SUPREME COURT DOCKET NO. 2000-303
JUNE TERM, 2001
|Paula Trepenier Harris|
Joseph David Harris
Windsor Family Court
Trial Judge: Theresa S. DiMauro
In the above-entitled cause, the Clerk will enter:
Husband appeals from a family court order granting wife's motion for an upward modification of spousal maintenance, and awarding wife attorney's fees. Husband contends the court erroneously: (1) found that there had been a real, substantial and unanticipated change of circumstances; (2) increased the amount of spousal maintenance; (3) admitted certain evidence; (4) deprived husband of his due process rights; and (4) awarded wife attorney's fees and denied his motion for attorney's fees. We reverse the modification of spousal maintenance, and affirm the award of attorney's fees.
The parties' thirty-year marriage was dissolved by a judgment of divorce in September 1981. At the time of the divorce, husband was forty-seven years old and a professor of physics at Dartmouth College. Wife was fifty years old, and had worked at home during the marriage raising the couple's four children (who had all reached majority), entertaining, and running the household. Wife had recently taken part-time work writing a weekly newspaper column and restoring antiques for relatively little income. The judgment of divorce provided that the proceeds from the sale of the parties' principal assets - the family homestead in Norwich and an apartment house in Lebanon, New Hampshire - would be equally divided between husband and wife; that husband would maintain existing life insurance policies with wife as beneficiary; and that wife would receive permanent spousal maintenance. The maintenance award was based on the court's finding that although in good health, wife's thirty-year contributions as a homemaker had deprived her of the opportunity to obtain work that would enable her to maintain herself at the standard established during the marriage. Based on husband's then current income ($1680 net per month), the court awarded wife maintenance of $650 per month for one year, and $425 per month thereafter until husband retired, at which time she would become entitled to one-half of husband's yearly income from his pension plan, or $20,000, whichever was less. At the time of the divorce, it was projected that the pension program would produce a retirement income for husband, at age sixty-five, of approximately $50,000 per year.
In November 1999, wife moved to modify maintenance, alleging that husband's retirement income had increased substantially beyond what the court anticipated at the time of the divorce, and that her standard of living had declined substantially since the end of the marriage. In her affidavit in support of the motion, wife stated that recent ill health had made her more fully aware of the need for financial security, and that higher maintenance would allow her to invest for financial security in the event husband predeceased her.
Following the first half of a bifurcated hearing on the question of whether wife had shown a real, substantial and unanticipated change of circumstances, the court issued a written decision in wife's favor. The court found that since the divorce, wife - who was now sixty-nine years old - had worked intermittently at a variety of part-time jobs, earning small amounts of income, and had otherwise occupied herself with her children and grandchildren. The court found that wife's total monthly income from a variety of sources, including maintenance of $1666.67, social security, and income-producing assets, was $2,955.08, or $31,735.95 per year, and that her monthly expenses were $1,578.00. The court further found that husband, who had retired in June 1999, had income in 1999 of $121,812.95, including $54,000 withdrawn from his retirement account between July and December, or $9000 per month. Husband's assets totaled $1,800,000, which included the stock and money market accounts of his retirement plan, valued at approximately $1.6 million. Wife's assets totaled $125,000.
The court thus found that husband's retirement account could comfortably provide him with an annual income of $108,000 per year ($9000 per month), which was more than double the amount anticipated in the divorce decree, and that his maintenance obligation of $20,000 per year represented only 18.5 percent of this amount. Concluding that it was "reasonable to expect that the former homemaker should derive some benefit from the working spouse's good fortune," the court ruled that wife had met her burden of proving a real, substantial and unanticipated change of circumstances sufficient to support an upward modification of spousal maintenance. Finding, in addition, that husband had failed to comply promptly with an earlier discovery order, the court also awarded wife $200 in attorney's fees. Following a subsequent hearing, the court ordered wife's maintenance payments to be increased by $1000 per month, for a total of $32,000 per year. The court further granted wife's motion for attorney's fees, which totaled $4005.49, and denied husband's request for attorney's fees of $10,000. This appeal followed.
