Opinion
14-P-1497
04-22-2016
ELIZABETH W. KURTIN v. ABNER B. KURTIN.
NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
In this appeal from an amended modification judgment of the Probate and Family Court, Elizabeth W. Kurtin (wife), the former wife of Abner B. Kurtin (husband), challenges the alimony award and the lack of an order regarding the payment of the children's college expenses. We address the wife's arguments in turn.
1. Alimony. The parties were married in 1994, and for nearly all of the marriage, the husband was the sole wage-earner. In 1998, the husband started a hedge fund, which "generated an enormous amount of income for the family." Between 2005 and 2008, the husband earned more than $70 million, which enabled the parties to live "a lavish upper-class lifestyle." In December of 2007, the parties divorced pursuant to an agreement which, among other things, provided the wife with approximately $4.8 million in net assets and required the husband to pay the wife a percentage of his "earned" income as alimony. Following the divorce, instead of earning income through employment, the husband generated income by investing his assets. This enabled him to "maintain an upper-class lifestyle" and avoid making any alimony payments to the wife for approximately five years. During this period, the wife continued to maintain an upper-class lifestyle, which she funded almost entirely with the assets that she received in the divorce. The wife eventually sought modification of the husband's alimony obligation. However, by the time of the modification trial in 2013, the wife had already depleted her entire $4.8 million divorce settlement.
During the prior two years, the husband earned approximately $1 million annually working for another hedge fund.
The modification judge found that the husband had intentionally avoided his alimony obligation by ensuring that his postdivorce income fell outside the definition of "earned" income set forth in the separation agreement. The judge therefore found it necessary to "eliminate all of the provisions in the [separation agreement] regarding the payment of alimony" and attribute investment income to the husband of $396,036 per year. The judge ordered the husband to pay thirty-three percent of his attributed income to the wife, resulting in a weekly alimony payment of $2,513. In arriving at the $396,036 attributed income figure, the judge took the husband's total assets valued at $12,720,712, deducted the $4.8 million in assets that she found the wife had "negligently depleted," and then applied a five percent annual interest rate of return to the difference ($7,920,712). On appeal, the wife principally challenges the judge's conclusion that she "negligently depleted" her entire $4.8 million divorce settlement. The wife argues that this conclusion, which resulted in a "drastically" reduced alimony award, is contradicted by the judge's own subsidiary findings and fails to take into account the wife's "legitimate" expenses. We agree.
The judge then deducted the husband's weekly child support payment of $465, for a net weekly alimony payment of $2,048.
While we have concerns regarding the judge's method for determining the husband's income and alimony obligation, the wife has not challenged that methodology on appeal.
While a Probate and Family Court judge enjoys broad discretion when fashioning a support award, she must "keep in mind that 'the statutory authority of a court to award alimony continues to be grounded in the recipient spouse's need for support and the supporting spouse's ability to pay.'" Pierce v. Pierce, 455 Mass. 286, 296 (2009), quoting from Gottsegen v. Gottsegen, 397 Mass. 617, 624 (1986). "If a supporting spouse has the ability to pay, the recipient spouse's need for support is generally the amount needed to allow that spouse to maintain the lifestyle he or she enjoyed prior to termination of the marriage." Pierce, supra.
As the divorce judgment establishing the husband's original alimony obligation entered prior to the effective date of the Alimony Reform Act of 2011, see St. 2011, c. 124, inserting G. L. c. 208, §§ 48-55, we apply "the standards for modification existing at the time the judgment entered . . . ." Chin v. Merriot, 470 Mass. 527, 535 (2015).
In this case, the judge found that the husband "can derive sufficient income from his investments in order to meet his expenses and [the wife's] reasonable expenses." However, the judge made no findings as to which of the wife's expenses were "reasonable." On this record, therefore, we cannot determine whether the judge adequately considered the wife's needs. See Adlakha v. Adlakha, 65 Mass. App. Ct. 860, 869 (2006) ("Without the benefit of the judge's fact finding regarding the [recipient spouse's] reasonable needs, we must speculate to discern the basis for the [alimony] figure"). This is especially troubling as the wife's reported expenses of $7,730 per week are over 300 percent of the husband's weekly alimony payment.
We note that the judge found the wife capable of working and contributing to her own support; however, the judge also found that the wife had been out of the workforce since 1997. Accordingly, "the emphasis on the wife's earning capacity . . . is not appropriate." Goldman v. Goldman, 28 Mass. App. Ct. 603, 610-611 (1990).
