## Facts

- Spouses married in 1974 and experienced a marital crisis in 1997, during which a dissolution petition was filed and later held in abeyance while they attempted reconciliation.
- In November 1997, while reconciliation was underway, they executed a postmarital agreement intended to resolve present and future financial issues.
- Wife retained separate counsel and obtained family law counsel; husband also had independent counsel during negotiation and execution.
- The agreement provided wife significant financial benefits (including cash and property interests) and provided husband certainty regarding future treatment of wealth increases and business interests.
- Husband offered wife access to business and financial records related to marital assets; the agreement recited that neither spouse obtained an unfair advantage.
- A key dispute later concerned whether husband had to disclose additional information about a prospective, contingent merger involving his business interests that later increased asset values.
- In 2003, wife filed a new dissolution petition alleging the 1997 agreement was void and unenforceable.
- After an evidentiary hearing before a stipulated temporary judge, the court found the agreement valid and enforceable; wife appealed.

## Issues

1. Whether an interspousal presumption of undue influence applied to the postmarital agreement and, if so, whether it was rebutted.
2. Whether husband committed actual fraud by failing to provide written disclosure about a prospective merger and its possible impact on asset values.
3. Whether Family Code §§ 2104 and 2105 disclosure requirements applied to a postmarital agreement executed while dissolution litigation was dormant and the parties were attempting reconciliation.
4. Whether wife could rescind for nonperformance or failure of consideration where she repudiated the agreement in later dissolution pleadings.
5. Whether ratification and estoppel barred wife from challenging enforceability after accepting benefits and living under the agreement for years.

## Decision

- The Court of Appeal affirmed the order enforcing the postmarital agreement.
- No presumption of undue influence arose because the agreement did not give husband an unfair advantage; both spouses received benefits, had independent counsel, and wife had access to relevant records.
- Even assuming the presumption applied and the burden was misallocated, substantial evidence supported the finding that the agreement was not procured by undue influence, making any burden error harmless.
- Wife’s fraud theory based on nondisclosure of a prospective merger was rejected on substantial evidence and credibility findings.
- Family Code §§ 2104 and 2105 did not apply because the agreement was negotiated while the dissolution action was in abeyance and the spouses were attempting reconciliation rather than imminent dissolution.
- Wife’s rescission theory failed because her repudiation excused further performance by husband pending a judicial validity determination.
- Ratification and estoppel precluded wife’s challenge due to her acceptance and retention of benefits and delayed effort to disaffirm.

## Legal Principles

- In interspousal transactions, a presumption of undue influence arises only when one spouse obtains an unfair advantage or receives property for no or clearly inadequate consideration.
- A postmarital agreement providing reciprocal benefits, negotiated with independent counsel and meaningful access to financial information, supports a finding that no unfair advantage was taken and no undue influence occurred.
- Claims of actual fraud based on nondisclosure require proof of concealment or misrepresentation; contingent future business events, combined with access to information and counsel, may not establish fraud on substantial evidence review.
- Family Code §§ 2104 and 2105 disclosure declarations are tied to active dissolution proceedings and do not govern reconciliation-oriented postmarital agreements executed while litigation is dormant.
- A party’s repudiation of an agreement may excuse the other party’s performance pending adjudication, undermining rescission based on alleged nonperformance.
- Acceptance of substantial benefits and prolonged conduct consistent with an agreement can constitute ratification and create estoppel against later challenges to enforceability.

## Conclusion

The court enforced the spouses’ postmarital agreement, holding that it did not trigger (or, in any event, was not the product of) undue influence, that the asserted merger-related nondisclosure did not amount to actual fraud, that dissolution disclosure statutes did not apply during reconciliation with dormant litigation, and that wife’s later repudiation and long acceptance of benefits supported rejection of rescission and application of ratification and estoppel.


In re Marriage of Burkle, 139 Cal. App. 4th 712 (Cal. Ct. App. 2006)