The Pennsylvania Superior Court case of Annechino v. Joire provided a reminder and clarification to family law practitioners regarding the enforceability of property settlement agreements.
Donna Annechino and Kenneth Joire entered into a property settlement agreement May 15, 2001. On Aug. 2, 2001, a divorce decree was entered, divorcing the parties from the bonds of matrimony. Interestingly, Joire's complaint in divorce did not contain a count for equitable distribution, nor did the divorce decree incorporate the parties' property settlement agreement. After the parties' divorce, Joire filed a petition to enforce the parties' property settlement agreement. Annechino defended against Joire's petition by claiming that the court did not have the authority to enforce the property settlement agreement because the agreement was not incorporated into the divorce decree and Joire's complaint did not contain a count for equitable distribution. Annechino argued that Joire's only remedy was a separate civil action in equity.
The Chester County trial court granted Joire's petition to enforce the agreement. Thereafter, Annechino appealed the trial court's decision.
In 23 Pa. C.S.A. Section 3105(a) it provides: "A party to an action regarding matters within the jurisdiction of court under this part, whether or not the agreement has been merged or incorporated into a decree, may utilize a remedy or sanction set forth in this part to enforce the agreement to the same extent as though the agreement had been an order of the court except as provided to the contrary in the agreement."
It is clear by the plain language of 23 Pa. C.S.A. Section 3105(a) that an agreement between parties to a divorce action, regarding matters within the jurisdiction of the court under the divorce code, are enforceable whether or not they are merged or incorporated into a divorce decree. However, in this case, Annechino argued that Section 3105(a) is inapplicable in the present case because Joire did not plead for equitable distribution in his complaint in divorce. In Section 3105(a), the words "under this part" pertain to the Pennsylvania Divorce Code. Annechino directed the court to Section 3104(a), which pertains to jurisdiction in divorce and annulment cases. Section 3104(a) reads, in part: "The court shall have original jurisdiction in cases of divorce and for the annulment of void or voidable marriages and shall determine, in conjunction with any decree granting a divorce or annulment, the following matters, if raised in the pleadings, and issue appropriate decrees or orders with reference thereto, and may retain continuing jurisdiction thereof." Annechino argued that by reading Section 3104(a) in conjunction with Section 3105(a), because equitable distribution was not "raised in the pleadings" as directed by Section 3104(a), the court does not have jurisdiction to enforce the agreement under Section 3105(a).
The Superior Court, in addressing this issue, stated, "In the 1988 Amendments, the Legislature made a drastic change in the law. The Legislature in essence provided that almost all matters involving family law issues should be heard under the Divorce Code, which would be in the family court division of those courts having separate divisions." The statute overturned the common law that precluded enforcement of unmerged agreements and left the parties to contract law.
The Superior Court acknowledged that Section 3105 does not specify that the agreement had to have been pled in the divorce complaint. Referencing that the Legislature "has clearly set forth its intent and objectives, and because it has granted the courts continuing jurisdiction and broad enforcement powers," the Superior Court did not agree with Annechino's argument that Section 3104(a) restricts or limits the jurisdiction and enforcement powers of the trial court under Section 3105.
Before the 1988 amendments, when a party sought to enforce an unmerged agreement regarding property issues and rights, he or she had to "seek enforcement at law or in equity." The General Assembly's aim in enacting the 1988 Amendments was to "extend the Divorce Code's remedies, sanctions, and vehicles of enforcement to agreements covering certain matters ancillary to divorce." Further evidence of the General Assembly's intent is seen in Section 3323(f) of the Pennsylvania Divorce Code. That section is the "catch all" which grants the court "not only broad enforcement powers, but 'full equity and jurisdiction' to issue orders necessary to protect the interest of the parties and effectuate economic justice and insure the fair and just settlement of the parties' property rights."
Putting this all together, the Superior Court found that limiting the court's jurisdiction and enforcement powers pursuant to Annechino's reading of the statute "would discourage the resolution of economic claims by agreement and send economic claims relating to divorce over to the civil division as a breach of contract claim, precisely the situation the legislature intended to change by the 1988 Amendments."
In affirming the trial court's decision, the Superior Court gave a reminder that the policy of the Pennsylvania Divorce Code is to "effectuate economic justice between divorcing parties," and said policy requires the court to read 3105(a) broadly. The Superior Court further held: "We conclude, therefore, that it was the General Assembly's intent in enacting §3105(a) to make the enforcement provisions of the Divorce Code available to parties to an agreement, so long as the agreement pertains to a matter that is covered in Part IV [Divorce]."
What is interesting in this case is that regardless of whether Annechino won or lost she would still find herself in court (either equity or family court), defending against the enforcement of the agreement. One would think that it would be more beneficial for the litigants in a family law case to resolve matters related to their divorce in family court.
This case is a reminder to all family law practitioners that once a property settlement is signed by the parties, at the moment it is fully executed it has the same teeth as if it were incorporated into a divorce decree and made an order of court. Further, it is clear that in a situation where the parties entered into an agreement but have failed to plead equitable distribution in a divorce complaint, a fatal error has not occurred, and the agreement will still be enforceable.
MICHAEL E. BERTIN is an associate in the Philadelphia law firm of Obermayer Rebmann Maxwell & Hippel. Bertin is co-chairman of the custody committee and a member of the executive committee of the family law section of the Philadelphia Bar Association.
This article is reprinted with permission from the August 12, 2008 issue of The Legal Intelligencer © 2008 NLP IP Company
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