Schwartz v. Haas

Schwartz v. Haas (98-176); 169 Vt. 612; 739 A.2d 1188

[Filed 19-Jul-1999]


                                 ENTRY ORDER

                       SUPREME COURT DOCKET NO. 98-176

                              APRIL TERM, 1999


Samuel Owen Schwartz	               }	APPEALED FROM:
                                       }
                                       }
     v.	                               }	Bennington Family Court
                                       }	
E. Willa Haas	                       }
f/k/a Ethel Seldin-Schwartz	       }	DOCKET NO. 157-6-94 Bndm


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


       This proceeding is before us for a second time.  In Schwartz v.
  Seldin-Schwartz, 165 Vt.  499, 685 A.2d 665 (1996), we held that the family
  court was without authority in a divorce case  to award a money judgment to
  husband even in the face of findings that wife wrongfully diverted  assets
  from the marital estate she shared with her seriously disabled spouse.  See
  id. at 503-04,  685 A.2d  at 667-68.  On remand, the family court took up
  our mandate to reconsider both its  maintenance and property settlement
  awards, see id. at 504, 685 A.2d  at 668, and entered a  decree that
  significantly resembles its previous order - the salient difference being
  that husband  was awarded the sum of $50,000 "payable from [wife's] share
  of the marital estate."  When wife  did not remit the $50,000 by the
  deadline established in the decree, the court further directed that  this
  sum be offset from husband's monthly maintenance obligation.  Wife appeals. 
  We affirm.

       As wife acknowledges, our previous opinion gave us an occasion to
  assess and ultimately  to affirm the family court's underlying factual
  determinations.  See id. at 500-01, 685 A.2d  at  665-66.  We therefore will
  not recapitulate the facts here in detail.  It suffices to note that
  husband  is seriously and permanently disabled as the result of a head
  injury and has resided at an assisted-care facility in Vermont since 1992;
  that wife had a power of attorney to manage husband's  affairs, but it was
  revoked in early 1992 after wife demanded that he not reside in the marital 
  home; and that, notwithstanding the revocation, wife spent down certain
  marital assets, took sole  title to the marital home in New York and
  refinanced the residence, receiving $112,000 in  proceeds on the house and
  half of a $34,000 brokerage account.  The family court characterized 
  wife's actions as "fraudulent" and her explanations as "unsatisfactory." 
  Id., 685 A.2d  at 666.

       To restore to husband at least part of the misappropriated assets, the
  family court initially  awarded husband a $50,000 judgment against wife in
  its divorce order.  Husband's daughters  sought such a lump-sum amount to
  enable husband to purchase an interest in a living facility 

 

  more appropriate to his physical and mental condition.  It was this order
  that we initially reversed  and that the family court amended into a part
  of the property disposition.  

       In its decision after remand, entered in its final form on June 17,
  1997,(FN1) the family  court noted that husband was in need of $100,000 up
  front to buy into the desired residential  facility. The court also took
  note that wife, still living in the marital residence, "was in need of  an
  income stream for living expenses."  Thus, the court regarded its objective
  as "to divert some  income to [wife] to help maintain her while
  transferring back to [husband a] sum which would  allow him at least a
  start towards relocation."  The court reaffirmed its previous award of 
  maintenance to wife in the amount of $1,600 per month, but gave wife a
  90-day deadline to pay  husband the $50,000 (selling the house if
  necessary) or face a suspension of the maintenance  payments until the
  $50,000 is paid.

       Further proceedings ensued.  Husband filed a motion on July 21, 1997
  seeking an order  enforcing the judgment and an order of contempt. 
  Specifically, and because he noted that in  excess of 140 days had passed
  since the court first directed wife to pay him $50,000, he asked the 
  family court to set off his maintenance obligation against the sum owed him
  by wife.  The court  agreed it had the authority to enter such an order,
  and granted the requested relief in part.  It  reduced husband's monthly
  maintenance obligation by $750 per month until such time as husband 
  thereby amassed the $50,000 plus interest, and also awarded attorney fees
  to husband.  From this  order, entered on March 23, 1998, wife filed a
  timely notice of appeal.

       Wife first contends that offsetting husband's maintenance obligation
  against the $50,000  property award runs afoul of 12 V.S.A. § 2740, which
  authorizes the taking and selling on  execution of property to satisfy a
  judgment debt but specifically exempts certain property owned  by the
  debtor.  As wife points out, among the exemptions enumerated in the statute
  is "property  traceable to or the debtor's right to receive, to the extent
  reasonably necessary for the support of  the debtor . . . alimony, support
  or separate maintenance."  Id. at (19) and (19)(D).

       This argument is without merit, based on the plain meaning of § 2740. 
  Wife is not a debtor  of husband; for present purposes she is a party who
  has been subject to the family court's  equitable powers.  See Licursi v.
  Sweeney, 157 Vt. 599, 602, 603 A.2d 342, 344 (1991) ("The  purpose of the
  statute is to afford debtors protection from the loss of property specified
  by the  Legislature as essential to living and working."); Jakab v. Jakab,
  163 Vt. 575, 585, 664 A.2d 261, 267 (1995) (court's task in divorce
  proceeding is "to equitably divide and assign" marital  property). 
  Likewise, when the family court invokes its authority to divide marital
  property and/or  to award spousal maintenance, it is not taking or selling
  goods in execution, the statutory power  conferred by § 2740 and subject to
  the exceptions enumerated therein.  Wife contends that § 2740  is
  applicable if read in pari materia with the maintenance statute, 15 V.S.A.
  § 752, 

 

  authorizing such relief when the court deems it necessary to meet the payee
  spouse's "reasonable  needs" or to maintain the payee's pre-divorce
  standard-of-living.  We apply such a rule of  construction when two
  statutes "deal with the same subject matter or have the same objective or 
  purpose."  Board of Trustees of Kellogg-Hubbard Library, Inc. v. Labor
  Relations Bd, 162 Vt.  571, 574, 649 A.2d 784, 786 (1994).  That is not the
  case here.

