Pouech v. Pouech (2004-423); 180 Vt. 1; 904 A.2d 70
2006 VT 40
NOTICE: This opinion is subject to motions for reargument under
V.R.A.P. 40 as well as formal revision before publication in the Vermont
Reports. Readers are requested to notify the Reporter of Decisions,
Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
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2006 VT 40
Natacha Pouech Supreme Court
On Appeal from
v. Chittenden Family Court
Phillip Pouech November Term, 2005
Mark J. Keller, J.
John R. Durrance, Jr. of Gaston, Durrance & Fairbanks, Montpelier, for
Christopher L. Davis and Devin McLaughlin of Langrock Sperry & Wool, LLP,
Burlington, for Defendant-Appellee.
PRESENT: Reiber, C.J., Dooley, Johnson and Skoglund, JJ., and
Allen, C.J. (Ret.), Specially Assigned
¶ 1. REIBER, C.J. Wife appeals the family court's decision
refusing to allow her to amend her divorce complaint to seek maintenance.
We conclude that the family court applied the wrong standard in determining
whether to consider her request for maintenance in light of the stipulated
settlement that the parties had filed. Accordingly, while we affirm the
divorce decree, we reverse the family court's August 5, 2004 decision and
remand the matter for the court to reconsider wife's maintenance request
and whether to accept or reject the parties' stipulation in whole or in
¶ 2. The parties were married in 1981 and separated in 2003. They
have three children, born in October 1982, May 1986, and February 1993.
After the parties separated, they negotiated a settlement between
themselves with the help of a mediator and then a lawyer, who assisted both
parties in finalizing a stipulation drafted by husband. The lawyer advised
the parties to consult independent counsel. Husband did, but wife did not.
On October 20, 2003, the parties signed a document entitled "Stipulation
for Temporary and Final Order and Decree of Divorce." The document
contains twenty-five paragraphs that deal with, among other things,
parental rights and responsibilities, child support, marital property, and
marital debt. The agreement is silent with respect to maintenance.
¶ 3. On October 27, 2003, one week after the document was signed,
wife filed the parties' stipulation along with her divorce complaint. She
did not check the box on the complaint form that would have indicated she
was seeking maintenance. Approximately five months later, before the final
divorce hearing, an attorney entered an appearance on behalf of wife and
filed a motion to amend the complaint to allow wife to seek maintenance.
Husband opposed the motion, arguing that the court should not permit wife
to present evidence on the issue of spousal maintenance, and, in the
alternative, that maintenance should not be awarded because the stipulation
was not inequitable. Over two days in late May 2004, the court held a
hearing on wife's motion, and both parties testified.
¶ 4. At the hearing, wife's attorney stated that wife was not
asking the court to set aside the whole stipulation. Nevertheless, when
the court expressed its belief that opening up the issue of maintenance
would effectively require it to consider all financial aspects of the
parties' divorce, wife's attorney still insisted that wife wanted
maintenance, even if it meant that the stipulation would have to be set
aside. On direct examination, wife stated that she knew she had a right to
maintenance, but did not ask for it when the parties negotiated the
stipulation because of feelings of guilt about leaving her family. Husband
testified that wife told him she did not expect him to pay her anything.
In a post-hearing memorandum in support of her motion to amend, wife argued
that the stipulation should be interpreted to allow her to request
maintenance, and that, in the alternative, there was a mutual mistake
regarding the issue of maintenance. The principal thrust of her first
argument was that, although the parties' stipulation was a binding
contract, the absence of any provision on maintenance did not permit the
court to assume that the parties had an agreement regarding maintenance.
She also contended, however, that the family court had an independent
obligation to assure that the stipulation was equitable.
