Separations and Void Modifications (Kelley v. Kelley)

Kelley v. Kelley, T.C. Memo. 2017-798, 2017 WL 1251018

Facts: Husband and wife were married in 1982. They later entered into a Separation and Property Settlement Agreement upon their separation in 1994 (the “1994 agreement”). The two later divorced in 1999. The 1994 agreement resolved several issues between the two such as child support, alimony, and equitable distribution, but most importantly, the agreement contained a “Modification and Waiver” clause. In 2003, approximately nine years after the parties separated and four years after their divorce, the parties allegedly signed a document titled, “Amendment to Settlement Agreement.”

The ex-wife, approximately eleven years after the parties entered into the 2003 Amendment, filed suit against ex-husband alleging he had breached the 2003 Amendment. Ex-husband responded by filing a motion for summary judgment, which the trial court denied. Ex-husband appeals to the Court of Appeals of North Carolina.

Issue: Whether the ex-husband breached the 2003 Amendment.

Answer to Issue: No.

Summary of Rationale: Within the 1994 agreement, the “Modification and Waiver” clause explained that any modification or waiver of the agreement shall be consistent with the original formality of the agreement and reduced to a writing. In addition to being reduced to a writing, modifications also needed to be acknowledged by both parties before a certifying officer.

The ex-wife argues that the amendment was signed in a lawyer’s office where lawyers and notaries were present, but this was not enough to prove that the signing took place before a certifying official – not to mention, there was not a notary page attached to the amendment. The ex-wife also claimed that the amendment was an ordinary contract and therefore, did not require notarization. The title of the amendment, “Amendment to Settlement Agreement,” clearly expressed that the amendment was indeed a modification to the original 1994 agreement, invalidated this argument. Thus, the amendment would have needed to be notarized, and the absence of this element deemed the amendment void, as a matter of law.

Comments:

In North Carolina, any modification(s) of separation agreements are required to be in writing and acknowledged by both parties before a certifying official who must not be a party to the contract. N.C.G.S. § 52-10.1.

Lawson had no dispute as to whether the document between the parties was signed before a notary because the plaintiff provided evidence to prove it was and a statement was made by the notary, confirming the plaintiff’s evidence. This greatly differs from this case.

Though there was recognition of the possibility that the amendment was signed before a notary, with the lack of evidence by the ex-wife to support such likelihood, the court could not consider the agreement to be valid.

by Sade Knox, Intern, Woodruff Family Law Group