE § 4300 (West 2014).

5. See Steve Mindel, Succeeding As a California Family Law Practitioner, in S

TRATEGIES

FOR FAMILY LAW IN CALIFORNIA: LEADING LAWYERS ON UNDERSTANDING DEVELOPMENTS IN

CALIFORNIA FAMILY LAW 71 (2014 ed.) (Advising family law practitioners to “warn clients that

any modification of spousal support rights remain an unsettled area in family law, and the

drafting of premarital agreements should be approached with caution.”); Hallin, supra note 3, at

73 (recognizing that “the issue of whether or not a waiver of spousal support in a prenuptial

agreement will be valid has been a very hot topic in California for many years.”).

6. Unless otherwise noted, all references to the Family Code in this Article refer to the

California Family Code.

7. F

AM. § 1612(c).

846 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

on her signing a premarital agreement that requires her to waive any

right to spousal support if they ever divorced, but also provides for

her to receive $200,000 in lump sum, their Caribbean timeshare, and

their million-dollar marital home to which she made no financial

contribution. Jane agrees. Shortly after the wedding, she quits her

retail job to be a stay-at-home mom, leaving George financially

responsible for Jane, their son, and Jane’s daughter from a previous

marriage. After fifteen years, they separate.

During the divorce proceedings, Jane asks the court for post-

dissolution spousal support. She admits that she freely and

voluntarily waived her right to spousal support in their premarital

agreement, but she claims that enforcing that waiver would be

unconscionable under section 1612(c). How should the court rule?

Would it be it unconscionable to deny her spousal support, when she

would still receive $200,000, a Caribbean timeshare, and their

million-dollar home? Does it matter that Jane has not worked in

fifteen years, while George makes over $1 million per year? What if

George makes only $500,000 per year? What if George lost his job

during the marriage? Would it matter if their marriage lasted only

fifteen weeks instead of fifteen years?

In In re Marriage of Facter,

the California Court of Appeal

made its first attempt to delineate the circumstances in which

enforcement of a premarital waiver of spousal support would be

unconscionable. There, Nancy Facter waived her right to spousal

support in a premarital agreement.

In deciding whether or not to

enforce the waiver, the court noted that Nancy was entitled to receive

$200,000, a Jaguar automobile, and a fifty-percent interest in their

marital home from her ex-husband.

Nevertheless, the court found

that “[c]ompared to what she is likely to receive in court-ordered

spousal support, these assets [were] manifestly inadequate.”

The

court had “little difficulty” concluding that the spousal support

waiver was unconscionable, given that her ex-husband Jeffrey was

8. 152 Cal. Rptr. 3d 79 (Ct. App. 2013).

9. Id. at 84–85. Paragraph No. 3 of the Property Rights section of the agreement stated that

Paragraph No. 2 would “constitute [Nancy’s] sole right to property acquired during marriage and

to support . . . .” Id. at 83–84. Paragraph No. 6 in the Child Support section of the agreement

provided that “nothing in his conditional . . . ‘shall give rise to any other obligations to pay of the

housing of [Nancy], spousal support, or additional sums of child support.’” Id. at 83.

10. Id. at 93.

11. Id.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 847

worth over $10 million with earnings of $1 million per year, while

Nancy had no separate property and no income coming out of the

marriage.

Said succinctly, the court decided that Nancy deserved

more and that Jeffrey could pay more.

To be clear, this Article does not suggest that the Court of

Appeals was wrong (or right) in finding that the waiver in Facter

was unconscionable. Nor does it probe for some mathematical

formula to determine unconscionability. Instead, this Article seeks to

address several important questions that have remained unanswered

since the enactment of Family Code section 1612(c) and continue to

remain unanswered even after Facter. For instance, what is the

standard for determining whether a spousal support waiver is

unconscionable at the time of enforcement? Is the waiver

unconscionable simply because it later turns out to be unfair? Should

spousal support waivers be treated as any other type of contractual

waiver with regard to unconscionability? Perhaps the broader inquiry

underlying these questions is whether the courts, through this

unconscionability approach, should be able to invalidate a premarital

contract term when they find it to be more favorable to one party

over the other, and if so, why?

Part II of this Article explores the historical development of

California law on premarital waivers of spousal support. Part III

takes a closer look at Facter to illustrate how the current law

precluding enforcement of spousal support waivers found to be

unconscionable, without a clear standard for determining

unconscionability, allows courts to arbitrarily evaluate the

substantive fairness of such waivers. Drawing upon contract law

principles and policy considerations that arise when prospective

spouses attempt to modify their legal obligations under marriage,

Part IV argues that a court’s unconscionability determination must

consider the delicate balance between freedom of contract and public

policy embodied in section 1612(c) of the Family Code. Part V

explains why the spousal support waiver provision in the recently

promulgated Uniform Premarital and Marital Agreements Act of

2012

fails to strike such a balance, and proposes a set of policy-

based guidelines for judicial or legislative consideration regarding

the enforceability of such waivers under the existing law.

12. Id.

13. U

NIF. PREMARITAL & MARITAL AGREEMENTS ACT, 9C U.L.A. 12 (Supp. 2014).

848 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

II. THE EVOLUTION OF CALIFORNIA LAW ON

SPOUSAL SUPPORT WAIVERS

Premarital agreements have long been used to delineate the

property rights between spouses during the marriage

and to

regulate the disposition of property upon the death of one of the

spouses.

In the 1970s, as the number of divorces increased in the

advent of “no-fault” divorce legislation and changing attitudes

towards marriage, California courts began recognizing and enforcing

premarital agreements in contemplation of divorce.

With regard to

property rights, spouses were freely permitted to “agree to marriage

terms at variance with [community property] law . . . unless they

violated general contractual concepts of fraud, duress, or undue

influence, or otherwise were contrary to public policy.”

Yet during

that time, courts remained hesitant to enforce provisions waiving or

limiting spousal support due to public policy concerns against

promoting divorce.

A. Early Case Law on Spousal Support Waivers

The first major decision in California involving spousal support

waivers rested heavily on public policy concerns. In In re Marriage

of Higgason,

decided in 1973, a husband and wife entered into a

premarital agreement in which each spouse waived “any and all right

14. See BLUMBERG, supra note 2, at 67 (“To insulate daughters from the operation of the

[English] common law, wealthy English families created trusts for a wife’s separate benefit and

negotiated premarital contracts that gave a wife control of her property during marriage.”).

15. Id. (“[P]remarital agreements have served the needs of older persons, often widows and

widowers, who wish to remarry but also to safeguard the family patrimony for the children of a

prior marriage. Originally, such contracts regulated the disposition of property upon the death of

one of the parties.”). Such agreements were once “regarded with distrust and hostility” for being

within “the province of the wealthy, the age disparate, the heartless, or the simply greedy.”

Allison Marston, Planning for Love: The Politics of Prenuptial Agreements, 49 S

TAN. L. REV.

887, 888 (1998); see also Hearing on SB 78, supra note 2, at 4–5 (“[Premarital] agreements

normally have been considered enforceable unless they violated general contractual concepts of

fraud, duress, or undue influence, or otherwise were contrary to public policy.”).

16. C

HARLOTTE K. GOLDBERG, COMMUNITY PROPERTY 69 (2014); see also BLUMBERG,

supra note 2, at 68 (“As the frequency of divorces increased, attorneys began to insert divorce

provisions in premarital agreements.”); Hearing on SB 78, supra note 2, at 5 (“As economic

conditions, attitudes toward marriage, and views on the status of men and women changed over

the latter half of the twentieth century, the use of pre-marital agreements also has increased.”).

