Posik v. Layton

Brief Fact Summary.

Posik (Plaintiff) and Layton (Defendant) entered a same-sex relationship and entered into a support agreement, much like a prenuptial agreement. When the relationship ended, Plaintiff sought to enforce the agreement.

Synopsis of Rule of Law.

A support agreement between two unmarried adults is valid unless it is inextricably based upon illicit consideration of sexual services.

Facts.

Plaintiff, a female nurse, and Defendant, a female doctor, began a romantic relationship. The couple entered into an agreement under which Plaintiff agreed to leave her job and accompany Defendant, live with her, and care for the home for the remainder of her life. The agreement stated that if Defendant’s behavior caused Plaintiff to move out of the home, Defendant would pay liquidated damages to Plaintiff in the amount of $2,500 a month. Eventually, Defendant moved out of the home to live with another woman and Plaintiff sought to enforce the agreement. The trial court found that Plaintiff had waived the right to sue over the breach of the agreement through acquiescence and that Plaintiff had breached the agreement herself as well. Plaintiff appealed.

Issue.

Is a support agreement between two unmarried adults valid?

Held.

(Harris, J.). Yes. A support agreement between two unmarried adults is valid unless it is inextricably based upon illicit consideration of sexual services. The agreement, as is the case here, must be in writing. Although Plaintiff and Defendant certainly anticipated a sexual relationship when the agreement was made, that was not the extent of the relationship upon which the agreement was based. The agreement contemplated two people sharing each other’s lives and is therefore enforceable. Defendant did not prove waiver. Defendant first breached the agreement and Plaintiff was therefore not required to continue to perform her portion of the contract. The liquidated damages provided for in the agreement are enforceable under the circumstances. Plaintiff’s actual damages were not readily ascertainable at the time the agreement was created and the payments are reasonable and do not serve as a penalty. The trial court’s determination that the agreement is unenforceable is reversed and the case remanded.

Concurrence.

(Peterson, C.J.) The agreement in this case was between two competent individuals who are able to exercise their constitutional private property and contract rights in forming a lifetime personal services contract, just as a household employee and invalid employer might. The reason for the agreement was not to effect a same-sex marriage not recognized by the laws of the state.

Discussion.

When a contract contains a liquidated damages clause, the damages set must be reasonable based upon the circumstances of the contract. When the damages are reasonable, the court will respect the agreed upon amount as the actual measure of damages. When the damages agreed to are unreasonable, they are considered a penalty and are not enforced.