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Use It or Lose It: Failure to Address Property in Settlement Agreement may Constitute Waiver

In the case of Hart v. Hart, S15F0964 (Ga. Sept. 14, 2015), the Georgia Supreme Court recently considered whether a wife’s failure to address husband’s civil service retirement assets in the parties settlement agreement constituted a waiver of her right to claim an interest in the account. In Hart, as in several other divorce cases, the couple ultimately entered into a marital settlement agreement outlining, among other things, the division of the couple’s marital property. Unlike in other divorce cases, the Harts did not reach a mutually agreeable resolution to their divorce until the morning of trial. After lunch, on the first day of jury selection, the parties advised the court that a settlement agreement had been reached, and the terms of the agreement were recited to the court on the record.

In the following weeks, the attorneys for both parties worked to memorialize the settlement agreement. Although the agreement addressed the division of other retirement accounts and assets, no version of the agreement addressed husband’s civil service retirement account. Additionally, each version of the written agreement drafted by the parties’ attorneys included a waiver stating that “the parties waived any claims or rights they may have against the other as to retirement accounts not mentioned in the agreement.” However, when a final draft was presented to the court for incorporation into a final decree of divorce, wife refused to sign the agreement. In response, husband filed a motion to enforce the agreement, and the trial court ultimately granted husbands motion. Id. Wife appealed, and the Georgia Supreme Court affirmed the trial court’s decision, holding:

[…] [W]e conclude that under the circumstances of this case, the trial court correctly determined that as part of her agreement to finally settle all issues between the parties, wife agreed to waive any interest she may have had in husband’s civil service retirement. The terms of the announced settlement and the conduct and statements of the parties and their counsel, both at the time the settlement was announced and during the drafting of the written agreement, all support the finding that a reasonable person in husband’s position would ascribe to wife her assent to waive any claims she may have had against husband’s civil service retirement. The absence of an affirmative statement regarding husband’s civil service retirement in the announced settlement does not, contrary to wife’s argument, mandate the conclusion that this issue was left unresolved by the settlement reached by the parties. In fact, had the parties not intended to resolve their differences regarding this retirement account, clearly that issue would have been submitted to the jury already selected by the parties.

We conclude, therefore, that the facts of this case are distinguishable from the facts in Reichard, 262 Ga. 561, where it was undisputed that the proposed written settlement agreement contained additional substantive terms not agreed to by the parties, and DeGarmo, 269 Ga. 480, where the evidence supported the finding that the final decree included several substantive provisions not included in the parties’ settlement agreement. In contrast, the record in this case supports the finding that the parties mutually agreed to waive any claims they may have had to retirement accounts not mentioned in the announced settlement, and the trial court simply included in its final decree language reflecting the parties’ mutual assent. It follows that the trial court was authorized to include the waiver language in its final divorce decree.

Id. (Internal case citations omitted). It is important for divorce litigants and divorce attorneys to take note of Hart, because failure to fully and specifically address the division of marital assets in marital settlement agreements may result in a spouse’s waiver of any future claim to such assets. So, if you are considering an uncontested divorce, or if you and your spouse are currently engaged in settlement negotiations, please be sure to address all accounts, properties, and other assets to guarantee you receive the fair finance settlement you deserve.

 

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