Supreme Court to consider mandatory attorney review, equitable defenses in palimony agreements
The New Jersey State Bar Association (NJSBA) is once again participating as amicus curiae to argue the parameters of palimony agreements in light of a 2010 amendment to New Jersey’s statute of frauds mandating that they be in writing. In the matter of Moynihan v. Lynch, the NJSBA urges the Supreme Court to overturn the Appellate Division’s decision that failing to obtain attorney review of the agreement is a bar to enforcement of its terms despite evidence of promissory estoppel and partial performance. The brief was written by the NJSBA’s Family Law Section chair, Robin C. Bogan, of Pallarino & Bogan LLP; Brian G. Paul, of Szaferman Lakind; and past chair of the Family Law Section, Brian M. Schwartz, of Schwartz Vinhal & Lomurro.
“The NJSBA urges this Court to confirm that promissory estoppel and partial performance remain valid defenses to defeat the Statute of Frauds writing and/or attorney review requirement when necessary to prevent an injustice,” wrote the NJSBA in its brief.
The underlying matter is about a palimony agreement that was signed and notarized by the parties post 2010, when the statute of frauds was amended to require these agreements be in writing. N.J.S.A. 25:1-5(h) also required the parties to seek independent advice of counsel. The parties split, and Moynihan sought to enforce the terms of the agreement. At the time of the trial, Lynch testified that he never intended to be bound by the agreement and was aware that he was inducing Moynihan to remain in the relationship. Moynihan testified that when she suggested seeking counsel, Lynch demurred, saying he was a “man of his word.”
In reversing the trial court, the Appellate Division held that this was a palimony agreement subject to N.J.S.A. 25:1-5(h). The court held the agreement was unenforceable because the parties failed to seek independent counsel. It also denied that the equitable defenses of promissory estoppel and partial performance were not available here because the legislative intent of the 2010 amendment to the statute of frauds sought to overturn “recent ‘palimony’ decisions by the New Jersey courts.”
The NJSBA argued that the 2010 amendment did not extinguish Moynihan’s ability to prove by clear and convincing evidence that the palimony agreement was enforceable under both promissory estoppel and partial performance. Taking issue with the court’s decision not to apply these equitable defenses and to bar enforcement of the agreement because of the parties’ failure to seek independent counsel, the NJSBA reminded the Court of the unequal positions the parties are often in when making these agreements.
“While the NJSBA believes it is prudent for anyone entering into a contract or agreement to consult with independent counsel, requiring such consultation in order for the agreement to be valid is contrary to fundamental notions of fairness, equal application of the laws and access to justice for all persons, especially financially or otherwise disadvantaged litigants,” wrote the NJSBA.
The NJSBA also highlighted the legislative intent of the 2010 amendment, as expressed by then-Gov. Jon Corzine in his statement on signing the bill. Pulling a quote directly from the statement, the NJSBA pointed out that it was the intent of legislative leadership and the sponsors to uphold such agreements “when they are mutual, in writing and notarized as opposed to mandating the involvement or services of an attorney.”
This is a status report provided by the New Jersey State Bar Association on recently passed and pending legislation, regulations, gubernatorial nominations and/or appointments of interest to lawyers, as well as the involvement of the NJSBA as amicus in appellate court matters. To learn more, visit njsba.com.
Oral arguments have not yet been scheduled.