Divorce Law Journal

Is non-modifiable maintenance modifiable? Unpublished opinion from Ky Court of Appeals

We do not usually post unpublished opinions from the Ky Court of Appeals but Geralds v. Geralds  is notable, giving guidance to the bench and bar about an issue that has perplexed us since Woodson v. Woodson in 2011.  Geralds holds that agreements for non-modifiable maintenance are enforceable. We don't know why the opinion was designated not to be published, but hope the court changes its mind. 

Applicability of New Spouse’s Income and Expenses for Children of New Marriage in Modification of Maintenance Award to Former Spouse, Case Digest, Tudor v. Tudor, Ky Court of Appeals

Chauncey J. Tudor v. Melanie K. Tudor, No. 2012-CA-000110-MR

Published: Reversing and Remanding

County: Jessamine

FACTS:

Husband and Wife initiated divorce proceedings in 2009. After extensive hearings and a trial, Husband was ordered the custodial parent and ordered to pay $1,700 per month in maintenance for ten years. The divorce decree was entered in 2009.

In 2011, Husband filed a motion seeking disclosure of financial documents and motions for modification of child support and maintenance. The trial court’s findings of fact and conclusions of law only addressed Husband’s maintenance obligation. Relying primarily on the income of Husband’s new wife and citing expenses relating to their marriage and the children of their marriage, the court determined that the maintenance obligation should not be altered because the payment amount was not unconscionable. Husband appealed.

ANALYSIS:

The issue presented to the court was whether a new spouse’s income, and the couple’s ability to provide for children of the new marriage, should be considered when determining whether maintenance owed to the former spouse should be modified. KRS 403.250(1) states that maintenance obligations may be modified “upon a showing of changed circumstances so substantial and continuing as to make the terms unconscionable.” When a party seeks to modify maintenance obligations, the court compares the parties’ current circumstances to the circumstances at the time the decree was entered. Modification of maintenance looks solely to whether the obligor’s circumstances have changed in a substantial and continuing way such that the order is rendered unconscionable. 

The trial court in this case determined that the Husband was earning $96,000 per year at the time the decree was entered, and Husband earned only $48,000 per year when he sought modification of the maintenance award. Rather than focusing on the income of Husband’s new wife and expenses relating to his new children, the trial court should have focused on whether the change in Husband’s income is substantial and continuing such that the award is unconscionable. If the trial court is determining whether the award should be reduced, the trial court may consider the extent to which Husband’s relevant expenses have been reduced as a result of his new marriage. Although not raised in this case, whether an obligor is voluntarily underemployed or whether retirement, if applicable, was reasonable could prevent the modification of a maintenance award.

Judge Maze wrote separately, concurring in the judgment. The trial court misapplied the facts to the law in this case because a spouse’s decision to remarry and start a new family does not relieve the spouse of the obligation to pay maintenance awarded to a former spouse. The new spouse has no obligation to contribute to the former spouse’s support. However, other facts in the case could support the trial court’s decision to deny the maintenance modification. The trial court should examine further on remand whether Husband’s income resulted from voluntary underemployment, general economic conditions, his own choices, or some combination thereof. Evidence that Husband in the past found well-paying employment in auto sales even during difficult economic and personal circumstances could indicate that Husband failed to show that the change in his circumstances is not likely to be substantial and continuing.

Digested by: McKenzie Cantrell, Attorney, of counsel, Diana L. Skaggs + Associates

Woodson v. Woodson, Ky Supreme Court, Modification of Lump-Sum Maintenance, overruling Dame

Woodson v. Woodson

2010-SC-000053-DG

Published:  Reversing and Remanding

County: Jefferson

Overruling Dame v. Dame, SC held that “a maintenance award in a fixed amount to be paid out over a definite period of time is subject to modification under KRS 403 .250(1).” 

