Phillips v. Phillips

Phillips v. Phillips  (94-075); 164 Vt 600; 664 A.2d 272

[Filed 14-Jul-1995]

                               ENTRY ORDER

                      SUPREME COURT DOCKET NO. 94-075

                              MAY TERM, 1995


Roland T. Phillips, III              }     APPEALED FROM:
                                     }
                                     }
     v.                              }     Bennington Family Court
                                     }
Carole L. Phillips                   }
                                     }     DOCKET NO. S95-90BcFd


                    In the above-entitled cause, the Clerk will enter:

     Plaintiff appeals from an order of the Bennington Family Court
requiring him to reimburse defendant for the amounts she expended to meet
her health insurance deductible during the period he was obligated to pay
the premium on such insurance.  We affirm in part and reverse in part.

     The parties were divorced on March 18, 1992 and the final order
required plaintiff "to maintain health insurance for [defendant] and for 
the children providing all benefits that existed on January 1, 1991 and
January 1, 1992."  Defendant moved to amend the order in a number of 
respects including claims that the court erred in not specifying the
length of time during which plaintiff had to maintain the health
insurance and that because there had been a change in health insurance
companies between January 1991 and January 1992, it was unclear as to
what coverage plaintiff was obligated to maintain.  The motion was denied
and the parties thereafter entered into an agreement purporting to
resolve all outstanding issues between them.  Portions of the stipulation
were incorporated into an amended final order, which contained identical
language to the original order with respect to the health insurance.
Defendant's concern regarding the change in policies between 1991 and 
1992 was not addressed.  The amended order limited plaintiff's obligation 
to ten years and provided for termination if defendant became employed
under certain conditions.

     Defendant filed a motion to enforce the order alleging that
plaintiff refused to abide by the terms with regard to the health
insurance.  At the hearing on the motion, the evidence disclosed that the
deductible amount on the health insurance had increased from $100 to
$500, and then to $1000; plaintiff initially paid the deductible when it
increased to $500, but refused to pay over $100 after the increase to
$1000.  The court found that in July 1992 plaintiff promised defendant
that he would continue to pay the policy's deductible, and ordered 
plaintiff to continue to pay the deductible for the length of his
obligation to provide the insurance.

     In this Court, plaintiff argues that the stipulation and its
incorporation into the amended final order settled all outstanding issues
between the parties and extinguished any oral contract. Defendant argues
that plaintiff's earlier agreement to pay the deductible eliminated this 
as a contested issue, and it was therefore not resolved by merger into
the final agreement.

     The trial court found that plaintiff had no obligation to pay the
deductible under either the original or amended order, but concluded
that, as part of the negotiations of potentially appealable issues,
plaintiff promised to pay the deductible in July 1992, and ordered
plaintiff to

 

reimburse defendant for the deductibles paid during the period of
obligation.

     We affirm the order requiring plaintiff to make the deductible
payments, but on different grounds.  See Hudson v. Town of East
Montpelier, 161 Vt. 168, 170, 638 A.2d 561, 563 (1993) (this Court not
required to adopt trial court's rationale in affirming its conclusions).  
The parties agreed, and the court ordered, that plaintiff maintain
defendant's health insurance providing all the benefits which existed on 
the named dates.  "Benefit" is defined as pecuniary help in time of
sickness.  Webster's Ninth New Collegiate Dictionary 144 (1991).  In the 
context of insurance, it customarily means the amount to be paid to the
beneficiary.  See Mack Boring & Parts v. Meeker, Sharkey, Moffitt, 930 F.2d 267, 273 (3d Cir. 1991).  The amount actually received is calculated
by subtracting the applicable deductible from the benefit amount provided
in the policy.  The functional purpose of a deductible is to simply alter
the point at which the insurer's obligation to pay ripens.  American 
Nurses Ass'n v. Passaic Gen. Hosp., 484 A.2d 670, 673 (N.J. 1984).  Its 
effect is to reduce the amount the beneficiary would otherwise receive.

     The agreement and order called for the maintenance of insurance with
the same benefits, not insurance with benefits reduced by a larger
deductible.  Plaintiff's argument, taken to its logical extreme, would 
permit the procurement of a policy with a deductible eliminating most if
not all benefits.  We cannot endorse such a revision of plaintiff's 
obligation.  See Milton Bd. of Sch. Directors v. Milton Staff Ass'n, ___ 
Vt. ___, ___, 656 A.2d 993, 995 (1995) (Court will not rewrite contract
or construe contract to alter rights of parties, but will enforce it
according to its terms).

     Unfortunately, we cannot put the matter to rest.  The parties
stipulated to insurance coverage for benefits in policies existing on two
different dates.  The evidence indicates that different plans were in
effect on those two dates.  The problem was raised in plaintiff's motion
to amend, but never resolved.  As we have pointed out, stipulations must
be carefully constructed and drawn, and if they are not, they should not
be incorporated in an order.  Cooper v. Cooper, 132 Vt. 619, 621, 326 A.2d 145, 147 (1974).  This shortcoming requires a remand for a
resolution of this issue.

     Affirmed in part and reversed in part; remanded for further
proceedings in accordance with this opinion.


     BY THE COURT:


     _______________________________________
     Frederic W. Allen, Chief Justice

     _______________________________________
     Ernest W. Gibson III, Associate Justice

     _______________________________________
     John A. Dooley, Associate Justice

     _______________________________________
     James L. Morse, Associate Justice

     _______________________________________
     Denise R. Johnson, Associate Justice