Those are four items you probably never thought you’d see in the same sentence. Yet beginning in the spring of 2011, they all came together. Well, all of them except for the Buffalo, MN divorce lawyers component. Nevertheless, the Frank and Jamie McCourt divorce saga has some important lessons for Wright County family law attorneys.
Some baseball fans might remember the McCourts. This billionaire power couple owned the Los Angeles Dodgers in the early 2000s.
Minnesota is one of the few states which has not adopted the Uniform Marital and Premarital Agreements Act. Generally, lawmakers in St. Paul do not follow trends. They either start them or ignore them. Nevertheless, the issues presented in the McCourt prenup matter are very similar to the ones Buffalo, MN divorce lawyers face on an ongoing basis.
Prenups in Minnesota and Buffalo, MN Divorce Lawyers: An Overview
Rich couples who own baseball teams are by no means the only people who should consider prenuptial agreements. For the most part, these pacts are much more than divorce insurance. Since they decide most financial matters in advance, prenups usually make marriages stronger. Money is the leading cause of marital distress. And, premarital agreements remove money from the equation.
In Minnesota, prenuptial agreements can cover more than property division, spousal support, and property management issues. These pacts also often address inheritance and succession matters, especially if the couple owns a family business and stepchildren are involved. Frequently, Minnesota’s antiquated inheritance laws do not jive with a couple’s intentions.
Generally, premarital agreements are valid as long as each couple had an independent Buffalo, MN divorce lawyer, the agreement was properly recorded in the deed records, it was not blatantly one-sided, and it was voluntary. Those first two requirements are largely technicalities. The second two requirements, however, merit closer attention.
Aided greatly by Kirk Gibson’s impossible home run in Game One, the Dodgers won the World Series in 1988. After that, the club fielded a succession of underachieving teams. Fan interest waned, and so did team revenues. When the McCourts bought the Dodgers in the early 2000s, they probably thought their investment epitomized the old axiom of buying low and selling high. Little did they know that the Dodgers would sink even lower before they rose again.
The team finally bottomed out in June 2011. Reportedly, Frank McCourt, who was the only remaining owner, did not have enough cash to make payroll. So, the club filed bankruptcy.
Then, something else impossible happened. The Dodgers suddenly became contenders again, largely due to the emergence of pitching ace Clayton Kershaw. Notoriously fickle SoCal fans returned and the team’s revenue exploded. As a result, Frank sold the team for a whopping $2.15 billion.
Breaking Down the McCourt Property Agreement
Just before the Dodgers went to bankruptcy court, the team owners were in divorce court. Supposedly, things came to a head for the feuding couple when Jamie had an affair with her bodyguard.
The divorce was contentious to say the least. Lawyers spent most of their time on the property division. Since the team was on the edge of bankruptcy and almost worthless, Jamie agreed to give up her half of the team for about $180 million in cash and property. That seemed like a good deal at the time.
Jamie’s jaw probably fell open when she saw the news of the sale. After all, California is a community property state. So, she argued in court, half that $2.15 billion was hers.
Eventually, a Superior Court judge disagreed. As mentioned above, Buffalo, MN divorce lawyers can use these same arguments in Wright County.
Withheld Information: In both California and Minnesota, prenuptial agreements are invalid if a party withholds financial data. Jamie claimed that Frank misled her about the team’s value. However, the judge noted that Frank produced tens of thousands of financial documents during discovery. Additionally, even if Frank did lie to her, Jamie was a co-owner at the time. So, she could have reviewed all the financial data she wanted.
Unconscionable Agreement: By almost any definition, the property agreement’s result was unconscionable. It left Jamie $900 million shy of a 50-50 split in a community property state. However, the agreement was not unconscionable when it was made. According to the court: “Jamie simply chose the security of a guaranteed $131 million payment, plus more than $50 million in real and personal property, over the uncertainty and risk presented by the valuation and sale of the Dodger assets.”
So, Jamie lost her appeal and even had to pay her ex-husband’s legal fees. But her story has a somewhat happy ending. The longtime GOP fundraiser recently became the U.S. ambassador to France and Monaco.