Family Law Prof Blog

Case Law Development: Modifying Alimony in the Golden Years

After an 18 year marriage dissolved, Husband was ordered to pay alimony to Wife.  Twenty-six years later, Husband (now 67 years old and in poor health) retires and sells his entire interest in his business, leaving him with social security benefits as his sole income.  In response to Husband's motion to modify alimony, the trial court ordered that his alimony be reduced from $ 78,000 to $ 1 per year.

The Supreme Court of Connecticut, noting that it is a rare case in which it will reverse a trial court's decision to modify alimony, found that the trial court's focus on Husband's poor health and reduced income was too narrow.

We conclude that, in reducing the defendant's alimony obligation from $ 78,000 to $ 1 per year, the trial court improperly focused on the fact that the defendant's monthly income had been reduced from $ 14,880.14 to $ 1640, and failed to give proper consideration to the defendant's other financial resources. In addition, although the trial court properly considered the fact that the defendant had retired and was in poor health, it failed to give due weight to the plaintiff's health and financial situation. Accordingly, we conclude that, although the trial court properly determined that there had been a substantial change in circumstances justifying a modification of the defendant's alimony obligation, the trial court abused its discretion in determining the amount of that modification. We recognize that a finding of abuse of discretion in making financial awards in marital dissolution cases is very rare..... Nevertheless, in light of the extreme nature  of the modification order and the trial court's misconception and misapplication of the statutory criteria, we are compelled to conclude that this is one of those rare cases.

Simms v. Simms, 2007 Conn. LEXIS 321  (August 14, 2007)
Opinion online (Last visited August 18, 2007 bgf)

Case Law Development: Characterizing Awards for Tax Purposes

The tax court, in a recent summary opinion, provides a good example for our students of the importance of careful drafting in light of the interrelationship between the tax code and state law when determining the tax consequences of divorce.  In this case, the divorce decree provided that Husband would pay Wife $1200 a month in “rehabilitative alimony” and an additional $72,000 in “lump-sum alimony”, payable in installments of $600 a month.  The decree did not indicate whether this lump sum
award would terminate upon Wife’s death.

Under section 71(b) of the tax code, alimony is not deductible if it does not terminate upon the payee spouse’s death.  Because the Florida courts have held that an award of lump-sum  alimony survives the death of both the obligor and the obligee, the alimony was not properly deductible.

Hinson v. Commissioner, US Tax Court Summary Opinion 2007-92 (June 7, 2007)

Read opinion (last visited June 14, 2007 bgf)

Case Law Development: Allegations of Wife's Attempted Murder of Husband Do Not State a Claim for Terminating His Maintenance Obligation

The Missouri Supreme Court affirms the dismissal of an ex-husband's petition to terminate maintenance based on his allegations that wife had sought to have him murdered.  The couple had agreed to a non-modifiable maintenance term in their divorce decree.  The Supreme Court noted that Missouri statutes provide that such an agreement, when found conscionable and incorporated into a divorce decree, binds the court:

A non-modification provision can cut both ways. No one can know which party will need more or deserve less as time passes. As with all contract terms, a non-modification provision is an agreed allocation of future risk, bargained for and for which consideration is exchanged. The Missouri legislature has seen fit to allow such a clause to be elevated from contractual to judicial status by incorporation into the dissolution decree. We are bound to respect the statute and to enforce these documents as agreed to and ordered.

The court rejected husband's argument that a court may reconsider the conscionability of the agreement based on later events. It likewise found that waiver was inapplicable as the attempt to murder husband would not establish a "clear and unequivocal attempt to relinquish her contractual right to maintenance so long as [husband] is living."  Finally, the court rejected the application of the public policy doctrine which prohibits an individual from receiving death benefits when they have murdered their spouse.  Reasoning that wife would not benefit from the successful murder of husband, the court found these cases inapplicable.

Richardson v. Richardson, 2007 Mo. LEXIS 39 (March 20, 2007)
Opinion on web (last visited March 20, 2007 bgf)

Case Law Development: The Costs of Divorce

The Missouri Court of Appeals decided a case involving a divorce from a 27-year marriage in which maintenance, division of property and attorneys fees were disputed.  The court affirmed the trial court's decision to award maintenance to wife, who had been a homemaker for most of the marriage and who had health problems and few job skills, and to award her a portion of the husband's retirement account, as well as the decision to award attorneys fees. 

That the trial court's decisions were upheld is not particularly surprising given the high degree of deference given to trial courts on these issues and the fact that Missouri allows marital fault to impact these decisions. 

What is striking about the case from a teaching perspective are the numbers:

Wife stayed at home for most of the marriage and never had earned more than $2000 a year. 
At the time of trial, Husband had a monthly income of $3900, working as a machinest.

The couple had arrived at a settlement agreement and divided most of their marital property and debts.  After the trial court divided the retirement account, the total property Wife received under the judgment was $9908. The total value of the property awarded to Husband, less the marital debt, came to $14,341. The trial court ordered Husband to pay modifiable maintenance to Wife in the amount of $550 per month.

Each party incurred about $3000 in attorneys fees for the dissolution action. For the appeal, Wife was awarded $6000 attorneys fees for her representation on appeal; Husband paid $18,000 for his representation on appeal.

Russum v. Russum, February 20, 2007
Opinion on the web (last visited February 26, 2007 bgf)

Case Law Development: Improper Factors in Calculating Maintenance

The Supreme Court of Connecticut has affirmed the court of appeals ruling in a case in which a couple were married for 11 years, lived together for a number of years and then remarried for six years.  (See Family Law Prof Blog post of February 10, 2006) The cour of appeals had found that the trial court, in fixing the term of the maintenance award, improperly took into consideration both the prior marriage and cohabitation and the fact that there were adult children with grandchildren residing in the house.
The court concludes that " 'length of the marriage' criterion prescribed in [statutes governing maintenance awards], as a matter of law, does not include prior marriages or cohabitation preceding the marriage." 

