Opinion
AC 41227
10-29-2019
James K. GROGAN v. Jill PENZA
Steven L. Katz, Hartford, with whom was Melissa Gagne, for the appellant-cross appellee (defendant). Mark V. Connolly, Avon, for the appellee-cross appellant (plaintiff).
Steven L. Katz, Hartford, with whom was Melissa Gagne, for the appellant-cross appellee (defendant).
Mark V. Connolly, Avon, for the appellee-cross appellant (plaintiff).
Lavine, Bright and Bear, Js.
BEAR, J. The defendant, Jill Penza, appeals from the judgment denying her postdissolution motion for contempt. On appeal, she claims that the trial court improperly concluded that the plaintiff, James K. Grogan, had not violated a "true up" alimony obligation contained in the parties' separation agreement. The plaintiff cross appeals, claiming that the trial court abused its discretion in denying his request for statutory attorney's fees incurred in defending against the defendant's motion for contempt. We disagree with the parties' claims and, accordingly, affirm the judgment of the trial court.
The defendant also claims that the trial court (1) "improperly calculated the plaintiff's annual income for purposes of determining the ‘true up’ alimony obligation owed to the defendant," (2) "erred in failing to order the plaintiff to pay $45,846 to the defendant for ‘true up’ alimony due for 2015," and (3) "erred in denying the defendant's motion for contempt [on the basis of] its conclusion that no ‘true up’ alimony was due and owing to the defendant." Because we conclude that the trial court properly determined that no true up alimony was owed, these claims necessarily fail.
The following facts, as found by the trial court, and procedural history are relevant to our resolution of this appeal and cross appeal. On September 25, 2013, the parties, each of whom is an attorney, and each of whom was represented by an attorney, entered into a twenty-three page divorce settlement agreement (agreement). On September 27, 2013, the court, Olear, J. , dissolved the parties' marriage. At the time of the dissolution, the plaintiff was a partner at the law firm of McCormick, Paulding & Huber, LLP (MPH). In accordance with General Statutes § 46b-66, the judgment of dissolution incorporated by reference the agreement. Article I of the agreement addressed the plaintiff's various alimony obligations and specified how to calculate such alimony. Section 1.1 of the agreement provided in relevant part: "The alimony payments detailed [herein] are based on an annual earned income/earning capacity attributed to [the defendant] of $35,000 and the [plaintiff's] ‘annual income from employment’ (hereinafter ‘income’) which, for purposes of the alimony formula[s] herein, is presently defined as [l]ine 1 on [the plaintiff's] annual [schedule] K-1 from [MPH]. The alimony paid by the [plaintiff] to the [defendant] shall be paid in three components (monthly ... and quarterly payments totaling $160,000 based on the first $550,000 of [the plaintiff's] income, and a yearend ‘true up’ alimony payment based on gross income of the [plaintiff] between $550,000 and $750,000)." (Footnote added.)
"A schedule K-1 is the document that states each individual partner's proportionate income or loss based upon [his or her] percentage ownership. The income or loss on the schedule K-1 is in turn reported on each partner's individual tax return." (Internal quotation marks omitted.) McTiernan v. McTiernan , 164 Conn. App. 805, 813 n.10, 138 A.3d 935 (2016).
The true up alimony formula applicable in the present case was set forth in § 1.1 D of the agreement, which provided in relevant part: "For the tax year 2014 and thereafter, [the plaintiff] shall pay ‘true up’ alimony to [the defendant] of 25 [percent] of the amount of [the plaintiff's] income between $550,000 and $700,000 as reflected on [l]ine 1 of [the plaintiff's schedule] K-1 and 20 [percent] of any income between $700,000 and $750,000. For example, if [the plaintiff's schedule] K-1 for 2014 shows [l]ine 1 income of $775,000, [the plaintiff] would owe [the defendant] additional ‘true up’ alimony in the amount of $47,500 ...."
In June, 2015, the plaintiff sold his interest in MPH, where he had been a partner for over twenty years, and created a new law firm, Grogan, Tuccillo & Vanderleeden, LLP (GTV), located in Springfield, Massachusetts. GTV, like MPH, was structured as a partnership. As a result, the plaintiff received two schedule K-1s for the 2015 tax year, one from MPH covering the period between January 1 and May 31, 2015, and one from GTV covering the period between June 1 and December 31, 2015. The schedule K-1 issued by MPH listed negative $93,463 of "[o]rdinary business income (loss)" on line 1 and $605,000 of "[g]uaranteed payments" on line 4. The schedule K-1 issued by GTV listed $103,017 on line 1 and $127,178 on line 4. In previous years, when he was employed by MPH, all of the income the plaintiff received from employment had been reported on line 1 of his schedule K-1s.
