Gwendolyn Warren v. Lewis Warren
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IN THE COURT OF APPEALS
OF THE
STATE OF MISSISSIPPI
NO. 2001-CA-00777-COA
GWENDOLYN WARREN
v.
LEWIS WARREN
DATE OF TRIAL COURT JUDGMENT:
TRIAL JUDGE:
COURT FROM WHICH APPEALED:
ATTORNEYS FOR APPELLANT:
ATTORNEY FOR APPELLEE:
NATURE OF THE CASE:
TRIAL COURT DISPOSITION:
DISPOSITION:
MOTION FOR REHEARING FILED:
CERTIORARI FILED:
MANDATE ISSUED:
APPELLANT
APPELLEE
04/17/2001
HON. THOMAS L. ZEBERT
RANKIN COUNTY CHANCERY COURT
JEFFREY JUDE PADGETT
HAZEL DIANNE TANNER
ORBIE S. CRAFT
CIVIL - DOMESTIC RELATIONS
MODIFICATION OF DIVORCE DECREE DENIED
AFFIRMED - 04/23/2002
5/14/2002
BEFORE McMILLIN, C.J., LEE, AND BRANTLEY, JJ.
LEE, J., FOR THE COURT:
¶1. Gwendolyn Warren appeals a judgment of the Chancery Court of Rankin County which denied her
request to modify a judgment of divorce in which she was ordered to pay her former husband a monthly
payment from her retirement account. Having found that the chancellor did not err, we affirm.
FACTS
¶2. Lewis and Gwendolyn were divorced by a judgment of divorce on the grounds of irreconcilable
differences. Pursuant to the parties' property settlement agreement which was incorporated into the
chancellor's final judgment, Gwendolyn was required to pay Lewis, for the remainder of her lifetime, the
sum of $225 per month from her retirement account with the Mississippi Public Employees Retirement
System. The basis for this agreement was the sale of the parties' home which Lewis owned before the
marriage. Although she was not entitled to any interest in the home, Gwendolyn was given $38,000 from the
proceeds of the sale and under the terms of the property settlement agreement, she agreed to pay Lewis
$225 per month for the remainder of her life. The property settlement agreement specifically stated that
both parties waived any claims or entitlements to alimony from the other.
¶3. Gwendolyn filed a "Petition to Modify Alimony" in which she alleged that there had been a substantial
change in circumstances, i.e., Lewis's remarriage and her inability to work due to her disability, such that she
should no longer be required to pay Lewis alimony.(1) In response, Lewis filed a petition for money
judgment and contempt against Gwendolyn requesting a money judgment, attorneys fees and the
incarceration of Gwendolyn until she purged herself of contempt. Lewis alleged that she was over $1100
behind in making payments to him.
¶4. At a hearing on the matter, Gwendolyn testified that she had been placed on full disability and was no
longer able to work. She was living on an income of about $2000 from her state retirement and disability
payments. She stated that at the time of their divorce she would have signed anything Lewis wanted her to
sign and she did not understand the consequences of signing the property settlement agreement. She
acknowledged that she gambled some, but denied losing large sums as she indicated she played with only
nickels and pennies.
¶5. There was testimony that Gwendolyn had previously been ordered by the chancellor to participate in
Gamblers Anonymous and had previously fallen behind in payments to Lewis and was ordered to pay an
additional $50 monthly to pay off that arrearage. Gwendolyn testified that she attended the program
although she felt it was not for her because she did not drink or use drugs and most of the participants in the
program had such problems.
¶6. Following the hearing, the chancellor entered his findings of fact and conclusions of law and judgment.
The chancellor determined that whether a "Qualified Domestic Relations Order" (QDRO) was entered was
of no consequence in determining the issues presented before him. The chancellor concluded that the parties
agreed to all the terms in the agreement, signed it, were represented by attorneys, entered into it voluntarily
and, having no evidence pointing to the contrary, the property settlement agreement met the requirements to
be a legally enforceable contract.
¶7. Next, the chancellor addressed the matter of whether the $225 payments were legally disguised
alimony. The chancellor's findings provided:
2. The basic controversy centers around Paragraph 5 of the agreement which states the following:
"Wife shall set over for Husband, and he shall have $225.00 per month during Wife's lifetime from her
retirement benefits from the Mississippi Public Employers Retirement Systems and a QUADRO [sic]
shall be entered to enforce this provision. This payment shall begin on the first day of the month after
the house is sold per Paragraph 1."
The wording of "this payment shall begin on the first day of the first month after the house is sold per
Paragraph 1" was penned in and interlineated into Paragraph 5 and was initialed by Gwen and Lewis.
In addition to Paragraph 5 of the agreement the Court must look at Paragraph 10 of the same
agreement which states, "Husband and Wife each waive any claim for alimony or spousal support
against the other."
3. Testimony in the case revealed that Gwen took from the agreement the sum of $38,000.00 from
the sale of the house of the parties which Lewis owned prior to the marriage of the parties and Lewis
agreed to accept the sum of $225.00 per month from Gwen in lieu of any money from the sale of the
property.
In finding that the payments were not alimony, the chancellor stated: "In light of the terminology contained in
Paragraph 5 of the agreement when taken in conjunction with Paragraph 10 of the agreement, this Court
cannot and does not find that it is alimony in any form." Finally, the chancellor found Gwendolyn in civil
contempt of court in the amount of $1050 and required her to pay attorneys fees in the amount of $350 and
court costs.
