In Re the Estate of Greiff

New York Court of Appeals
680 N.Y.S.2d 894, 703 N.E.2d 752, 92 N.Y.2d 341 (1998)

ELI5:

Rule of Law:

When a prenuptial agreement is challenged, the burden of proof shifts to the proponent of the agreement to prove its fairness only after the challenging party first demonstrates, by a preponderance of the evidence, that the confidential relationship between the fiancés rendered probable the existence of undue and unfair advantage.

Facts:

In 1988, Helen Greiff, age 65, and Herman Greiff, age 77, became engaged to be married.
Prior to their marriage, they executed reciprocal prenuptial agreements.
In the agreements, each party waived their statutory right of election, which is the right of a surviving spouse to inherit a portion of the deceased spouse's estate.
Herman Greiff selected and paid for the attorney who represented Helen Greiff in the execution of the agreements.
The couple married, and Herman Greiff died three months later.
Herman Greiff's will made no provision for his surviving spouse, Helen Greiff, leaving his entire estate to his children from a prior marriage.

Procedural Posture:

Helen Greiff (surviving spouse) filed a petition in Surrogate’s Court, Kings County, to claim a statutory elective share of her deceased husband's estate.
The children of Herman Greiff (the decedent) opposed the petition, presenting the prenuptial agreements as a bar to her claim.
After a trial, the Surrogate's Court invalidated the prenuptial agreements, finding undue influence and overreaching by the decedent, and granted the elective share to Helen Greiff.
The decedent's children, as appellants, appealed to the Appellate Division.
The Appellate Division, an intermediate appellate court, reversed the Surrogate's Court's decree on the law, upholding the agreements.
Helen Greiff, as appellant, was granted leave to appeal to the Court of Appeals, the highest court in New York.

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Issue:

Does a party challenging the validity of a prenuptial agreement have to demonstrate that the confidential relationship between the engaged parties resulted in probable undue and unfair advantage before the burden of proof shifts to the proponent of the agreement to show it was free from fraud or overreaching?

Opinions:

Majority - Bellacosa, J.

Yes. A party challenging a prenuptial agreement must first establish by a preponderance of the evidence that the relationship manifested 'probable' undue and unfair advantage before the burden shifts to the agreement's proponent to prove it was free from fraud, deception, or undue influence. The court rejected the idea that the relationship between prospective spouses automatically creates a presumption of fraud. Instead, it adopted a nuanced approach that recognizes the confidential nature of the relationship without invalidating the strong public policy favoring prenuptial agreements. The court reasoned that while engaged parties are in a relationship of trust and confidence, modern law treats marital partners as equals. Therefore, the spouse contesting the agreement must establish a 'fact-based, particularized inequality' before the burden shifts. This approach harmonizes prior case law, steering a middle course between presuming all such agreements are fraudulent (Graham v Graham) and treating them as standard commercial contracts (Matter of Phillips).

Analysis:

This case establishes a significant procedural framework for litigating the validity of prenuptial agreements in New York. It strikes a balance between the public policy of encouraging individuals to order their own affairs through contracts and protecting vulnerable parties from overreaching in a confidential relationship. By rejecting a per se rule of presumptive invalidity, the court reinforces the general enforceability of prenuptial agreements. However, by creating a path to shift the burden of proof, it provides a crucial safeguard in exceptional cases where a fact-based showing of a significant power imbalance can be made, ensuring that fairness remains a consideration.

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