¶ 5. Following the hearing, in an August 2004 order, the family
court denied wife's motion to amend. In arriving at its decision, the
court noted that wife's attorney had explicitly indicated that wife was not
seeking to set aside the agreement on the grounds that its terms were
unfair or unconscionable, but rather was arguing only that: (1) because the
agreement was silent on the issue of maintenance, the court had the
authority to impose maintenance; and (2) the court could void the agreement
based on mutual mistake. With respect to wife's mutual mistake argument,
the court found that wife knew she had a right to maintenance but did not
ask for it, and that even if she had mistakenly believed she could seek
maintenance at the final divorce hearing notwithstanding the absence of a
provision on maintenance in the parties' stipulation, it was a unilateral
mistake on her part. Further, the court found that the parties intended
their stipulation to be a final, complete resolution of their divorce and
that the stipulation unambiguously omitted any mention of maintenance.
Hence, the court refused to allow wife to seek maintenance over and above
the terms of the agreement. On August 26, 2004, the court entered a decree
of divorce incorporating the parties' stipulation into the final order.
Wife appeals, raising several interrelated arguments.
¶ 6. Wife first argues that, by stating in their stipulation that
the terms and conditions of the agreement "may constitute the basis for" a
final order and decree of divorce, the parties intended to resolve only
those matters explicitly dealt with in the stipulation, but not to the
exclusion of other unmentioned matters over which the court had
jurisdiction. According to wife, the stipulation's silence on the issue of
maintenance demonstrated that the parties had not come to any agreement on
that issue, and therefore the court was free to consider it.
¶ 7. We reject this argument because it is contrary to the family
court's findings and conclusions, which are supported by the evidence.
The court found that wife knew she had a right to maintenance, but
nevertheless did not ask for it in the stipulation, and that the parties
intended the stipulation to be a complete, final agreement on their
divorce. (FN1) Both the language of the parties' stipulation and the
circumstances surrounding its execution support the court's determination
that the stipulation unambiguously excluded maintenance as part of the
parties' intended final divorce settlement. See Isbrandtsen v. N. Branch
Corp., 150 Vt. 575, 579, 556 A.2d 81, 84 (1988) (court may consider
circumstances surrounding making of agreement in determining whether
agreement is ambiguous).
¶ 8. The evidence showed that: (1) the parties signed a
twenty-five-paragraph agreement entitled "Stipulation for Temporary and
Final Order and Decree of Divorce," which dealt with parental rights and
responsibilities, child support, marital property, and marital debt; (2)
wife filed the stipulation along with her divorce complaint, in which she
did not check the box indicating that she was seeking maintenance; (3) wife
testified that she knew she had a right to maintenance but did not ask for
any because she felt guilty for having left her family; and (4) husband
testified that wife indicated to him that she did not expect him to pay her
anything. Given this evidence, the family court did not err in determining
that the parties' stipulation unambiguously represented a comprehensive
agreement on their divorce. Cf. Meier v. Meier, 163 Vt. 608, 609, 656 A.2d 212, 213 (mem.) (1994) (finding no ambiguity in separation agreement that
was silent with respect to maintenance).
¶ 9. Further, wife's reliance on the language "may constitute the
basis for" in the stipulation is misplaced. Use of the word "may" merely
recognized the family court's ultimate authority to resolve matters
concerning the parties' divorce and had nothing to do with whether the
parties intended their agreement to be final and comprehensive.
¶ 10. Next, wife argues that the family court was obligated to
determine whether the parties' stipulation was fair and equitable before
incorporating it into its final divorce order. Along these lines, wife
also argues that the court should have assured itself that the provisions
of the stipulation were within the general parameters of other cases
involving similarly situated individuals. According to wife, the instant
stipulation provides her with far less than what other litigants have
received in comparable situations. Wife contends that if the court had
made adequate findings, it would have concluded that the parties'
stipulation was unfair and inequitable. Husband responds that wife waived
this argument by expressly disavowing it below and by failing to present
evidence to back it up.
¶ 11. Before addressing the substance of wife's argument, we reject
husband's contention that wife waived it. To be sure, wife stated at the
hearing on her motion to amend that she was not asking the family court to
set aside the parties' entire stipulation or claiming that the stipulation
was unconscionable. She also acknowledged in her follow-up memorandum of
law that the final stipulation was a binding contract between the parties.