KRS 403 .250(1) states in part:

"Except as otherwise provided in subsection (6) of KRS 403 .180, the provisions of any decree respecting maintenance may be modified only upon a showing of changed circumstances so substantial and continuing as to make the terms unconscionable." (Emphasis added.)

In giving the statute its obvious meaning, all decrees ‘respecting maintenance’ are modifiable under certain circumstances. This is precisely the point that was made by Justice Clayton in his dissent in Dame.

"In saying farewell to Dame, we do not belittle the compelling need for finality in all divorce cases. The burden of proof to change maintenance orders is sufficiently strict to insure relative stability and finality. It requires the showing of ‘changed circumstances so substantial and continuing as to make the terms unconscionable.’ KRS 403.250(1). However, the statute does not divest trial judges of the discretion to decide when modification outweighs the virtue of finality in seeking fairness and equity in what many times may be dire consequences and complicated options.”

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates  

From The Kentucky Supreme Court This Month: Dame v. Dame to be Reviewed

The Court accepted discretionary review in Woodson v. Woodson, in which the Court of Appeals upheld the trial court as it lacked authority to rule contrary to Dame v. Dame. The Court of Appeals' unpublished opinion is here. So, the question is whether fixed payments of maintenance over a fixed period of time remain non-modifiable.

There were no published family law opinions released by the Kentucky Supreme Court today.

Daunhauer v. Daunhauer, Ky COA, Modification of Maintenance

DAUNHAUER v. DAUNHAUER, ___S.W.3d___ (Ky. App. 2009)

PUBLISHED: REVERSING
ACREE PRESIDING; NICKELL AND SENIOR JUDGE KNOPF CONCUR
COUNTY:JEFFERSON

Ex-Ex-Husband appealed from TC’s order denying his motion to terminate his maintenance obligation, arguing that Ex-Wife was no longer dependent upon that maintenance to meet her needs. 

FACTS:

Ex-Husband and Ex-Wife were married for 21 years.  At time of divorce, Ex-Husband was 48 and working as a dentist, earning $22,000 per year, and Ex-Wife was 42 and working as a secretary, earning $10,000 per year.  Ex-Wife relocated to California before Decree entered.  Parties entered agreement in which Ex-Husband would pay Ex-Wife maintenance of $400 per month, with such amount being modifiable after two years.  TC reduced maintenance to $200 per month after three years, when Ex-Wife’s income as a medical assistant was $26,000 per year and Ex-Husband’s income as a dentist was $36,000 per year.  Five years after that, TC denied Ex-Husband’s next motion for maintenance reduction, finding insufficient change in circumstances.  In 2006, at age 66, Ex-Husband injured himself and needed surgery and physical therapy, so he decided to sell his dental practice and retire.  He filed a motion to terminate maintenance, and although TC found retirement reasonable, TC denied motion as it found parties’ circumstances had not sufficiently changed.  Ex-Husband appealed.

ANALYSIS:

CA held that goal of maintenance award per KRS 403.200 is to facilitate one’s transition from dependence on a former spouse to independence.  CA held that original maintenance award was rehabilitative, and that the most appropriate reason for modification is Ex-Wife’s ability to live independently of maintenance.  Although it is appropriate in some cases to have maintenance not terminate, that occurs only when the claimant’s prospects of self-sufficiency are dismal.  The policy underlying KRS 403.250, requiring a substantial change of circumstances for modification, is relative stability.  CA found these two policies are not at odds.  Because Ex-Husband’s voluntary retirement was reasonable, TC could consider his resulting change of circumstances.  Ex-Wife earned more income than Ex-Husband at time of hearing.  Both parties had expenses in excess of their income.  CA held that if Ex-Wife achieved self-sufficiency, then post-decree increases in Ex-Husband’s income or assets are irrelevant.  Self-sufficiency is determined with reference to standard of living acquired during marriage, not post-decree.  CA also found that TC erred by considering the “relatively small” amount of maintenance and the higher cost of living in California.  If a claimant has achieved self-sufficiency, any amount of maintenance is inappropriate.  Further, since Ex-Wife has sufficient income to meet her needs, the higher cost of living is irrelevant.  CA reversed and remanded. 