¶8. In her brief to the lower court as in her brief before us, Gwendolyn challenges the validity of the
property settlement agreement arguing that the $225 payments to Lewis from her retirement account violate
federal law regarding an alternate payees' rights to receive a portion of the benefits payable under a plan as
provided in a QDRO. She also contends that because no QDRO exists, Lewis has no vested right to
receive payment. She maintains that the $225 payment looks like, feels like and actually is alimony subject
to modification. Finally, she contests the validity of the property settlement agreement pertaining to the
lifelong payments to Lewis on the basis that such a contract is unconscionable and therefore void.
RESOLUTIONS OF THE ISSUES
1. Failure to enter a QDRO
¶9. Gwendolyn argues that because a QDRO was never entered, Lewis cannot have a vested interest in her
retirement plan. The property settlement agreement does not specify who was responsible for having the
QDRO entered, though Lewis contends that it was Gwendolyn's responsibility to do so. Nevertheless, the
time period for filing such a document in securing an interest in Gwendolyn's retirement has now lapsed.
Gwendolyn asserts that because a QDRO was not entered, it is a violation of the Internal Revenue Code to
give Lewis a vested interest in her retirement. Gwendolyn points us to section 414(p)(6)(A)(i) of the
Internal Revenue Code which governs a pension plan administrator's procedures once a QDRO has been
filed and is accepted.
¶10. In the equitable division of property as a consequence of divorce, an alternate payee's interest in a
pension plan vests only after the chancellor has determined that an equitable division of the marital assets
requires awarding some portion of one spouse's pension or profit sharing plan to the other spouse and a
QDRO is entered and accepted as qualified. Parker v. Parker, 641 So. 2d 1133, 1139 (Miss. 1996).
Furthermore, we know that property settlements incorporated in a divorce decree are not subject to
modification. East v. East, 493 So. 2d 927, 931-32 (Miss. 1986). Such an agreement is similar to any
other contract, and the fact that it is between divorcing spouses, and incorporated in a divorce decree, does
not change its character as a contract. Id. Agreements created in the process of the termination of the
marriage by divorce are contracts,"made by the parties, upon consideration acceptable to each of them, and
the law will enforce them." Lewis v. Lewis, 586 So. 2d 740, 745 (Miss. 1991); McManus v. Howard,
569 So. 2d 1213, 1215 (Miss. 1990).
¶11. In this case, the chancellor determined that the payment of $225 was not alimony as Gwendolyn
asserts and that she contractually obligated herself to make such payments under the terms of the property
settlement agreement. It is true that Lewis is not vested in Gwendolyn's retirement program and pursuant to
the applicable regulations he may not become vested because the time has lapsed for gaining a vested
interest in Gwendolyn's retirement. Notwithstanding this, Gwendolyn is still obligated pursuant to the terms
of the property settlement agreement to provide the $225 monthly payments to Lewis. The contractual
obligation to make such payments cannot be side stepped by the failure of a QDRO to be filed. It would
have benefitted Lewis to see to it that the QDRO was timely filed. Nonetheless, the absence of a QDRO
here only prohibits Lewis from obtaining security in the fulfillment of Gwendolyn's obligation to him and has
no effect on Gwendolyn's commitment to pay him monthly. Furthermore, we agree with the chancellor that
Gwendolyn's obligation to make monthly payments to Lewis arose out of their contractual agreement and
not an agreement to provide alimony to support Lewis. Even further, the property settlement specifically
states that neither party was entitled to alimony.
¶12. Federal law involving the administration of Gwendolyn's pension plan has not been violated. As stated,
Lewis does not and cannot now at this point obtain a vested interest in Gwendolyn's state retirement
monies.
2. Unconscionable contract
¶13. Divorce decrees are viewed as quasi-contracts. Grier v. Grier, 616 So. 2d 337, 340 (Miss. 1993).
"[W]here a property settlement agreement is entered into in contemplation of a divorce on the grounds of
irreconcilable differences, there is more at work than general contract law." Grier, 616 So. 2d at 340.
While a properly drafted agreement may be binding on the parties, the chancellor is within his discretion to
modify the terms in a divorce decree where he finds it is necessary to protect the parties because the courts
are not used as tools "for implementing unconscionable contracts which are not fair to either party." See
Miss. Const. art. IV, § 94.
¶14. An unconscionable contract is said to be an agreement by which "one such as no man in his senses and
not under a delusion would make on the one hand, and as no honest and fair man would accept on the
other. . . . " In re Will of Johnson, 351 So. 2d 1339, 1341 (Miss. 1977). The property agreement in this
case is not such a contract. Gwendolyn made a bargained for exchange. Apparently having determined that
she was not entitled to the proceeds of the marital home in an equitable division of property, Lewis
nonetheless agreed to give Gwendolyn $38,000 of the home's proceeds following its sale because she
needed the money and she was willing to agree to provide the $225 payment monthly and for her lifetime to
him in return.
¶15. Other than the testimony of Gwendolyn that she did not realize what she was doing when she made
such an agreement, there is no other evidence suggesting that the contract made between the parties is
unconscionable. Having listened to and considered the testimony exacted at the hearing on the matter, the
chancellor was within his discretion in determining the credible evidence and ruling that Gwendolyn was
bound to the terms of the property settlement agreement. We find no error and therefore affirm.
¶16. THE JUDGMENT OF THE CHANCERY COURT OF RANKIN COUNTY IS
AFFIRMED. STATUTORY DAMAGES AND INTEREST ARE AWARDED. ALL COSTS OF
THIS APPEAL ARE ASSESSED TO THE APPELLANT.
McMILLIN, C.J., KING AND SOUTHWICK, P.JJ., THOMAS, IRVING, MYERS,
CHANDLER AND BRANTLEY, JJ., CONCUR. BRIDGES, J., NOT PARTICIPATING.
1. In her petition, she referred to the amount she agreed to repay as alimony notwithstanding a specific
denial of the right to any alimony by either party pursuant to their contractual agreement.
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