## Facts

- Three days before marrying, Paula Lane and David Lane signed an antenuptial agreement after exchanging disclosures of assets.
- The agreement stated that each party’s separate property would remain separate upon divorce and specifically identified David’s interests, including his 401(k), profit-sharing plan(s), and a partnership interest connected to his brokerage work, as his separate property.
- The agreement also provided that both parties waived maintenance (spousal support) if the marriage ended.
- It included a fee-shifting clause requiring a “defaulting” or “breaching” party to pay the other party’s attorney’s fees and litigation expenses.
- The parties were married for nearly ten years and had two children.
- During the marriage, Paula primarily cared for the children and did not work outside the home for extended periods, while David worked as a stockbroker.
- By the time of dissolution, David’s earnings had increased dramatically (reported at approximately $1,000,000 annually), and Paula had far less income and earning capacity.
- In the dissolution proceeding, the trial court concluded that enforcing the maintenance waiver would be unconscionable and awarded Paula limited-duration maintenance.
- The trial court also treated David’s 401(k) as marital property despite the agreement’s language and awarded Paula attorney’s fees.
- The Kentucky Court of Appeals reversed key parts of the trial court’s ruling by enforcing the agreement more strictly.
- The Supreme Court of Kentucky granted discretionary review to determine whether, given the parties’ circumstances at divorce, strict enforcement was required.

## Issues

1. Whether a prenuptial agreement that is valid when executed must be enforced as written at divorce when post-marriage circumstances make enforcement of specific provisions unconscionable.
2. Whether the agreement’s waiver of maintenance was enforceable at dissolution or could be set aside as unconscionable.
3. Whether the agreement’s designation of David’s retirement assets (including the 401(k)) as separate property controlled, or whether the trial court could treat some or all of those interests as marital property.
4. Whether the agreement’s attorney’s-fees clause could be applied in the dissolution litigation, and whether attorney’s fees could be awarded on other grounds.

## Decision

- The Supreme Court of Kentucky rejected a purely strict-enforcement approach and held that unconscionability at the time enforcement is sought can justify refusing to enforce particular prenuptial provisions.
- The court held that the maintenance waiver could be found unconscionable at dissolution and upheld the trial court’s ability to award maintenance notwithstanding the waiver.
- The court held that the trial court was not required to treat David’s 401(k) as entirely nonmarital solely because the agreement referenced retirement plans as separate property, and it permitted marital treatment at least to the extent tied to the marriage.
- The court agreed that applying the agreement’s default-based attorney’s-fees provision in this dissolution setting could be unconscionable, but it allowed attorney’s fees to be addressed under the court’s domestic-relations authority based on fairness and the parties’ financial circumstances.
- The judgment was affirmed in part, reversed in part, and remanded for proceedings consistent with the Supreme Court’s unconscionability framework.

## Legal Principles

- Antenuptial (prenuptial) agreements are generally enforceable when entered voluntarily with fair disclosure and without fraud, duress, or overreaching.
- Enforceability may still be limited at dissolution: a court may decline to enforce a specific term if enforcement at the time of divorce would be unconscionable in light of the parties’ then-existing economic circumstances and the marriage’s course (including child-rearing and foregone employment).
- A maintenance waiver in a prenuptial agreement is not automatically binding at divorce; a court may award maintenance when enforcing the waiver would be unconscionable.
- Retirement and similar employment-related benefits may be treated as marital property to the extent they are accumulated during the marriage, particularly where strict contractual classification would produce an unconscionable result at dissolution.
- A fee-shifting clause tied to “default” or “breach” cannot be applied in a way that penalizes a spouse for asserting legitimate dissolution claims; courts may award attorney’s fees based on statutory or equitable domestic-relations standards, including disparity in financial resources.

## Conclusion

Lane v. Lane holds that a valid prenuptial agreement is not always enforced term-for-term at divorce in Kentucky; courts may refuse to enforce provisions that become unconscionable at the time of dissolution, including a complete maintenance waiver and litigation-fee penalties, and may treat certain retirement assets accumulated during the marriage as marital property, with the case remanded for further proceedings under that approach.


Lane v. Lane, 202 S.W.3d 577 (2006)