Moreover, the alimony award is "not consistent with the judge's findings . . . concerning the couple's previously elaborate life-style," or concerning the parties' postdivorce lifestyles. Goldman v. Goldman, 28 Mass. App. Ct. 603, 608 (1990). The judge criticized the wife's postdivorce spending and found that she had "made little efforts to reduce her living expenses." This conclusion is contradicted by the judge's own subsidiary findings, which reveal that the wife had actually decreased her expenses by approximately sixty percent by the time of the modification trial. While the wife's spending may not have been prudent, it reflected the lavish upper-class lifestyle enjoyed by the parties during the marriage. "That the judge might not have approved of the parties' life-style is irrelevant." Id. at 611. Moreover, the judge also found that the husband "has made little effort to curb his spending and has taken no steps to diminish his lifestyle." "Absent good reason, in a long term marriage, there is no justification for the life-style of one spouse to go down while the other remains high." Ibid. While the parties were living relatively commensurate upper-class lifestyles at the time of the modification trial, it does not appear that the current alimony award will enable the wife to maintain that lifestyle going forward.
At the time of the divorce in 2007, the wife reported having expenses of approximately $20,248.46 per week ($1,052,919.90 per year). In contrast, on her April, 2013, financial statement, the wife reported having expenses of approximately $7,730 per week ($401,960 per year).
On his April, 2013, financial statement, the husband reported having weekly expenses of approximately $7,974 ($414,648 per year), which was slightly higher than the wife's reported weekly expenses. Moreover, the judge specifically found the husband's financial statement to be fraudulent, and concluded that his expenses were likely much higher than what he had reported.
In sum, the award of alimony does not reflect adequate consideration of the wife's needs, and it is inconsistent with the judge's findings regarding the parties' lifestyle during, and after, the marriage. On this record, we cannot say that the judge's "reasons for [her] conclusions are 'apparent and flow rationally' from [her] findings and rulings." Baccanti v. Morton, 434 Mass. 787, 790 (2001), quoting from Williams v. Massa, 431 Mass. 619, 631 (2000). Accordingly, we vacate the alimony award and remand the matter for further findings as to the wife's need for alimony, including, but not limited to, a redetermination of her "reasonable" expenses, which should be measured, at least in part, by the parties' station in life during the marriage. See Goldman, supra at 612. The judge may reenter an alimony award upon making such additional findings.
2. College expenses. The wife argues that the judge erred by declining to include a provision in the amended modification judgment regarding the payment of college expenses for the parties' children. Child support orders are reviewed for an abuse of discretion. See J.S. v. C.C., 454 Mass. 652, 660 (2009). Generally, "support orders regarding the future payment of post-high school educational costs are premature and should not be made" until the child is already attending, or is about to attend, college. Passemato v. Passemato, 427 Mass. 52, 54 (1998), citing Doe v. Roe, 32 Mass. App. Ct. 63, 69-70 (1992). Here, while the judge arguably could have made an order for the payment of college expenses, given that the parties' eldest daughter was a high school senior at the time of trial, it was not an abuse of discretion for the judge to decline to do so. See Massachusetts Child Support Guidelines § II.F (2013) ("Contribution to college costs is not presumptive"). Moreover, the parties' separation agreement provides a mechanism for determining their respective contributions to the children's college expenses. Accordingly, we discern no error in the judge's decision to refrain from making an order regarding the payment of college expenses.
If the parties are unable to agree regarding the payment of college expenses, they may submit their dispute to a mediator or to the Probate and Family Court.
3. Appellate fees and costs. The wife seeks an award of appellate attorney's fees and costs. We allow the request to proceed for reasonable fees and costs related to the wife's successful challenge of the alimony award, but not with respect to her unsuccessful challenge regarding college expenses. See Eldim, Inc. v. Mullen, 47 Mass. App. Ct. 125, 131 (1999). Within fifteen days of the date of this decision, the wife shall file with this court and serve on the husband a motion to determine her appellate legal fees and costs, along with a detailed supporting affidavit of counsel, in accordance with the procedure described in Fabre v. Walton, 441 Mass. 9, 10-11 (2004). The husband may file an opposition to the wife's request within fifteen days thereafter.
Conclusion. For the foregoing reasons, we vacate so much of the amended modification judgment as pertains to alimony, and remand the case to the Probate and Family Court for further proceedings consistent with this memorandum and order. The amended modification judgment is affirmed in all other respects. Pending final disposition, the judge shall make a temporary order for the payment of alimony as she may deem appropriate. Attorney's fees and costs for this appeal will be awarded as set forth above.
To the extent that we do not address the parties' other contentions, "they 'have not been overlooked. We find nothing in them that requires discussion.'" Department of Rev. v. Ryan R., 62 Mass. App. Ct. 380, 389 (2004), quoting from Commonwealth v. Domanski, 332 Mass. 66, 78 (1954).
So ordered.
By the Court (Cypher, Grainger & Meade, JJ.),
The panelists are listed in order of seniority. --------
/s/
Clerk Entered: April 22, 2016.