The trial court found that the plaintiff had had no control over how his income was reported on his 2015 schedule K-1.
On May 31, 2017, the defendant filed a motion for contempt alleging that the plaintiff wilfully had violated the parties' agreement by failing to pay her true up alimony for the 2015 tax year. More specifically, the defendant claimed that the plaintiff's 2015 "annual income from employment" was $741,732—the total of lines 1 and 4 from both schedule K-1s—and that, consequently, she was entitled to $45,846 of true up alimony pursuant to § 1.1 D of the agreement. In his memorandum of law in opposition to the motion, the plaintiff countered that § 1.1 D clearly and unambiguously provided that his annual income from employment was to be determined solely by reference to line 1 of his schedule K-1s. Accordingly, the plaintiff argued that he owed no true up alimony for 2015 because his total line 1 income across both schedule K-1s amounted to only $9554—well below the $550,000 threshold required by the agreement. The plaintiff therefore requested that the court deny the defendant's motion for contempt and award him costs and reasonable attorney's fees pursuant to General Statutes § 46b-87.
The trial court, Nastri, J. , conducted an evidentiary hearing on the defendant's motion for contempt on September 28 and October 13, 2017. On December 4, 2017, following posttrial briefing by the parties, the court issued a memorandum of decision holding that § 1.1 D of the agreement was clear and unambiguous and limited the plaintiff's income from his employment for purposes of calculating true up alimony to the amount listed on line 1 of the plaintiff's schedule K-1. The court rejected the defendant's argument that it should look to lines 1 and 4 of the 2015 schedule K-1s to determine the total of the plaintiff's income from his employment. It explained that the defendant's argument, that the amounts listed on both lines 1 and 4 of the schedule K-1s should be considered income, required the court to ignore the language in § 1.1 C and D of the agreement. Accordingly, the court denied the defendant's motion, but it declined to award attorney's fees to the plaintiff. This appeal and cross appeal followed.
I
THE DEFENDANT'S APPEAL
On appeal, the defendant claims that the trial court improperly concluded that the plaintiff had not violated the true up alimony provision contained in § 1.1 D of the agreement. Her principal argument is that the court erred in determining that only income listed on line 1 of a schedule K-1 may be considered for purposes of calculating true up alimony due to her under § 1.1 D of the agreement. We disagree. We begin with general principles and the applicable standards of review. "It is well established that a separation agreement that has been incorporated into a dissolution decree and its resulting judgment must be regarded as a contract and construed in accordance with the general principles governing contracts .... When construing a contract, we seek to determine the intent of the parties from the language used interpreted in the light of the situation of the parties and the circumstances connected with the transaction .... [T]he intent of the parties is to be ascertained by a fair and reasonable construction of the written words and ... the language used must be accorded its common, natural, and ordinary meaning and usage where it can be sensibly applied to the subject matter of the contract .... When only one interpretation of a contract is possible, the court need not look outside the four corners of the contract .... Extrinsic evidence is always admissible, however, to explain an ambiguity appearing in the instrument .... When the language of a contract is ambiguous, the determination of the parties' intent is a question of fact .... When the language is clear and unambiguous, however, the contract must be given effect according to its terms, and the determination of the parties' intent is a question of law ....
The defendant argues in the alternative that the language of § 1.1 D was ambiguous and that the court therefore should have sought extrinsic evidence to determine the parties' intent. Rather than analyze the language of this provision and explicate why, in her view, it was ambiguous, the defendant merely states in a conclusory manner that "the settlement agreement was not clear and unambiguous as found by the trial court." The defendant therefore has abandoned this issue by failing to brief it properly. See State v. Buhl , 321 Conn. 688, 724, 138 A.3d 868 (2016) ("[a]nalysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly" [internal quotation marks omitted] ). Nevertheless, as our discussion of the defendant's principal argument demonstrates, the contract language at issue is clear and unambiguous in the context of the present case.
"A contract is unambiguous when its language is clear and conveys a definite and precise intent .... The court will not torture words to impart ambiguity where ordinary meaning leaves no room for ambiguity .... Moreover, the mere fact that the parties advance different interpretations of the language in question does not necessitate a conclusion that the language is ambiguous ....