As to the issue of the maintenance order being a disguished child support order for the adult children and grandchild in the home, the court reviewed cases from a number of other jurisdictions on the issue.  The court noted that the need to care for minor children can property affect alimony because of the lesser income a custodial parent is able to earn while caring for a minor child, but even then, "an alimony award should address the needs of that parent, not the minor child, whose needs properly are addressed under a support order."  However, the court found no justification for considering the impact of an adult child or grandchild in the home in crafting alimony.

Loughlin v. Loughlin, 2006 Conn. LEXIS 463  (December 12, 2006)
Opinion on the web (last visited December 13, 2006 bgf)

Case Law Development: Incorporation of Alimony Agreement into Divorce Decree Does not Transform Contractual Alimony into Decretal Alimony

Texas is an interesting state for studying approaches to spousal maintenance.  Texas courts long held that the statutes and public policy of the state precluded courts from awarding post-divorce alimony or spousal maintenance. However, the Texas Supreme Court held that parties could agree to such awards contractually and that these alimony agreements, as with other marital property agreements, even when incorporated into divorce decrees, were enforceable as contracts and governed by contract law. 

In 1995, Texas adopted legislation authorizing alimony in only two circumstances: in instances of recent violence by one spouse against the other or in a long-term marriage in which one spouse is unable to support him or herself.  Moreover, the legislation places strict limits on the length and total amount of alimony and provides a range of circumstances which terminate alimony, including cohabitation.

In this case, Husband had agreed to alimony in excess of the term and amount allowed by statute and that agreement was incorporated into the divorce decree.  He now sought to have the alimony terminated on the statutory grounds of wife's cohabitation, even though there was no contractual agreement that alimony would be terminable on this ground.  He argued that because the district court in the original divorce decree had incorporated the agreement into the decree and had ordered the parties to do all things necessary to effectuate the agreement, this "decretal" language transformed the contractual alimony payments into court-ordered maintenance payments. The trial court disagreed and the appellate court affirmed, holding that the agreement was governed by contract law rather than the family code.  "The fact that a court expressly approves such an agreement and incorporates it into the final divorce decree does not transform contractual alimony payments into court-ordered maintenance payments subject to the termination and modification provisions of chapter 8 of the family code." 

McCollough v. McCollough, 2006 Tex. App. LEXIS 7579 (August 25, 2006)
Opinion on web (last visited August 29, 2006 bgf)

Case Law Development: Supreme Court of Canada Allows Effect of Spousal Misconduct to be Considered in Awarding Alimony

Canada's Divorce Act eliminates consideration of misconduct in awarding spousal support.  The Supreme Court of Canada has now ruled that, although misconduct like adultery is not relevant in a divorce case, the consequences of that misconduct may be.  In justifying this nuanced distinction, the court noted:

The 1985 Divorce Act eliminates misconduct, as such, as a relevant consideration when making an award for spousal support.  Section 15.2(5) provides that in making an interim or final order for spousal support, “the court shall not take into consideration any misconduct of a spouse in relation to the marriage”.  In addition, s. 17(6) instructs the court not to consider in a variation application any conduct that could not be considered in the making of the initial order.  These provisions make it clear that misconduct should not creep back into the court’s deliberation as a relevant “condition” or “other circumstance” which the court is to consider under s. 15.2(4) in making or varying a spousal support order.  There is, of course, a distinction between the emotional consequences of misconduct and the misconduct itself.  Those consequences are not rendered irrelevant because of their genesis in the other spouse’s misconduct.  On the contrary, they can be highly relevant to factors, such as a claimant spouse’s capacity to be self‑sufficient, which must be considered when making a spousal support order.  Failure to achieve self‑sufficiency is not a breach of “a duty”.  It is simply one factor amongst others to be taken into account when considering a spousal support order. 

Leskun v. Leskun, 2006 SCC 25 (Sup. Ct. Canada June 21, 2006)
Opinion on web (last visited July 23, 2006)
Analysis of the opinion from Brampton News legal correspondent Meredith Cox.

Commentary: Canadian “Top Court Muddies Divorce Law”

Regular readers of this Blog may be interested in the commentary on no fault divorce and making an award of spousal support that appears in the Toronto Star and is authored by University of Toronto law professor Martha Shaffer.  Professor Shaffer analyzes  last week’s decision by the Canadian Supreme Court in Leskum v. Leskum, a no fault divorce action in which Ms. Leskum remained unable to work some eight years after the marriage because of depression caused by her ex-husband's adultery. The Supreme Court indicated that a trial judge could consider the consequences of the husband's conduct (the depression) on the wife when awarding spousal support. Professor Shaffer suggests that the decision is not all that ground breaking, rather, “the court could have carefully analyzed Leskun's situation to show how she was entitled to ongoing spousal support irrespective of Mr. Leskun's affair. Unfortunately, it did not. The result is a judgment that may be prone to misinterpretation.”  Source.  Martha Shaffer, Toronto Star, thestar.com. To read Professor Shaffer's commentary, please click here (last visited June 28, 2006).