Nevertheless, when the family court warned her at the hearing that her
request for maintenance would most likely require it to open up all aspects
of the financial matters contained in the parties' stipulation, she
acknowledged that possibility. Further, she argued in her memorandum of
law that the family court had an obligation, before the final judgment
issued, to consider her request for maintenance, regardless of whether its
absence in the stipulation was by mistake or design. In making this
argument, wife noted that a separation agreement is fundamentally different
from a regular contract because it concerns a relationship that is
sanctioned, promoted, and protected by the state. Thus, according to wife,
the court had an obligation to consider her request for maintenance as
allowed under 15 V.S.A. § 752.
¶ 12. Moreover, wife cited Vermont case law for the proposition
that the family court is not bound by the parties' stipulation with respect
to maintenance, and husband conceded this point in his memorandum of law,
acknowledging that it was for the court to determine whether any inequity
would result from enforcement of the agreement. For his part, husband
briefly explained why he believed the agreement was equitable, and wife set
forth reasons in her memorandum why she believed the agreement was not
equitable. Presented with these arguments, the trial court wrestled with
questions concerning the extent to which it was free to review the parties'
stipulation and consider wife's request for maintenance. Under the
circumstances, we find no waiver of wife's argument that the family court
had an obligation to determine whether the parties' agreement was equitable
before incorporating it into the final divorce order. See Bull v. Pinkham
Eng'g Assocs., 170 Vt. 450, 459, 752 A.2d 26, 33 (2000) ("In order to
effectively raise an objection, a party must present the issue with
specificity and clarity in a manner that gives the factfinder a fair
opportunity to rule on it.").
¶ 13. We now turn to the substance of that argument. We start by
examining our case law on this subject, which is open to various
interpretations. On several occasions, including in a recent case, this
Court has cited Hall v. Hall, 124 Vt. 410, 411-12, 206 A.2d 786, 787-88
(1964) for the proposition that "in matters of maintenance, the family
court is not bound by a stipulation of the parties." Boisclair v.
Boisclair, 2004 VT 43, ¶ 8, 176 Vt. 646, 852 A.2d 617 (mem.); see Hopkins
v. Hopkins, 130 Vt. 475, 477, 296 A.2d 266, 268 (1972) (citing Hall for
proposition that divorce court is "not bound by the stipulation between the
parties" regarding alimony); Segalla v. Segalla, 129 Vt. 517, 532, 283 A.2d 237, 245 (1971) (citing Hall for proposition that parties' stipulation,
upon which temporary order is based, need not be honored by trial court in
its final divorce decree); Frink v. Frink, 128 Vt. 531, 533, 266 A.2d 820,
822 (1970) (citing Hall for proposition that "in Vermont, courts may also
make an order regarding alimony contrary to the terms of a stipulation
between the parties").
¶ 14. Yet, on at least one occasion, we have also questioned the
scope of our holding in Hall. In Strope v. Strope, 131 Vt. 210, 217-18,
303 A.2d 805, 810 (1973), we noted that the Court in Hall upheld the trial
court's rejection of a written stipulation that was supposed to
memorialize, but in fact was inconsistent with, the parties' previous oral
stipulation that had been accepted by the trial court. In Strope, we also
distinguished other cases in which we held that the trial court had the
authority to reject stipulations, suggesting that the trial court's
authority was limited by the particular facts and circumstances of those
cases, one of which concerned child custody, Martin v. Martin, 127 Vt. 313,
248 A.2d 723 (1968), and the other a temporary order, Segalla, 129 Vt. 517,
283 A.2d 237. Strope, 131 Vt. at 218, 303 A.2d at 810.
¶ 15. In Strope, although the wife indicated in response to direct
questioning from the court that she was satisfied with the parties'
stipulation, the trial court increased the wife's maintenance payments
after expressing its dissatisfaction with the stipulation. Noting that the
stipulation was uncontested, this Court stated that the trial court could
not reject the agreement merely because it was dissatisfied with it, but
rather had to state a compelling reason for rejecting it. Id. at 216, 303 A.2d at 809. In so holding, the Court cited several standards for
reviewing stipulations, including a standard employed in an earlier case
involving an action to enforce payments pursuant to a separation
agreement-whether the agreement was the result of collusion, fraud, or
duress. Id. at 217, 303 A.2d at 809 (citing Cleary v. LaFrance, 109 Vt.