In determining to award spousal maintenance, the trial court must first find that the spouse seeking maintenance: (1) lacks sufficient income or property "to provide for his or her reasonable needs;" and (2) is unable to support himself or herself "at the standard of living established during the marriage." 15 V.S.A. § 752(a). The measure of a spouse's reasonable needs is not to be judged against the level of subsistence, but rather in relation to the standard of living established during the marriage. Clapp v. Clapp, 163 Vt. 15, 19, 653 A.2d 72, 74 (1994). We have also indicated that one purpose of maintenance is to compensate a homemaker for contributions to family well-being not otherwise recognized in the property distribution. See id.
When seeking modification of a maintenance award, proof of a real, substantial and unanticipated change of circumstances is a jurisdictional prerequisite, and the burden of proof rests on the party seeking modification. Gil v. Gil, 151 Vt. 598, 599, 563 A.2d 624, 625 (1989). In considering the motion, the trial court must "assess the parties current circumstances in light of their circumstances at the time of the divorce." DeKoeyer v. DeKoeyer, 146 Vt. 493, 496, 507 A.2d 962, 964 (1986). If these circumstances have changed in any way that is "real, substantial, and unanticipated," the court may modify the judgment. 15 V.S.A. § 752. We review the trial court's findings in the light most favorable to the judgment, and will not set them aside unless clearly erroneous. Stickney v. Stickney, 170 Vt. 547, 548, 742 A.2d 1228, 1230 (1999) (mem.).
Even when viewed in the light of this deferential standard, the record and findings here fail to disclose a real, substantial, and unanticipated change of circumstances sufficient to justify modification of the maintenance award. The record evidence did not establish that wife's reasonable needs were not currently being met in relation to the standard of living established during the marriage. The only significant change adduced by wife, and cited by the court, related to husband's circumstances; his income upon retirement was indisputably higher than the amount predicted in the divorce decree. Standing alone, however, we fail to see how this change was germane to the legal question of whether wife's current maintenance payments were sufficient to meet her reasonable needs.
Confronted with similar situations, other courts have reached the same conclusion. In Crews v. Crews, 751 A.2d 524 (N.J. 2000), for example, the defendant sought to increase alimony payments based, in part, on the fact that her former husband's financial condition had improved. The court held that the defendant had failed to establish the requisite change of circumstances, explaining:
A motion to modify alimony may not be used to enable a dependent spouse to share in the post-divorce good fortune of the supporting spouse. . . . When modification is sought, the level of need of the dependent spouse must be reviewed in relation to the standard of living enjoyed by the couple while married. If that need is met by the current alimony award and there are no other changed circumstances, support should not be increased merely because the supporting spouse has improved financial resources.
Id. at 533-34 (citations omitted). Many other courts have also concluded that increases in the supporting spouse's income do not support a finding of changed circumstances relative to the receiving spouse's ability to meet his or her reasonable needs at the standard established during the marriage. See, e.g., Sheeley v. Sheeley, 458 P.2d 522, 525 (Ariz. Ct. App. 1969) (husband's increased earnings after divorce failed to establish change of circumstances to modify alimony, because former spouse "has no continuing right to share in future accumulations of wealth" by divorced husband or wife); Council v. Council, 775 So. 2d 628, 630 (La. Ct. App. 2000) (court rejected proposition that "increase in [husband's] income alone is a change in circumstance justifying an increase in alimony"); Blaine v. Blaine, 646 A.2d 413, 423 (Md. 1994) (court held that dependent spouse was "not entitled to have his or her standard of living 'keep pace' with that of the other spouse after the divorce, or to share in the other spouse's future accumulations of wealth"); Katter v. Katter, 457 N.W.2d 750, 754 (Minn. Ct. App. 1990) (even substantial increase in former husband's earnings without unfavorable change in circumstances of divorced wife did not establish sufficient change to grant modification of maintenance); Kayle v. Kayle, 565 A.2d 1069,1071 (N.H. 1989) (alimony may not be modified to enable dependent spouse to share in former spouse's post-divorce prosperity); In re Marriage of Hill, 569 P.2d 686, 687-88 (Or. Ct. App. 1977) (reversing modification of alimony on basis of "well established rule . . . that an increase in income alone does not constitute a change in circumstances warranting an award of greater spousal support"); see also 2 H. H. Clark, The Law of Domestic Relations in the United States § 17.6 at 282 (2d ed. 1987) (noting general rule that although alimony "necessarily must decline with the husband's declining prosperity, it does not follow that it should rise if he strikes it rich").
