Summary
In Zeer, the judgment of divorce provided that any amount in excess of $365,000 received from the sale of the marital residence would be divided equally between the parties.
Summary of this case from Heugel v. HeugelOpinion
Docket No. 105572.
Decided August 21, 1989.
Michael S. Friedman, for plaintiff.
Lawrence Schultz, for defendant.
Before: BEASLEY, P.J., and WEAVER and CAVANAGH, JJ.
Defendant, Hikmat Meaka Zeer, appeals as of right from an order dated December 9, 1987, modifying the property settlement provisions of his 1986 divorce.
The parties were divorced in a default judgment dated July 16, 1986. With respect to property settlement, the judgment, inter alia, awarded the marital residence to plaintiff, Nadia Zeer, and provided that
at such time as the Plaintiff shall sell the marital residence then, after first deducting reasonable and necessary costs of sale, the Plaintiff shall be entitled to keep any sums so realized up to the amount of THREE HUNDRED SIXTY FIVE THOUSAND AND 00/100 ($365,000.00) DOLLARS. Any net sums realized from the sale of said residence in excess of $365,000.00 shall be divided equally between the Plaintiff and the Defendant at the time the sale is consummated.
Defendant was ordered to pay the taxes on the property and "to pay and hold the Plaintiff harmless from any liability for any encumbrances against" the residence.
During the ensuing months, defendant fell in arrears on his payment of alimony and child support per the terms of the divorce judgment. Accordingly, on November 10, 1986, the court, on plaintiff's motion, appointed a receiver to carry out the sale of certain real property that had been awarded to defendant under the divorce judgment, the proceeds to be applied to the arrearages.
On January 14, 1987, the court suspended the receivership conditioned upon defendant's tendering the money owed to plaintiff before May 3, 1987. The court further ordered that
the Defendant shall completely discharge any lien existing on the former marital residence in favor of Michigan National Bank or its assignee, and the Defendant shall at the time of closing on the sale of any of his business interests make a substantial payment to reduce the principal owing to Michigan National Bank as described in the Judgment of Divorce in the event of his enability [sic] to fully pay and discharge said obligation.
Defendant subsequently sold a parcel of land awarded to him under the terms of the divorce judgment for the sum of $1.25 million. Nevertheless, defendant apparently failed to thereupon pay off the mortgage on the marital residence. In response, plaintiff moved to amend the divorce judgment so as to delete that portion of the property settlement entitling defendant to receive one-half of any net proceeds arising from the sale of the marital residence in excess of $365,000. The trial court granted the motion by an order dated December 9, 1987.
On appeal, defendant argues that the trial court erred in ordering modification. We agree. Property settlement provisions of a divorce judgment, unlike alimony or child support provisions, are final and, as a general rule, cannot be modified. However, as with all final judgments, a party may seek relief from the property settlement provisions of a divorce judgment under MCR 2.612(C). That subrule provides, in pertinent part, as follows:
Colestock v Colestock, 135 Mich. App. 393, 397; 354 N.W.2d 354 (1984); Bers v Bers, 161 Mich. App. 457, 463; 411 N.W.2d 732 (1987).
Colestock, supra, p 398.
(1) On motion and on just terms, the court may relieve a party or the legal representative of a party from a final judgment, order, or proceeding on the following grounds:
(a) Mistake, inadvertence, surprise, or excusable neglect.
(b) Newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under MCR 2.611(B).
(c) Fraud (intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party.
(d) The judgment is void.
(e) The judgment has been satisfied, released, or discharged; a prior judgment on which it is based has been reversed or otherwise vacated; or it is no longer equitable that the judgment should have prospective application.
(f) Any other reason justifying relief from the operation of the judgment.
The only basis for relief under the rule which could be argued as being applicable to the within case is that set forth in subrule (f). But, that section may be applied only where defendant's substantial rights will not thereby be detrimentally affected. Here, defendant's substantial rights in the excess proceeds on sale of the marital residence were clearly quite detrimentally affected by the modification. Accordingly, relief from the property settlement provisions of the divorce judgment was not warranted on the basis of MCR 2.612(C), and the general rule of nonmodifiability stands. In so ruling, we would point out that this does not mean that plaintiff is precluded from setting off against any amount that might become payable to defendant after sale of the marital premises amounts owed by defendant to plaintiff by virtue of the divorce judgment.
