Gade v. Gade and the Plenary Jurisdiction of the Vermont Family Division Over Premarital Agreement Breach Claims

I. Introduction

In Christopher Gade v. Erin Gade, 2025 VT 68, the Vermont Supreme Court confronted a recurring but often murky question in family law: when divorcing spouses have a premarital (prenuptial) agreement that governs their property rights, and one spouse claims the other has breached that agreement, which court has jurisdiction to adjudicate those claims—the Family Division or the Civil Division?

The Family Division had enforced parts of the parties’ premarital agreement—most notably an attorney’s-fee provision—but refused to hear the husband’s claims that the wife had breached other provisions of the agreement regarding the marital home, household expenses, and taxes. The family court reasoned that it lacked jurisdiction to award “damages” for breach of contract and suggested the husband pursue his claims in the Civil Division.

On appeal, the Vermont Supreme Court reversed. It held that the Family Division has jurisdiction, within the context of a divorce proceeding, to interpret and enforce premarital agreements and to adjudicate associated breach-of-contract claims concerning property—even where those agreements label the assets as “separate property.” The Court remanded for the Family Division to determine whether the wife materially breached the premarital agreement and, if so, what remedies are appropriate under contract principles.

This decision clarifies and strengthens the principle that Vermont’s Family Division has plenary authority over all property issues in divorce proceedings, including disputes arising under premarital agreements. Parties cannot contractually remove property—or contract disputes about that property—from the Family Division’s jurisdiction by designating it as “separate” or by attempting to channel such disputes into another forum.

II. Summary of the Opinion

Parties and Background

• Husband: Christopher Gade
• Wife: Erin Gade
• Marriage: 2018
• Separation: October 2021
• Divorce filing: February 2023

Before marrying, the parties executed a comprehensive premarital agreement. In broad terms:

• Each party’s assets and anticipated inheritances were designated as separate property, to be retained free of any claim by the other in the event of divorce.
• The agreement was structured so that no property was marital except for the marital residence—though that home itself had a special contractual treatment.
• Husband owned the marital home prior to marriage. In a divorce, wife would be entitled to 50% of the increase in the home’s appraised value, payable by husband in monthly installments amortized over 30 years, with a balloon payment due five years after the first payment.
• The parties agreed to contribute to household living expenses in proportion to their incomes.
• If they filed joint tax returns, each remained responsible for taxes associated with their own separate property income and earned income.
• The agreement contained an attorney’s-fee provision: a breaching party would pay the other’s reasonable legal fees incurred in enforcing the agreement.

Both parties sought enforcement of the premarital agreement in the Family Division. However:

• Wife argued that the marital home, being designated as husband’s separate property, was outside the Family Division’s jurisdiction.
• Husband agreed that the agreement controlled the division of property but alleged that:
  • Wife severely damaged the marital home after its appraisal, complicating the calculation of the increase in value she was entitled to.
  • Wife failed to pay her proportionate share of household expenses.
  • Wife later failed to meet her tax obligations under the agreement.
• Husband argued that any amount he owed wife for the home’s appreciation should be offset by:
  • The diminution in value caused by her alleged damage to the home.
  • Her alleged nonpayment of agreed household and tax obligations.

Family Division’s Ruling

The Family Division granted wife’s motion to enforce the premarital agreement and ordered husband to pay attorney’s fees under the fee-shifting provision. But it:

• Concluded that the agreement precluded it from considering “separate property” in dividing the marital estate.
• Held that it was a court of limited jurisdiction with authority only to allocate the marital estate—not to award damages for breach of contract.
• Suggested that husband might pursue his “damage” claims in the Civil Division, if not barred by the agreement.
• Denied husband’s motion for reconsideration, reiterating that it had no authority to award damages for breach of contract.

Supreme Court’s Holding

The Vermont Supreme Court:

• Held that the Family Division has jurisdiction over husband’s claims that wife breached the premarital agreement.
• Relied on the plain language of:
  • 4 V.S.A. § 33(a)(4): The Family Division has exclusive jurisdiction over “[a]ll annulment and divorce proceedings.”
  • 15 V.S.A. § 751(a): “All property owned by either or both of the parties, however and whenever acquired, shall be subject to the jurisdiction of the court.”
• Reaffirmed that premarital agreements are enforceable contracts whose enforceability, interpretation, and alleged breaches fall within the Family Division’s authority when raised in a divorce proceeding.
• Clarified that designating property as “separate” in a premarital agreement does not remove that property from the Family Division’s jurisdiction in a divorce.
• Distinguished Allen v. Allen and confirmed that contracts made in contemplation of divorce (such as premarital/postnuptial agreements) remain within the Family Division’s purview, unlike freestanding contracts unrelated to divorce.
• Reversed the Family Division’s jurisdictional ruling and remanded for:
  • A determination whether wife materially breached the premarital agreement.
  • A determination of appropriate remedies, applying contract principles.