Canada’s Supreme Court Rules that Courts May Consider the Consequences of Spousal Misconduct When Deciding Support Award

Although Canada's 1985 Divorce Act eliminates misconduct, as such, as a relevant consideration when making an award for spousal support, the Supreme Court ruled that courts may distinguish between the emotional consequences of misconduct and the misconduct itself. It said in Leskum v. Leskum, filed June 21, that the consequences are not rendered irrelevant because of their genesis in the other spouse’s misconduct. “On the contrary,” wrote the court, “they can be highly relevant to factors, such as a claimant spouse’s capacity to be self-sufficient, which must be considered when making a spousal support order. Failure to achieve self-sufficiency is . . . one factor amongst others to be taken into account when considering a spousal support order.”  In this case, the husband’s affair had a devastating effect on the wife and she was unable to attain self-sufficiency. Therefore, the consequences of the misconduct were correctly considered by the lower court. The opinion of the Supreme Court of Canada may be found by clicking on this link (last visited June 24, 2006, reo).

Wealthier Spouses Warned to Beware

"By the time the House of Lords had finished delivering its double ruling in the Miller and McFarlance cases today, divorce lawyers around the country were already scrambling to interpret its significance. There was disagreement as to whether it clarified or complicated divorce laws. Many believed it would lead to higher maintenance payments for ex-wives and an increase in pre-nuptial agreements. All agreed on one thing: it was a blow to wealthier spouses.

"Overall it hasn't got better for the husbands," Magnus Mills, a partner at Manches, said. "It's probably slightly better for the wives. White v White [the landmark 2000 case] was the watershed that made things better for wives everywhere and that swing hasn't halted." Justin Moss, a family law solicitor at Wilsons, a firm in Salisbury, said: "Rich men shouldn't get married, frankly. It's that simple. It's not sensible for anyone, man or woman, to marry anybody financially weaker than they are."" By Alex Spence, Times Online Link to Article (last visited 5-24-06 NVS)

Discrimination in Scottish Divorce

"ONE of Scotland's most senior legal figures has launched a scathing attack on Scots law by claiming that women are being discriminated against in divorce settlements north of the Border. Lord Hope of Craighead yesterday took the unusual step of criticising Scottish law as he delivered a ruling on two multi-million pound divorce cases in England. The former lord president was among a panel of judges at the House of Lords that ruled Melissa Miller was entitled to £5 million of her former husband's assets after just two years and nine months of marriage. Meanwhile, Julia McFarlane, who was awarded £250,000 a year from her former husband's earnings, was told that she can keep her maintenance payments for life if necessary.

In his opinion on the cases, Lord Hope called for a review of the limited awards Scottish courts can grant to spouses to cushion the blow of divorce. He called on judges north of the Border to be given power to provide long-term compensation to the partner of a marriage who has given up well-paid, promising careers after marriage. The cases have been hailed as a significant victory for women. But as the judges were ruling on English cases, their judgments are not binding on Scotland." By Michael Howie,scotsman.com Link to Article (last visited 5-24-06 NVS)

Colorado Woman in Polygamous Marriage Seeks $2.5 Million from Alleged Spouse

A Colorado woman is seeking $2.5 million from a businessman who she claims was involved in a polygamous marriage with her. She alleges that when she left a business that she and the other wives were working in that the man had agreed to pay her $2.5 million to settle her interest in the business. Attorneys for the man contend that the woman is attempting to extort money by threatening to have him prosecuted for polygamy. Source. AP, cbs4denver.com. Please click here to read the complete story (last visited May 10, 2006, reo).

Case Law Development: Effect of Bankruptcy Discharge on State Court Judgements to Enforce Non-Discharged Debts

The United States Court of Appeals for the Fifth Circuit was called upon to revisit what it characterized as the “ceaseless litigation” involved following a couple’s divorce in 1993. The case addresses the issue of discharge of debt in bankruptcy but also provides yet another example of how difficult and contentious efforts to enforce obligations under divorce judgments can be.

After their 1993 divorce action, Husband filed bankruptcy and had discharged certain property settlement obligations but was unsuccessful in discharging his alimony debt. Wife then brought several state court contempt actions to enforce the obligations under the divorce proceeding.  In one of these actions, she obtained a state court judgment for contempt ordering that Husband pay the discharged property settlement (the court being unaware of the bankruptcy discharge at that point), the alimony arrearages of over $96,000, damages for failure to pay alimony (primarily Wife’s lost equity in property that was foreclosed when she was unable to pay her mortgage), and attorneys fees in enforcing the obligations.

Husband then brought an action in bankruptcy court to reopen the bankruptcy and requested the court to void the state court judgments. The bankruptcy court ruled that Husband's prior bankruptcy discharge caused all of Wife's claims, except for the claim for non-discharged alimony, to be barred by res judicata. The decision was affirmed by the district court.

The court of appeals, rejected the bankruptcy court’s use of res judicata to resolve the dispute and focused instead solely on the questions of focus instead on the requirements of section 524(a)(1) of the Bankruptcy Act regarding whether the state court judgments were for debts that had been discharged by the bankruptcy action. Thus, the court pointed out that the state court’s original judgment for non-payment of the property settlement was clearly an attempt to enforce a discharged debt and was void.

As to the judgment for attorney’s fees, the court of appeals noted that reasonable attorneys' fees incurred in collecting support obligations should be treated as support obligations while attorney’s fees related to discharged debts should be considered discharged debt. Wife’s award of attorneys’ fees related to efforts to enforce both discharged and non-discharged debt. The district court had held that, because of this, the entire judgment of attorneys' fees was void under the equitable doctrine of unclean hands. The court of appeals disapproved this use of the unclean hands doctrine, noting that this equitable doctrine may not be used by a federal court to void a state court judgment. Rather, the court held that the state court judgment for fees was void to the extent that those attorneys' fees were incurred in enforcing discharged debt and remanded for a determination of what portion of the attorneys’ fees related to that debt.