Jackson Printing Co, Inc v Mitan, 169 Mich. App. 334, 340; 425 N.W.2d 791 (1988).
By reason of the foregoing, the trial court erred in modifying the property settlement provisions of the divorce judgment.
Reversed.
CAVANAGH, J., concurred.
I dissent. I believe that the trial court's order modifying the property settlement provisions of the parties' 1986 divorce judgment should be affirmed.
A review of the record in this case indicates that the defendant himself, by his inexcusable delay, deceit, and general uncooperativeness in complying with the original divorce judgment, occasioned the necessity for modification. Defendant's conduct was sufficient to trigger the "extraordinary circumstances" test for relief under MCR 2.612(C)(1)(f), "any other reason justifying relief from the operation of the judgment." This provision empowers the trial court to vacate judgments whenever extraordinary circumstances make it necessary to achieve justice and the substantial rights of other parties in the matter in controversy are not affected. Kaleal v Kaleal, 73 Mich. App. 181, 189; 250 N.W.2d 799 (1977), citing 3 Honigman Hawkins, Michigan Court Rules Annotated (2d ed), p 189.
Such extraordinary circumstances existed in this case, and there are no other parties in the matter in controversy whose rights will be affected. In the original divorce judgment dated July 16, 1986, defendant had been ordered to pay $80,000 to plaintiff on or before October 20, 1986, and "to pay and to hold plaintiff harmless from any liability for any encumbrances against the marital residence so that plaintiff would own same free and clear of any such encumbrances or liens." The record clearly shows that it was defendant's failure to meet these obligations which resulted in plaintiff's motion to appoint a receiver to administer the sale of defendant's parcel of Macomb County real estate, which motion the trial court granted in its November 10, 1986, order.
It further appears that plaintiff tried to work cooperatively with defendant to aid him in meeting his obligations, but that defendant persisted in vexatious and gamesmanlike fashion to continue his delays. Plaintiff's cooperative attitude resulted in the trial court's subsequent suspension of receivership on two specific conditions: (1) that defendant pay to plaintiff $40,000 by May 3, 1987, and (2) that defendant "completely discharge any lien existing on the former marital residence in favor of the Michigan National Bank" and, upon the sale of any of defendant's business interests, "make a substantial payment to reduce the principal owing to Michigan National Bank . . . in the event of his enability [sic] to fully pay and discharge said obligation." (Emphasis added.)
In spite of plaintiff's efforts to cooperate with defendant so that he could more easily meet his obligations, defendant continued to further delay. Defendant did not pay the $40,000 by May 3, 1987, thereby causing plaintiff to request reinstatement of the receivership. Plaintiff's motion was rescheduled five times but the hearing never occurred. It was only after plaintiff's considerable efforts to accommodate defendant that plaintiff finally petitioned the court to modify the order regarding receivership and judgment of divorce, which matter was heard on December 9, 1987.
By the time of the hearing on December 9, 1987, plaintiff had finally paid the $80,000 which he had originally been ordered to pay by October 20, 1986, more than one year earlier. In the meantime, however, defendant had sold one of his business interests — approximately eight out of twenty acres of real estate — for one million two hundred fifty thousand dollars. From this sale defendant received $300,000 cash, with the balance to be paid in annual installments over the next three years.
Upon the sale of this property, defendant was in possession of the $300,000 needed to pay off plaintiff's mortgage, which amount he was obligated to pay under the terms of both the original divorce judgment and the order suspending receivership. However, defendant persisted in his pattern of evasion and failure to pay, this time asserting that he did not know when or if he could pay off the mortgage, and that he was only obligated to make a "substantial payment." By the time the matter was heard on December 9, 1987, defendant had apparently become so confident in his evasive conduct that his lawyer even asserted that there was "no such thing as [defendant's] agreement to remove the mortgage," only "an agreement to make a substantial payment."
On these facts, it seems inconceivable that the trial court was impotent to further invoke its equitable powers by entering a modification order. In my view, defendant's conduct qualified as "extraordinary circumstances" meriting relief under MCR 2.612(C)(1)(f). The trial court was empowered to hear the motion if it was made within a reasonable time. MCR 2.612(C)(2). The facts of this case show that the motion was brought within a reasonable time.
The trial court acted properly within its powers. I would affirm the trial court's fair and equitable modification of the divorce judgment.