       Next wife takes the position that the family court's offset order runs
  afoul of established  principles of finality in the divorce context. 
  "Vermont law is clear that the [family] court cannot  modify the property
  disposition aspects of a divorce decree absent circumstances, such as fraud 
  or coercion, that would warrant relief from a judgment generally." 
  Boisselle v. Boisselle, 162  Vt. 240, 242, 648 A.2d 388, 389 (1994). 
  Modification of a maintenance award requires "a  showing of a real,
  substantial, and unanticipated change of circumstances."  15 V.S.A. § 758;
  see  Gil v. Gil, 151 Vt. 598, 599, 563 A.2d 624, 625 (1989) (noting that
  such showing is a  "jurisdictional prerequisite" with burden placed on
  party seeking modification).  We view this  situation as one in which the
  family court was not modifying its property division or maintenance  award
  but, rather, was seeking to enforce the terms of the decree as originally
  entered in the face  of intransigence by one of the parties.  See Elmore v.
  Elmore, 159 Vt. 278, 281, 617 A.2d 159,  161 (1992) (considering father's
  recalcitrant history in paying maintenance, court had authority  "to adopt
  a provision penalizing defendant for any future late payments"); see also
  Walters v.  Walters, 232 S.E.2d 240, 241 (Ga. 1977) (setoff order is not
  modification of original decree).  The court made clear in its memorandum
  decision accompanying the remand order that it would  suspend maintenance
  payments to enforce the property order, if necessary.  Although "[t]here is 
  no area of law requiring more finality and stability than family law," St.
  Hilaire v. DeBlois, ___  Vt. ___, ___, 721 A.2d 133, 136 (1998) (citation
  omitted), we know of no principle of repose that  permits a litigant to
  assert a reliance interest in her ability to thwart the terms of a divorce
  decree.

       We agree with husband that this was an appropriate use of the
  equitable remedy of setoff.  We have long-recognized a broad remedy to
  reduce the multiplicity of actions.  See Reporter's  Notes to V.R.C.P. 13;
  McLane v. Johnson, 59 Vt. 237, 243, 9 A. 837, 839 (1886).  Other courts 
  have used the remedy in situations comparable to the one before us.  See
  Walters, 232 S.E.2d  at  241; Levine v. Levine, 373 So. 2d 1380, 1382 (La.
  Ct. App. 1979) (allowing setoff between  property and alimony award because
  "she would owe him his half anyway; this method simply  allows a quicker
  settling-up on paper"); Kalter v. Kalter, 399 N.W.2d 455, 459 (Mich. Ct.
  App.  1986) (allowing setoff of property payment against support arrearage
  as a matter of equity);  Dobransky v. Dobransky, 452 N.Y.S.2d 661, 664
  (App. Div. 1982) (allowing setoff against  alimony, but not child support). 
  In looking at the relevant equities, we stress that we are dealing  with a
  setoff against maintenance, rather than against child support where the
  interest of the child  is paramount; we are addressing a liquidated amount
  for which wife's obligation to pay is  undisputed, in circumstances where
  husband has a need for timely payment; and the offsetting  payment
  obligations are interrelated in a divorce decree in order to meet the needs
  of both  spouses.

       Wife's remaining arguments can be quickly dispatched.  She complains
  that the family 
       
 

  court's key finding in its order imposing the setoff, that she had "made no
  effort whatsoever to  comply" with the order to pay husband $50,000, lacks
  support in the record.  Wife agrees that  she made no payment, but
  apparently objects to the court's characterization of the situation in
  light  of her poor health and limited resources.  We discern no error.  It
  is obvious that the court was  simply noting that a party who had defrauded
  her husband pre-divorce was ignoring her chief  obligation to him
  post-divorce, thus warranting further judicial intervention that, as wife
  herself  argues, fell short of a contempt determination with all its
  implications.

       Finally, wife complains that the family court improperly entered an ex
  parte order on  October 14, 1997, suspending husband's maintenance
  obligation pending ultimate resolution of  husband's motion for a further
  order enforcing the decree.  Reduced to its essence, this amounts  to a
  contention that, even assuming the court properly set off the maintenance
  obligation against  the unsatisfied property award, the court acted too
  soon.  The error, if any, was harmless.

       Affirmed.	






                                       BY THE COURT:



                                       _______________________________________
                                       Jeffrey L. Amestoy, Chief Justice

                                       _______________________________________
                                       John A. Dooley, Associate Justice

                                       _______________________________________
                                       James L. Morse, Associate Justice

                                       _______________________________________
                                       Denise R. Johnson, Associate Justice

                                       _______________________________________
                                       Marilyn S. Skoglund, Associate Justice


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                                  Footnotes


FN1. The court originally entered its order on February 11, 1997 and it
  thereafter granted  husband's motion to amend the decree based on matters
  that are not germane to wife's appeal.