422, 199 A. 242 (1938)). The Court also suggested that it was irrelevant
that the parties' stipulation had not yet been incorporated into an order.
Id. at 217, 303 A.2d at 810. Ultimately, the Court reinstated the parties'
agreement because the evidence established that it was "fair and just."
Id. at 218, 303 A.2d at 810; see Hopkins, 130 Vt. at 478, 296 A.2d at 268
(overturning trial court's decision to require additional payments to wife
where evidence indicated that parties' uncontested stipulation was "fair
¶ 16. Since Strope, this Court has continued to send mixed messages
as to the standard for reviewing stipulations made in anticipation of
divorce. See Boisclair, 2004 VT 43, ¶¶ 5, 8 (noting that pretrial
agreements are contracts that can be set aside only on grounds sufficient
to set aside contract, but also citing Hall for proposition that family
court is not bound by parties' stipulation regarding maintenance). Compare
Lewis v. Lewis, 149 Vt. 19, 22, 538 A.2d 170, 172 (1987) ("The court is not
bound by stipulations between the parties, but acts within its discretion
in making a different disposition of the property based on evidence before
it."), with Bendekgey v. Bendekgey, 154 Vt. 193, 197, 576 A.2d 433, 435
(1990) ("A pretrial agreement to distribute property is a contract, which
the court can set aside only for grounds sufficient to set aside a
¶ 17. Regarding policy considerations, on the one hand, we have
assumed that agreements reached by the parties are preferable to those
imposed by a stranger to the marriage-the court. Kanaan v. Kanaan, 163 Vt.
402, 413, 659 A.2d 128, 135 (1995); Bucholt v. Bucholt, 152 Vt. 238, 241,
566 A.2d 409, 411 (1989). On the other hand, we have recognized that
stipulations in anticipation of divorce do not necessarily deprive the
family court of its statutorily authorized independent role in distributing
the assets of divorcing couples. See Poulin v. Upham, 149 Vt. 24, 28, 538 A.2d 181, 183 (1987) ("Even if there had been a stipulation between the
parties the court would have to make an independent determination of
whether the distribution is equitable."); Rudin v. Rudin, 132 Vt. 30, 33,
312 A.2d 736, 738 (1973) (given that court in divorce action has right
under 15 V.S.A. § 751 to decree a just and equitable division of property,
"the court was not bound by the parties' property stipulation, but was
within its discretion in making a new disposition of the property under the
evidence before it"); (FN2) cf. Manosh v. Manosh, 160 Vt. 634, 636, 648 A.2d 833, 836 (mem.) (1993) ("Where there is no § 751 motion, however, the
family court has no independent obligation to review an agreement unless it
is submitted by the parties to be incorporated in the divorce order.").
¶ 18. Significantly, we have emphasized a strict contractual
standard for reviewing divorce stipulations most often in situations where
the parties' stipulation was uncontested at trial. E.g., Damone v. Damone,
172 Vt. 504, 512, 782 A.2d 1208, 1214 (2001); Strope, 131 Vt. at 216, 303 A.2d at 809. But see Bendekgey, 154 Vt. at 196-99, 576 A.2d at 435-36
(declining to overturn agreement husband contested at trial because husband
failed to prove grounds sufficient to overturn contract). For example, in
Damone, after the divorce complaint was filed, the parties executed an
agreement dividing a personal injury settlement attributable to husband's
accident during the marriage. Although "both parties testified that they
wanted the terms of the agreement to control distribution of the settlement
proceeds, and the court to enforce that agreement," Damone, 172 Vt. at 512,
782 A.2d at 1214-15, the trial court refused to enforce the agreement but
instead distributed the settlement proceeds more favorably to the wife.
