Lack of Mental Capacity to Sign Marital Dissolution Agreement Rejected in Lafayette, Tennessee Divorce: Wheeler v. Wheeler

June 17, 2020 K.O. Herston 0 Comments

Facts: Husband and Wife divorced after over 10 years of marriage.

On the morning of trial, the parties and their lawyers announced their settlement to the trial court.

Husband and Wife signed a marital dissolution agreement (MDA) that awarded their real estate, business, and farm and business equipment to Husband. It also required Husband to pay $250,000 to Wife within 60 days plus an additional $2000 per month as alimony in solido for 10 years.

The MDA expressly says the parties entered into the MDA “without any undue influence, fraud, coercion, or misrepresentation.” Both also acknowledged in writing that the MDA “is fair and equitable and that it is being entered into voluntarily and with the advice of counsel.”

The trial court approved the settlement and incorporated the MDA into the final judgment of divorce.

Husband moved to set aside the MDA per Rule 60.02 because he alleged he never read or understood the MDA when he signed it, and his then-attorney failed to explain the MDA’s provisions for alimony and property division.

Husband was the only testifying witness at the hearing on his motion. He testified about his various health issues, his lack of education, his inability to read and understand the agreement when he signed it (he claimed he dropped out of school in the sixth, seventh, and eighth grades), and the pressure he felt his previous attorney placed on him to sign the agreement at the risk of suffering greater losses if the divorce went to trial.

Tennessee marital dissolution agreementOn cross-examination, he admitted sending several text messages to Wife in the hours after the agreement was signed. The messages included statements that the “numbers are not fair at all,” that he would not fight about the terms because he did not want to “go through all of the nasty stuff that would be said in court,” and that his lawyer warned him that his alimony payments would be higher if he went to trial. More messages advised Wife to “get ready for round two” and that signing the MDA was “just a formality.”

The trial court denied Husband’s motion after finding that Husband could read and understand the agreement and that he knew what he was doing when he signed the agreement.

Husband appealed.

On Appeal: The Court of Appeals affirmed the trial court.

Marital dissolution agreements are contracts made between the parties in contemplation of divorce. It is rare for a court to find that a contract is unenforceable based on the unsound emotional state of a contracting party. A party seeking relief from a contract based on mental incapacity must prove that he or she had no reasonable perception or understanding of the nature or terms of the contract. Parties can be excused from performing a contract based on incompetency when

  • they cannot reasonably understand the nature and consequences of the transaction, or
  • when they cannot act reasonably in relation to the transaction, and the other party has reason to know of their condition.

The Court found Husband’s proof unpersuasive:

The proof in this case falls far short of the proof presented in [similar] cases. No medical professional testified about Husband’s medical ailments, and no other third-party testified about Husband’s education or condition at the time the MDA was signed. While we certainly do not hold that expert proof is required in all cases in which mental incapacity is at issue, some proof beyond the unsupported, and ultimately, unconvincing, assertions of the litigants are often required to meet the clear and convincing standard. Husband did not present any medical records or other documents to support his assertions. Likewise, Husband presented no testimony from third parties concerning his mental state at the time he signed the agreement. Instead, Husband relied solely on his own testimony to claim that he was mentally incapable of understanding the nature and ramifications of the hearing. Husband’s testimony alone did not support the notion that he was unable to advocate for himself or understand the MDA when he signed the agreement. Moreover, nothing . . . indicates how Husband’s capacity was particularly different when he signed the MDA and agreed to the divorce than at other periods of time. Given the clear language in the MDA that the terms were entered into voluntarily, with the advice of counsel, and resulted in a fair settlement, combined with Husband’s testimony, we cannot conclude that the trial court erred in refusing to credit Husband’s unsupported assertions of mental incapacity.

Rather, the evidence as a whole supports the trial court’s decision. Importantly, Husband admitted to sending various text messages the day he signed the agreement which indicated his understanding of the agreement and its consequences. . . . Based on these messages, however, several things are clear. First, Husband’s asserted lack of education does not amount to an inability to read or write. Moreover, Husband and Wife, along with their respective counsel, were engaging in negotiations prior to the signing of the MDA, indicating that the decision to enter into an MDA was not a last-minute strong-arm by Wife. Moreover, the messages show that Husband was aware of the ramifications of the MDA, including the substantial alimony award to Wife, around the time he signed the contract. Husband therefore clearly had the capacity to understand the nature of the MDA and its consequences near in time to when it was signed. Given Husband’s testimony and text messages sent around the time the MDA was signed, we are not persuaded that Husband acted without a reasonable understanding of the nature and consequences of his actions.

The Court affirmed the trial court’s ruling denying Husband’s Rule 60.02 motion based on a lack of mental capacity.

Wheeler v. Wheeler (Tennessee Court of Appeals, Middle Section, June 3, 2020).

Lack of Mental Capacity to Sign Marital Dissolution Agreement Rejected in Lafayette, Tennessee Divorce: Wheeler v. Wheeler was last modified: June 15th, 2020 by K.O. Herston

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