Digested by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

Castle v. Castle, Ky COA, Termination Of Open-ended Maintenance

Castle v. Castle, --S.W.3d—(Ky. App. 2008), 2007-CA-001238-MR

The parties were married for twenty-five (25) years. There was no separation agreement between the parties, but a Domestic Relations Commissioner’s report was confirmed by the lower court. However, the court increased the open-ended maintenance award to $750 per month and added a requirement that maintenance would terminate if the wife cohabitated with an individual other than a relative. In 2006 the husband filed a motion to terminate maintenance, alleging the wife was living with her boyfriend. The court granted his motion and denied the wife’s motion to alter, amend, or vacate. Wife appealed.
Open-ended maintenance awards may be modified by only two methods 1) a separation agreement or 2) changed circumstances so substantial and continuing as to make the terms of the award unconscionable pursuant to KRS 403.250(1). The lower court held that the wife’s cohabitation with her boyfriend constituted a changed circumstance sufficient to make the payment of maintenance unconscionable. COA found that the lower court made sufficient findings to support the termination of maintenance.
The wife also argued that the court erred in not awarding her attorney fees. COA found no abuse of discretion.
AFFIRMED.
Digested by Sarah Jost Nielsen, Diana L. Skaggs + Associates

More On Whether Same Sex Relationships Terminate Maintenance

New York Divorce Report directs us to posts about recent decisions in Virginia, Oregon and California.

Registered Domestic Partnership Does Not Terminate Maintenance (and some vacation blog musing about colleagues to the north)

Marcia Oddi at Indiana Law Blog has been doing my work for me while I was on vacation with her post here quoting from the L.A. Times about a recent decision holding that unlike remarriage, a registered domestic partnership does not terminate alimony.

State marriage laws say that alimony ends when the former spouse remarries, and Garber reasons he should be off the hook, given that domestic partnership is akin to marriage. But an Orange County judge has decided that registered partnership is cohabitation, not marriage, and that Garber must pay.

On the way to Lake Michigan last week I had a delightful mid-morning chat with Marcia. It is so nice putting a face with the name and the pen. A couple of Kentucky legal bloggers have had many "behind the scenes" email chats with her and admire her wisdom and restraint. So, I am pleased to now say that I know her and that she will try to join us when we get together next time. As we have reported several times, Marcia won the 2006 Excellence in Public Information and Education Award, presented by the Indiana Judges Association. If you take a look at her updated site you will see that the Indiana Bar Association is now a sponsor. Her blog is the gold standard.

I was very sorry not to meet Jeanne Hannah of Updates In Michigan Family Law in Traverse City. We had dinner planned last Friday night, but I had to cancel because we had boat engine problems and were stranded in Leland. Not that spending three days in Leland is anything to complain about; it is a lovely town and I could have stayed there the entire summer. The joy and occasional disappointment about boating is that you just can't plan well. Fog. Near gale force winds creating huge waves. Or, as in our case, all that plus what turned out to be an alternator problem which caused the radar to go out, the marine radio to quit, then the power steering to shut down and finally an engine failure, all while we were in a shipping lane in thick fog, near shoals between the Manitou Islands. It was great fun, but I really did miss meeting Jeanne. Maybe next year, unless my hosts decide I am bad luck!

