Prenuptial agreements (prenups) make great movie plots. Body Heat, Private Benjamin and Cary Grant’s Indiscreet are just a few of the comedies, dramas and thrillers that feature them in their plotlines. But if Hollywood wants accuracy, it should take note of a California law and a new ruling that holds... Read More »
Woman Who Didn’t Read Her Prenup to See if Requested Changes Were Made Gets No Relief
The facts in Eskra v. Grace read like an afternoon soap opera plot that centers around who will inherit an estate after the husband dies in a car accident. Will it go to the widow or to his child by his first wife?
Right before she got married, Brandy Eskra learned about a provision in her prenuptial agreement (prenup) that gave her husband Scott’s estate not to her but to his daughter if he died. Scott said he would change it to allow Brandy to inherit his property unless they divorced. Three years after they married, Scott died in a car accident without changing the prenup.
Brandy and Scott were married on May 2, 2015. He had one daughter from a previous marriage who was nine at the time of his new nuptials. He died without a will in March 2018. Brandy wanted Scott’s separate property. So did his ex-wife on behalf of their daughter. So did Scott’s parents.
After Scott died, Brandy discovered that Scott never made the changes. She had signed the prenup without reading it. The trial judge ruled that Brandy therefore gets nothing because she did not exercise reasonable care when she put her signature on a document she never read. The appellate court affirmed the trial court’s judgment.
In a unanimous opinion by a three-judge panel on May 3, Justice Mark B. Simons of Division Five of California’s First District Court of Appeals affirmed the judgment of Humboldt Superior Court Judge Timothy Canning. Canning had ruled in favor of Scott’s mother, Catherine Grace, and her husband Scott Eskra, who were the respondents in the probate petition filed by Brandy. They argued that Scott’s daughter was to inherit his estate under intestate succession laws.
Brandy was seeking to be the personal representative of her husband’s estate. Instead, Canning appointed Scott’s parents to be the administrators. After the initial ruling, Brandy won an appeal that allowed her to give the court additional evidence that would contradict the terms of the prenuptial agreement.
She had retained an attorney, Tracy Rain, to review the prenup with her. Brandy knew she would not get Scott’s separate property if they got divorced, but said it was “news to her” that she wouldn’t get it if he died. Ms. Rain told Brandy she would “seek” to have the clauses related to Scott’s death redacted, and told her to discuss the proposed changes with Scott. Brandy testified that Scott told her he didn’t know that the death clauses were in the proposed prenup.
Ms. Rain also testified that she personally heard Scott call his attorney and tell him, “This isn’t about death. It’s about divorce only. Take it out.” Brandy’s son also remembered incidents related to the death clauses. In addition, Attorney Rain emailed Scott’s attorney, saying she was “hopeful that (Scott) will agree to redact” the sections regarding death. Brandy relied on these conversations as credible evidence that the changes would be made.
But Scott’s attorney told the court that during discussions with his client, “Scott confirmed he wanted the premarital agreement to apply in case of death as well as divorce.” He sent the unchanged agreement back to Ms. Rain, who “could not explain her failure to request changes to the pertinent language in the prenup.” Critically, Brandy failed to meet with her attorney or make sure the changes she requested were actually put into effect before she signed the prenup shortly before the wedding. Scott signed it without reading it, too.
During the trial, Scott’s daughter, mother, and stepfather all testified that Scott had told them he wanted his estate to go to his daughter after his death. Brandy claimed those conversations never happened. On remand, the trial court decided Brandy’s failure to read the prenup before signing was a “unilateral mistake” rather than a mutual one because Scott “was not mistaken when he signed the agreement.” Brandy’s unilateral mistake, the court ruled, “did not justify rescission of the Agreement because ‘there was insufficient evidence that Scott encouraged or fostered Brandy’s mistaken belief.”
Also, the court ruled that the prenup was signed voluntarily and was enforceable. The trial court ruled Brandy was not entitled to repeal the written agreement. She appealed again. She lost again. She said she trusted Scott. Big mistake.
“We affirm,” Simons wrote. “Because Brandy failed to read the Agreement and to meet with her attorney to discuss it before signing it, she bore the risk of her mistake and is not entitled to rescission.” The opinion discussed the difference between mistakes of fact and legal mistakes and concluded that “misinterpretation of a contract is a mistake of law ...the trial court properly analyzed the rescission claims as being based on a unilateral mistake of fact” about whether the contract had been amended as Brandy hoped.
Simons relied on a California Supreme Court precedent that detailed when rescission of a contract was permissible. It requires the defendant to make a mistake about a basic assumption, the result to have an “adverse material effect” on the defendant, the defendant to not bear the risk of the mistake, and the result of enforcement to be unconscionable. When applying this test, the trial court found that Scott was not unaware of Brandy’s mistaken beliefs, and she bore the risk of any mistake because she neglected her legal duty to read the contract or even meet with her attorney before she signed it.
She did not exercise reasonable care. She bears the risk of her mistake and her agreement was executed voluntarily. There was also no fraud because Scott did not encourage or foster her mistaken belief.
If this were a soap opera, those curious about what happens next could tune in tomorrow. Here, the appellate ruling stands and there are not likely to be any additional plot twists.
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