As to the damages for foreclosure of Wife’s property, the court noted that because the foreclosure occurred before Husband had filed for bankruptcy, they were “claims” in the bankruptcy and were discharged along with Husband’s other debts. As to losses of other property, the court remanded for a factual determination of how much of that award was for pre-petition and post-petition claims.

In re Egleston, 2006 U.S. App. LEXIS 11296 (May 5, 2006)
Opinion on the web (last visited May 8, 2006 bgf)

Case Law Development: New Hampshire Supreme Court Addresses Rehabilitative Maintenance Preference, Extended Payments of Property Settlements and Division of Moral Obligations that are not Legal Debts

The New Hampshire Supreme Court reviewed a divorce action with a spectrum of economic issues worth noting.  The couple in the case had been married 13 years and had four children.  Husband owns a dental practice with his father.  Wife earned a law degree early in the marriage but, by agreement between the couple, she remained at home as homemaker and primary caretaker of the children. 

One issue related to the choice of rehabilitative rather than permanent maintenance. The trial court awarded wife $3000 a month alimony for three years, based on the amount of time required for her to prepare herself (in terms of mental health and education and job placement) to return to the job market.  Wife argued that she should have been awarded permanent alimony, given the couple's agreement that she stay home with the children, the fact that the children would still be school aged in three years, and her current depression and anxiety.  The Supreme Court affirmed the alimony order, noting that rehabilitative alimony is the preferred approach and should only be rejected where "a supported spouse suffers from ill health and is not capable of establishing an individual source of income, or where the supported spouse in a long-term marriage lacks the requi-site job skills to independently ap-proximate the standard of living established during the marriage."  Neither situation existed in these facts.  Moreover, the court noted, Wife could petition for extension of the alimony if at the end of three years she was still not in a position to meet her reasonable needs.

A second issue concerned the division of property.  The court divided the marital estate of $ 2.9 million and awarded 55 percent to Wife.  The trial court then ordered that Husband be permitted to pay her the outstanding share of the property settlement over a period of 23 years.  The Supreme Court found such an extended payment schedule to be an abuse of discretion.  The court did observe that case law from other jurisdictions supported extended payment schedules where there were substantial nonliquid marital assets and a lump-sum cash payment would create a serious financial hardship for the obligor. The court further commented that "We acknowledge the frustration and inconvenience that may occur when one former spouse must sell part of his or her assets to make the payments required by a divorce judgment. It is an inevitable result of virtually every property division, however, that a former spouse who is required to turn over assets to the other at the termination of the marriage has fewer assets after the division than before.... Accordingly, we hold that the trial court unsustainably exercised its discretion by allowing the respondent to pay a substantial portion of the petitioner's share of the marital estate over a twenty-three year period."

Finally the court held that the trial court had abused its discretion in ordering reimbursement to Husband's parents of contributions they made to certain marital property.  The court cited the general rule that courts may not divide mere "moral" obligations but only legal debts.  The court concluded that if Husband reimbursed his parents for their contributions, "he would be doing so gratuitously and not as a result of an enforceable legal obligation. Accordingly, the trial court unsustainably exercised its discretion in ordering such a reimbursement and reducing the marital estate by $ 275,000."

Harvey v. Harvey, 2006 N.H. LEXIS 49 (April 26, 2006)
Opinion on  the web (last visited May 1, 2006 bgf)

Case Law Development: Retroactive Application of Family Law Decisions Regarding Alimony Agreements

The Georgia Supreme Court considered the retroactive application of family law rulings in a case in which the question was whether alimony obligations survive the death of the obligor parent.  The court affirmed the trial court's decision that husband's estate could not be held in contempt for failing to continue to pay the alimony obligation.  The trial court had concluded that the normal rule that death of the obligor terminates the agreement should apply because the settlement agreement's provision that Wife was entitled to alimony until she remarried or died did not evidence a manifest intention to reverse that rule. 

The issue for the Supreme Court was whether that rule, drawn from a 1981 Georgia Supreme Court decision, should be applied retroactively to the couples' incorporated settlement agreement entered in 1975.   The court concluded that it would apply the general rule that "a judicial decision announcing a new rule is retroactive unless the decision itself expressly makes it a matter of pure or selective prospectivity or, after examining whether retroactive application would adversely affect operation of the new rule and weighing the inequity imposed by retroactive application, we subsequently conclude application of the new rule would cause unjust results to those who justifiably relied on the former state of the law." Applying that rule to this case, the court noted that there had been conflicting authority on the issue of whether alimony terminates upon death of the obligor.  The authority wife argued supported her position was a narrowly drawn case and a plurality opinion which set itself out as an exception to the general rule that a recipient spouse's claim for alimony terminated upon the death of the obligor spouse.  A subsequent decision that overruled that authority did not indicate that it should be applied prospectivity only.  Accordingly the court concluded that retroactive application would not result in "substantial inequitable results that amounts to the injustice or hardship that would authorize a holding of nonretroactivity."

Findley v. Findley, 2006 Ga. LEXIS 254 (April 25, 2006)
Opinion on the web (last visited April 28, 2006 bgf)

Case Law Development: Conviction of Domestic Violence Basis for Termination of Alimony Even Though Agreement Makes Support Nonmodifiable

The California Court of Appeals has held that the rebuttable presumption its Family Code that an award of spousal support not be made to a spouse who has been convicted of intraspousal domestic violence applies where Wife was convicted of domesic battery, stalking, and violation of a protective order in Florida, even though the parties' settlement agreement provided that spousal support was not subject to modification or termination.  "We conclude that the public policy against enforcement of the nonmodifiable spousal support provision clearly outweighs any interest in its enforcement. Though there is a strong public policy in favor of enforcing the spousal support provisions of the parties' settlement agreement and appellant would forfeit a substantial amount of spousal support if there were no enforcement, the parties could not have reasonably expected that respondent would finance his own abuse by appellant. Balanced against these factors, we note that there is a significant public policy against domestic violence. ... Refusal to enforce the spousal support provision will further this policy against domestic violence, because appellant will have fewer financial resources to continue her harassment of respondent. We must also emphasize that appellant's misconduct is extremely serious and has continued despite incarceration and court orders in California and Florida. Moreover, there is a direct connection between appellant's misconduct and the nonmodifiable spousal support provision."