Block v. Block

BLOCK V. BLOCK___SW3d___(Ky.App. 2007)
FAMILY LAW: MAINTENANCE MODIFICATION (CO-HABITATION FACTORS)
2005-CA-000666
TO BE PUBLISHED: VACATING AND REMANDING (MOORE)
DATE RENDERED: 5/4/2007

Ex-husband appealed family court’s order denying his motion to modify spousal maintenance. In the parties’ Marital Settlement Agreement, it was provided that if Ex-wife should ever “reside with a member of the opposite sex not related to her by blood,” the family court could “entertain a motion of [Ex-husband] to modify maintenance as a result of [the] alleged cohabitation, … [and in reviewing such motion], the provisions of KRS 403.250 would control.” Ex-husband was to pay Ex-wife maintenance in the amount of $3,000 until September 2010. In December 2002, a male not related to Ex-wife by blood moved in with her, and shortly thereafter, they purchased a home and a boat together, resulting in Ex-wife’s decreased cost for housing, and they shared living expenses, paid from a joint account, which provided Ex-wife with a monthly savings of $400. Furthermore, they entered a written partnership agreement, modeled after a prenuptial agreement, setting forth their rights and obligations to any property they jointly purchased or acquired; and they engaged in a “commitment ceremony” that was identical to a marriage ceremony except that the words “lifelong commitment” were substituted for “marriage” throughout the ceremony. Based on these facts and the terms of the Marital Settlement Agreement, Ex-husband motioned the court to modify his spousal maintenance obligation to zero. The family court denied Ex-husband’s motion, deciding that Ex-wife received only “some” financial benefit from her current relationship, and thus the circumstances were insufficient to meet the standard set forth by the Kentucky Supreme Court in Combs v. Combs, 787 S.W.2d 260 (Ky. 1990).

CA noted that “each [cohabitation] case is reviewed separately and on its own facts,” but that one principle is exceedingly clear from the caselaw: “absent a provision otherwise in a separation agreement, cohabitation is only one factor to consider in reviewing modification of maintenance cases.” CA looked to the factors enumerated in Combs, and held that while each of those factors should be considered, that case also requires that the cohabitation must result in a change in the cohabiting spouse’s economic position in order to modify maintenance. CA held that family court’s finding that Ex-wife enjoyed only some economic benefit from living arrangement was not supported by substantial evidence, and that, in fact, Ex-wife’s current relationship constituted a “new financial resource” for her, as described in Combs, and combined with the other factors in Combs, the evidence overwhelmingly indicated a change of circumstances so substantial and continuing as to make the maintenance obligation unconscionable. On this basis, CA vacated family court’s decision, and remanded the case to family court, where the maintenance obligation should be reduced to zero.

Digest by Michelle Eisenmenger Mapes, Diana L. Skaggs + Associates

Maintenance Modification (KY)

Here's an outline I presented at two consecutive LBA/AAML seminars:
Download Redlined.Modification.handiout.outline.doc The red-lined changes were for the second seminar. After dozens (hundreds?) of hours and 26 pages, I had the law figured out. On my copy I later marked at the top that it needed to be revised to account for two new cases. Now there are more, including a new Court of Appeals decision last week, Block v. Block. We will digest and post that "to be published" decision soon. With this case, Massey v. Massey (motion for discretionary review pending). and Rayborn v. Rayborn, about which we posted here the architecture of my outline is obsolete. If a client wants to know if maintenance can be modified, you will have to update the research and perhaps it is time for the Kentucky Supreme Court to take a look at this recurring issue and put some predictability to it. It is not only tough for our trial courts to know what standards apply, but those of us in the trenches drafting these agreements are hard pressed to know what the law will be at the time of enforcement.

Maintenace Modification Only If Wife's Circumstances Improve

Note: This "to be published" case is not final; a motion for discretionary review has been filed:
Massey v. Massey, __ S.W.3d __ (Ky. App. 2006), 2006 WL 2517525 (Ky. App.
Issues and Holdings:
1) Whether a maintenance order that is subject to modification is an open-ended award rather than lump sum. The Court held yes, such an order is an open-ended maintenance award.
2) Whether the family court’s order permitting modification of maintenance only if the former wife’s income increased was authorized by the maintenance modification statute. The Court held no, such an order is not permitted under the statute.
3) Whether the amount of maintenance awarded was adequate. The Court held yes, the award was adequate.
4) Whether the family court’s findings were sufficient to support the five-year duration of the maintenance award. The Court held no, the court’s findings were insufficient.

