Law News

Panel Clarifies Rules Enforcing Separation Pacts

by Gary Spencer
New York Law Journal
July 28, 1999

ALBANY -- In an interstate matrimonial dispute, an upstate appellate court ruled Thursday that New York courts had jurisdiction to enforce a New York separation agreement against a shrimp fisherman who obtained his divorce in North Carolina.

The unanimous ruling by the Appellate Division, Third Department, clarified its rules for enforcing separation agreements, holding that such an agreement is presumed to survive a judgment of divorce unless the parties clearly intended it to be merged into the judgment.

A North Carolina court had issued an order staying the fisherman’s alimony obligations under the separation agreement in 1997, but the Third Department held in Von Schaaf v. Von Schaaf, 83920A and B, that the agreement remained a separate and enforceable contract that gave New York courts subject matter jurisdiction to sequester the fisherman’s pension assets and order payment of the alimony arrears.

Karl and Constance Von Schaaf were living in upstate New York in 1992 when they separated after 32 years of marriage. Under their separation agreement, Ms. Von Schaaf was to receive $800 per month in support and maintenance through a bank transfer of half of her husband’s monthly pension payments as a retired fireman. The agreement also provided that it would be incorporated by reference in any subsequent divorce decree.

Mr. Von Schaaf then moved to North Carolina and sued for divorce, obtaining a judgment of absolute divorce in 1996. He also initiated proceedings in North Carolina to challenge the support and maintenance provisions of the separation agreement, obtaining an order staying his payment obligations in 1997, when Ms. Von Schaaf failed to comply with discovery demands.

Ms. Von Schaaf then brought her own action in New York to enforce the separation agreement and Albany County Supreme Court granted her motion for an order sequestering Mr. Von Schaaf’s pension assets.

The Appellate Division affirmed in an opinion by Justice D. Bruce Crew III, rejecting Mr. Von Schaaf’s argument that the separation agreement had merged into the North Carolina divorce decree, and that New York courts therefore lacked subject matter jurisdiction.


CONTRACT LAW
When a divorce judgment does not state whether the underlying separation agreement is to survive or merge, courts apply principles of contract law to determine the parties’ intent from the separation agreement itself, or if the agreement is ambiguous, from extrinsic evidence.

The Third Department had said in Steinard v. Steinard, 221 AD2d 835, that a separation agreement merges into the judgment of divorce unless the agreement expressly stipulates against it. But it applied the opposite presumption in Von Schaaf.

"In the event that no extrinsic evidence is available, or a review of such evidence fails to resolve the issue of the parties’ intent, the separation agreement is presumed to survive the resulting decree," Justice Crew wrote.

"To the extent that this court’s prior decision in Steinard holds to the contrary, we reject the reasoning employed therein," the court said in a footnote.

It found the Von Schaafs had intended their separation agreement to survive. "Accordingly," it said, "the separation agreement remained a separate and enforceable contract upon which plaintiff could seek relief and provided Supreme Court with a valid basis for exercising subject matter jurisdiction over this dispute."

The case was argued by Albany attorneys Ihor B. Evanick, of McCarthy & Evanick, for Ms. Von Schaaf, and by Florence M. Richardson, of Kahn & Richardson, for Mr. Von Schaaf.

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