Maryland Supreme Court upholds $7 million adultery ruling in postnuptial agreement

in opinion By Judge Michelle D. Houghton, the Supreme Court has held that spouses may allocate marital assets in a divorce on the grounds of adultery, as supported by Maryland’s public policy, which allows spouses to transfer assets to each other on grounds of adultery leading to annulment. from marriage.

The case centers on Thomas Lloyd and Anna Nikita, ex-husband and wife. Lloyd is the grandson of the late social activist and philanthropist Rachel Lambert Mellon, and Nikita worked as a White House social secretary during the Trump administration.

Nikita took Lloyd back again after his previous relationship in 2014 on the condition that they come to a postnuptial agreement.

The agreement, reached in 2015, calls for a lump sum payment of $7 million if Lloyd engages outside of marriage in sexual intercourse, romantic kissing, hugging, fondling, cuddling, emailing or sexting.

Houghton writes that the lump sum did not restrict Lloyd’s ability to foster platonic relations nor did it require the parties to remain married, but merely required Lloyd to remain faithful to Nisita.

Moreover, Hutten wrote that prize money under Fam. § 8-205(a)(1) cannot exceed the value of marital property. Here, a $7 million transfer will be made of Lloyd’s 50% stake in Column B assets, which is specified in the agreement.

Ex Spouses Chevy Chase A courtroom odyssey It began in Montgomery County Circuit Court, which awarded Nikita $7 million and granted her a divorce from Lloyd for adultery in October 2021.

On appeal, the Maryland Court of Appeals said the postnuptial agreement contained mutual sacrifices, or considerations, in which Nikita expressly agreed to waive her right to file for divorce and instead work to reconcile the marriage in exchange for Lloyd’s pledge to pay her $7 million if he strayed. once again.

The Circuit Court and the Supreme Court relied on it McGeehan v. McGeehanwhich held that the intention of the parties is the relevant analysis in determining whether property acquired after a specific agreement constitutes non-marital property.

Although Lloyd argued that the General Assembly did not expressly authorize penalties in matrimonial agreements, the Supreme Court has found that a lump sum payment is not a penalty as the term applies to liquidated damages clauses, but rather a “conditional appropriation of marital assets”.

Lloyd said it was dangerous for the Maryland Supreme Court to “operate” adultery penalties in spousal agreements, which he said would exacerbate spousal abuse and become “instruments of fear and coercion.” However, the court rejected this argument.

This ruling has been helpful to the Maryland State Bar and parties in drafting these types of agreements, said Cheryl New, co-counsel with Jeff Evan Lowinger of New & Lowinger, PC for Niceta.

This gives clear direction and clarifies McGeehan “If the parties are free to enter into agreements that include provisions, such as those in (this) case that address fault issues,” New said. “This is wonderful and illustrative for Maryland attorneys and practitioners.”

New said it was important to note that the court did not go so far as to give its opinion on prenuptial agreements.

Lloyd’s co-attorney was not immediately available for comment.