17. Hearing on SB 78, supra note 2, at 5.

18. Michelle Butler, Part Two: Alimony and the Marriage Contract: California Premarital

Agreements Waiving or Specifying Spousal Support Obligations, 20 J.

CONTEMP. LEGAL ISSUES

41, 41 (2009).

19. 516 P.2d 289 (Cal. 1973) disapproved by In re Marriage of Dawley, 551 P.2d 323, 327

(Cal. 1976).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 849

for contribution to the support, maintenance and expenses of the

other party.”

At the time they were married, the wife was a

seventy-three-year-old woman with “substantial assets,” whereas the

husband, at forty-eight, was “earning $2 an hour plus tips, and had

little or no means.”

About halfway through their two-year

marriage, the husband began incurring substantial medical and

hospitalization costs after being beaten by an unknown assailant,

having a lung surgically removed due to lung cancer, and suffering a

heart attack that left him disabled.

The trial court denied the

husband’s request for temporary spousal support of $2,500 per

month and other post-dissolution financial benefits based on its

conclusion that the premarital agreement precluded him from

receiving such support.

The California Supreme Court remanded, holding that the

premarital agreement was void against public policy and, therefore,

did not preclude the court from awarding support to the husband.

Recognizing a distinction between agreements relating to the

disposition of property and those that seek to “vary the personal

duties and obligations to each other which result from the marriage

contract itself,”

the court articulated the bright line rule that “[a]ny

attempt by the parties to diminish or waive this obligation in an

antenuptial agreement is unenforceable.”

The court reasoned that

because contracts containing spousal support waivers would

“facilitate divorce or separation by providing for a settlement only in

the event of such an occurrence,” such contracts would not be “in

contemplation that marriage relation will continue until the parties

are separated by death” and would, therefore, be void against public

policy.

Shortly thereafter, in In re Marriage of Dawley,

the California

Supreme Court revisited its ruling in Higgason when it upheld the

validity of a premarital agreement in which the parties, both of whom

planned the early dissolution of their marriage, agreed to keep their

20. Id. at 290–91.

21. Id. at 290.

22. Id. at 291.

23. Id. at 292–93.

24. See id. at 295–98.

25. Id. at 296.

26. Id. at 295.

27. Id.

28. 551 P.2d 323 (Cal. 1976).

850 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

earnings and other property acquired during marriage as separate

property.

In her request for court-ordered support, the wife relied

on Higgason to argue that the premarital agreement as a whole was

invalid as against public policy because it was not “made in

contemplation that the marriage relation will continue until the

parties are separated by death.”

The court disagreed, however,

clarifying that a premarital agreement “violates state policy favoring

marriage only insofar as its terms encourage or promote dissolution,”

and that the parties’ anticipation of an early termination of their

marriage was irrelevant to the enforceability of the agreement.

Finding that the spousal support provision neither waived nor limited

financial support to the wife, but instead guaranteed her a minimum

amount of support, the court held that the agreement did not violate

public policy and was therefore enforceable.

B. The Uniform Premarital Agreement Act and Pendleton

When it first codified statutory law regarding premarital

agreements, the California Legislature contemplated the prevailing

public policy against contractual limitation of spousal support

articulated in Higgason and Dawley.

In 1985, California became

the first state to adopt the Uniform Premarital Agreement Act

(UPAA),

which was promulgated by the National Conference of

Commissioners on Uniform State Laws to address the “substantial

uncertainty as to the enforceability . . . of [premarital] agreements

and [the] significant lack of uniformity of treatment of these

agreements among the states.”

When bill was first proposed in the

California State Senate, it contained all sections of the model code

almost word for word.

However, after considering testimony in

opposition of the UPAA sections regarding spousal support, the bill

was enacted without the provisions that allowed for premarital

29. Id. at 325.

30. Id. at 325.

31. Id. at 329–30.

32. Id. at 331.

33. See Hearing on SB 78, supra note 2, at 2 (at the time of enactment of the Uniform

Premarital Agreement Act, “California case law considered the waiver of spousal support to be

void as against public policy, because public policy favored the protection of marriage and the

waiver of spousal support was believed to encourage dissolution.”).

34. Charlotte K. Goldberg, “If It Ain’t Broke, Don’t Fix It”: Premarital Agreements and

Spousal Support Waivers in California, 33 L

OY. L.A. L. REV. 1245, 1245 (2000).

35. U

NIF. PREMARITAL AGREEMENT ACT Prefatory Note, 9B U.L.A. 36 (1983).

36. See Hearing on SB 78, supra note 2, at 5.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 851

modification or elimination of spousal support.

The California Legislature explained that by deleting the two

spousal support provisions from its version of the UPAA, “California

case law would continue to prevail on the issue of spousal support in

premarital agreements.”

Some commentators understood that, by

omitting those provisions, the Legislature “intended to preclude

predetermination of spousal support upon divorce” as against public

policy in favor of marriage.

Others, however, viewed that the

Legislature’s omission of the support provisions left open the

question of whether the courts should continue to follow prior case

law (Higgason and Dawley) on the enforceability of spousal support

waivers, or whether the Act should be read to allow the courts

discretion in allowing or prohibiting such waivers.

The Supreme

Court took fifteen years to address this issue in its decision in

Fifteen years later, in In re Marriage of Pendleton,

the

California Supreme Court recognized that “changes in the law

governing the spousal relation warrant[ed] the reexamination of the

assumptions and policy underlying the refusal to enforce waivers of

spousal support.”

In Pendleton, a husband and wife, each of whom

had considerable assets to their name and elevated earning capacities

at the time of dissolution,

entered into a premarital agreement in

which they each waived “all rights to any type of spousal support or

37. See UNIF. PREMARITAL AGREEMENT ACT § 3(a)(4), 9C U.L.A. 43 (1983) (“Parties to a

premarital agreement may contract with respect to . . . the modification or elimination of spousal

support.”). But see Hearing on SB 78, supra note 2, at 5 (“After hearing testimony opposing the

bill’s waiver provisions on several grounds . . . the Legislature deleted the two provisions

permitting waiver of spousal support before enacting the rest of the UPAA into law.”); Butler,

supra note 18, at 42 n.6 (“[O]pposition from the Women Lawyers Association of Los Angeles

and others led the Family Law Section [of the California State Bar] to condition its support [of

the bill] on the elimination of the provision allowing the waiver of spousal support.”).

38. Butler, supra note 18, at 42 (quoting A

SSEMBLY SUBCOMMITTEE ON THE

ADMINISTRATION OF JUSTICE, REPORT ON SB 1143, S.B. 1143, 1985–86 Reg. Sess., at 3 (1985)).

39. Goldberg, supra note 34, at 1253; see also Robert H. Martin, Waivers of Spousal

Support in Premarital Agreements, 1 S

AN DIEGO JUST. J. 475, 487 (1993) (“The legislature has

spoken. And the California courts have made clear their intentions. In California, the courts will

continue to apply case law and will hold waivers of spousal support void as against public

policy.”).

40. Butler, supra note 18, at 42–43.

41. 5 P.3d 839 (Cal. 2000).

42. Id. at 845.

43. Id. at 840. At the time of their divorce, each spouse was worth approximately $2.5

million. The husband held a doctorate in pharmacology and a law degree, while the wife held a

master’s degree and was earning $5,772 per month in Social Security benefits, investment

returns, and rental income. Id.

852 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

child support from the other” in the event of divorce.

Both parties,

represented by independent counsel in the negotiation and

preparation of the agreement, understood its legal consequences and

executed it freely and voluntarily.

