The recent case of Etzion v. Etzion drives home the importance of the need to conduct an extensive due diligence of all realty that is part of the marital estate before settling a divorce action. In Etzion, the parties entered into a settlement agreement regarding the wife's distributive share, including a division of marital assets based on a neutral appraiser's report. One key asset was a warehouse property which was agreed to have a market value of $7.7 million.
Seven weeks after the parties entered their agreement, New York City Department of City Planning adopted a rezoning plan to allow for residential development of the warehouse property and husband later contracted for sale of the property for $84.57 million. Wife commenced an action to set aside the agreement claiming that the agreement was premised upon the parties agreeing that the warehouse had a market value of $7.7 million. Husband claimed wife failed to uncover evidence giving rise to a question of fact regarding ongoing negotiations for the sale of the property prior to entering into the agreement, despite five years of discovery.
The court agreed and dismissed wife's complaint. Had the wife conducted proper due diligence just prior to signing the agreement, she would have learned of the rezoning plan which rezoning plan increased the value of the property. Let Jane K. Cristal, P.C. review your particular facts to determine how to best protect your interests during negotiations and financial discover: settlement or trial period. For further information about all divorce issues, contact our firm today!