Anthony Budzius And Monica Budzius, Appellants V. Leslie Miller, Respondent (Majority)

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FILED COURT OF APPEALS DIVISION If IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON 20140E0 30 API 9: 48 DIVISION II STATE OF WASHINGTON, ANTHONY J. BUDZIUS and 45275- MONICA BUDZIUS, husband and wife, Appellants, v. UNPUBLISHED OPINION LESLIE D. MILLER fka BUDZIUS, Respondent MELNICK, J. — vacate an amended Budzius' amendment decree s was Anthony Budziusl appeals from the trial court' s denial of his complaint to to his dissolution decree invalid because it with Leslie Miller. was not a qualified former attorney lacked authority to agree domestic to the Budzius argues that the relations order ( QDRO), and amended decree. We disagree and affirm the trial court. FACTS Budzius worked as was married a police officer to Miller for approximately 10 in Fife. years. During that time, Budzius He had a Law Enforcement Officers' and Fire Fighters' Retirement System ( LEOFF) Plan 22 retirement plan with the state. Budzius and Miller divorced in November of 1992. The decree of dissolution, as originally drafted, provided that the value of the community interest in Budzius' s retirement account was 27,210, and " a Qualified Domestic Relations Order should issue, such that [ Miller] should be awarded fifty percent ( 50 %) of said $ 27,210. 00." Ex. 3, at 4. Budzius did not pay Miller. He 1 Although Budzius' s current wife Monica is also named as an appellant, she was not involved in the relevant events and will not be discussed further. 2 RCW 41. 26. 005 -.062, RCW 41. 26. 410 -.921. 45275 -8 -II understood that at the time ofhis retirement, he would be obligated to pay half of the then -existing 27, 210 in his retirement account, or $ Throughout the dissolution proceedings, Joseph 13, 605. Lombino, attorney at law, represented Budzius. In July 1993, Lombino agreed with Miller' s attorney to amend the dissolution decree. The amended decree awarded Miller a percentage of Budzius' s retirement payments in the event that Budzius received periodic contributions or became payments. eligible for a On the other hand, if Budzius withdrew his retirement lump sum death benefit, Miller would receive the $ 13, 605 plus interest. The attorneys signed the order ex parte, allegedly without Budzius' s knowledge or Miller' s attorney did consent. indicate whether Lombino not serve the ever provided a amended decree copy to Budzius. on Budzius. The record does not Miller' s attorney deposed Lombino in an attempt to ascertain what happened, but Lombino claimed the attorney -client privilege and did not provide evidence. Budzius left his job for from the state retirement. in December medical reasons of that year. in 2008. He began receiving retirement benefits He did not pay Miller anything or inform her of his Because of an error, the state Department of Retirement Systems ( DRS) did not immediately process the amended decree. In 2011, DRS notified Budzius that he owed Miller approximately $ 600 per month from his retirement benefits. 3 DRS paid Miller $20, 682. 24 and demanded reimbursement of the same amount from Budzius. Budzius paid.DRS in full. Until DRS notified him, Budzius did not know of any obligation to make periodic payments to Miller. Since 2011, Budzius has continued to pay Miller $653. 42 per month. 3 This amount was calculated by dividing Budzius' s 115 months of marriage by his 338 total months of state employment and halving that figure, resulting in a community entitlement of 17. 012 percent of benefits. 2 45275 -8 -II PROCEDURAL HISTORY Budzius filed a complaint against Miller to vacate the amended decree and obtain reimbursement of the money paid to her from his retirement account. A bench trial ensued. Budzius' s theory of the case was that the amended decree was not a QDRO because it fundamentally altered the property distribution under the original decree of dissolution. Budzius further argued that Lombino had not been authorized to amend the decree on Budzius' s behalf., Lombino did not appear or testify at the trial. Miller argued at trial that the original decree plainly contemplated a supplemental order, and the amended decree served as that order. The court agreed and further held that Budzius had failed to carry his burden of proving Lombino had overreached his authority. The court entered judgment in Miller' s favor and declined to adjust the amended decree. Budzius appeals. ANALYSIS Although the parties raise several issues, the dispositive question in this case is whether the amended decree was enforceable. That question turns on two issues: first, whether the amended decree was properly qualified as a QDRO, and second, whether the amended decree was entered with Budzius' s authority. We hold that the amended decree did qualify as a QDRO and that Lombino had authority to agree to the amended decree on Budzius' s behalf. I. STANDARD OF REVIEW We review a trial court' s decision on a motion to vacate a judgment for abuse of discretion. Haller v. Wallis, 89 Wn.2d 539, 543, 573 P. 2d 1302 ( 1978). " A trial court abuses its discretion if its decision is manifestly unreasonable or based on untenable grounds or untenable reasons." re Marriage ofLittlefield, 133 Wn.2d 39, 46 -47, 940 P. 2d 136 ( 1997). 