August 01, 2013

Surrogacy Agreement Generally Enforceable as a Contract

The views expressed herein have not been approved by the House of Delegates or the Board of Governors of the American Bar Association, and accordingly, should not be construed as representing the policy of the American Bar Association.

In re F.T.R., 2013 WL 3467121 (Wis.).

Where couples knowingly entered into a surrogacy agreement, trial court could consider it in making custody determination and enforce it provided it was not contrary to the child’s best interests, but court could not enforce clause to force birth mother to voluntarily relinquish rights. Enforcement of such agreements promoted stability for children and thus tended to support their best interests. 

Marcia Rosecky and Monica Schissel met in grade school and had been friends for many years. Mrs. Rosecky was diagnosed with leukemia, successfully completed treatment, but was thereafter unable to have biological children. After extensive discussions between the couples about Mrs. Schissel being a surrogate for the Roseckys, both couples retained attorneys and drafted an agreement. The agreement provided that the Roseckys would be legal parents of the child and assume legal and physical custody and that Mrs. Schissel would voluntarily terminate her rights to allow Mrs. Rosecky to adopt. 

Mrs. Schissel changed her mind shortly before the birth. She refused to voluntarily terminate her rights and she did allow the child to go home with the Roseckys from the hospital.

The case was heard in the Circuit Court. Regarding the Parentage Agreement (PA), the Circuit Court found the agreement was comprehensive and clear. It found the parties entered it fully understanding its terms. However, it found it could not enforce the termination provision because it lacked statutory grounds. 

Regarding custody, the court assigned a psychologist and guardian ad litem  to make recommendations about the child’s best interests. Both recommended Mr. Rosecky have primary custody. The parents also retained their own experts. 

The court-appointed psychologist testified that the child was bonded to the Roseckys and Mrs. Schissels’ insistence on competing as a maternal figure would be contrary to the child’s best interests. Further, due to the high conflict between the couples, she did not recommend joint parenting. The Roseckys’ expert supported her findings. The Schissels’ expert disagreed, testifying that children can form multiple attachments. However, he conceded that the hostile relationship between the couples could harm the child’s well-being. 

The Circuit Court awarded primary custody to Mr. Rosecky and secondary custody to Mrs. Schissel with visitation every other weekend. 

The father appealed. The Court of Appeals certified the case to the Wisconsin Supreme Court, finding the state had no legislative or common law regarding surrogacy agreement enforceability. 

The Wisconsin Supreme Court examined the few statutory provisions in the state that dealt with surrogacy, paternity, and birth certificates. It reviewed the private custody, adoption, and termination sections, noting they did not specifically address surrogacy. Regarding custody determinations, the court found many of the best interests factors were difficult to apply in a surrogacy case. 

Because the statutes did not provide for or prohibit surrogacy agreements, the court considered contract law. 

Mr. Rosecky argued on appeal that public policy favored enforceability of surrogacy contracts to promote stability for children. He argued that the Circuit Court erred by not considering the severability clause in the contract, which would allow he and his wife to have full custody without a termination. Finally, he contended that the trial court erred in not considering the agreement during the custody phase of the proceeding, since, at a minimum, it spoke to parental wishes, a best interests factor. 

Mrs. Schissel made several arguments on appeal, including that enforcement was contrary to statute providing that custody determinations should be made solely on best interests. She argued that the agreement was contrary to a statute that prohibits payments in adoption cases. She also argued that enforcement would violate case law that indicated custody orders could not prohibit later requests for modification. 

Considering the arguments, the Wisconsin Supreme Court found that public policy more strongly supported stability and permanence for children and PAs supported this aim in general. Enforcing surrogacy agreements, provided they are not contrary to the best interests of the child, promotes safety and permanence because it allows the intended parents to plan for the child’s birth and would tend to reduce contentions litigation that might disrupt a child’s life. 

As a contract, the court held, the agreement would be subject to defenses such as misrepresentation, mistake, duress, undue influence, or incapacity, but none were alleged in the case. 

The court agreed with the trial court that the agreement could not be used to bypass the termination statute. However, it held the circuit court erred in not considering the PA in its custody determination and in particular in whether to sever the termination portion or to make a determination about sole custody.

Based on the above, the Wisconsin Supreme Court remanded the case for a new determination on custody. The court also recommended the legislature consider passing a surrogacy statute.