Despite having satisfied the statutory procedural requirements,

the trial court found the waiver to be void as against public policy,

and it ordered the husband to pay temporary spousal support of

$8,500 per month.

The Court of Appeal reversed and remanded on

the ground that “the current state of family law is one that ‘should

not per se prohibit premarital spousal support waivers or

limitations.’”

The California Supreme Court agreed, concluding

that:

[N]o public policy is violated by permitting enforcement of

a waiver of spousal support executed by intelligent, well-

educated persons, each of whom appears to be self-

sufficient in property and earning ability, and both of whom

have the advice of counsel regarding their rights and

obligations as marital partners at the time they execute the

waiver.

Noting that section 1612(a)(7) of the Family Code expressly

permits premarital agreements as to “any other matter, including

their personal rights and obligations, not in violation of public

policy,”

the Supreme Court reversed and remanded.

In the majority opinion, Justice Baxter noted that the California

version of the UPAA, as it was introduced, contained provisions that

would have permitted waivers of spousal support but were

subsequently deleted by amendment.

In his view, the omission of

44. The spousal support waiver was worded as follows: “[B]oth parties now and forever

waive, in the event of a dissolution of the marriage, all rights to any type of spousal support . . .

from the other.” Id.

45. Id.

46. Id. at 840–41 (explaining that in determining the amount of support to be ordered, the

court took note of the couple’s “$20,000 to $32,000 per month” lifestyle).

47. Id. at 841 (quoting In re Marriage of Pendleton, 72 Cal. Rptr. 2d 840, 845 (Ct. App.

1998), aff’d, 5 P.3d 839 (Cal. 2000)).

48. Id. at 848.

49. C

AL. FAM. CODE § 1612(a)(7) (stating that in addition to those subject matters expressly

enumerated in subsections (a)(1) through (a)(6), “[p]arties to a premarital agreement may contract

with respect to . . . [a]ny other matter, including their personal rights and obligations, not in

violation of public policy or a statute imposing a criminal penalty”).

50. Pendleton, 5 P.3d at 849.

51. Id. 849–50.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 853

those provisions evinced the Legislature’s intention to “leave the law

as it was in 1985,” but he found it to be “unreasonable to assume that

the Legislature intended the common law of the 19th century to

govern the marital relationship in the 21st century.”

Justice Baxter

understood the Legislature to have been “satisfied with the evolution

of the common law governing premarital waivers of spousal support

and intended that evolution to continue.”

In light of that

interpretation, the court found that “the common law policy, based

on assumptions that dissolution of marriage is contrary to public

policy and that premarital waivers of spousal support may promote

dissolution, [was] anachronistic.”

The Pendleton court took a significant step towards the

common-law recognition of spousal support waivers by overruling

Higgason, but it also called for legislative action on the matter. In its

opinion, the majority expressly invited the Legislature to impose

limitations on the right to waive spousal support and/or to specify the

circumstances in which enforcement of a waiver would be unjust.

Less than one year later, the invitation was accepted.

C. The Pendulum Swings After Pendleton

In 2001, Senate Bill 78 amended section 1612 of the Family

Code to expressly permit premarital waivers of spousal support. As it

was introduced, however, the bill contained language to prohibit

such waivers, which the author intended to operate as a direct

legislative response to nullify the Pendleton holding.

According to

the author of the bill, the Pendleton court “fundamentally

52. Id. (explaining that the “common law of the 19th century” imposed a blanket prohibition

against premarital waivers of spousal support because such waivers were found to encourage

divorce); see In re Marriage of Higgason, 516 P.2d 289, 295 (Cal. 1973); Barham v. Barham, 202

P.2d 289 (Cal. 1949); Whiting v. Whiting, 216 P. 92 (Cal. 1923).

53. Pendleton, 5 P.3d at 845.

54. Id. at 845.

55. Id. at 839 n.12 (“The Legislature may, of course, limit the right to enter into premarital

waivers of spousal support and/or specify the circumstances in which enforcement should be

denied.”).

56. See Hearing on SB 78, supra note 2, at 5.

57. Id. (“[T]he right of a child or a spouse to support may not be adversely affected by a

premarital agreement.”) (emphasis omitted). The bill was also proposed in response the California

Supreme Court’s decision in In re Marriage of Bonds, which held that the lack of representation

by independent counsel at the execution of a premarital agreement was only one factor in

determining voluntariness of a premarital agreement. 5 P.3d 815, 828 (Cal. 2000). However, this

Article focuses specifically on spousal support waivers and the court’s evaluation of substantive

fairness thereof at the time of enforcement.

854 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

misinterpreted the Legislature’s intent” in omitting the spousal

support provisions from its version of the UPAA.

But after the bill

met opposition from various organizations and individuals,

amended version was proposed that allowed enforcement of such

waivers on a case-by-case basis so long as certain conditions were

met; the amended version passed almost unanimously.

As it was

ultimately enacted, the support provision of Senate Bill 78—now

codified in subsection (c) of Family Code section 1612—provides:

Any provision in a premarital agreement regarding spousal

support, including, but not limited to, a waiver of it, is not

enforceable if the party against whom enforcement of the

spousal support provision is sought was not represented by

independent counsel at the time the agreement containing

the provision was signed, or if the provision regarding

spousal support is unconscionable at the time of

enforcement.

Although the bill as enacted did not prohibit waivers of spousal

support as its author originally intended, it created two obstacles for

those seeking to enforce such waivers in court.

The first part of the

rule, which requires representation by independent counsel at the

time of signing, operates as a procedural safeguard to ensure

voluntariness at the time of execution of the waiver. The second part,

however, is substantive in nature in that it expressly prohibits

enforcement of waivers that are shown to be unconscionable at the

time of enforcement.

This Article centers on the unconscionability standard set forth

58. Hearing on SB 78, supra note 2, at 5.

59. Id. at 6 (explaining that the bill, as introduced, met opposition from the Coalition of

Parent Support and other individuals who argued that a statutory prohibition on spousal support

waivers is “paternalistic, demeans adult women who should be able to enter a premarital

agreement as freely as any other contract, discourages second marriages by men already carrying

an unfair spousal support burden, and is contrary to the laws of 40 other states and the District of

Columbia”).

60. Complete Bill History, S.B. 78, 2001–02 Reg. Sess. (Cal. 2002), http://www.leginfo.

ca.gov/pub/01-02/bill/sen/sb_0051-0100/sb_78_bill_20010912_history.html (last visited Mar. 4,

2015) (detailing that the bill was passed with thirty-nine ayes to zero noes in the Senate, and

sixty-one ayes to six noes in the assembly).

61. C

AL. FAM. CODE § 1612(c) (West 2014).

62. See also John G. Gherini, The California Supreme Court Swings and Misses in Defining

the Scope and Enforceability of Premarital Agreements, 36 U.S.F.

L. REV. 151, 171 (2001)

(explaining that the amendment “adds significant protections to a party who benefits from spousal

support”).

63. F

AM. § 1612(c).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 855

in the second part of the rule because, as illustrated in In re Marriage

Facter,

this standard gives courts significant discretion in

evaluating the substantive fairness of spousal support waivers.

Furthermore, it allows courts to determine the enforceability of a

waiver by considering the circumstances existing at the time the

waiver is to be enforced, as opposed to the time of its execution.

III. IN RE MARRIAGE OF FACTER: PAINTING A PICTURE OF THE

UNCONSCIONABLE WAIVER

The enactment of Senate Bill 78 amended California law to

provide, among other things, that “[a]ny provision in a premarital

agreement regarding spousal support, including, but not limited to, a

waiver of it, is not enforceable . . . if the provision regarding spousal

support is unconscionable at the time of enforcement.”

