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Georgia Case Law Update – Christian v. Christian (Part 1)

When drafting a settlement agreement in a divorce action, wording matters. It is important to carefully read over ever word of a settlement agreement before signing it to make sure that the language reflects the actual agreement between you and your soon-to-be ex. The specific language in the agreement (as well as language that may not be included in the agreement) can make a huge difference in how a court interprets that agreement if there is a later issue. A recent case in the Supreme Court of Georgia turned on the Court’s interpretation of the specific language in the parties’ Separation Agreement. Christian v. Christian, S16F1160 (November 21, 2016).

In the Christian case, the parties signed a Separation Agreement in 2006, which was approved by the trial court in 2008. The Wife subsequently filed for divorce several years later in 2013. In the divorce action, there were several disputes over the interpretation of a particular section of the Separation Agreement, which said: “The parties acknowledge that should they divorce, Wife shall be entitled to one-half of Husband[']s retirement, 401K or other employment benefits.”

One dispute was over the valuation date of the retirement accounts. After a hearing, the trial court held that the language of the Separation Agreement “requires that the date of valuing and dividing the retirement, 401(k) or other employment benefits is the date of the Separation Agreement…and not the date of the divorce.” The Wife appealed this ruling, alleging that the trial court should have valued her portion of the retirement benefits based on the date of the divorce, which is the time she would receive the benefits, rather than the date of the Separation Agreement, which was signed a decade prior to the appeal. The Supreme Court of Georgia agreed with the Wife, finding that the assets in question were not valued and separated at the time of the Separation Agreement and, in addition, nothing in the parties Separation Agreement indicates that the parties intended that the complicated analysis required to determine the 2006 value should be done. Rather, the Agreement itself said that Wife was only entitled to those assets “should they divorce.”

As further support, the Supreme Court of Georgia cited well established Georgia law that provides “the last date for acquiring marital assets is ‘the date of the final decree of separate-maintenance or the date of the decree of divorce,’ because such a date is certain rather than subject to manipulation by one of the parties.” Id., citing Friedman v. Friedman, 259 Ga. 520 (384 SE2d 641)(1989). Thus, the Separation Agreement meant nothing as far as valuation. Accordingly, the Supreme Court of Georgia reversed the trial court’s ruling as to the valuation date, requiring the assets to be divided according to their valuation on the date of the final divorce decree.


Case Law Update
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