"In contrast, a contract is ambiguous if the intent of the parties is not clear and certain from the language of the contract itself .... [A]ny ambiguity in a contract must emanate from the language used by the parties. ... The contract must be viewed in its entirety, with each provision read in light of the other provisions ... and every provision must be given effect if it is possible to do so .... If the language of the contract is susceptible to more than one reasonable interpretation, the contract is ambiguous." (Citation omitted; emphasis omitted; internal quotation marks omitted.) Parisi v. Parisi , 315 Conn. 370, 383–84, 107 A.3d 920 (2015) ; see also Nation-Bailey v. Bailey , 316 Conn. 182, 191–92, 112 A.3d 144 (2015) ; Dejana v. Dejana , 176 Conn. App. 104, 115, 168 A.3d 595 (when language in question is clear and unambiguous, contract must be given effect according to its terms, and determination of parties' intent is question of law), cert. denied, 327 Conn. 977, 174 A.3d 195 (2017). "Furthermore, [i]n giving meaning to the language of a contract, we presume that the parties did not intend to create an absurd result." (Internal quotation marks omitted.) South End Plaza Assn., Inc . v. Cote , 52 Conn. App. 374, 378, 727 A.2d 231 (1999).
The defendant argues that the court's interpretation of the true up alimony provision set forth in § 1.1 D was flawed because it rendered superfluous the "presently defined" language in § 1.1, which, according to the defendant, applies to subsection D. More specifically, the defendant contends that, "[b]y specifically stating that income was ‘presently defined’ as line 1 of [the defendant's] schedule K-1, it is abundantly clear that the parties did not intend to permanently define income as line 1 of a schedule K-1." (Emphasis omitted.) Rather, in the defendant's view, this language indicates that the reference to line 1 income "was an example and [was] not meant to be determinative." Thus, according to the defendant, "[t]he placement of the plaintiff's earnings, whether on line 4 or line 1 of the schedule K-1 or any other income reporting form, should not bar recovery of true up alimony." (Internal quotation marks omitted.) Section 1.1 of the parties' agreement sets forth the definition of the plaintiff's income "for purposes of the alimony formula herein ...." (Emphasis added.) The only alimony formulas in the agreement that refer to the plaintiff's income are the true up alimony formulas contained in subsections C and D of § 1.1. Pursuant to § 1.1, the income to be used to calculate the plaintiff's true up alimony obligations under these subsections "is presently defined as [l]ine 1 on [the plaintiff's] annual [schedule] K-1 from [MPH]." (Emphasis added.) We disagree with the defendant, however, that this "presently defined" language requires that the reference to line 1 income was meant merely to be an example of one type of employment income that could be considered, at the defendant's election to do so, with other types of alleged income in calculating the plaintiff's true up alimony obligation. This claim is belied by the clear and unambiguous language of § 1.1 D, which provides that "[f]or the tax year 2014 and thereafter, [the plaintiff] shall pay ‘true up’ alimony to [the defendant] of 25 [percent] of the amount of [his] income between $550,000 and $700,000 as reflected on [l]ine 1 of [the plaintiff's schedule] K-1 and 20 [percent] of any income between $700,000 and $750,000. For example, if [the plaintiff's schedule] K-1 for 2014 shows [l]ine 1 income of $775,000, [the plaintiff] would owe [the defendant] additional ‘true up’ alimony in the amount of $47,500 ...." A court cannot ignore or disregard the language of the agreement because in hindsight an additional or more expansive term would have been better for one of the parties. See, e.g., Crews v. Crews , 295 Conn. 153, 169, 989 A.2d 1060 (2010) ; Chang v. Chang , 170 Conn. App. 822, 828, 155 A.3d 1272, cert. denied, 325 Conn. 910, 158 A.3d 321 (2017). To the extent that there is any conflict in the reasonable interpretation of the language of the agreement set forth in § 1.1 and § 1.1 D, which we do not credit, the more specific language in § 1.1 D controls over the more general language in § 1.1: "[I]t has been well settled that ‘the particular language of a contract must prevail over the general.’ " Issler v. Issler , 250 Conn. 226, 237 n.12, 737 A.2d 383 (1999), see also Bead Chain Mfg. Co. v. Saxton Products, Inc. , 183 Conn. 266, 273, 439 A.2d 314 (1981) ; Miller Bros. Construction Co. v. Maryland Casualty Co. , 113 Conn. 504, 514, 155 A. 709 (1931).