III. Analysis

A. Statutory Foundations: 4 V.S.A. § 33(a)(4) and 15 V.S.A. § 751(a)

The Court’s central analytical move is straightforward textual interpretation of two key statutes:

1. 4 V.S.A. § 33(a)(4):

   The Family Division shall have exclusive jurisdiction to hear and dispose of [a]ll annulment and divorce proceedings.

2. 15 V.S.A. § 751(a):

   All property owned by either or both of the parties, however and whenever acquired, shall be subject to the jurisdiction of the court.

These provisions jointly establish that the Family Division’s subject matter jurisdiction in a divorce extends to:

• All aspects of the divorce proceeding, including property division, and
• All property of either spouse, irrespective of when or how acquired, and irrespective of whether the parties label it “marital” or “separate.”

The Family Division is indeed a court of limited jurisdiction—it only hears matters specifically assigned by statute—but within its assigned domain (divorce), its jurisdiction over property is plenary. It must:

• Determine what property is subject to division.
• Consider appropriate statutory factors under § 751(b).
• “Settle the rights of the parties to their property” by equitably dividing and assigning it.

The Supreme Court therefore rejects the Family Division’s narrower view that it may only interact with “marital property” as defined by the premarital agreement. The statutory language makes all property “subject to the jurisdiction of the court,” which is a jurisdictional, not merely classificatory, grant.

B. Premarital Agreements as Contracts in Vermont Law

The Court situates this case in Vermont’s broader jurisprudence on premarital (prenuptial) agreements:

• Stalb v. Stalb, 168 Vt. 235, 719 A.2d 421 (1998):
  • Premarital agreements are enforceable contracts.
• Bassler v. Bassler, 156 Vt. 353, 593 A.2d 82 (1991):
  • The Court refused to enforce a premarital agreement on public policy grounds when the agreement left wife with no interest in husband’s property while she was on public assistance.
  • Shows that even in presence of a premarital agreement, the Family Division may deviate from its terms in exceptional circumstances.
• Gamache v. Smurro, 2006 VT 67, 180 Vt. 113, 904 A.2d 91:
  • Premarital agreements are interpreted under ordinary contract construction rules.
• Lacroix v. Rysz, 2025 VT 16:
  • The Court remanded to the Family Division to consider wife’s claims that husband breached the expectations of a premarital agreement.
  • Reinforces that breach claims about premarital agreements are part of family-court work.
• Padova v. Padova, 123 Vt. 125, 183 A.2d 227 (1962):
  • Absent fraud or unconscionable advantage at execution, parties are generally bound by their agreement.
  • Court overrides only to enforce duties imposed by law or to protect children’s interests.

From these cases, the Court underscores two key points:

1. Premarital agreements are ordinary contracts in terms of interpretation and breach, subject to general contract doctrine (including implied covenants, material breach, waiver, etc.).
2. Despite that, jurisdiction over divorce-related property issues remains with the Family Division, which must integrate these agreements into the statutory framework for property division.

Thus, the question is not whether the agreement is contractual—that is settled. The question here is whether the Family Division, in a divorce, may hear breach claims arising from such an agreement and fashion remedies within the context of the property settlement. The Court answers that question in the affirmative.

C. Precedents on Jurisdiction: Quinn, Lussier, Allen, and Maier

1. Quinn v. Schipper and Lussier v. Lussier

The Court draws on two prior decisions involving separation agreements or stipulations:

• Quinn v. Schipper, 2006 VT 51, 180 Vt. 572, 908 A.2d 413 (mem.):
  • Held that a breach-of-contract claim concerning a separation agreement was appropriately heard in the Family Division because the agreement was part of the divorce proceedings and thus within the family court’s jurisdiction.
• Lussier v. Lussier, 174 Vt. 454, 807 A.2d 374 (2002) (mem.):
  • When a final divorce order incorporates a stipulation agreement, that agreement becomes part of the divorce proceeding and remains within the family court’s jurisdiction.

