DEBRA SCHOO CECIL and IRVIN D. FOLEY v. BENNET DOWNS CECIL, III and BENNET DOWNS CECIL, III v. DEBRA S. CECIL
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RENDERED: March 5, 1999; 2:00 p.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1997-CA-001272-MR
DEBRA SCHOO CECIL and
IRVIN D. FOLEY
APPELLANTS
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE JAMES M. SHAKE, JUDGE
ACTION NO. 92-CI-02178
v.
BENNET DOWNS CECIL, III
APPELLEE
and
NO.
1997-CA-001454-MR
BENNET DOWNS CECIL, III
APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE JAMES M. SHAKE, JUDGE
ACTION NO. 92-CI-02178
v.
DEBRA S. CECIL
APPELLEE
OPINION
AFFIRMING IN PART AND VACATING AND REMANDING IN PART
** ** ** ** **
BEFORE:
COMBS, DYCHE, and SCHRODER, Judges.
COMBS, JUDGE:
This case is a consolidated appeal from two
judgments of the Jefferson Circuit Court in an action to modify
child support and maintenance.
Debra Schoo Cecil (now Debra
Schoo Hibberd — “Debra”) and Bennet Downs Cecil, III (“Ben”) both
filed direct appeals from the orders of the circuit court entered
on April 3, 1997, and April 21, 1997, respectively.
Debra and Ben were married on May 7, 1973; three
children were born of the marriage.
In March, 1992, Debra filed
a petition for dissolution of the parties’ marriage.
The court
dissolved the marriage by decree entered November, 1992, but it
reserved all other issues relating to the dissolution.
After
three years of litigation, the court disposed of the remaining
issues in a judgment entered on November 17, 1995, and a
supplemental judgment entered on February 7, 1996.
Pertinent to
this appeal, the court awarded Debra custody of the parties’
three minor children, granted Ben visitation, and required him to
pay $2,850.00 a month in child support to Debra.
The court also held that Debra was entitled to
maintenance and ordered Ben to pay her $3,000.00 a month for ten
years from the entry date of the judgment (November 17, 1995).
In awarding Debra maintenance, the court found significant the
fact that Debra had supported the household while Ben was
attending medical school.
Additionally, the court divided the
marital property equally — with each party receiving
approximately $239,059.00 in marital property.
The record indicates that very soon after entry of the
court’s judgment of November, 1995, Ben was in arrears in child
support and maintenance payments.
Consequently, Debra filed a
series of motions to require him to make his child support and
maintenance payments and to hold him in contempt of court for
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failure to do so.
She also filed a garnishment against the
accounts receivable of his medical practice.
Ben then filed a motion to reduce his child support and
the maintenance obligation to Debra.
A hearing on this matter
was scheduled for March 20, 1996, but it was postponed due to
discovery disputes between the parties.
Near the end of May,
1996, Ben closed his private medical practice; he had earned
between $200,000 and $300,000 a year from his practice.
In
August, 1996, Ben took a staff position with the Department of
Veteran Affairs with an annual salary of $102,730.00.
This
position required him to staff a primary care clinic at Fort
Knox, Kentucky, as well as to provide supervision at Ireland Army
Hospital.
Upon closing his practice, Ben filed a motion in June,
1996, to reduce his child support obligation and to suspend his
maintenance payments.
The Domestic Relations Commissioner (DRC)
conducted a hearing on November 21, 1996, on the issue of child
support and of maintenance modification.
Ben argued that he was
entitled to a reduction in his child support and maintenance
obligation on the ground that there had been a material change in
his circumstances.
Conversely, Debra maintained that Ben was
voluntarily underemployed, citing the fact that he had elected to
close his successful, profitable private practice in order to
take a salaried position for less than half of what he had earned
in private practice.
On December 20, 1996,
the DRC submitted its report to
the court, agreeing and finding that there had been a substantial
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change in Ben’s circumstances and that his child support and
maintenance obligations should be reduced.
The DRC also held
that Ben was not voluntarily underemployed, stating that Ben had
closed his private practice due to mental health problems.
The
DRC re-calculated Ben’s child support obligation as $1,373.50 per
month and recommended that his maintenance payments be reduced
from $3,000.00 to $2,250.00 per month; the modifications were to
relate back to June 1, 1996, the date Ben filed his motion.
Additionally, the DRC determined that Ben owed Debra a total of
$30,374.00 in arrearage for child support and maintenance.
After conducting a hearing on the parties’ exceptions,
the court entered an order on April 3, 1997, adopting the DRC’s
report and recommendations.
The Court also stated that Debra and
Ben were to pay their own legal fees.
Subsequently, on April 21,
1997, the court denied Debra’s motion to amend the court’s order
of April 3, 1997, to allow her to reserve the issue of attorney’s
fees.
Debra and Ben both filed direct appeals from the court’s
orders of April 3, 1997, and April 21, 1997; their appeals were
consolidated into this appeal.
Debra and Ben both raise issues concerning the court’s
modification of the original maintenance award to Debra.
Ben
argues that the court erred by not eliminating entirely his
maintenance obligation to Debra.
the court erroneously modified her
Debra, however, contends that
maintenance award.
We find
that the court improperly reduced Debra’s maintenance award.
It is well established in Kentucky that a maintenance
award for a fixed sum — payable either in lump sum or in
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installments to be paid over a definite period — is not subject
to modification.