In re Marriage of Cauley, 2006 Cal. App. LEXIS 566 (April 24, 2006)
Opinion on the web (last visited April 25, 2006 bgf)

Same-sex Marriage Battles Escalate Nation-wide

Our readers may find the survey article by Joan Biskupic written earlier this week in USAToday interesting and an excellent overview of the present status of the same-sex marriage battle throughout the United States.  Source:  Ms. Joan Biskupic, USAToday.com. Please click here to go to Ms. Biskupic’s article (last visited March 25, 2006, reo).

Case Law Development: Portion of Expected Inheritance May be Awarded as Alimony

The Georgia Supreme Court found no error in a trial court's ruling that a portion of Husband's undivided interest in the estates of his late parents may be awarded as alimony.  However, the court did reverse the trial court's joinder of Husband's two brothers (the co-executors of the estate) in the divorce action, finding that "the absence of the Co-executors from this litigation would not render the relief afforded the wife partial or hollow because she would obtain an interest as full and complete as that presently held by Husband."

Searcy v. Searcy, 2006 Ga. LEXIS 170  (March 13, 2006)
Opinion on the web (last visited march 14, 2006 bgf)

Pennsylvania Legislature Rejects Removing Adultery from Alimony Consideration

Two Pennsylvania legislators, Senators Linda Short and Brad Hutto, were reportedly unsuccessful last week in their effort to amend Pennsylvania law to remove adultery from consideration as a factor in awarding alimony.  Under their proposal, family court judges could excuse marital misconduct “as grounds to deny alimony once a temporary hearing has been held on a divorce proceeding — a much earlier point in the process.”  The proposal was voted down in the state senate by a vote of 26-16.  Supporters of the proposal argued that spouses involved in a divorce action may “string out” court proceedings in order to “catch” their partner in adultery. “Then, the partner — usually the man — can then use the misconduct to deny alimony.”  Source:  Roddie Burris, centredaily.com. Please click here to read the complete story (last visited March 5, 2006, reo).

Case Law Development: Contempt in Enforcing Lump Sum Alimony

The Florida Court of Appeals has held that, although contempt is not available in Florida to enforce equitable distribution, it is available in case of nonpayment of alimony.  The court upheld its use in this case where husband failed to pay lump sum alimony which had been ordered after husband failed to comply with the court's order that he pay wife a share of the proceeds of sale of equitably distributed property.

Bongiorno v. Yule, 2006 Fla. App. LEXIS 1970 (February 17, 2006)
Opinion on the web (last visited February 21, 2006 bgf)

Case Law Development: Alimony and Property Division May not Be Based on Entirety of Relationship but only the Marriage being Dissolved

In this case, the couple were married for 11 years, had three children, divorced, reconciled and cohabited for a number of years, and then remarried for another six years. At the time of their second divorce, their children were between the ages of 16 and 22 and the 20-year-old had a child.  (I always wonder how common this situation is.  I haven't found much research on the subject.  Professor Howard Wineberg has reported that "Approximately 10 percent of all currently married couples in the United States have separated and reconciled" Wineberg and McCarthy, "Separtion and reconciliation in American marriages," 29 Journal of Divorce & Remarriage 131-46 (1993) and my students' anecdotal reports of these situations tend to run at a rate of about 1 out of 150 students.)

The trial court granted Wife the marital home, half of Husband's pension, and 12 years of non-modifiable maintenance.  Husband appealed, arguing that the trial court had improperly relied on the total length of the parties' relationship rather than on the length of their second marriage only in making these awards.  The Connecticut Court of Appeals agreed with Husband and reversed. The court reviewed Connecticut law on the status of cohabitants and concluded that the trial court clearly could not take the period of cohabitation into account as this would undermine Connecticut publicc policy, which makes "a clear distinction between marriage and mere cohabitation, even when that cohabitation was preceded by, or ultimately led to, a marital relationship.... parties who have made the formal commitment of marriage are afforded greater rights and protections than those who choose to reside together informally."  As to the consideration of the first marriage, the court noted this issue was closer but ultimately concluded that the plain language of the statute, the principal of res judicata, and the guidance of the decisions of other states in "serial marriage cases" all supported the court's conclusion that the trial court erred in considering, as equitable factors, the prior marriage.

Loughlin v. Loughlin, 2006 Conn. App. LEXIS 58 (February 7, 2006)
Opinion on the web (last visited February 10, 2006 bgf)

Case Law Development: A Classic Case Study of Maintenance in Long-term Marriage

In a classic case study of alimony in a long-term marriage, the Missouri Court of Appeals reversed a trial court’s decision to award limited, non-modifiable maintenance of $1000 a month, holding that the facts of the case could not justify such a limited award.

During their twenty-two-year marriage, Wife, at Husband’s insistence, did not work outside the home.  Without any assistance from Husband, she cares for the household and raised the children.  She also acted as Husband’s bookkeeper for his profitable trucking business (for which Husband did not pay her because it caused her to accumulate Social Security) and doted on her husband (to the point that the court notes that she bathed him and gave him regular pedicures).  After a two-year affair with a co-worker, husband filed for divorce.  The trial court awarded the vast majority of the assets to Husband and awarded Wife $1000 a month nonmodifiable maintenance for two years. Wife appealed only the maintenance.