" ‘Herein’ as used in legal phraseology is a locative adverb and its meaning is to be determined by the context. It may refer to the section, the chapter or the entire enactment in which it is used." Gatliff Coal Co. v. Cox , 142 F.2d 876, 882 (6th Cir. 1944).
The defendant has neither provided analysis nor cited to any legal authority to support her contention that the addition of the word "presently" somehow trans-forms the definition of "annual income from employment" set forth in § 1.1 into a mere example that can be expanded upon by adding another line from the schedule K-1. See Packard v. Packard , 181 Conn. App. 404, 406, 186 A.3d 795 (2018) ("analysis, rather than mere abstract assertion, required to avoid abandoning issue by failing to brief issue properly; where claim receives only cursory attention without substantive discussion or citation of authorities, it is deemed abandoned"). Moreover, the defendant's position is untenable when § 1.1 is interpreted in light of the situation of the parties at the time of the dissolution.
"Presently" is an adverb that simply means "now" or "at the present time." Webster's Third New International Dictionary (2002), p. 1793.
The "presently defined as [l]ine 1 on [the defendant's] annual K-1 from [MPH]" language set forth in § 1.1 referred to the plaintiff's then income from his employment at MPH, for purposes of the alimony formula . It is not specified in the agreement that the line 1 language is limited solely to the year 2013 when the agreement was made, and, thereafter, the definition of the plaintiff's annual income from employment in subsequent years would be open to review and revision, except in § 1.3, which anticipates the plaintiff's possible retirement justifying a second look at his alimony obligation. There was no dispute between the parties about the amount of the plaintiff's line 1 income for 2014, and there was no line 4 income in that year. The relevant language of § 1.1 D is clear: for the tax year 2014 and thereafter, the plaintiff shall pay true up alimony to the defendant from his income as reported on line 1 of his schedule K-1. It is also not specified in the agreement that there would be an automatic "second look" if there were entries on line 4, or any other lines other than line 1, in 2014 or in any other subsequent year. Given the clear and unambiguous language of § 1.1 D, if the $605,000 in "guaranteed payments" from line 4 of the MPH schedule K-1 for 2015 were used to calculate the plaintiff's true up alimony obligation, the agreement certainly would be violated. Without the inclusion of the $605,000 in the calculation of the plaintiff's income, the plaintiff's income in 2015 did not exceed $550,000.
The trial court recognized the differentiation between the application of the line 1 limitation in the true up alimony formula and the lack of its limitation to a specific year when it rejected the defendant's arguments and found that, in reaching their agreement, the parties were free to define income in any way they wanted and did not have to use the schedule K-1 to do so. Having agreed to use the schedule K-1, the parties could have referenced any of the lines therein, including lines 1 and 4, or any other combination of lines in part III of the schedule K-1, titled "Partner's Share of Current Year Income, Deductions, Credits and Other Items." The parties, however, agreed that the plaintiff's income, for alimony purposes, was limited to line 1 of the plaintiff's schedule K-1. At no time prior to or after the defendant's filing of her motion for contempt did she file any motion for modification of the alimony terms or any other motion concerning the definition of alimony in the agreement, so the court did not have the authority during the hearing on the contempt motion to modify the alimony terms. See Connolly v. Connolly , 191 Conn. 468, 474–75, 464 A.2d 837 (1983).
At the time of the dissolution of the parties' marriage in 2013, the plaintiff had been a partner at MPH for over twenty years, and, during this time, his income from such employment had always been reported on line 1 of the schedule K-1s prepared by its outside accountants and issued by that law firm. That continued in 2014 and 2015. After the defendant left MPH on May 31, 2015, his new law firm, GTV, was set up as a partnership that also provided a schedule K-1 to the plaintiff with respect to his annual income from such employment. He thus received schedule K-1 forms from both MPH and GTV for the 2015 tax year, which forms had been prepared by their respective outside accountants. He did not receive a W-2 form for the 2015 tax year from MPH or GTV, or any other type of form related to his employment income. It is thus inappropriate to speculate about the possible effect, if any, on the application of the agreement of his receipt of such other income reporting forms.
We, therefore, agree with the trial court that, pursuant to the specific and plain language of the agreement set forth in § 1.1 D, only income reported on line 1 of the plaintiff's annual schedule K-1s could be used in calculating his 2015 true up alimony obligation. Because the plaintiff's combined line 1 income from both 2015 K-1s was less than $550,000, the defendant was not entitled to any true up alimony, and, consequently, the trial court properly denied the defendant's motion for contempt.