These cases establish that agreements that are integrated into the divorce process—either by being incorporated into a final divorce order or inherently governing divorce-related property or support—remain within the Family Division’s subject matter jurisdiction. They provide a template for treating premarital agreements as likewise “divorce-related” once a divorce is filed and the agreement is invoked as determinative of property rights.

2. Allen v. Allen: Distinguishing Freestanding Contract Claims

Both parties debated the relevance of Allen v. Allen, 161 Vt. 526, 641 A.2d 1332 (1994). Allen involved:

• A loan from wife to husband during the marriage, with interest owed.
• A separate postnuptial agreement.
• A divided Court on whether the Family Division had jurisdiction to adjudicate the loan claim, which was not part of the postnuptial agreement.

In Allen, two justices thought the Family Division lacked jurisdiction over the loan because it was a separate, non-divorce-related debt claim; two other justices thought the court had ancillary jurisdiction over the claim as incidental to property division. No majority resolved the issue, and the opinion was fractured.

In Gade, the Court carefully sidesteps the unresolved split in Allen:

• It notes that in Allen, the loan contract was not formed in anticipation of divorce and was separate from the postnuptial agreement.
• By contrast, in Gade, husband’s claims:
  • Directly allege breaches of the premarital agreement itself, and
  • Invoke the implied covenant of good faith and fair dealing within that same agreement.

Because the claims in Gade are contract claims arising out of the very agreement that structures the parties’ property rights upon divorce, they are part of the divorce proceeding, not freestanding commercial or tort claims between spouses. That factual distinction allows the Court to hold squarely that such claims fall within the Family Division’s jurisdiction, while leaving the loan-claim question in Allen unresolved.

3. Maier v. Maier: The “Untethered” Contract

The Court also cites Maier v. Maier, 2021 VT 88, 216 Vt. 33, 266 A.3d 778, where it held that:

The family division does not have jurisdiction to adjudicate an action to enforce a contract between the parties that is untethered to a divorce.

Maier stands for the proposition that if spouses are involved in a dispute over a purely commercial or unrelated contract that has no meaningful connection to their divorce proceeding, that dispute belongs in the Civil Division, not in family court.

Gade is the mirror image: husband’s claims are very much tethered to the divorce. They are:

• About the allocation of property in divorce.
• Based on the premarital agreement’s specific provisions regarding property, expenses, and taxes in the event of divorce.

Thus, Maier confirms the converse: once a contract is integrated into how the divorce court is to resolve property division, the case falls within the Family Division’s jurisdiction, not outside it.

D. The Core Jurisdictional Rule: No Contracting Around Family Division Authority

The Court’s most significant doctrinal statement appears in its clear rejection of the argument that parties can “untether” their property or limit family-court jurisdiction by contract language:

Contrary to wife's suggestion otherwise, parties cannot “untether[] their separate property from the divorce action” or “narrow[] the Family Division's jurisdiction” by delineating certain property as “separate property” in an agreement.

This has several important facets:

1. Labeling property as “separate” does not remove it from jurisdiction.
   • 15 V.S.A. § 751(a) expressly states that all property of either spouse is subject to the court’s jurisdiction.
   • The term “separate property” may limit how the court should divide property if the agreement is enforceable, but it cannot alter the existence of jurisdiction.
2. Premarital agreements do not shrink the scope of the Family Division’s authority.
   • If enforceable, they may reduce the room for judicial discretion in distribution, but the court still has:
     • Authority to interpret the agreement.
     • Authority to determine if it violates public policy or statutory duties.
     • Authority to apply it or set it aside in whole or in part.
3. Disputes about breaches of premarital agreements are within family-court jurisdiction.
   • Especially when breaches relate to property rights on divorce (home value, expense sharing, tax allocation).

In short, family-court jurisdiction is set by statute, not by private contract.

E. Legal Reasoning: Contract Principles Within Divorce Jurisdiction

The Court’s reasoning proceeds as follows:

1. Step 1: Identify the nature of husband’s claims.
   • Husband alleges that wife:
     • Damaged the marital home and thereby undermined the agreed allocation of its appreciation.
     • Failed to pay her agreed share of living expenses.
     • Failed to meet tax obligations specified in the agreement.
   • He characterizes these acts as breaches of the premarital agreement and of the implied covenant of good faith and fair dealing.
2. Step 2: Confirm that such claims are about divorce-related property rights.
   • They concern how property and economic rights will be resolved upon divorce.
   • The premarital agreement has been invoked by both parties as the framework for the property settlement.
   • The agreement is expressly incorporated in the final decree.
3. Step 3: Apply statutory jurisdiction.
   • Since the Family Division has exclusive jurisdiction over all divorce proceedings, and all property is subject to its jurisdiction, it must also have jurisdiction to:
     • Interpret the premarital agreement.
     • Determine whether it has been breached in ways that affect property distribution.
     • Fashion remedies consistent with contract law and Vermont’s premarital-agreement precedents.
4. Step 4: Distinguish non-divorce-related contract disputes.
   • If the contract at issue were unrelated to divorce (as in commercial dealings between spouses), then under cases like Maier, jurisdiction would lie in the Civil Division.

To support the contractual framing, the Court cites Carmichael v. Adirondack Bottled Gas Corp. of Vt., 161 Vt. 200, 635 A.2d 1211 (1993), which articulates the implied covenant of good faith and fair dealing:

An underlying principle implied in every contract is that each party promises not to do anything to undermine or destroy the other's rights to receive the benefits of the agreement.

Husband’s allegations that wife damaged the home and failed to meet her financial obligations under the agreement naturally fall under this doctrine: they allegedly deprived him of the agreed benefits and undermined the property allocation framework set by the premarital agreement.

F. Remedies and the Nature of “Damages” in Family Court

The Family Division rejected jurisdiction partly on the ground that it had “no authority to award damages for breach of contract.” The Supreme Court responds in two ways:

1. It clarifies the scope of jurisdiction.
   • The Family Division may not have jurisdiction over a standalone damages action for breach of an unrelated contract between spouses.
   • But it has jurisdiction to interpret and enforce premarital agreements as part of its property-division mandate.
2. It does not define the exact types of remedies available, but gives guidance.
   • The Court remands for the Family Division to:
     • Determine whether there were material breaches.
     • Consider “appropriate remedies applying contract principles consistent with our precedent regarding premarital agreements.”
   • These remedies could include:
     • Offsets or adjustments to the amount the husband owes wife for the increase in the home’s value.
     • Declining to enforce certain contractual benefits for the breaching party.
     • Enforcing the contractual attorney’s-fee provision, which the Family Division already did.

The Court deliberately does not pre-decide whether the Family Division’s remedies must be framed as part of property division (e.g., offsets within the divorce decree) or whether it can issue something more akin to a separate money judgment for contract damages. That question is left to be worked out on remand and in future cases.

G. Impact and Practical Consequences

1. Forum: Consolidation in the Family Division

The most immediate practical effect is on forum selection:

• Parties litigating divorce actions in Vermont who wish to raise:
  • Alleged breaches of premarital agreements, or
  • Disputes over performance of financial or property-related obligations under such agreements,
  must bring these issues in the Family Division as part of the divorce proceeding.
• There is no need—and indeed it would often be improper—to file a parallel breach-of-contract action in the Civil Division for the same premarital agreement issues.

This promotes procedural efficiency and prevents inconsistent judgments. It also places responsibility squarely on the Family Division to resolve both:

• The interpretation of the premarital agreement, and
• The factual questions surrounding alleged breaches (e.g., whether the home was damaged, whether expenses were paid, etc.).

2. Drafting and Negotiating Premarital Agreements

For practitioners drafting premarital agreements, Gade sends a clear message:

• You cannot use contract language to:
  • Carve certain assets out of the Family Division’s jurisdiction, or
  • Require that disputes be litigated in a forum other than the Family Division (at least as to divorce-related property issues).
• Attempts to label property as “separate” may be effective in shaping distribution, but not in eliminating jurisdiction.

Lawyers must also appreciate that:

• Any fee-shifting, damage-limitation, or remedy clauses in premarital agreements will be evaluated and potentially enforced by the Family Division applying contract principles.
• Neglecting to account for how alleged breaches (e.g., destruction of property, failure to pay taxes or expenses) will be addressed may lead to complex litigation in the Family Division.

3. Litigation Strategy and Pleading

For litigants:

• Frame breach claims explicitly as premarital-agreement issues.
  • Husband succeeded on appeal in part because he consistently characterized his claims as contractual breaches of the premarital agreement and of the implied covenant, rather than purely as tort claims.
• Be prepared for the Family Division to undertake detailed fact-finding.
  • On remand, the court will likely need evidence on:
    • The extent of alleged damage to the home.
    • Payments made or not made toward expenses and taxes.
    • Potential waivers or modifications of contractual expectations.
• Expect contractual doctrines to be fully engaged.
  • Material breach, waiver, implied covenant, and remedies for breach may all be litigated in the Family Division.