In In re

Marriage of Facter, the California Court of Appeal made its first

attempt to paint a picture of what an unconscionable waiver of

spousal support looks like at the time of enforcement.

As one

practitioner noted, In re Marriage of Facter is “the most remarkable

case involving premarital agreements to come along in over a

decade, and the family law bench and bar are going to be dealing

with the fallout from it for years to come.”

A. The Agreement, the Disagreement, and the Decision

When Nancy met Jeffrey in 1990, she had a part-time job selling

shoes at Nordstrom, and Jeffrey was a partner at a law firm.

Jeffrey

was a Harvard graduate; Nancy had a high school diploma.

Jeffrey

64. 152 Cal. Rptr. 3d 79 (Ct. App. 2013). For a discussion of Facter, see infra, Part III.

65. See Butler, supra note 18, at 46 (“In determining which support arrangements are

‘unconscionable’ at the time of divorce, the legislature seems to have relegated considerable

space to common-law development and treatment of these agreements.”).

66. This type of provision has been referred to as a “second-look” provision. D

AVID

WESTFALL ET AL., ESTATE PLANNING LAW AND TAXATION § 11.05(1)(a)(i) (4th ed. 2014).

67. F

AM. § 1612(c).

68. Id. at 79. Although it is of no significant consequence to this analysis, it is important to

note that the Facter court did not directly refer to Family Code section 1612(c) when it made its

ruling on unconscionability, but instead referred to the language from Pendleton. Id. This is

because the statute does not apply retroactively to premarital agreements executed before the

statute was enacted. See In re Marriage of Rosendale, 115 P. 3d 417 (Cal. 2005); In re Marriage

of Howell, 126 Cal. Rptr. 3d 539 (Ct. App. 2011).

69. Brian J. Kramer, Dealing with the Fallout from In re Marriage of Facter, B

RIAN J.

KRAMER P.C. FAMILY LAW (Sept. 23, 2013), http://bjkpc.com/2/featured-blog/.

70. In re Facter, 152 Cal. Rptr. 3d at 86.

71. Id. at 92.

856 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

began providing financial support for Nancy as their relationship

progressed.

He bought her a used car and financed her real estate

licensing course.

When Nancy stopped working, Jeffrey became

solely responsible for the living expenses of Nancy and her two

children from a prior marriage.

When they purchased their home in

Mill Valley, they took title in joint tenancy, even though Nancy did

not contribute any money towards the purchase.

The couple decided to get married in contemplation of having

their first child together.

According to Nancy, “Jeffrey wanted to

have a child but Nancy told him she would not do so outside of

marriage.”

Nancy had already been involved in divorce litigation

with her prior husband

that included disputes regarding support and

attorney fees;

she was familiar with “laws on community property,

support, and support arrearages.”

Jeffrey expressed to Nancy his

concern about protecting his earnings and conditioned the marriage

on her signing a premarital agreement, which he would prepare

himself.

On November 7, 1994, the day before their wedding, Jeffrey and

Nancy entered into a premarital agreement (the “Agreement”).

The

Agreement declared that Jeffrey’s separate property (valued at

approximately $3 million at the time) and his earnings of between

$475,000 and $700,000 before the marriage, were to be kept out of

Nancy’s reach.

Also, because the Agreement opted out of

community property rights, all property acquired during marriage by

each spouse would be his or her own separate property.

In the

event of divorce or permanent separation, however, Jeffrey promised

to give Nancy $100,000 up front, and an additional $100,000 if the

72. Id. at 84.

73. Id.

74. Id.

75. Id. at 86.

76. See id. at 85.

77. Id.

78. Id. at 86.

79. Id. at 86 n.11.

80. Id. at 86.

81. Id. at 85 (“[Jeffrey] told [Nancy] he was afraid of marriage because he had worked hard

all his life, had earned a lot of money, and wanted all that he had earned prior to marriage to be

protected.”).

82. Id. at 83 (“The parties married the day after they signed the Agreement.”).

83. Id. at 82.

84. See id.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 857

marriage lasted at least fifteen years and if he was a partner at his

firm for more than seven years during the marriage.

Nancy was

also to receive at divorce half of the value of the marital estate (after

reimbursement of the down payment, costs, fees and taxes to

Jeffrey), all of the home’s furnishings, and the Jaguar automobile.

The Agreement also contained a waiver of spousal support.

The couple separated after sixteen years of marriage.

In her

motion for temporary support and attorney fees, Nancy argued that

the document did not contain a spousal support waiver.

Jeffrey

opposed, relying on two provisions to argue that a spousal support

waiver was contemplated in the agreement: (1) the provision that his

promise to continue paying the mortgage, taxes, and insurance on the

marital home “shall [not] give rise to any other obligations to pay for

the housing of [Nancy], spousal support, or additional sums for child

support”; (2) the provision stating that the assets enumerated in

Paragraph No. 2 “constitute [Nancy’s] sole right to property acquired

during the marriage and to support.”

The trial court granted

Nancy’s motion for temporary support and attorney fees and costs,

and in response, Jeffrey abandoned his efforts to enforce the spousal

support waiver.

Jeffrey instead focused his argument on the

severability clause in the Agreement, which would require the

property-related provisions of the Agreement to be honored despite

the invalid waiver.

Yet his abandonment of the waiver claim did

not prevent the trial court from finding the spousal support waiver to

be unconscionable, and using that finding to invalidate the entire

agreement as unenforceable.

On appeal, the court agreed that the there was an invalid,

unconscionable waiver of spousal support in the Agreement,

but it

85. Id. at 83.

86. Id.

87. Id. at 89. Although there was some dispute as to whether the Agreement actually

contained a spousal support waiver, the court ultimately found that a spousal support waiver

existed in Paragraph No. 3 of the Agreement.

88. Id. at 82–83. The parties married in 1994 and separated in 2010.

89. Id. at 83.

90. Id. at 83–84 (second and third alterations in original).

91. Id. at 84.

92. Id.

93. Id. at 87–88.

94. Id. at 93. Although this Article is narrowly concerned with unconscionability at the time

of enforcement, it is important to note that the appellate court in Facter also discussed at length

whether the spousal support waiver was unconscionable at the time of execution based on the

858 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

found that the trial court erred in refusing to sever the invalid

provisions.

In deciding whether the spousal support waiver was

unconscionable at the time of enforcement, the court acknowledged

that, under the Agreement, Nancy was already entitled to receive

$200,000, the Jaguar automobile, and a fifty-percent interest in their

marital home.

Nevertheless, according to Judge Margulies, these

assets were “manifestly inadequate” when “[c]ompared to what she

[was] likely to receive in court-ordered spousal support.”

After all,

Jeffrey owned separate property valued at $10 million and earned an

annual income of $1 million per year, while Nancy had neither

income nor separate property to her name.

Thus, the court had

“little difficulty” concluding that the waiver of spousal support was

unconscionable.

B. The Facter Aftermath

Although the Facter court identified factual circumstances that

would make a spousal support waiver unconscionable, it neglected to

articulate a clear standard from which it decided that those

circumstances amounted to unconscionability.

100

The court simply

decided that $200,000, a Jaguar automobile, and a fifty-percent

ownership interest in a multi-million-dollar home was not enough in

light of Jeffrey’s net worth and annual income.