After stating that the parties' agreement controls unless a challenger
demonstrates that it should be set aside on grounds sufficient to set aside
a contract, we concluded that because "the court failed to adhere to an
unchallenged property distribution agreement, and failed to timely notify
the parties of its intent to do so, the court's distribution of the
settlement proceeds contrary to the parties' agreement was an abuse of
discretion." Id. at 512, 782 A.2d at 1215 (emphasis added).
¶ 19. In contrast, in the instant case, wife challenged the
parties' stipulation before the family court approved it, held a final
divorce hearing, or incorporated it into a final divorce order. Although
wife primarily wanted the court to consider her maintenance request without
disturbing the stipulation, the court recognized the impossibility of doing
so, and wife still wanted to go forward with her request for maintenance.
Under these circumstances, we conclude that the family court erred by
refusing to consider wife's maintenance request because of her failure to
prove duress, unconscionable advantage, or another basis for overturning a
contract. Rather, the court should have given the parties an opportunity
to present evidence on the fairness of their stipulation. Based on the
evidence presented by the parties, the court had the discretion to reject
the stipulation on grounds that it was inequitable in light of the relevant
¶ 20. Once a stipulation is incorporated into a final order,
concerns regarding finality require that the stipulation be susceptible to
attack only on grounds sufficient to overturn a judgment. See Bucholt, 152
Vt. at 241, 566 A.2d at 411 (holding that unchallenged stipulations
accepted by trial court and incorporated into final divorce order are
presumed to be fair, formal, and binding on parties); see also Guthrie v.
Guthrie, 594 S.E.2d 356, 358 (Ga. 2004) (noting that trial court has
discretion to reject settlement agreement before it becomes judgment of
court). Further, after the close of evidence at a final hearing in which
the parties have submitted a stipulation to the court for inclusion into a
final order, considerations of judicial economy favor requiring a party who
wishes to challenge the stipulation before issuance of the final judgment
to establish grounds sufficient to overturn a contract. Cf. Putnam v.
Putnam, 166 Vt. 108, 112-13, 689 A.2d 446, 448-49 (1996) (stating that
court-approved stipulation challenged after attorneys were directed to
prepare written order could be set aside only on grounds sufficient to set
¶ 21. Before then, however, if one or both parties object to a
previous agreement made in anticipation of divorce, the policy
considerations that favor deference to the parties' "voluntary" agreement
are less forceful. Cf. Leighton v. Leighton, 261 N.W.2d 457, 461 (Wis.
1978) (holding that stipulations in advance of trial cannot subscribe or
oust court of its authority to resolve matters in divorce proceedings, and
concluding that trial court would not abuse its discretion by refusing to
recognize stipulation repudiated by one of parties). By the same token,
under such circumstances, the policy considerations recognizing the family
court's role in resolving marital disputes in contested divorce proceedings
¶ 22. Accordingly, we hold that in a situation such as the instant
case, when parties have executed a stipulation in anticipation of divorce
regarding maintenance or the division of marital property, but one or both
of the parties challenge the stipulation before the family court has held a
final hearing or incorporated the stipulation into a final divorce order,
the court may reject the stipulation even if the challenging party fails to
demonstrate grounds sufficient to overturn a contract. Of course, it is
imperative that the court provide adequate findings as to why it has chosen
to reject or accept the stipulation. To the extent that prior case law is
contrary to this holding, that case law is overruled.
¶ 23. In determining whether to reject the stipulation, the family
court should consider all of the circumstances surrounding execution of the
stipulation. The family court is not obligated to reject a stipulation
merely because the agreement does not divide the marital property or
provide maintenance precisely in the manner or the amount that it would
have had the agreement not existed. See In re Marriage of Ask, 551 N.W.2d 643, 646 (Iowa 1996) (noting that trial court, to uphold consent decree,
need not necessarily conclude that it would have arrived at same result if
it were adjudicating controversy). Rather, the question is one of fairness
and equity viewed from the perspective of the standards and factors set
forth in our divorce statutes. If the parties' agreement is inequitable in
light of those standards and factors, the family court is not compelled to
accept the agreement simply because the challenging party cannot establish
a formal contractual defense such as duress or unconscionable advantage.