Dame v. Dame, Ky., 628 S.W.2d 625 (1982).
The Supreme Court carved out a narrow exception to this rule in
Low v. Low, Ky., 777 S.W.2d 936 (1989).
In Low, as part of the
division of the marital property, the husband was required to
execute a promissory note in favor of the wife; the promissory
note was a significant factor in the court’s decision to award a
fixed sum of maintenance to the wife, which the husband was to
pay to her in installments.
Subsequently, the husband
voluntarily filed bankruptcy and the promissory note was
discharged.
The wife then sought a modification to increase her
original award of maintenance.
Recognizing the “strong nexus”
between property awarded and maintenance, the Court held that
modification of the wife’s fixed maintenance award was proper,
stating:
Upon occasion, however, extraordinary events
may intervene which render full compliance
with the decree impossible and defeat the
scheme formulated by the court. As a result,
one party may reap a windfall while the other
is left to suffer. In equity and good
conscience, this Court cannot approve
prospective application of one provision of a
decree when another and essential provision
of the same decree has failed entirely.
Low, supra at 938.
The Court explained however that this
decision was not to be read as a significant departure from Dame.
The Court emphasized that parties could continue to rely upon the
finality of a lump sum maintenance award.
The exception
established in Low is applicable only under extraordinary
circumstances which affect the underlying purpose of the decree.
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In this case, Debra was awarded maintenance by means
of a fixed sum to be paid to her installments over a definite
period of time — $3,000.00 per month to be paid over a ten-year
period.
Thus, the award cannot be modified unless there has been
a failure of the division of marital property upon which the
court’s calculation of maintenance was based.
We find that the
scheme formulated by the court in the original decree has not
changed nor has it been rendered unconscionable by the occurrence
of any extraordinary events.
After the parties’ divorce, Ben
continued in his private medical practice, earning a substantial
salary.
The fact that Ben closed his practice and is now earning
a lower salary does not constitute a failure of the court’s
original division of marital property.
The reasons behind the
closure of his medical practice are irrelevant as Bennett
continues to have a high earning potential.
We find that the
court erred in reducing Ben’s maintenance obligation.
The next issue raised by Debra on appeal is whether the
court erred in determining that Ben was not underemployed.
The
court adopted the DRC’s finding on this issue, attributing the
closure of Ben’s medical practice to mental and emotional
difficulties.
Debra, however, argues that he voluntarily closed
his private practice and took a lower paying job solely to defeat
her maintenance award.
She maintains that the court should not
have reduced his child support obligation based upon his lower
salary.
Pursuant to KRS 403.212(2)(d), the court in its
discretion may find a parent underemployed and calculate child
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support based upon a determination of his or her potential
income.
However, this statute should be interpreted to include a
bad faith requirement so as to avoid unfairly punishing an
individual whose employment situation has changed because of
circumstances beyond his control or where his change in
employment is reasonable in light of the circumstances.
In this
case, the DRC found that it was reasonable for Ben to close his
medical practice because of his mental health problems and to
seek less stressful employment that resulted in a lower salary.
The trial court’s findings of fact should not be
disturbed on appeal unless they are clearly erroneous.
CR 52.01.
The DRC’s findings of fact, which were adopted by the court, were
extensive and detailed.
The record contains substantial evidence
to support the court’s findings.
Ben introduced evidence that he
had been diagnosed as suffering from chronic depression and that
his doctor had recommended that he limit his work hours for
health reasons.
We do not consider the court’s finding on this
issue to be clearly erroneous and will not disturb it on appeal.
Having found that Ben was not underemployed, the court was
correct in re-calculating his child support obligation based upon
his current salary of $102,730.00.
The final issue raised by both Debra and Ben on appeal
relates to attorney’s fees.
In its order entered April 3, 1997,
the court found that the parties had “the ability and should
therefore be required to pay their own attorney’s fees and
costs.”
Debra filed a motion to amend the court’s order of
April 3, 1997, to reserve her right to move for attorney’s fees.
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The court denied her motion in its order entered on April 27,
1997.
Debra contends that the court has erred procedurally in
denying her (in advance of the motion) the opportunity to move
for attorney’s fees.
Ben maintains that the court erred in
failing to order Debra to pay his attorney’s fees and court
costs.
KRS 403.220 authorizes the trial court “from time to
time after considering the financial resources of both parties”
to order a party to pay a reasonable amount for the cost to the
other party of maintaining or defending a proceeding under KRS
Chapter 403.
The plain language of the statute does not prohibit
the court from addressing this issue sua sponte.
Moreover, the
allocation of attorney’s fees and court costs is entirely within
the discretionary authority granted to the trial court.
v. Wilhoit, Ky. App., 521 S.W.2d 512 (1975).
Wilhoit
We find no error in
the court ordering sua sponte the parties to pay their own legal
expenses.
Based upon the foregoing reasons, we affirm in part and
vacate and remand in part the order of the Jefferson Circuit
Court entered April 3, 1997.
We also affirm the order of the
circuit court entered on April 21, 1997.
ALL CONCUR.
BRIEFS FOR APPELLANT/APPELLEE
DEBRA SCHOO CECIL:
BRIEFS FOR APPELLEE/APPELLANT
BENNET DOWNS CECIL, III:
Irvin D. Foley
Christian L. Juckett
Louisville, KY
Bennet D. Cecil, III
Louisville, KY
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