4. Burden on the Family Division

Gade implies that family judges will increasingly need to:

• Apply general contract law, not just family-law statutes, when premarital agreements are involved.
• Handle evidence and arguments that look more like civil contract litigation (expert appraisals, damage calculations, offset theories).

This may increase the complexity of divorce cases involving detailed premarital agreements, but it also avoids fragmentation of litigation across multiple courts and promotes comprehensive resolution within a single proceeding.

IV. Complex Concepts Simplified

1. Subject Matter Jurisdiction (in this context)

“Subject matter jurisdiction” means the power of a court to hear a particular type of case. The Family Division is limited to the kinds of cases the Legislature gives it—divorces, parentage, juvenile matters, etc.—but within divorce it has broad authority over:

• Property division.
• Support obligations.
• Enforcement and interpretation of agreements that govern those issues.

Parties cannot change subject matter jurisdiction by agreement; only statutes can.

2. Premarital (Prenuptial) Agreement

A premarital agreement is a contract made before marriage that sets out how property and sometimes support will be handled if the marriage ends by divorce or death. In Vermont:

• Such agreements are generally enforceable if fairly made and not contrary to public policy.
• They can significantly alter the default rules for property division.

3. “Separate Property” vs. “Marital Property”

Many agreements (and some states’ laws) distinguish between:

• Separate property: Usually property owned before marriage or acquired by gift or inheritance, which one spouse keeps.
• Marital property: Generally property acquired during the marriage, which is subject to division.

Vermont’s statute, however, says all property either spouse owns is under the court’s jurisdiction in divorce. “Separate” vs. “marital” is mainly a functional category to help the court decide what is fair, or to implement a premarital agreement—not a way to exclude property from judicial authority.

4. Implied Covenant of Good Faith and Fair Dealing

Every contract in Vermont includes an implied promise that each party will not do anything to destroy or undermine the other party’s right to receive the contract’s benefits. Applied here:

• Even if the premarital agreement did not explicitly say “do not damage the house,”
• Husband argues that wife’s alleged destruction of property and failure to contribute to agreed expenses and taxes violated this implied promise and thereby breached the agreement.

5. Material Breach

A “material breach” is a serious violation of a contract that goes to the heart of the agreement and substantially deprives the other party of the benefit of the bargain. If a breach is material, the non-breaching party may:

• Be excused from further performance.
• Seek appropriate remedies, such as damages or offsets.

6. Ancillary Jurisdiction vs. Freestanding Claims

Sometimes, when a court properly has jurisdiction over a main case (like a divorce), it may also decide related issues that are “incidental” or “ancillary” to its main task. In the divorce context:

• Disputes about a premarital or separation agreement are usually “ancillary” to the core work of dividing property and setting support.
• By contrast, a purely commercial loan unrelated to divorce might be a “freestanding” claim that belongs in a different court.

7. Waiver

Waiver is the voluntary giving up of a known right. On remand, the Family Division may need to consider whether either party, by words or conduct, waived any rights under the premarital agreement—for example, by accepting noncompliance for a long time without objection.

V. Conclusion

Gade v. Gade is an important clarification of the Vermont Family Division’s jurisdiction and the role of premarital agreements in divorce proceedings. The case establishes that:

• The Family Division has exclusive jurisdiction over all divorce proceedings, including disputes about property governed by premarital agreements.
• All property of either spouse—however labeled—remains under the court’s jurisdiction in divorce.
• Premarital agreements are enforceable contracts, and disputes about their breach, especially as they affect property division, are properly adjudicated by the Family Division.
• Parties cannot contractually “strip” the Family Division of jurisdiction by designating assets as “separate property” or by recasting divorce-related disputes as civil contract matters.
• The Family Division may apply general contract principles, including the implied covenant of good faith and fair dealing and doctrines of material breach, to determine the effect of alleged misconduct on the enforcement of premarital agreements.

By reversing and remanding, the Supreme Court does not guarantee a win for either party on the merits. Instead, it ensures that the correct court—the Family Division—fully considers whether wife materially breached the premarital agreement and, if so, what equitable and contractual remedies are appropriate. In doing so, Gade solidifies the principle that divorce-related contract disputes concerning premarital agreements belong squarely in the Family Division and cannot be fragmented or avoided through private agreement.