3 In 45275 -8 -II QDRO II. Budzius argues that the amended decree could not be considered to be a QDRO, and was thus ineffective as a modification of the property division in the original decree of dissolution. We disagree. QDROs exist under federal law and are a means to implement a court order entered in a domestic provisions of Tex. App. Budzius' Budzius argues that a QDRO may never " alter or amend the substantive relations case. s the decree." 2006)). theory 1056( d)( 3)( B)( i). Br. of Appellant at 13 ( citing Gainous v. Gainous, 219 S. W.3d 97, 107 Budzius fails to contravenes provide the plain any Washington law for his language of QDRO the proposition. statute, 29 In fact, U. S. C. § That statute defines a QDRO as " a domestic relations order (I) which creates or recognizes the existence of an alternate payee' s right to, or assigns to an alternate payee the right to, receive all or a portion of the benefits U. S. C. § 1056( d)( 3)( B)( i) ( emphasis payable with respect to a participant under a plan." 29 added). A QDRO is subject to the following statutory requirements: 1. participant' s It creates or recognizes an alternate payee' s right to receive all or a portion of a benefits payable under the plan. I.R. C. § 414( p)( 1)( A)(i); 29 U.S. C. § 1056( d)( 3)( B)( i)(I). 2. It is a judgment, decree, or order relating to the provision of child support, alimony payments, or marital property rights of a spouse, former spouse, child, or other dependent of a participant, and that is made pursuant to a state domestic relations law. I. R. C. § 414( p)( 1)( B); 29 U. S. C. § 1056( d)( 3)( B)( ii). 3. It states the name and last known mailing address of the participant and of each alternate payee. I.R.C. § 414( p)( 2)( A); 29 U. S. C. § 1056( d)( 3)( C)( i). However, the QDRO will 4 45275 -8 -II not fail to be qualified " merely because the [ QDRO] does not specify the current mailing address of the participant and alternate payee if the plan administrator has reason to know that address independently of the [ QDRO]." S. Rep. No. 98 -575, P.L. 98 -397, reprinted in 1984 U.S. C. C. A.N. 2547, 2566. It states the amount or percentage of participant' s benefit payable to each alternate 4. the payee, or manner in which the amount or percentage is to be determined. I.R. C. § 414( p)( 2)( B); 29 U.S. C. § 1056( d)( 3)( C)( ii). It sets forth the number of payments or the period over which the plan must make 5. payments to the alternate payee. I.R.C. § 414( p)( 2)( C); 29 U. S. C. § 1056( d)( 3)( C)( iii). Here, all five elements of a QDRO are met. The amended decree creates a right for Miller to receive a portion of Budzius' s benefits payable under the retirement plan. The amended decree relates to Miller' s marital property rights in Budzius' s retirement account, and it was made pursuant to a state domestic relations law. The amended decree states the names of the participant Budzius) mailing and the addresses, alternate payee ( Miller), DRS knew how to and although it does not state Budzius' s and Millers' contact them; in fact, DRS contacted both parties. The amended decree stated the manner in which the percentage due to Miller would be calculated. Finally, the amended decree set forth the period over which DRS was to pay Miller — as Budzius was receiving payments. We hold that the amended decree was a QDRO. 5 long as 45275 -8 -II AUTHORITY TO ENTER AMENDED DECREE III. Budzius argues that his prior attorney impermissibly surrendered a substantial right of Budzius' s when the attorney consented to the amended decree. Miller argues that because Budzius designated attorney Lombino to represent him, the court and the parties were entitled to rely on Lombino' s authority. Accordingly, Miller argues that Budzius failed to meet the requirements to vacate a judgment. We agree with Miller and affirm the trial court. Generally, if an attorney is authorized to appear, that attorney' s acts are binding on the client. Haller, 89 Wn.2d at 547. But the attorney' s ability to bind the client is limited: " an attorney is without authority to surrender a substantial right of a client unless special authority from his client has been granted him to do so." Graves v. P.J. Taggares, Co., 94 Wn.2d 298, 303, 616 P. 2d 1223 ( 1980) ( quoting 30 A.L. R.2d 944, 947, § 3 ( 1953)). Here, the trial court found that Lombino remained as Budzius' s attorney throughout the relevant period. While Budzius challenges this finding of fact, we will uphold challenged findings as verities on appeal Wn.2d 1, if they are supported 8, 93 P. 3d 147 ( 2004). by substantial evidence. In re Estate of Jones, 152 Substantial evidence is evidence sufficient to persuade a fair - minded person of the truth of the declared premises. Pilchuck Contractors, Inc. v. Dept. ofLabor Indus., 170 Wn. App. 514, 517, 286 P. 3d 383 ( 2012). Here, Lombino represented Budzius during the divorce proceedings and continued to represent him with regard to child support. This is sufficient evidence to persuade a fair minded person that Lombino was authorized to appear for Budzius, even if he was allegedly unauthorized to enter a specific order. We rule that the finding that Lombino was Budzius' s attorney is a verity on appeal. 