101

To clarify, this Article does not suggest that Facter was

incorrectly decided. Nor does it suggest that a monetary imbalance

between the parties is irrelevant to the inquiry. However, the court’s

mathematical approach in Facter provides little guidance as to what

constitutes unconscionability, perhaps because it would be difficult,

circumstances around the time Nancy signed the agreement. See id. at 90–92. Finding that “there

was a great disparity in the parties’ respective incomes and assets at the time they entered into the

Agreement” and that a “significant inequality of bargaining power” was evidenced by the fact

that Jeffrey drafted the Agreement and told Nancy that the spousal support waiver was not

negotiable, the court concluded that the waiver was unconscionable at the time of execution. See

id. at 92.

95. Id. at 99.

96. Id. at 93.

97. Id.

98. Id.

99. Id.

100. See Request for Partial Depublication at 2, In re Marriage of Facter, 152 Cal. Rptr. 3d 79

(Ct. App. 2013) (No. A134191), http://www.walzermelcher.com/articles-prenup/Req-for-Partial-

Depublish.pdf.

101. In re Facter, 152 Cal. Rptr. 3d at 93–94 & n.26.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 859

if not impossible, to attach a mathematical formula to

unconscionability. If Jeffrey had promised $500,000 to Nancy

instead of only $200,000, would the support waiver still be

unconscionable? What about $700,000? What if he promised her full

ownership interest in their home rather than only fifty percent?

The lack of a clear and objective standard for determining

unconscionability makes it difficult for prospective spouses to

predict the enforceability of such waivers and leads to unnecessary

litigation.

102

But in a broader sense, the Facter decision illustrates

the prevailing issue with California’s unconscionability approach on

spousal support waivers: a rule that bars enforcement of support

waivers found to be unconscionable at the time of enforcement,

without proper guidance for determining unconscionability, allows

courts to arbitrarily evaluate the substantive fairness of such waivers.

This Article seeks to resolve this issue by proposing a clear and

objective set of guidelines for determining whether a premarital

waiver of spousal support is unconscionable at the time of

enforcement.

103

To that end, the following part of this Article

discusses the contract law principles and policy considerations that

arise when prospective spouses attempt to waive spousal support

obligations before marriage.

IV. PUBLIC POLICY VS. FREEDOM OF MARITAL CONTRACT

Contractual autonomy often conflicts with public policy

considerations when prospective spouses attempt to modify or waive

their legal rights and obligations before marriage.

104

Under the

bargain principle of contracts, “parties should be bound to honor

agreements to which they truly consented at an earlier time.”

105

The

underlying premise is that “[c]ontracts would not serve their function

of allocating the risk of future events if the law were to decline

enforcement of an agreement merely because the future turned out

102. See Request for Partial Depublication, supra note 100, at 2; Peter M. Walzer, The

Gender Factor of Marriage of Facter, L.A.

LAW., May 2013, at 44, 44 (“[A] vague standard as to

the meaning of the word ‘unconscionability’ will lead to considerable litigation over the

enforceability of prenups.”).

103. See infra Part V.B.

104. See Request for Partial Depublication, supra note 100, at 2 (“There is a natural tension

between freedom of contract and the court’s role in protecting spouses in need of spousal

support.”).

105. A

M. LAW INST., PRINCIPLES OF THE LAW OF FAMILY DISSOLUTION § 7.05 cmt. a

(2002).

860 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

less favorably than one of the contracting parties expected.”

106

the other hand, however, “social policy seeks to assure a fair

allocation of the gains and losses when the marriage relationship

ends.”

107

As noted by the California Legislature, “agreements

between prospective spouses occupy a unique area of law and policy,

involve emotional relationships far different than those between most

contracting parties, and thereby merit a unique approach.”

108

The

following sections explain how this unique approach took form in the

careful balancing of freedom of contract and public policy concerns

with regard to the ability of prospective spouses to contractually

modify or waive their legal rights and obligations before marriage.

A. Public Policy in Favor of Marriage

The Uniform Premarital Agreement Act (UPAA)

109

has been

adopted by twenty-six states since its promulgation in 1983;

110

roughly half of those states have made significant amendments.

111

Although, California was the first state to adopt the UPAA in 1985,

the Legislature omitted the provisions that permitted spousal support

waivers in premarital agreements

112

because California case law at

that time considered such waivers to be against public policy

106. Id.

107. Joan M. Krauskopf, Theories of Property Division/Spousal Support: Searching for

Solutions to the Mystery, 23 F

AM. L.Q. 253, 256 (1989).

108. C

AL. SENATE JUDICIARY COMM., BILL ANALYSIS OF SB 78: PREMARITAL

AGREEMENTS, S.B. 78, 2001–02 Reg. Sess., at 7 (Cal. 2001), http://www.leginfo.ca.gov/pub/

01-02/bill/sen/sb_0051-0100/sb_78_cfa_20010425_100434_sen_comm.html.

109. U

NIF. PREMARITAL AGREEMENT ACT § 1, 9C U.L.A. 39 (1983).

110. U

NIF. PREMARITAL AGREEMENT ACT, 9C U.L.A. 35 (1983).

111. J. Thomas Oldham, Would Enactment of the Uniform Premarital and Marital

Agreements Act in All Fifty States Change U.S. Law Regarding Premarital Agreements?, 46

AM. L.Q. 367, 371 (2012) (“Thirteen states adopted the UPAA without modifications, while

twelve states enacted it with modifications that almost always made it easier for a spouse to

challenge an agreement.”).

112. See U

NIF. PREMARITAL AGREEMENT ACT § 3(a)(4), 9C U.L.A. 43 (1983) (providing

that “[p]arties to a premarital agreement may contract with respect to . . . the modification or

elimination of spousal support.”); U

NIF. PREMARITAL AGREEMENT ACT § 6(b), 9C U.L.A. 43

(1983) (providing that “[i]f a provision of a premarital agreement modifies or eliminates spousal

support and that modification or elimination causes one party to the agreement to be eligible for

support under a program of public assistance at the time of separation or marital dissolution, a

court . . . may require the other party to provide support to the extent necessary to avoid that

eligibility.”). But see C

AL. SENATE JUDICIARY COMM., supra note 108, at 22 (“After hearing

testimony opposing the bill’s waiver provisions on several grounds . . . the Legislature deleted the

two provisions permitting waiver of spousal support before enacting the rest of the UPAA into

law.”).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 861

favoring the protection of marriage.

113

This common-law doctrine

was based on the assumption that “the state had a vital interest in and

should act to ensure the permanency of the marriage relation.”

114

In Pendleton, the court recognized that “changes in the

relationship between spouses and support obligations in

particular . . . clearly warrant[ed] reassessment of what remains of

the rule that premarital waivers of spousal support may promote

dissolution and, if they do so, are unenforceable.”

115

Under this

premise, the court took a significant step toward contractual

autonomy between spouses by lifting the blanket prohibition on

premarital waivers of spousal support, concluding that “a premarital

waiver of spousal support does not offend contemporary public

policy” so long as it is “entered into voluntarily by parties who are

aware of the effect of the agreement.”

116

Justice Baxter made clear,

however, that “[p]ublic policy continues to favor and encourage

marriage.”

117

B. Policy of Protecting Spousal Support

As previously noted, when Senate Bill 78 was first introduced in

2001, it was intended “to legislatively confirm that waivers of

spousal support in premarital agreements are void as against public

policy.”

118

According to its author, Senator Sheila Kuehl,

“[p]reserving spousal support as a protection against the unknown

circumstances at the end of a marriage . . . is an important policy

goal justifying the continued prohibition of spousal support waivers

in premarital agreements.”

119

This policy goal of preserving spousal

support remained an important consideration even after the bill was

amended in the Assembly to expressly permit premarital waivers of

spousal support.

