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Cause of Action for Breach of “Sharing Assets” Agreement Entered Into During an 18-Year “Committed Same-Sex Relationship” Reinstated

In a full-fledged opinion by Justice Austin, over a dissent, the Second Department determined plaintiff had stated a cause of action for breach of contract based upon an agreement made during an 18-year “committed, same-sex relationship.” The complaint alleged that the partners had entered an oral “joint venture/partnership” agreement involving sharing assets, including retirement contributions and earnings, in exchange for plaintiff’s leaving her full-time job to care for the partners’ children. Supreme Court had dismissed the complaint. The Second Department reinstated the breach of contract cause of action but affirmed the dismissal of the constructive trust, unjust enrichment and accounting causes of action.  With respect to breach of contract, the court wrote:

[The] factual allegations adequately set forth the existence of a contract pursuant to which the plaintiff would quit working full-time, thereby ceasing to earn money toward her own retirement plan, and pursue part-time work enabling her to stay home to care for the parties’ children, in exchange for a one-half share in the defendant’s retirement accounts accrued during those years that the plaintiff refrained from working at a job which provided retirement benefits.

The alleged contractual agreement between the parties was supported by consideration. “Consideration consists of either a benefit to the promisor or a detriment to the promisee. It is enough that something is promised, done, forborne, or suffered by the party to whom the promise is made as consideration for the promise made to him [or her]” … . The consideration here for the alleged contract is the forbearance of the plaintiff’s  career, the inability to continue to save toward her retirement during that forbearance, and her maintenance of the household in return for a share in the defendant’s retirement benefits and other assets earned during the period of forbearance … . Since the plaintiff also alleged that the defendant breached the alleged agreement and that she has sustained damages as a result of that breach, at this pleading stage, the eighth cause of action must survive dismissal … .

The fact that the alleged agreement was made by an unmarried couple living together does not render it unenforceable. “New York courts have long accepted the concept that an express agreement between unmarried persons living together is as enforceable as though they were not living together, provided only that illicit sexual relations were not part of the consideration of the contract'” … . “[W]hile cohabitation without marriage does not give rise to the property and financial rights which normally attend the marital relation, neither does cohabitation disable the parties from making an agreement within the normal rules of contract law” … . Dee v Rakower, 2013 NY Slip Op 07443, 2nd Dept 11-13-13

 

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