Premarital agreements, also commonly known as prenuptial agreements or a “prenup”, are contracts. But family law in Virginia can act like a distortion zone, where the normal rules of court are modified or cast aside in favor of pursing fairness, or at least fairness as the judge sees it. So the question is whether a premarital agreement is interpreted like a normal contract, according to the plain language of the agreement, or can be interpreted other ways to achieve a more “fair” outcome. That’s what the Court of Appeals addressed recently in the case of McDaniel v. Griffith, Record No. 0597-15-3 (Va. Ct. App. 2016).
In this case, Mr. McDaniel and Ms. Griffith entered into a premarital agreement which addressed, among other things, what they would do with the undeveloped land that Mr. McDaniel owned. The agreement plainly stated that they intended to build a house on the property. To do this, they agreed that they would each pay half the cost of building the home. Over the next year, the parties hired Ms. Griffith’s cousin as lead contractor for building the home, started construction, had the relationship fall apart, and separated permanently. After the final separation, Ms. Griffith instructed her cousin to stop construction. Months later, Mr. McDaniel restarted construction without consulting Ms. Griffith. He couldn’t consult her, or even contact her, due to a protective order. Despite Ms. Griffith’s later protests, Mr. McDaniel finished the house.
When Ms. Griffith refused to pay half of the total cost of building the house, Mr. McDaniel sued for breach of contract. The circuit court ruled that no, Ms. Griffith had not breached the contract as Mr. McDaniel had first breached the contract by resuming construction of the house without first consulting Ms. Griffith. This was based on the parties’ intent changing between when the premarital agreement was made and when Mr. McDaniel restarted construction. Simply put, the circuit court saw that the prior intent no longer existed, so it refused to enforce the contract as stated.
On appeal, the Court of Appeals flatly reversed the circuit court. Regardless of any changes of intent or equitable considerations, the Court of Appeals interpreted the premarital agreement as a contract and nothing more. There is a rule Virginia courts use when interpreting contracts called the “plain meaning” rule, which states that a contract whose meaning is plainly clear when read ordinarily will be interpreted and applied according to that plain meaning. The contract stated plainly that the parties intended to build a house and to split the costs of building the house evenly. The fact that the parties’ intent had changed before the house was finished is irrelevant. If the contract said that the parties would build a house, then Mr. McDaniel building the house the contract calls for could not be breach of contract. He was doing what the contract said to do. Therefore the circuit court was wrong for finding Mr. McDaniel was in breach of contract.
The lesson to take from this is that you should expect to be bound by whatever you put into a premarital agreement. This is one area where the squishiness of family law does not come into effect. A contract is a contract and will be interpreted and applied by the court accordingly. So if you’re looking to form a premarital agreement, be careful what you put in there, or you could end up paying for half the cost of building your ex-husband’s house. If you need any help with crafting a premarital agreement, or any other family law matters in the Northern Virginia area, please feel free to contact us at (703) 359-0088 or at info@SAlawfirm.com.