The Court of Appeals held that $1000 a month was insufficient given the facts and suggested an award of twice that to be more appropriate.  Husband and Wife had maintained a relatively high standard of living during the marriage.  Wife’s expenses after divorce exceeded her income by approximately $4000 a month. 

Limited duration maintenance was inappropriate as “there was virtually no evidence that Wife would be able to find appropriate employment or acquire sufficient education or training within two years…. Wife has a high-school education; however, the expert witness, hired by Husband, testified that though Wife could read at the high-school level, her spelling and arithmetic were at the eighth-grade level.”  Wife was currently working two part-time jobs, but the trial court had imputed earnings to her based on a full-time job.  The appellate court found this inappropriate, as she had never held a full-time wage-earning job. “The limitation on her earnings was at Husband's insistence as he felt she should be home with the children. …. In short, at forty-five years of age and being out of the workforce for twenty years, Wife has no viable work history.”

The court noted the strict division of roles in the marriage as an additional factor favoring maintenance of a larger amount and unlimited duration.  “It was also admitted by Husband that he did not participate in any household chores, that Wife virtually did any and all household and childcare chores. On the other hand, Husband used his twenty-plus years during the marriage to build and maintain his business acumen, free from the responsibilities of caring for the household. He had no health issues and was able to produce substantial income.”

As to making the award non-modifiable, the court commented, “we are unable to conclude that there are no circumstances under which a non-modifiable order would be authorized; however, we perceive that they would be exceedingly rare.”

Van Shannon v. Shannon v. Shannon, 2005 Mo. App. LEXIS 1952 (December 30, 2005)

Case Law Development: Modification of Maintenance after Bankruptcy Discharge

The Nebraska Supreme Court has held that bankruptcy law does not preclude the modification of maintenance based on changed economic circumstances that result from one spouse filing bankruptcy.  Upon divorce, wife was awarded maintenance of $1 a year.  Almost a year later, husband filed for Chapter 7 Bankruptcy when his veterinary clinic failed.  After discharge, the bank foreclosed and sued the wife, who had signed as a guarantor for the loan, for the deficiency. Wife then moved for a modification of maintenance on the basis of changed circumstances.  The court of appeals found the “wife's liability for the deficiency judgment resulted in a material and substantial change in the relative economic circumstances of the parties which was not within the reasonable contemplation of the parties at the time of the dissolution.”  Thus a modification of maintenance was appropriate.  The court noted however, that “if a spousal support modification is essentially a reinstatement of the property settlement under the guise of alimony, the modification violates 11 U.S.C.S. § 524 and is not permitted. Mere attempts to "end run" around a bankruptcy discharge are not allowed. However, if the alimony modification merely takes into account the fact that one spouse would no longer receive the property settlement payments upon which the original support award was premised and the discharge results in changed financial circumstances, then modification will not violate federal bankruptcy law.”

Collett v. Collett, 270 Neb. 722; 2005 Neb. LEXIS 196 (December 9, 2005)
Opinion on the web at http://court.nol.org/opinions/2005/december/dec9/s04-850.htm (last visited December 15, 2005 bgf)

Case Law Development: Alimony in Very Long Term Marriage

The Florida Court of Appeals reversed a permanent periodic maintenance award in favor of wife in a 47 year marriage.  Both husband and wife were on fixed incomes, though the husband's income was four times that of the wife.  Husband had paid $1000 a month temporary alimony during the couple's separation.  The trial court concluded that wife had not proven that she needed more or that husband could pay more.

The court of appeals reversed and remanded for additional findings on these issues.  The court noted that the couple's standard of living during the marriage was "far from frugal."  While recognizing that maintaining the same standard of living after divorce is impossible, the appellate court noted that the trial court should have explained a decision that left Wife with "less than the husband to cover her expenses in this long, long-term marriage."  The dissent would have given greater deference to the trial court's finding that wife had failed to prove that husband could pay more, noting that "Any additional obligation that the former husband must incur would require him to dip further into his savings or deplete his capital assets at an increased pace. This court has been loath to require such actions."

Sussman v. Sussman, 2005 Fla App LEXIS 19611 (Dec. 7, 2005)
Opinion on the web at http://www.4dca.org/Dec2005/12-07-05/4D04-3804.op.pdf (last visited December 15, 2005 bgf)

Case Law Development: Need for Fair Warning for Termination of Long-term Alimony

The California Court of Appeals agreed with a 61-year-old wife's argument that "the trial court manifestly abused its discretion by pulling the plug on her spousal support after 14 years had gone by without any indication from [Husband] or the court she was expected to become self-supporting through employment and giving her only three weeks to find a job."  Wife had been granted $5,800 a month spousal support from her ex-husband in 1989. The decree did not contain a "Richmond order" terminating spousal support jurisdiction as of a specific date (In re Marriage of Richmond, 105 Cal. App. 3d 352 (1980)) nor a "Gavron warning" advising Judy she needed to become self-sufficient or face legal and financial consequences (In re Marriage of Gavron, 203 Cal. App. 3d 705 (1988)).

Husband brought an action to terminate the support because wife was able to earn income with her social work license, her medical expenses had substantially decreased, and she had attained an age at which she could draw upon her IRA without penalty.  The court of appeals found that there was substantial evidence to justify terminating Wife's spousal support but the trial court abused its discretion in doing it so abruptly as to deny Judy reasonable notice and an opportunity to find a job. 

As a remedy, the court of appeals directed that Wife's spousal support be returned to the original amount and continue until Wife "obtains employment at the rate of at least $ 2,500 per month or ceases to make a good faith effort to obtain such employment, or attains the age of 65 years, whichever occurs first."