II
THE PLAINTIFF'S CROSS APPEAL
In his cross appeal, the plaintiff claims that the trial court abused its discretion in denying his request for attorney's fees and costs incurred in successfully opposing the defendant's motion for contempt. We disagree.
"Our law for awarding attorney's fees in contempt proceedings is clear. General Statutes § 46b-87 provides that the court may award attorney's fees to the prevailing party in a contempt proceeding. The award of attorney's fees in contempt proceedings is within the discretion of the court .... In making its determination, the court is allowed to rely on its familiarity with the complexity of the legal issues involved. Indeed, it is expected that the court will bring its experience and legal expertise to the determination of the reasonableness of attorney's fees .... Moreover, because the award of attorney's fees pursuant to § 46b-87 is punitive, rather than compensatory, the court properly may consider the defendant's behavior as an additional factor in determining both the necessity of awarding attorney's fees and the proper amount of any award." (Internal quotation marks omitted.) Pace v. Pace , 134 Conn. App. 212, 218, 39 A.3d 756 (2012).
In the present case, the record does not reveal the court's reason for denying the plaintiff's request for attorney's fees and whether, or to what extent, it considered such factors as the merits of the defendant's motion for contempt, the complexity of the legal issues involved, and the defendant's behavior. In its memorandum of decision, the court simply ordered that "[n]o attorney's fees are awarded to either party." Following our review of the briefs of the parties and the record of the hearing on the motion for contempt, we are unable to conclude that the court abused its discretion in declining to award attorney's fees to the plaintiff.
The judgment is affirmed.
In this opinion LAVINE, J., concurred.
BRIGHT, J., concurring in part and dissenting in part. Although I agree with the majority's conclusion in part II of its opinion regarding the plaintiff's cross appeal, I disagree with its conclusion in part I of its opinion that the parties' separation agreement (agreement) is clear and unambiguous regarding the terms of the plaintiff's obligation to pay "true up" alimony to the defendant. Because the trial court based its denial of the defendant's motion for contempt solely on its conclusion that the language of the parties' agreement is clear and unambiguous, I conclude that the matter should be remanded to the trial court for factual findings that are required when an agreement is ambiguous. Furthermore, I conclude that the fact that the agreement is ambiguous does not prevent the trial court from granting relief to the defendant, even though it almost certainly would preclude a finding that the plaintiff is in contempt. Finally, because the court made no findings as to whether the plaintiff met his full obligation to pay true up alimony under the terms of the ambiguous agreement, I conclude that we are not in a position to affirm the decision of the trial court on the basis of the plaintiff's alternative ground for affirmance. Consequently, I would reverse the court's judgment denying the defendant's motion for contempt, and I would remand the matter for a new hearing on the motion. Having reached this conclusion, I would affirm the court's judgment denying the plaintiff's motion for attorney's fees. Therefore, I concur in part and respectfully dissent in part.
Because the majority's holding in part I of its opinion rests solely on its conclusion that the agreement is clear and unambiguous, I will focus my analysis on the language of the agreement and the applicable law to explain why I disagree with the majority's conclusion. As a preliminary matter, I agree with the majority's statement as to the applicable law as set forth by our Supreme Court in Parisi v. Parisi , 315 Conn. 370, 382–84, 107 A.3d 920 (2015). In my view, three principles of contract interpretation are particularly relevant to the resolution of the parties' dispute. First, the parties' agreement must be viewed in its entirety, with each provision read in light of the other provisions, and every provision given effect if possible to do so. Nation–Bailey v. Bailey , 316 Conn. 182, 191–92, 112 A.3d 144 (2015). Second, if the language of the contract is susceptible to more than one reasonable interpretation, the contract is ambiguous. Id. Third, "[w]e will not construe a contract's language in such a way that it would lead to an absurd result." Welch v. Stonybrook Gardens Cooperative, Inc. , 158 Conn. App. 185, 198, 118 A.3d 675, cert. denied, 318 Conn. 905, 122 A.3d 634 (2015).
