Wednesday, May 9, 2012

Home Sale Can't Stop Divorce


A most fascinating case was just decided in Manhattan Supreme Court where the parties had agreed (stipulated) that until their residence was sold "neither party shall file any papers to obtain a judgment of divorce". 

So the question before the Court was: "whether the parties can condition their divorce upon the mercurial nature of the New York City real estate market."

The Court would have none of that and deemed this clause unenforceable because the Court felt that public policy was to make a divorce less burdensome and to remove as many roadblocks to its conclusion as possible. 

What is interesting from this case is how people utilize economic coercion as negotiation leverage in a divorce. Had the clause remained, the parties would have either had to accept a lower sales price or remained married. This would have allowed the party less motivated to sell to get concessions from the other party in other aspects of the divorce in order to permit the sale. 

For real estate professionals, you now know that in Manhattan a divorce should not block a sale of the property as the Court doesn't see the sale of real estate as a reason to stop a divorce. Instead, the divorce should go forward and as the Court says: " If the parties are unable to accomplish the sale themselves, then the court can force a sale (CPLR § 5103), appoint a receiver (CPLR § 5106), or order a conveyance by a sheriff (CPLR § 5107)"

To read the case in full, click here