Mr. Kessler quoted about high profile divorce clients and prenuptial agreements.
Holts’ postnuptial pact could pave way for peaceful divorce
By Tom Orsborn
A marital property agreement between Spurs chairman and co-CEO Julianna Hawn Holt and her husband Peter Holt could pave the way for the couple to have a low-key divorce away from the public eye, family law experts said.
“They have pretty much already decided how everything is going to go,” St. Mary’s University law professor Dayla S. Pepi said. “That’s part of the purpose of these agreements.”
Julianna Hawn Holt became chairman of the board of the Spurs ownership group in March 2016 after her husband stepped down from that post following a remarkable 20-year run that included five NBA championships.
Citing that the marriage has become “insupportable because of discord or conflict of personalities,” Julianna Hawn Holt filed for divorce after more than 30 years of marriage last Dec. 22 in state District Court in Bexar County, according to documents obtained by the San Antonio Express-News.
Peter Holt responded by filing a counterpetition on Jan. 26.
Records show the Holts entered into their postnuptial agreement in 2006 and amended it more than seven years later. Neither the original nor the amended agreement was publicly filed, so the contents are not known.
The agreement, though, defines the property each owned prior to their marriage, the property each received during the marriage, and their community property.
In addition, it specifies “who has management, control and the rights to disposition” as to their separate property and their community property.
Pepi said if the “partition agreement” is followed, the divorce will get “dispensed of relatively under the radar without anybody knowing it’s on a docket or anything like that.”
Court documents show both Julianna Hawn Holt and Peter Holt have stated their desire that the court “enforce the agreement(s) and divide the marital estate accordingly.”
But Pepi was quick to caution a “knock-down drag out” could ensue should one of the parties eventually decide for whatever reason they don’t want to follow the postnup agreement.
“If one has this sense the other party was responsible for the divorce and sort of feels slighted,” Pepi said, “then they can try like with any other contract to go in and tell the court why this contract isn’t enforceable, why they shouldn’t be bound by the agreement.
“But, otherwise, they have already decided among themselves who is going to keep what. More often than not, these cases are negotiated and an agreed order is brought to the court so they don’t have a bench trial or a jury trial or anything drawn out.”
But not all postnuptial agreements hold up under scrutiny. That was the tough lesson then-Los Angeles Dodgers owner Frank McCourt and his wife Jamie learned in 2010 while in the midst of an ugly, drawn-out divorce that drew vigilant media attention while playing out against a Hollywood backdrop.
A 10-page postnuptial agreement giving Frank McCourt sole ownership of the baseball team was thrown out by a judge after it was discovered two conflicting versions were signed and the McCourts acknowledged they hadn’t read the agreements, the Los Angeles Times reported.
The testimony by both parties “paints a picture of two people who had no involvement in the drafting or execution of the (agreement) … and did not closely read or did not read at all the drafts or final copies of the various (agreements) involved in this case,” the judge wrote, per the Times.
In 2011, the court finally ordered Frank McCourt to pay his former wife and Dodgers ex-CEO $131 million as part of their settlement, ending a case that aired dirty laundry, including the couple’s lavish spending habits.
Randy Kessler, an Atlanta-based family law attorney who has represented several professional athletes and other celebrities in divorce and child custody cases, agreed with Pepi that the Holts could avoid a public spat by honoring their postnuptial agreement. Otherwise, Kessler, echoed Pepi’s belief that it could get nasty in an argument over property.
The Holts own 40 percent of a team recently valued by Forbes at nearly $1.6 billion, meaning their share of the franchise is valued at about $620 million. The next largest investor is believed to be Aramark Inc., the AT&T Center’s concessions contractor, with more than 10 percent.
Kessler said sticking points could arise over the labeling of property.
“That’s the litigation — is the money we want to divide dividable or was it separate property,” he said. “There is a whole industry of forensic investigators that dig into it, and then one side tries to prove the money that purchased the team was the money he earned during the marriage. And then the other side tries to prove that, no, that was the money he had from his family or a family trust or whatever it is.
“Hopefully, the post-nuptial agreement cuts to the chase and says, ‘Here is what we are going to do regardless of what the law is.’ There is a phrase that you can use, and that’s you are allowed to contract around the law.”
One thing is certain: Each party has top-notch representation.
Peter Holt has hired attorney William Ford. Julianna Holt is represented by Richard Orsinger, who was also involved in divorce cases involving Spurs icons Tim Duncan and Tony Parker.
Orsinger was Parker’s attorney when the point guard filed for divorce in 2010 from actress Eva Longoria. Orsinger, however, later withdrew from the case because of a conflict of interest. Three years later, he helped represent Amy Duncan when she filed for divorce from Tim Duncan.
“They are preeminent family law attorneys,” Pepi said. “Richard Orsinger represents pretty much every celebrity in San Antonio that is going through a divorce. And Bill Ford is highly regarded and also does these larger divorces.”