6 45275 -8 -II Here, Budzius testified that he never gave Lombino authority to amend the decree of dissolution. Accordingly, we must determine whether Lombino' s action surrendered a " substantial right" of Budzius' s. Substantial rescission of the necessary for judgment ... [ at 304 -05; rights review or] App. in a by " surrendering property without securing a compromised settlement of a contract ... tort cause of action ... parental deprivation proceeding ... stipulating that the see also Will, 10 Wn. may be client is mentally ill not recording the testimony stipulating to a contingent consent without a hearing." Graves, 94 Wn.2d App. 193, 195, 563 P. 2d 1260 ( 1977); Grossman v. 141, 144, 516 P. 2d 1063 ( 1973). Graves itself involved particularly egregious Morgan v. Burks, 17 Wn. facts, in which the attorney failed to appear for a summary judgment hearing, failed to provide any evidence at trial, and failed to advise the client of a $ 131, 200 memorandum order against the client. 94 Wn.2d at 299 -300. Here, Lombino did not dispose of a claim of Budzius' s, as occurred in Morgan or Grossman. Nor did Lombino fail to appear, like in Graves. Budzius had already agreed to pay Miller, and the court merely clarified the means by which the agreed -upon payment would be made. Significantly, the original dissolution decree contemplated the entry of a supplemental order to address Budzius' s payment. While the QDRO may have required Budzius to pay more money than was contemplated in the original decree, the amount Miller received from Budzius' s periodic payments was directly proportionate to contributions Budzius made to his retirement plan while he was married to Miller. Furthermore, Budzius had ample opportunity to pay the amount owed in the decree and never did so of his own volition. While reasonable people could disagree as to whether the new payment scheme deprived Budzius of a substantial right, the trial court' s refusal to upset a 20- year -old 7 45275 -8 -II decree was not an untenable decision. The trial court did not abuse its discretion by ruling that Lombino' s acquiescence was not sufficient grounds to vacate the amended decree. Budzius raises two other challenges that we reject. First, Budzius argues that he was never given his constitutionally guaranteed right to adequate notice and opportunity to be heard before the amended decree was enforced against him. This argument fails under Haller, which holds that notice to a client that his attorney is making application to the court for some action on its part, is not a requirement of court rule and there has been no showing that it is a requirement of due process." 89 Wn.2d at 547. Second, Budzius argues that the amended decree may be vacated notwithstanding the passage of time because it was void. However, voidness is narrowly defined for CR 60 purposes. It is not inherent enough when Dep' t App. it lacks order be to be void, the order must actually exceed the erroneous — Metro. Fed. Say. & Loan Ass 'n of Seattle v. Greenacres Mem' l 695, 699, 502 P. 2d 476 ( 1972). power of Ass' n, 7 Wn. only that the This means that " a court enters a void order the court." personal jurisdiction or subject matter jurisdiction 886 P. 2d 189 ( 1994); of Labor & Indus., 125 Wn.2d 533, 541, Schneider,. 173 Wn.2d 353, 360, 268 P. 3d 215 ( 2011); Wn.2d 162, 170, 937 P. 2d 565 ( 1997). of either personal jurisdiction Kingery v. over the claim." Marley v. see also In re Marriage of Dep' t of Labor & Indus., 132 As a matter of law, Budzius cannot establish the absence or subject matter jurisdiction. Rather, "[ i]f an attorney is authorized to appear, the jurisdiction over the defendant is perfect, and the subsequent action of the attorney, 8 45275 -8 -II not induced by the fraud 89 Wn.2d 5th at party, is binding 547 ( quoting 3 E. Tuttle, A TREATISE 1925)). ed. rev. of the adverse on the OF THE client at LAW OF law and in equity." Haller, JUDGMENTS § 1252, at 2608 Because Budzius does not show that Miller committed fraud, his voidness argument fails. Although Lombino may have acted against Budzius' s interest when he entered into the amended decree, the court and Miller were authorized to rely on Lombino' s representation of Budzius, and Lombino' s acts will be imputed to Budzius. Budzius is free to pursue a remedy against Lombino for exceeding his authority, but he has failed to show that the trial court abused its discretion by declining to vacate the amended decree. We affirm the trial court. IV. ATTORNEY FEES Both parties request reasonable attorney fees if they are successful. Miller argues that she is entitled to fees because Budzius' s appeal is frivolous. Although we agree with Miller on the merits, we decline to award fees. An appeal is frivolous "' if there are no debatable issues upon which reasonable minds might differ, and it is so totally devoid of merit that there was no reasonable possibility of reversal. "' Tiffany Family Trust Corp. v. City ofKent, 155 Wn.2d 225, 241, 119 P. 3d 325 ( 2005) quoting Green River 730 P. 2d 653 ( 1986)). Cmty. Coll. Dist. No. 10 v. Higher Educ. Pers. Bd., 107 Wn.2d 427, 443, All doubts as to whether an appeal is frivolous should be resolved in favor of the appellant. Tiffany, 155 Wn.2d at 241. Resolving all doubts in Budzius' s favor, we rule that his arguments —while not convincing —are not frivolous either. Budzius' s position arguably has support in Graves. Accordingly, we deny Miller' s request for reasonable attorney fees. 9 45275 -8 -II We affirm the trial court. A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2. 06. 040, it is so ordered. We concur: 1 orgen., A.C. J. 10

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