We have, to be sure, recognized that changes in the financial condition of the supporting spouse may justify modification of a maintenance award in the limited circumstance where a decrease in income has substantially affected the ability to pay. See Lowery v. Lowery, 156 Vt. 268, 273-74, 591 A.2d 81, 84 (1991). One of the statutory factors which the court must consider in awarding maintenance is the "ability of the spouse from whom maintenance is sought to meet his or her reasonable needs while meeting those of the spouse seeking maintenance." 15 V.S.A. § 752(b)(6). A reduction in the supporting spouse's income is obviously material to this issue. It does not follow, however, that increases in income are in any way relevant to establishing that the dependent spouse is unable to meet his or her reasonable needs at the standard established during the marriage. Although the opinion in Sylvia v. Sylvia, 146 Vt. 596, 598, 508 A.2d 708, 709 (1986), makes reference to a "significant and unanticipated increase in [husband's] income," our decision to uphold an order modifying child and spousal support was based on several additional factors, including "the nearly total frustration of the employment expectations of [wife,] and the inadequacy of existing alimony and child support." Id. It does not support the proposition that an improvement in the supporting spouse's income, standing alone, establishes a real, substantial, and unanticipated change of circumstances sufficient to modify spousal maintenance.
The trial court's conclusion that wife had met her burden of proving a real, substantial and unanticipated change of circumstances cannot, therefore, be sustained. The only significant "change" underlying the court's ruling was the fact that husband's pension funds had "done better than expected," coupled with its belief that "the former homemaker should derive some benefit from the working spouse's good fortune." There was no evidence, however, that wife's circumstances had so changed that the current level of spousal maintenance was insufficient to support her at the standard established during the marriage, the legal predicate to a finding of changed circumstances.
In its later decision granting an upward modification of spousal maintenance the court did, belatedly, suggest that its ruling was based on more than the improvement in husband's financial condition, observing that wife's "standard of living after the divorce has never been consistent with that which was enjoyed during the marriage." The court was not free, however, to revisit the question of whether the original 1981 maintenance award adequately reflected the standard established during the marriage. That issue was res judicata. The only question before the court was whether wife's circumstances had so changed that the maintenance award was no longer adequate to meet her reasonable needs as measured by the standard established during the marriage. In this regard, the record evidence showed only that wife's current monthly income rather closely approximated the parties' income during the marriage, and continued to more than meet her monthly expenses. The court did not cite, nor does the record disclose, any evidence that wife's current income was insufficient to meet her reasonable needs as measured by the marital standard at the time of the divorce. Accordingly, we discern no legal or factual basis for the modification. Hence, we conclude that the modification order was clearly erroneous, and must be reversed. Our conclusion renders it unnecessary to address husband's additional claims relating to the maintenance issue.
Husband also contends the court erred in awarding attorney's fees of $4005.49 to wife, and denying his request for attorney's fees of $10,000. We disagree. "The primary consideration in an award of attorney's fees is the ability of the supporting party to pay and the financial needs of the party receiving the award." Smith v. Stewart, 165 Vt. 364, 375, 684 A.2d 265, 272 (1996). In its decision, the court found that husband was in a better position to bear the expenses of the litigation, that wife's requested fees were limited to the motion to modify, that the fees charged by wife's attorney were reasonable, and that they were necessarily incurred for the protection of wife's marital interests. Our holding that the modification order was erroneous does not undermine these essential findings, or imply that wife's motion was frivolous or entirely without merit. Accordingly, we conclude that the award was within the discretion of the trial court, and should stand despite our reversal of the order. See id. (upholding award of attorney's fees to wife despite reversal of order granting her motion to enforce child support).
That portion of the family court's order granting the motion to modify spousal maintenance is reversed. That portion of the order awarding wife attorney's fees is affirmed.