Supporters of the amended version of Senate Bill 78, now

113. CAL. SENATE JUDICIARY COMM., supra note 108, at 2 (“At that time, California case

law considered the waiver of spousal support to be void as against public policy, because public

policy favored the protection of marriage and the waiver of spousal support was believed to

encourage dissolution.”). See, e.g., Barham v. Barham, 202 P.2d 289 (Cal. 1949); Whiting v.

Whiting, 216 P. 92 (Cal. 1923).

114. In re Marriage of Pendleton, 5 P.3d 839, 847 (Cal. 2000).

115. Id. at 848.

116. Id.

117. Id. at 847.

118. C

AL. SENATE JUDICIARY COMM., supra note 108, at 5; see supra Part II.C.

119. C

AL. SENATE JUDICIARY COMM., supra note 108, at 6.

862 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

codified as section 1612(c) of the Family Code, recognized that

“spousal support, and the role that it can play at the time a marriage

is ending, is worthy of some special protection.”

120

That special

protection took form as two foundational requirements that must be

met for a spousal support waiver to be enforceable: First, the waiving

spouse must have been represented by independent counsel at the

time of execution.

121

This provision functions as a procedural

safeguard to ensure voluntariness at the time of execution of the

waiver. Second, the support waiver must not be unconscionable at

the time of enforcement.

122

This provision allows courts to evaluate

the substantive fairness of the waiver at the time enforcement is

sought, not at the time the waiver was executed. Therefore, the

statute gives prospective spouses contractual autonomy to modify

their rights and obligations to each other, subject to procedural and

substantive limitations reflecting the prevailing policy goal of

preserving spousal support.

C. Public Policy Considerations in the Facter Decision

As illustrated in the Facter decision, the unconscionability

approach set forth by Senate Bill 78 allows courts to evaluate the

substantive fairness of a premarital waiver of spousal support at the

time of enforcement, even when all procedural requirements have

been met at the time of execution of that waiver. And as explained in

this part, the substantive review of fairness is justified by public

policy concerns embodied in existing California law. The prevailing

issue with the court’s decision in Facter, however, is that it neglected

to articulate the policy considerations that justified its substantial

review of the spousal support waiver in the premarital agreement.

Nor did it require Nancy, the party contesting enforcement of the

waiver, to prove that these policy concerns were existent. Instead, the

court focused largely on Jeffrey’s net worth and earning capacity

(and Nancy’s lack thereof) to rationalize its decision to invalidate

Nancy’s waiver of spousal support.

123

120. Hearing on SB 78, supra note 2, at 10.

121. See C

AL. FAM. CODE § 1612(c) (West 2014).

122. See id.

123. In re Marriage of Facter, 152 Cal. Rptr. 3d 79, 93 (Ct. App. 2013).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 863

V. ALTERNATIVE APPROACHES TO ENFORCEABILITY

Since the promulgation of the Uniform Premarital Agreement

Act (UPAA) in 1983,

124

states have taken widely varying approaches

to the enforceability of provisions in premarital agreements that limit

or waive spousal support.

125

In some states, prospective spouses have

significant discretion to waive or limit spousal support before

marriage. For instance, the Texas version of the UPAA omits section

6(b),

126

which gives courts discretion to decline enforcement of

support waivers that would cause the waiving party to be eligible for

public assistance programs.

127

Similarly, non-UPAA states such as

South Carolina and Florida have enforced spousal support waivers

even where one party would become a public charge, so long as it

was foreseeable for it to occur at the time of execution.

128

On the

other hand, some states, such as Iowa, South Dakota, and New

Mexico, do not permit any modification or limitation on spousal

support in premarital agreements.

129

In the middle of the spectrum are those states that impose

specific limitations on enforceability of premarital waivers of spousal

support. In Colorado, for instance, a support waiver will not be

enforced if the waiving party would be left unable to provide for his

or her reasonable post-divorce needs.

130

Indiana considers whether

enforcement of the waiver would result in “extreme hardship” to one

party, while Illinois probes for any “undue hardship” arising out of

any unforeseen change of circumstances during the marriage.

131

Several states have joined California in prohibiting enforcement of

waivers found to be unconscionable at the time of divorce, including

Connecticut, New Jersey, and North Dakota.

132

124. UNIF. PREMARITAL AGREEMENT ACT, 9C U.L.A. 43 (1983).

125. W

ESTFALL ET AL., supra note 66, ¶ 11.05[1][a][i].

126. Id. ¶ 11.05[1][b].

127. U

NIF. PREMARITAL AGREEMENT ACT § 6(b), 9C U.L.A. 43 (1983).

128. J. Thomas Oldham, With All My Worldly Goods I Thee Endow, or Maybe Not: A

Reevaluation of the Uniform Premarital Agreement Act After Three Decades, 19 D

UKE J.

GENDER L. & POL’Y 83, 110 (2011).

129. Id. at 87.

130. Id. at 123.

131. Id. at 124.

132. Id. at 87.

864 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

A. The Uniform Premarital and Marital Agreements Act:

An Incomplete Solution

Recognizing the “significant divide” among the states as to the

ability of courts to modify or set aside premarital agreements for

unfairness at the time of enforcement, the Uniform Law Commission

began promulgating the Uniform Premarital and Marital Agreement

Act (UPMAA) in July of 2012.

133

Its overall goal was to “produce an

act that would promote informed decision-making and procedural

fairness without undermining interests in contractual autonomy,

predictability, and reliance.”

134

First, section 9(e) of the UPMAA would allow the court to

invalidate a spousal support waiver if enforcement “causes a party to

the agreement to be eligible for support under a program of public

assistance at the time of separation or marital dissolution.”

135

Although the drafters assert that section 9(e) attempts to give

vulnerable parties “protections far beyond what was given in the

original Uniform Premarital Agreement Act” of 1983,

136

its language

is derived almost word for word from the spousal support waiver

provision in the 1932 act,

137

which the California Legislature already

rejected in 1983.

138

More importantly, however, Section 9(e) does

not conform to existing public policy, given that “spousal support

awards in California are based on the marital standard of living, not

on an amount that would keep the supported spouse off public

133. Barbara A. Atwood & Brian H. Bix, A New Uniform Law for Premarital and Marital

Agreements, 46 F

AM. L.Q. 313, 314–15 (2012).

134. Id. at 315.

135. U

NIF. PREMARITAL & MARITAL AGREEMENTS ACT § 9(e), 9C U.L.A. 12 (Supp. 2014).

(“If a premarital agreement or marital agreement modifies or eliminates spousal support and the

modification or elimination causes a party to the agreement to be eligible for support under a

program of public assistance at the time of separation or marital dissolution, a court, on request of

that party, may require the other party to provide support to the extent necessary to avoid that

eligibility.”).

136. U

NIF. PREMARITAL & MARITAL AGREEMENTS ACT § 9 cmt., 9C U.L.A. 25 (Supp.

2014).

137. Section 9(e) of the UPMAA is adapted from section 6(b) of the UPAA, which states:

If a provision of a premarital agreement modifies or eliminates spousal support and

that modification or elimination causes one party to the agreement to be eligible for

support under a program of public assistance at the time of separation or marital

dissolution, a court, notwithstanding the terms of the agreement, may require the other

party to provide support to the extent necessary to avoid that eligibility.

NIF. PREMARITAL AGREEMENT ACT § 6(b), 9C U.L.A. 43 (1983).

138. See supra Part II.B; see also Goldberg, supra note 34, at 1245–46 (“[California] did not

adopt wholeheartedly the ‘freedom of contract’ philosophy evinced by [the UPAA].”).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 865

assistance.”

