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Marital Settlement Agreements: Vague Language May Trump Specifics

In the recent Florida Supreme Court case Crawford v. Barker, the court analyzed the lower court’s decision to be an interpretation of language which was included in the couple’s martial settlement agreement (an agreement signed by divorcing couples in the State of Florida). The case reviewed the issue of who should receive funds from a deferred compensation fund held by one of the parties.

As a result of one of the parties dying (although the settlement agreement was finalized before his death) it did not specifically list the beneficiary of his pension plan and his deferred compensation fund in the event of his death; however, when he died, the deferred compensation plan was awarded to the former spouse. The daughter of the couple became the representative of her father’s estate, beginning a legal dispute with the mother over the funds. After reviewing the lower court’s decision, the Florida Supreme Court reversed the lower court’s decision as it found the language in the settlement agreement to be vague (compared the simple language already listed in in the deferred compensation fund).

Although marital settlement agreements may be completed at the time a divorce is finalized, their interpretation by different courts may vary. Spouses should remember to to change the listed beneficiary of funds, insurance policies (life, home, vehicle), pension plans, deferred compensation funds and/or bank accounts, etc. after finalizing a divorce.

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