MORSE, J., dissenting. The Court's decision to reverse the family court's order granting wife a relatively modest $12,000 increase in spousal maintenance violates our standard of review. The family court may find that a dramatic improvement in the supporting spouse's income constitutes a real, substantial and unanticipated change of circumstances sufficient to modify a twenty-year old divorce judgment. Regardless of the circumstances at the time of the original decree, the court retains inherent and statutory authority to adjust spousal support obligations as later circumstances and justice require. That is precisely what occurred here. Accordingly, I respectfully dissent.
Our review of the family court's decision is necessarily limited. In a modification proceeding, it is the trial court's responsibility to weigh the evidence and credibility of the witnesses to determine whether the party seeking a modification has met the statutory burden of demonstrating a real, substantial and unanticipated change of circumstances. Wardell v. Clapp, 168 Vt. 592, 595, 720 A.2d 862, 865 (1998) (mem.); 15 V.S.A. § 758. We review the trial court's findings only for clear error, taking the evidence in the light most favorable to the prevailing party, and disregarding the effect of any modifying evidence. Stickney v. Stickney, 170 Vt. 547, 548, 742 A.2d 1228, 1230 (1999) (mem.).
Although the Court's factual summary is accurate as far as it goes, it fails to note the extensive evidence of wife's extremely modest and frugal lifestyle since the parties' divorce in 1980. This Court has acknowledged the economic reality that divorce often visits a more dramatic economic penalty upon the spouse who has sacrificed a career outside of the home to contribute to the family's well-being. See Russell v. Russell, 157 Vt. 295, 299, 597 A.2d 798, 800 (1991); Klein v. Klein, 150 Vt. 466, 473-74, 555 A.2d 382, 386-87 (1988). This case presents a classic illustration. At the time of the divorce in 1981, the parties had been married for thirty years. Wife was fifty years old, and had worked throughout the marriage as a homemaker, raising the parties' four children and supporting husband's career as a professor. After the divorce, wife's lifestyle remained largely static; she never remarried, and lived within the modest means her fixed income allowed her. She suffered a heart attack in 1996, and was diagnosed with breast cancer in 1997, requiring debilitating radiation treatments. Husband, by way of contrast, continued his employment at Dartmouth College, remarried, purchased another house with his second wife, and retired in 1999 with retirement accounts valued at approximately $1.6 million.
The original divorce judgment anticipated that husband's retirement income would be approximately $50,000 per year. The trial court found, however, that husband could comfortably withdraw up to $9000 per month from the account, for an income of $108,000 per year. Wife's income from spousal maintenance of $1666.67, social security, and other income-producing assets totaled about $31,000 per year. Her total assets of $125,000 were less than one-tenth of husband's assets of $1.8 million.
These facts, together with the court's finding that, although wife was meeting her expenses, she was not living at the standard established during the marriage, amply supported the conclusion that a real, substantial and unanticipated change of circumstances justified an increase in spousal maintenance. Spousal maintenance orders are not final. See Stickney, 170 Vt. at 548, 742 A.2d at 1231 (spousal maintenance orders are not final, and may be modified from time to time as circumstances require); see also 15 V.S.A. § 758. Nor does our case law support a hard and fast rule prohibiting upward adjustments based upon increases in the supporting spouse's income. See Sylvia v. Sylvia, 146 Vt. 596, 597-98, 508 A.2d 708, 708-709 (1986) (increase in husband's income, together with other unanticipated circumstances, supported modification of alimony payment). Although other jurisdictions have adopted the policy that an increase in the income of the payor spouse is insufficient to support a modification of maintenance, the rule is not uniform. See, e.g., Crowley v. Crowley, 699 A.2d 1029, 1033 (Conn. Ct. App. 1997) (increase in husband's income constituted substantial change of circumstance justifying reconsideration of alimony order); Naylor v. Naylor, 700 P.2d 707, 709-710 (Utah 1985) (fact that husband's income doubled, while wife's income remained static contrary to expectations, supported finding of material, substantial change of circumstances).
The court's finding that a real, substantial and unanticipated change of circumstances justified a relatively modest increase in spousal maintenance was not clearly erroneous. Therefore, I would affirm the judgment.
BY THE COURT:
|James L. Morse, Associate Justice||Jeffrey L. Amestoy, Chief Justice|
|John A. Dooley, Associate Justice|
|Denise R. Johnson, Associate Justice|
|Marilyn S. Skoglund, Associate Justice|