In re Marriage of Schmir, 2005 Cal. App. LEXIS 1792 (November 16, 2005)
Opinion on the web at http://www.courtinfo.ca.gov/opinions/documents/B175397.PDF  (last visited November 17, 2005 bgf)

Case Law Development: Consideration of VA Disability Benefits in Marital Property Awards and Maintenance

In an opinion providing an exhaustive review of cases from across the United States, the Illinois Court of Appeals held that a trial court may consider accumulated veterans disability benefits as a consideration in dividing marital property and in determining maintenance awards.  The court reviewed the case law interpreting 38 U.S.C.A. § 5301(a)(1) (2004), which prohibits the assignment or attachment of present or anticipated veteran's disability benefit payments. The court acknowledged that, given this statute, state trial courts may not divide present or anticipated VA disability benefits as a marital asset.

In this case, the trial court awarded a slightly larger share of the marital estate to Wife, in part because Husband's separate property included $28,000 in disability benefits Husband had accumulated and which had been deposited in the couple's bank account.  The federal statute prohibiting attachment of present and future disability payments, however, "did not preclude the trial court from acknowledging the existence of such funds as being available to [Husband] as nonmarital property.

Husband also argued that the trial court erred in denying his request for maintenance from Wife in that, here too, the trial court took into account Husband's VA disability benefits. The court of appeals held that consideration of disability payments in determining need for maintenance was not error.

Wojick v. Wojick, 2005 Ill. App. LEXIS 1098 (November 4, 2005).
Opinion on the web at http://www.state.il.us/court/Opinions/AppellateCourt/2005/2ndDistrict/November/Html/2041076.htm (Last visited November 12, 2005 bgf)

Case Law Development: Cohabitation and Remarriage as Changed Circumstances Justifying Modification of Alimony

The Vermont supreme Court considered three consolidated cases in which the central issue was, "when does cohabitation or remarriage constitute a real, substantial, and unanticipated change of circumstances justifying a modification of spousal support?" 

Unlike the majority of states, Vermont does not presume that maintenance will be reduced or terminated on remarriage of the recipient spouse. Rather, remarriage is simply one circumstance -- like cohabitation -- that can constitute a "real, substantial, and unanticipated change of circumstances."

Vermont had not previously addressed the effect of cohabitation as a changed circumstance in maintenance actions.  The court concluded that cohabitation should be treated like remarriage in that it can constitute a change in circumstances if the obligor spouse can prove that it was unanticipated, and effects a real and substantial change in the financial circumstances of the obligee spouse.  The court cautioned that to constitute changed circumstances, "cohabitation must approach the permanency of marriage."   

Applying these standards to the cases before it, the court upheld the modifications in some and not in others, depending on the evidence of financial contribution from the new partner and its effect on the recipient spouse's financial condition.  The court held in one case, in which wife's cohabitant partner was not actually contributing to household expenses, that this did not constituted changed circumstances.  The court suggested that even cohabitation plus contribution would be insufficient unless the movant showed that this resulted in a actual improvement in the finances of the recipient spouse.  One judge dissented from this holding and objected to the dicta, finding that the court's rule was inconsistent with the approach used by the majority of states and unduly restricted the trial court's discretion.

Miller v. Miller, 2005 VT 122, 2005 Vt. LEXIS 303 (November 4, 2005)
Opinion on the web at http://dol.state.vt.us/gopher_root3/supct/current/2004-187.op (last visited November 7. 2005 bgf)

Early Voting Begins in Texas Gay Marriage Ban

AUSTIN - A proposed ban on gay marriage probably will be the big ballot draw as Texans start casting early votes Monday for the Nov. 8 constitutional amendments election.  Proposition 2 would define marriage as being only between one man and one woman. State law already bans same-sex marriage, but the amendment would cement that definition in the state constitution.  Groups on both sides of the same-sex marriage ban are working to stir interest in the ballot issue. The Republican Party of Texas' leader is aggressively speaking out in favor of it, while gay rights groups are opposed to it. Source. Kelley Shannon, Associated Press, Star-Telegram.com. For additional information, click here (last visited October 22, 2005, reo).

Case Law Development: Spending Patterns As Evidence Of Ability To Continue To Pay Alimony In Spite Of Income Reduction

The Michigan Court of Appeals affirmed a trial court's decision to lower but not eliminate Husband's alimony payment.  Husband had lost his job and was near retirement.  His income had been drastically reduced, near to the amount of alimony he was paying.  On a motion to modify, he asked the court to eliminate the duty to pay alimony.  The trial court held that cutting the alimony payment by about a third was justified.  The appellate court affirmed, finding that, given husband's lavish spending habits, and his ability to draw on an IRA for additional income, there was ample "evidence of plaintiff's continued ability to pay, regardless of his age and reported income" to uphold the trial court's decision to reduce but not eliminate alimony.  One dissenting judge would have found the trial court's decision clearly erroneous and inequitable.

Holmes v. Holmes, 2005 Mich. App. LEXIS 2480 (October 11, 2005)
Opinion on the web at http://courtofappeals.mijud.net/documents/OPINIONS/FINAL/COA/20051011_C252528_57_252528.OPN.PDF (last visited October 20, 2005 bgf).

Case Law Development: Court may not Impute Income to Starving Artist Wife upon Husband's Motion to Modify Maintenance

The Massachusetts Court of Appeals reversed a trial judge's reduction of alimony in a case involving an aspiring artist mother.  The couple in this case divorced when they were in their late 40s, with a 13-year-old son and twin 6 year olds sons. Wife stayed home with the children and painted.  The trial court suggested that Wife would have to think about a different career in the future if her painting didn't pan out.  The trial court granted alimony and suggested that it was likely the Husband would have to continue to pay that alimony until retirement.

