The last two weeks have seen significant activity in the area of former marital home sales. Two weeks ago, the New Jersey Supreme Court agreed to hear Sachau v. Sachau, a case in which the parties’ settlement agreement had anticipated that the marital home would be sold in or about 1984, after the youngest child graduated high school, and the proceeds divided equally subject to some adjustments. The husband, who was not living in the home never enforced his rights under the agreement until more than twenty years later. The trial court found that the former husband was entitled to one half of what the home would have been worth at the time it was to have been sold under the parties original agreement in 1984, plus interest. The Husband ‘s position is that he was entitled to one half the value at present. The Appellate Division affirmed and now the New Jersey Supreme Court will weigh in.
Just the other day, the Appellate Division considered a unpublished (non-precedential) case, McNeil v. McNeil, in which the parties entered into an agreement at their divorce in which the Husband was to purchase the Wife’s interest in the home for an amount certain ($150,000) within 90 days from the sate of the agreement. He failed to do so, and the ex-wife filed several actions to enforce her rights, which were granted. She first obtained an order from the court that compelled the house to be listed for sale and then subsequently, when the ex-husband refused to cooperate, the ex-wife was appointed attorney in fact to negotiate and close a contract for sale of the home. Additionally, she obtained an order which prevented the ex-husband from having any contact with the buyers and compelling him to vacate the property. Ultimately, the house was sold at a price ($287,000) almost a year and a half after the settlement agreement. The Husband then argued that the decrease in value of the home must be borne by both parties and that the ex-wife should not have received the $150,000 from the proceeds. The trial court enforced the parties’ agreement and the Appellate Division affirmed. Interestingly, in addition to the fact that the court enforced the clear terms of the agreement that the parties entered into, the court also noted that the ex-husband refused to cooperate and resisted the sale of the home while the real estate market was in a “free fall.”
In both of these cases, the failure of the parties to act in a timely manner significantly affected the proceeds that they were entitled to from the marital home. The lesson to be learned is that when the agreement has a time limited, follow it, suffer the consequences. Moreover, agreements should be clear regarding the parties intent. If they intend to limit or fix what someone gets, and the agreement sufficiently says so, then that is what is likely to enforced. We firmly doubt that the husband here would have been offering more to the wife if the house sold for more then expected.