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A PROPERTY AGREEMENT SIGNED TO SETTLE A DIVORCE IS BOUND BY CONTRACT LAW

In a May 2016 Pennsylvania Appellate Court decision, Gardell v. Gardell, Wife in a Divorce action signed a Property Settlement Agreement at a time when she claimed that she was not aware of the value of Husband’s retirement accounts. After that Agreement was signed, and after a Divorce Decree was entered, Wife had second thoughts.

Two weeks after the Divorce became final, Wife filed a Petition in Court seeking to have the Property Agreement either stricken or opened, so Wife could then gather information regarding Husband’s retirement accounts. The Trial Court refused to open or strike the Agreement.

On appeal, Wife argued that the Trial Court was incorrect in refusing to open or vacate the prior Agreement where Wife did not know the value of the retirement accounts before signing the Agreement.

The Appellate Court agreed with the Trial Court. Since there was no fraud on Husband’s part, since he had not forced Wife to sign the Agreement under duress and there was no “new evidence” to be considered, there was not basis to open or strike the Agreement. Wife knew, at the time she signed the Agreement, that she was unaware of the value of the retirement accounts and she decided to sign the Agreement with that lack of knowledge. Wife did not raise any issue of fraud.

The appeals Court held that a mistake in or lack of knowledge of the valuation of marital assets is not valid basis for opening a Divorce Decree. Moreover, the Court held that absent fraud, duress or undue influence, spouses were held to the terms of their divorce Agreements.

Hot Tip: Do not sign a Property Agreement or other Divorce Agreement until you have all of the information you need in order to make an informed decision regarding whether the Agreement is in your best interest. These agreements are contracts, as are contracts to purchase a home or to buy a car. Once signed, voiding or opening contracts is a difficult task in Pennsylvania.

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