Utah courts encourage divorcing couples to work together to resolve their property and custody issues. Couples are required to attend mediation prior to certifying their divorce case for trial. Unfortunately, working together sometimes involves one party pressuring the other to settle on his/her terms. Mediation can be emotionally and mentally exhausting, and the mediator may put additional pressure on the parties to settle.
So what happens when you are unhappy with the terms of your settlement agreement? Can you changeyour mind?
A settlement agreement is a contract between two parties and is generally enforced in the same manner as other legally binding contracts. It is difficult to renegotiate a signed agreement, and Utah courts are hesitant to relieve parties of their contractual obligations.
While difficult, it is possible to set aside some settlement agreements.
A settlement agreement may be set aside or may be deemed void where there is evidence of mistake, misrepresentation, incapacity, duress, undue influence or unconscionability. A settlement agreement is also void when the rights and/or obligations set forth in the contract are unlawful.
UNLAWFUL ORDERS: It is perhaps easiest to set aside a settlement agreement when you have agreed to certain rights and obligations that are unlawful under Utah law. This may happen where you have agreed to an unequal division of property, or you have agreed to waive child support.
Child Support: Under Utah law, child support is a right of the child. Both parents are required to provide support. Child support is calculated pursuant to statutory guidelines and using each parent’s gross monthly income and the number of overnights the child spends with each parent. Child support must be calculated pursuant to the guidelines, absent extraordinary circumstances. If the parents deviate from the guidelines, the settlement agreement and resulting court order must include specific reasons why complying with the child support guidelines would be unjust, inappropriate or not in the best interests of your child.
Property Distribution: In Utah, marital assets are divided equally, absent extraordinary circumstances. Accordingly, the Court is permitted to look past a settlement agreement if it finds that you agreed to an unfair or unreasonable division of property. Notwithstanding the existence of a signed agreement, the Court may make whatever other orders it deems fair, equitable and necessary for the protection and welfare of the parties. Although a settlement agreement is advisory and should be given weight, the court is not bound to enter and enforce the terms of your agreement.
MISTAKE: To establish mistake, you must show that you, your spouse or both parties relied on a factual or legal mistake when entering into your settlement agreement.
Example (Factual Mistake): You agree to accept payment of one-half of the equity in your home within 60 days after your Decree of Divorce is entered. You mistakenly believe that there is approximately $50,000.00 of equity in the home. For that reason, you also agree that your husband can stop paying alimony as soon as you receive your share of equity from your home. You later learn that a second loan was taken out on your home, and there is only $1,000.00 of equity.
Example (Legal Mistake): You agree to waive your right to receive half of you and your wife’s savings account. In exchange, your wife agrees to waive her right to child support. You mistakenly understand that Utah law allows your wife to waive child support. One month later your wife applies for state assistance, and the state of Utah garnishes child support from your paychecks. You learn that Utah law will not allow your wife to waive child support.
MISREPRESENTATION: To establish misrepresentation, you must show that the other party made a false statement of fact and that you relied on the false statement when entering into the agreement.
Example: You have $5,000.00 in a 401(k) account. Your wife tells you that she also has accrued only $5,000.00 in retirement. Relying on your wife’s representation, you agree to waive your right to receive a portion of her retirement benefits. You later learn that your wife has $50,000.00 in a 401(k) account, as well as a pension through her current employer.
INCAPACITY: For a contract to be valid and legally binding, both parties must be competent to enter into the contract. Competence refers both to the mental capacity and to the legal ability of certain persons to contract.
Example (Mental Competence): Your elderly father has been married for three years. He has been diagnosed with dementia, and his condition has worsened dramatically over the last several years. He requires constant care and supervision. One day, your father’s wife tells him that she needs him to sign a document. Your father unknowingly signs a divorce agreement, giving his wife real property, cars and retirement funds worth more than $500,000.00. When he signed the agreement, your father was incapable of understanding the value of his property or the nature of his actions.
Example (Legal Status): After a year of dating, you decide to propose to your girlfriend. She is only 16 years old, but her parents consent to the marriage. Six months after the wedding, your girlfriend decides that she missed out on her teenage years and wants a divorce. You sign a divorce settlement, agreeing that each of you should keep your own bank accounts and vehicles. You believe that your case has been finished, but minors under 18 years of age are always allowed to disaffirm their contracts.
DURESS: To establish duress, you must provide evidence that an unlawful threat of harm was used to coerce you into executing the agreement. Duress can be physical or economic.
Example (Physical Duress): Your husband has physically abused you and your children for years. You finally got the courage to leave your home. Advocates at a local women’s shelter help you file for divorce. After you file your papers, your husband asks if his parents can visit your children. He arranges to have your children taken from his parent’s house. He tells you that you will never see your children again if you do not sign an agreement that he is drafted. You can hear your children crying. You immediately sign the agreement.
Example (Economic Duress): Your wife changes the locks to your home while you are at work. She proceeds to transfer all of the funds from your joint savings account and checking account to her own separate accounts. While you are without access to your home, your wife sells your furniture, your classic car and your firearms. Your wife then tells you that she will allow you to enter the home to retrieve your remaining personal items and valuables if you sign a Settlement Agreement. You immediately sign the agreement.
UNDUE INFLUENCE: To establish undue influence, you must show that your spouse used his/her superior bargaining position to take advantage of you. Most often, undue influence refers to psychological control by one party over another.
Example: Your husband joins an extreme new religion. Over the next ten years, his behavior becomes increasingly controlling. He constantly calls you a bad wife and a sinner in front of your children. He tells you that your sisters are messengers from the devil, and he will not permit you to speak with your family. You are unable to see your family for more than a year. One day, you see your sister at the grocery store and she persuades you to seek shelter at her home. With the support of your family, you file for divorce. Your husband tells you that, by seeking a divorce, you have committed the greatest sin. He tells you that God will no longer allow you into his community or into the lives of his children. You feel ashamed and hopeless, so you sign an agreement giving you husband sole custody of your children.
If you have entered into a settlement agreement, and believe that agreement should be set aside, the Salt Lake divorce attorney at Intermountain Legal is happy to advise you on your options.