139

The second UPMAA provision, section 9(f), would allow a

court to:

[R]efuse . . . a term of a premarital or marital agreement if,

in the context of the agreement as a whole: (1) the term was

unconscionable at the time of signing; or (2) enforcement of

the term would result in substantial hardship for a party

because of a material change in circumstances arising after

the agreement was signed.

140

The first part of this provision has already been incorporated in

California law on premarital agreements.

141

The second part

resembles the approach adopted by the State of Illinois, where courts

are permitted to order spousal support if enforcement of the support

waiver would cause “undue hardship” to one party because of

“circumstances not reasonably foreseeable at the time of execution”

of the agreement.

142

The UPMAA provision, however, does not

require that the change in circumstances was unforeseeable, but only

that the change was “material” and that it resulted in “substantial”

hardship.

Although the second part of section 9(f) seems to provide a clear

and balanced standard for determining the enforceability of a spousal

support waiver, it neglects to consider some policy considerations

discussed earlier. What if, for instance, Jane signed a premarital

agreement waiving spousal support while she was unemployed, and

she remained unemployed until the divorce twenty years later?

Unable to find employment at fifty years old and with no assets to

her name, Jane is likely to meet the “substantial hardship”

requirement under section 9(f). But has there been a “material

change in circumstances” as required by the section? Is Jane’s aging

of twenty years a “material change?” As illustrated by this example,

139. Goldberg, supra note 34, at 1249 (citing CAL. FAM. CODE § 4320 (West 2014) (“In

ordering spousal support under this part, the court shall consider all of the following

circumstances: consider all of the following: (a) The extent to which the earning capacity of each

party is sufficient to maintain the standard of living established during the marriage . . . .”)).

“[T]he major thrust of recent California spousal support legislation is to enable a former spouse to

become self-supporting and not rely on support from either the state or an ex-spouse.” Id.

140. U

NIF. PREMARITAL & MARITAL AGREEMENTS ACT § 9(f), 9C U.L.A. 23, (Supp. 2014).

141. See F

AM. § 1615(a) (“A premarital agreement is not enforceable if the party against

whom enforcement is sought proves . . . the agreement was unconscionable when it was

executed . . . .”).

142. Oldham, supra note 128, at 110.

866 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

section 9(f) may not protect against a “substantial hardship” that did

not arise out of a “material change in circumstances arising after the

agreement was signed.”

143

As applied to Facter, this change-in-circumstances approach, by

itself, would likely have favored enforcement of the spousal support

waiver, contrary to the court’s ruling. There was no material change

in circumstances apparent in Facter. Nancy quit her job before the

marriage, and she was still unemployed at divorce sixteen years

later.

144

Even if their having a child (as they planned)

145

can be

characterized as a material change in circumstances, it would be

difficult to argue that Nancy would experience “substantial hardship”

after receiving $200,000, a Jaguar sedan, and half of the multi-

million-dollar home.

146

The set of guidelines proposed in the

following section incorporates this change-in-circumstances

approach into a larger framework for determining enforceability of

spousal support waivers in premarital agreements.

B. Proposed Guidelines: A Comprehensive Approach

Subsection (c) of Family Code section 1612 states that “[a]ny

provision in a premarital agreement regarding spousal support,

including, but not limited to, a waiver of it, is not enforceable if . . .

the provision regarding spousal support is unconscionable at the time

of enforcement.”

147

As previously discussed, this rule, without clear

guidelines for determining unconscionability, allows courts to

arbitrarily evaluate the substantive fairness of spousal support

waivers. This author proposes two additional provisions (the

“Guidelines”) for legislative or judicial adoption, which are adapted

from section 7.05 of the Principles of the Law of Family Dissolution:

Analysis and Recommendations drafted by the American Law

Institute.

148

The bifurcated approach under the Guidelines first

requires the party challenging enforcement to show that public policy

concerns exist to justify the court’s substantive review of the waiver,

143. UNIF. PREMARITAL & MARITAL AGREEMENTS ACT § 9(f), 9C U.L.A. 23, (Supp. 2014).

144. See In re Marriage of Facter, 152 Cal. Rptr. 3d 79, 84–87 (Ct. App. 2013).

145. Id. at 85.

146. Id. at 93.

147. C

AL. FAM. CODE § 1612(c) (West 2014).

148. A

M. LAW INST., PRINCIPLES OF THE LAW OF FAMILY DISSOLUTION: ANALYSIS AND

RECOMMENDATIONS § 7.05 CMT. A (2002). Guidelines 1 and 2 are based on subsections 2 and 3

of section 7.05 of the Principles of the Law of Family Dissolution. “Substantial injustice” is

replaced with “unconscionability” and “agreement” is replaced with “waiver” in the Guidelines.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 867

and then requires the court to consider a non-exhaustive set of factors

when deciding whether or not a waiver of spousal support is

unconscionable at the time of enforcement.

The Guidelines provide as follows:

(1) A court may consider whether a provision regarding

spousal support is unconscionable at the time of

enforcement if, and only if, the party resisting its

enforcement shows that one or more of the following

have occurred since the time of the waiver’s execution:

(a) more than ten years have passed since the

execution of the waiver;

(b) a child was born to, or adopted by, the parties;

that has a substantial impact on one of the parties

or their children.

(2) In deciding whether a provision regarding spousal

support is unconscionable at the time of enforcement, a

court must consider all of the following:

(a) the magnitude of the disparity between the

outcome if the waiver is enforced and the outcome

under otherwise prevailing law;

(b) for those marriages of limited duration in which it

is practical to ascertain, the difference between the

circumstances of the objecting party if the waiver

is enforced, and that party’s likely circumstances

had the marriage never taken place;

or protect the interests of third parties (such as

children from a prior relationship), whether that

purpose is still relevant, and whether the waiver’s

terms were reasonably designed to serve it; and

(d) the impact of the agreement’s enforcement upon

the children of the parties.

The legislative or judicial consideration of these Guidelines

would allow California courts to strike an appropriate balance

between freedom of contract and policy considerations when

evaluating the substantive fairness of a premarital waiver of spousal

support. The remainder of this Article identifies the policy goals

achieved under each part of the Guidelines and applies them to the

868 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

factual circumstances in Facter to illustrate that, had the court

adopted the Guidelines, it would have arrived at the same conclusion,

but with significantly more guidance and justification for its finding

of unconscionability.

1. A Policy-Based Threshold Requirement

Section (1) of the Guidelines operates as a threshold requirement

that must be satisfied before the court is permitted to evaluate a

spousal support waiver for unconscionability at the time of divorce.

Perhaps this section of the Guidelines is the more important of the

two, given that it effectively requires the party resisting enforcement

to show that public policy concerns exist to warrant the court’s

review of the substantial fairness of an otherwise valid contractual

term.

Only one of the three conditions under Section (1) must be

satisfied before the court can evaluate whether a spousal support

waiver is unconscionable at the time of enforcement. Each condition

reflects certain policy considerations embedded in existing California

law. For instance, subsection (a) requires that more than ten years

have passed since the execution of the waiver. This condition is

adapted from section 4336(b) of the Family Code, which provides

that “[f]or the purpose of retaining jurisdiction, there is a

presumption affecting the burden of producing evidence that a

marriage of 10 years or more, from the date of marriage to the date

of separation, is a marriage of long duration.”

149

Subsection (a) of

the Guidelines promotes marriages of long duration and, thereby,

conforms to the state policy in favor of marriage (and against

dissolution).

The condition set forth under subsection (b) is satisfied if the

marriage produces a child, including through adoption. Underlying

this condition is the state’s policy of protecting the interests of

children in the marriage reflected in Family Code section 4320(g),

which requires courts to consider “[t]he ability of the supported party

to engage in gainful employment without unduly interfering with the

interests of dependent children in the custody of the party.”