Further, the family court's determination that an agreement is unfair or
inequitable is discretionary, and thus we review its decision to reject or
accept a stipulation under an abuse-of-discretion standard.
¶ 24. Our holding is based on the simple truth that an agreement in
anticipation of divorce is not the same as any ordinary contract. Public
policy favors parties settling their own disputes in a divorce, but, as
noted, the family court has a statutorily authorized role to play in
divorce proceedings to assure a fair and equitable dissolution of the
state-sanctioned institution of marriage. See Croote-Fluno v. Fluno, 734 N.Y.S.2d 298, 299 (App. Div. 2001) (recognizing that separation agreements
are held to higher standard of equity than other contracts). This is
particularly true when one or both parties challenge the fairness of
agreements that are often made under trying and emotional circumstances.
Cf. In re Marriage of Bisque, 31 P.3d 175, 178 (Colo. Ct. App. 2001)
(stating that "conscionability standard applicable to separation agreements
is different because of the public policy concern for safeguarding the
interests of a spouse whose consent to the agreement may have been obtained
under more emotionally stressful circumstances") (internal quotations
¶ 25. Wife claims on appeal that the absence of maintenance in this
case is manifestly inequitable, given the length of the marriage, her role
as primary care giver during the marriage, and the wide disparity between
the parties in income and earning capacity. See Delozier v. Delozier, 161
Vt. 377, 382-83, 640 A.2d 55, 57-58 (1994) (citing relevant factors for
determining amount and duration of maintenance). Because the parties at
the hearing on wife's motion to amend focused primarily on whether the
family court could consider wife's request for maintenance rather than on
whether their underlying agreement was equitable, and because the family
court should consider, in the first instance, the fairness of the parties'
agreement, we remand the matter for the court to reconsider wife's request
for maintenance and the parties' agreement.
¶ 26. On remand, the family court need not consider husband's
suggestion that wife should be precluded from objecting to the parties'
stipulation because she ratified it by accepting half of husband's pension
funds and by having husband refinance the mortgage on the marital home to
relieve her of any further debt obligations associated with the property.
Rather than negating the family court's authority to reject the agreement,
any prior implementation of the agreement by the parties merely requires
the court, should it reject the agreement, to consider the financial
consequences of the parties' actions in equitably distributing the parties'
assets. See Rudin, 132 Vt. at 32-33, 312 A.2d at 738 (rejecting contention
that divorcing parties' implementation of their property agreement was
binding on divorce court); Leighton, 261 N.W.2d at 461 (concluding that
parties' partial implementation of their agreement did not alter trial
court's authority to reject it, but only made determination of equitable
division of marital assets more difficult).
The parties' divorce decree is affirmed, but the family court's August
5, 2004 decision is reversed, and the matter is remanded for the court to
reconsider wife's maintenance request and whether to accept or reject the
parties' stipulation in whole or in part.
FOR THE COURT:
FN1. We also find unavailing wife's contention that although the court's
decision makes it clear what was decided, one cannot discern from the
decision what facts were relied on because the court made only limited
findings. Wife did not request findings, see V.R.C.P. 52(a) (trial court
shall make findings upon request of party), and, in any event, the court
plainly indicated how it reached its decision. See Maurer v. Maurer, 2005
VT 26, ¶ 12, 16 Vt. L. Wk. 53, 872 A.2d 326 (major purpose of findings is
to enable appellate court to determine how trial court reached its
decision); Chaker v. Chaker, 147 Vt. 548, 549, 520 A.2d 1005, 1006 (1986)
(where findings are neither requested nor made, appellate court will assume
that trial court had evidence in mind and will examine record to see if
result is supportable).
FN2. In considering the family court's statutorily authorized role in
resolving marital disputes, we do not find it significant that 15 V.S.A. §
751(a) provides that the court "shall" settle the property rights of the
parties upon motion of either party, while 15 V.S.A. § 752 provides that
the court "may" order either spouse to pay maintenance. The fact that the
family court has the discretion to award maintenance does not diminish its
role in resolving the parties' financial matters, which may require a