Three years later, with wife's painting career improving but still not generating a positive cash flow, Husband moved to reduce alimony, claiming that wife was voluntarily unemployed and should be credited with larger earning capacity and that she had reduced expenses.  Husband  also argued that he had fewer assets because he had transferred income-producing assets to his mother.  Vocational experts for both parties testified regarding Wife's ability to earn more income than her painting was providing.

Trial court granted the reduction in alimony.

The Massachusetts Court of Appeals reversed.  The opinion contains plenty of scoldings:

First, the court of appeals noted that the trial court properly scolded the Husband for trying to argue changed circumstances in his reduced income, because his employment income had actually increased since the divorce.  Moreover, the trial court noted that it would not consider Husband's argument that he had reduced income from assets because he had transferred those assets since he had transferred the assets to his mother with the clear expectation that she would return them at a future date and he did not declare any income from those interests as of the time of the divorce. The trial court noted that Husband was "asking the Court to reduce his present support obligations in order to allow his future assets to be protected, preserved and enhanced -- all at the expense of the [wife] and the parties' three unemancipated children, whom he is obligated to support."

The appellate court had some scolding of its own to do.  In reversing the trial court's decision, the court found that there was no change in circumstance from the original decree.  While conceding that imputing income may be appropriate in modification in certain circumstances where there is evidence that  an obligee is deliberately choosing to deflate their income, the court noted that those were not the circumstances in this case.  Rather, the court concluded, the trial court's decision was based on the "judge's personal disapproval" of the wife's "avocation."  The appellate court noted that  at one point the judge had commented, "I'd love to be a professional golfer." He told the wife, "You may be a fine artist, but the term . . . 'starving artist' exists for a reason. . . . You can't keep losing money, ma'am. If you want to, that's your business, but he's not going to subsidize [your avocation]."  The court emphasized the caution "against relying unduly on the income-earning potential of a wife and mother who has been out of the regular job market for decades.... Such caution is appropriate in this case, where the wife has dedicated herself and expressed commitment to her vocation as an artist, whether or not she could earn more money in a clerical position."

Kelley v. Kelley, 2005 Mass. App. LEXIS 951 (October 11, 2005)
Massachusetts opinions are available online at http://massreports.com/slipops/ (last visited October 12, 2005 bgf)

Case Law Development: Property Settlement Agreements to Divide Military Disability Benefits May Not Be Enforced By State Courts

The Supreme Court of Montana, in a 4-3 decision, held that federal preemption precludes the state from holding husband in contempt for failing to pay VA disability benefits that had been awarded to wife in the prior dissolution action.  The award was made pursuant to an property settlement agreement in which Husband agreed to pay Wife a portion of his VA disability benefits each month.  In holding that federal law preempted the state in enforcing such an agreement, the court expressly overruled prior precedent distinguishing maintenance agreements from the  scope of federal preemption.  The court emphasized that a trial court may still consider military disability retirement pay “as a source of income in awarding spousal or child support, or generally as an economic circumstance of the parties justifying a disproportionate award of marital property to the nonretiree spouse."

Two dissenting opinions strongly disagreed that federal law preempted state enforcement of voluntary maintenance agreements involving military disability benefits.

In re Marriage of Lutes, 2005 MT 242; 2005 Mont. LEXIS 416 (September 27, 2005)
Opinion on the web at http://www.lawlibrary.state.mt.us/dscgi/ds.py/Get/File-45266/04-416.pdf (last visited September 29, 2005 bgf)

Case Law Development: Modification of Limited Duration Alimony – Retroactive Application of Statute

In this case, the New Jersey appellate court decides that the statute standards for a newly created category of “limited duration alimony” should apply retroactively on any motion to modify term alimony. In doing so, the court carefully distinguishes permanent alimony, rehabilitative alimony, and limited duration alimony and considers how the standards of modification would apply tov a variety of maintenance orders.

Gordon v. Rozenwald, 2005 N.J. Super. LEXIS 260 (August 31, 2005)

The court notes that prior to the 1998 legislation, alimony statutes did not provide for limited term alimony other than that which the parties might negotiate.  The court carefully distinguishes the purposes of the forms of alimony. “Limited duration alimony, like permanent alimony, is based primarily on the marital enterprise. It is distinguishable from permanent alimony because the length of the marriage does not warrant permanent support and from rehabilitative alimony because the term is not based upon projections about time needed to acquire education or job skills.”

The limited duration alimony statute includes two standards for modification. The amount of the award may be modified upon a showing of either a change in circumstances or the nonoccurrence of circumstances that the court found would occur at the time of the award.  In contrast, the length of the term may not be modified "except in unusual circumstances."  The court found the application of this standard retroactively consistent with prior decisional law, which imposed a higher standard for modification of alimony when it was based on agreement and the length of the term was not determined by reference to a prediction about some future event.

The limited duration alimony statute also provides “The court shall not award limited duration alimony as a substitute for permanent alimony in those cases where permanent alimony would otherwise be awarded.  The court holds that courts should presume that limited duration alimony is not a substitute for permanent alimony. The court provides numerous examples of when an alimony decree would and would not be a substitute.  The court holds that “a party may overcome the presumption and avoid application of [the statute] by demonstrating, as part of a prima facie case, that the term is a substitute for permanent alimony premised upon a promise or expectation of alternative funds for support that has not been fulfilled or realized.”

Finally, the court reviews other cases in which divorce legislation was applied retroactively and finds that, in this case, retroactive application is appropriate because it is “consistent with the most reasonable interpretation of the Legislature's intention in supplementing the alimony law and because the curative amendment reflects decisional law…”

BGF