150

Subsection (c) incorporates the “change-of-circumstances”

approach under section 9(f) of the UPMAA, which allows courts to

149. FAM. § 4336(b).

150. Id. § 4320(g).

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 869

invalidate a spousal support waiver if its enforcement would lead to

“substantial hardship for a party because of a material change in

circumstances arising after the agreement was signed.”

151

However,

because Section (1) of the Guidelines operates as a threshold

requirement, subsection (c) sets a lower bar than the UPMAA by

requiring only that a “substantial impact,” rather than “substantial

hardship,” resulted from a material change in circumstances. By

making it easier to meet this condition, subsection (c) adheres to the

policy goal of protecting spousal support embodied in the current

statute.

152

2. A Clear Set of Factors

Section (2) of the Guidelines identifies four factors for a court to

consider only after it has satisfied the threshold requirement under

the first section. The factors under (2)(a) and (2)(b) attempt to

promote the policy goal of equitable distribution by requiring courts

to ensure that both parties share equally the benefits, and burdens, of

the divorce

153

Subsection (a) considers the magnitude of the disparity

between the outcome if the support waiver is enforced and the

outcome without such waiver. Under subsection (b), if the marriage

is of limited duration (less than ten years under California law

154

the court must consider the difference between the circumstances of

the waiving party if the waiver is enforced, and that party’s likely

circumstances had the marriage never taken place.

The factors under (2)(c) and (2)(d) operate as a second layer of

safeguards, supplementing section (1)(b) of the Guidelines, to protect

children from the effects of a spousal support waiver. Like section

(1)(b), these factors conform to the state policy of protecting the

interests of children embedded in existing California law, such as

section 4320(2)(g) of the Family Code quoted above.

151. UNIF. PREMARITAL & MARITAL AGREEMENTS ACT § 9(f), 9C U.L.A. 23 (Supp. 2014).

152. See Hearing on SB 78, supra note 2, at 10 (“[S]pousal support, and the role that it can

play at the time a marriage is ending, is worthy of some special protection.”).

153. See Michelle Murray, Alimony as an Equalizing Force in Divorce, 11 J.

CONTEMP.

LEGAL ISSUES 313, 314 (1997) (“[S]ome jurisdictions consider alimony to serve the purpose of

supplementing or assisting with the equal or equitable division of intangible marital property.”);

Krauskopf, supra note 107, at 256 (“[T]he purpose of court-ordered economic settlement at

marriage dissolution is to achieve a fair sharing of the benefits and burdens of the marriage

measurable in dollars.”).

154. F

AM. § 4336(b).

870 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

C. Applying the Guidelines to Facter

The factual circumstances in Facter would have satisfied the

threshold requirements under section (1) of the Guidelines, thereby

giving the court jurisdiction to consider whether Nancy’s waiver of

spousal support was unconscionable at the time of enforcement. The

Facters had been married for approximately sixteen years when

divorce proceedings were initiated,

155

well over the ten-year

benchmark in subsection (a). Additionally, their marriage produced a

son,

156

which satisfies subsection (b).

Also, had the Facter court considered the factors set forth in

section (2) of the Guidelines, the court would likely have reached the

same decision to refuse to enforce the spousal support waiver. For

instance, section (2)(a) incorporates the court’s mathematical

approach in Facter. Judge Marguilles calculated the total amount that

Nancy would have received had the waiver been enforced, and then

compared it to the amount of Jeffrey’s assets and annual income.

157

As required under section (2)(a) of the Guidelines, the court

considered the magnitude of disparity between the outcome if the

waiver was enforced and the outcome without the waiver, concluding

that “[c]ompared to what [Nancy] is likely to receive in court-

ordered spousal support, these assets are manifestly inadequate.”

158

As to section (2)(b) of the Guidelines, the court considered the

difference between the circumstances if the agreement was enforced

and the circumstances if the marriage had never taken place. Instead

of “pursu[ing] her education or seek[ing] gainful employment,”

Nancy “devoted her efforts to child rearing and maintaining the

family home, while Jeffrey continued to successfully pursue a

financially rewarding career.”

159

Thus under the Guidelines, the

court would have similarly concluded that if the spousal support

waiver was enforced, “Nancy will never come close to replicating

the marital standard of living.”

160

Although the court did not consider whether the Facters’

agreement was intended or designed to benefit or protect third parties

155. The parties were married in 1994 and separated in 2010. In re Marriage of Facter, 152

Cal. Rptr. 3d 79, 82 (Ct. App. 2013).

156. Id. at 83 (“The marriage produced a son, who was born in March 1996.”).

157. See id. at 93.

158. Id.

159. Id. at 92.

160. Id. at 93.

Winter 2016]PREMARITAL WAIVERS OF SPOUSAL SUPPORT 871

(section 2(c) of the Guidelines), doing so would only have supported

the court’s decision to refuse enforcement of the support waiver.

Jeffrey was simply “afraid of marriage because he had worked hard

all his life and had earned a lot of money, and wanted all that he had

earned prior to marriage to be protected” and “did not want to have

any continuing financial obligations to [Nancy] if their marriage

ended.”

161

He did not intend for the agreement to protect any third-

parties. Nancy had two children from a prior marriage

162

that ended

with disputes regarding support and attorney fees.

163

It would be

difficult to argue, however, that Nancy intended to protect or benefit

her two children by agreeing to waive her rights to spousal support.

Therefore, the court’s consideration of this section 2(c) of the

Guidelines would have weighed in favor of non-enforcement.

The Facter court did not expressly consider the impact of the

enforcement on Nancy and Jeffrey’s son. However, the court

acknowledged the fact that Nancy intended to be a “stay-at-home

mom”

164

to “devote her efforts to child rearing and maintaining the

family home,”

165

and that she “will never come close to replicating

the marital standard of living” if the spousal support waiver were

enforced.

166

As such, it can be inferred that Nancy’s marital standard

of living included adequate and proper care for their son, which,

according to the court, would certainly be affected by enforcement of

the agreement. Therefore, had the court considered the effect of

enforcement on Jeffery and Nancy’s son, as required in Guideline

2(d), it would still have likely concluded that enforcement of waiver

would be unconscionable.

Had the Court of Appeals in Facter applied the Guidelines

proposed by this author, not only would the court have reached the

same decision (that Nancy’s waiver of spousal support was

unconscionable at the time of enforcement), the court would have set

forth a clear, policy-based approach to determining unconscionability

within the meaning of section 1612(c) of the Family Code.

161. Id. at 85–86.

162. See id. at 84.

163. Id. at 86 n.11 (“Nancy testified that her previous marriage had lasted for eight years.

When she got divorced, she and her former husband went through the court system. During the

proceedings, there were disputes regarding support and attorney fees.”).

164. Id. at 85.

165. Id. at 92.

166. Id. at 93.

872 LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 49:843

VI. CONCLUSION

California courts and the Legislature have an opportunity to

clarify an ambiguity in its existing family law. Section 1612(c) of the

Family Code prohibits enforcement of premarital waivers of spousal

support that are “unconscionable at the time of enforcement,”

167

but

it remains unclear what this phrase actually means. Without a clear

standard for determining what makes a support waiver

unconscionable, courts have unrestricted and unguided jurisdiction to

evaluate the substantial fairness of a private, contractual term

between spouses. The judicial or legislative adoption of the

Guidelines proposed by this author would strike an appropriate

balance between freedom of contract and the policies embodied in

existing family law.

167. CAL. FAM. CODE § 1612(c) (West 2014).