Facts:

The parties were married on August 21, 1982 and divorced on September 3, 2004. Lisa, the Appellant, was 41-years-old at the time of the divorce. One child was born of the marriage. The court awarded Michael sole custody of the child. Lisa was granted visitation, and ordered to pay $175 per month in child support. Lisa was awarded maintenance of $1200 per month, which was to be offset by her child

Rayborn v. Rayborn

Rayborn v. Rayborn, 185 S.W.3d 641 (Ky. 2006)
Issue and Holding:
Whether the circumstances of the parties brought about by the entry of the divorce decree and maintenance obligation can serve as the basis of the “changed circumstances” required by KRS 403.250 to allow modification of the maintenance award. The Court held no, the parties circumstances at the time of the decree and maintenance obligation are the status quo against which the changed circumstances requirement of KRS 403.250(1) is to be measured.

Facts:
Paul and Exie Rayborn were married for 25 years. Exie filed a petition for dissolution of marriage, and Paul did not respond. The trial court entered a default decree, wherein Exie received most of the personal marital property, including their mobile home, and Paul was assigned to pay the marital debt, except for the debt remaining on the mobile home. The parties owned a one-half interest in a 44-acre farm, which was not disposed of by the decree. Since Paul was a self-employed truck driver and Exie was disabled, the court also ordered Paul to pay $500.00 a month in permanent maintenance.
Following the divorce, Paul purchased the other half of the farm from a third party, sold the land, and gave Exie her share of the marital proceeds, $47,000, as well as the one acre where her mobile home was located. Paul received $153,615.51 from the sale of the farm.
The same year, Paul moved the court to terminate his maintenance obligation under KRS 403.250. The trial court granted the motion, finding that there had been a showing of changed circumstances sufficient to make the provisions and terms of the maintenance obligation unconscionable. The trial court noted that Exie’s standard of living had increased significantly since the marriage, due to the maintenance that she received. It also noted that Paul’s income had decreased significantly and that the sale of the farm constituted changed circumstances. Finally, it noted that the original decree was defective because it did not contain requisite findings of fact.
The Court of Appeals reversed, holding that the trial court’s findings were only conclusory and not supported by facts. The Supreme Court granted discretionary review.

Analysis:
KRS 403.250 requires that the changed circumstances occur after the divorce decree and maintenance obligation become effective. However, the changes noted by the trial court were the product of the divorce decree and maintenance obligation. Exie’s income had increased, due to the maintenance she received. Paul’s income had decreased, due to the maintenance that he paid. Although, the Court noted that Paul’s income might have actually increased overall, if calculated before maintenance was deducted. The Court also attributed the sale of the farm to merely a distribution of property that should have occurred as part of the original decree. The Court also pointed out that the proceeds from the sale actually improved Paul’s overall financial position. These changes brought about by the divorce decree and maintenance obligation cannot serve as the basis of the “changed circumstances” required by statute. Otherwise, every maintenance obligation could be immediately modified under the statute.
Finally, the Court acknowledged that the original decree was, in fact, defective. It did not dispose of the entire marital estate or contain requisite findings of fact. However, the Court held that those defects are to be raised in a direct appeal of the decree. Those defects cannot serve as a basis for a later action to modify the maintenance obligation.
Accordingly, the Court affirmed the decision of the Court of Appeals and remanded the case to the trial court for proceedings consistent with the opinion.

Rayborn v. Rayborn, 185 SW3d 641(Ky., 2006)

Rayborn v. Rayborn, 185 SW3d 641, (Ky., 2006)
The actual distribution of remaining marital property and
sale thereof did not result in the sort of substantial change in
circumstances that could render a maintenance obligation
nconscionable. Even if the initial divorce decree was done
incorrectly and without adequate findings, the remedy is
a direct appeal from the decree. These sorts of defects cannot
serve as a basis for a later action to modify the maintenance
obligation.