In the present case, the parties' dispute revolves around § 1.1 of the agreement, in particular the interplay of that section's initial foundational paragraph and sub-section D. Section 1.1 starts by setting forth the parties' agreement regarding the payment of alimony by the plaintiff; specifically, it sets forth the basis for the payment of alimony and a general description of how the amount of alimony due to the defendant is to be calculated. It provides in relevant part: "The alimony payments detailed below are based on ... the [plaintiff's] ‘annual income from employment’ (hereinafter ‘income’) which, for purposes of the alimony formula herein, is presently defined as Line 1 on [the plaintiff's] annual [schedule] K-1 [form] ( [K-1] ) from McCormick, Paulding & Huber LLP (‘MPH’). The alimony paid by the [plaintiff] to the [defendant] shall be paid in three components (monthly payments and quarterly payments totaling $160,000 based on the first $500,000 of [the plaintiff's] income, and a yearend ‘true up’ alimony payment based on gross income of the [plaintiff] between $550,000 and $750,000). [The defendant] shall not be entitled to any alimony on any annual income of [the plaintiff] in excess of $750,000. Said payments will be made as follows." (Emphasis added; footnote added.)
At the time the parties entered into the agreement and the dissolution judgment was rendered, the plaintiff was a full equity partner and the managing partner of MPH.
Section 1.1 then sets forth, in subsections A though D, the timing and methodology for making and calculating the alimony payments. Subsection D, in relevant part, provides: "For the tax year 2014 and thereafter, [the plaintiff] shall pay ‘true up’ alimony to [the defendant] of 25 [percent] of the amount of [the plaintiff's] income between $550,000 and $750,000 as reflected on Line 1 of [the plaintiff's] K-1 and 20 [percent] of any income between $700,000 and $750,000. For example, if [the plaintiff's] K-1 for 2014 shows Line 1 income of $775,000, [the plaintiff] would owe [the defendant] additional ‘true up’ alimony in the amount of $47,500 ...."
It is undisputed that the plaintiff has paid the defendant the required $160,000 per year in annual alimony. It also is undisputed that the plaintiff paid the defendant the proper amount of true up alimony in 2013 and 2014. Furthermore, had the plaintiff remained a partner at MPH through the end of 2015, and had MPH continued to report all of the plaintiff's employment income on line 1 of his K-1, as it had during the entire twenty plus years he was a partner of MPH, it is unlikely that the parties would have had any dispute over the plaintiff's obligation to pay true up alimony.
In 2015 though, the plaintiff resigned from MPH, effective June 1, and opened a new law firm, Grogan, Tuccillo & Vanderleeden, LLP (GTV), in which he is an equity partner. As a result, the plaintiff received two K-1s in 2015, one from each firm. Furthermore, both firms reported income, or loss, to the plaintiff on both line 1, titled "ordinary business income," and line 4, titled "guaranteed payments," of the K-1. When the defendant received the required copies of the plaintiff's K-1s, she totaled the amounts on lines 1 and 4 from both K-1s and determined that the plaintiff had a total income from employment in 2015 of $741,732. Applying the formula in § 1.1 D to this amount, the defendant determined that she was entitled to true up alimony in the amount of $45,846. When she demanded payment from the plaintiff, the plaintiff responded that the $605,000 reported on line 4 of the K-1 issued by MPH was not income but, rather, was the return of his capital from the firm upon his departure. The plaintiff informed the defendant that he was challenging MPH's treatment of that payment and asked her not to pursue any claim for true up alimony until he resolved the issue.
The majority notes that the court found that the plaintiff had no control over how his income was reported on his 2015 schedule K-1. The majority's reliance on this factual finding is troubling for two reasons. First, the finding is based on evidence extrinsic to the parties' contract, in particular, the plaintiff's testimony. Of course, such extrinsic evidence only may be considered where the agreement at issue is ambiguous. Second, the plaintiff did not testify that he had no control over GTV's K-1. To the contrary, he testified that it was a mistake for his new accountant to record any income on line 4 of the K-1, and that for 2016, all income from GTV was reported on line 1 of the K-1.
The defendant thereafter filed a motion for contempt, the denial of which is the subject of this appeal. In response to the motion for contempt, in addition to disputing that he had received sufficient employment income in 2015 to trigger the requirement that he pay true up alimony, the plaintiff also argued before the trial court that § 1.1 D of the agreement clearly and unambiguously limits income for the purpose of true up alimony to income reported on line 1 of his K-1. Because the total of the amounts reported on line 1 of the plaintiff's two K-1s in 2015 was only $9554, the plaintiff argued that no true up alimony was due. In contrast, the defendant argued before the trial court, in support of her motion for contempt, that the initial paragraph of § 1.1 clearly and unambiguously requires that alimony payments to the defendant are based on the plaintiff's "annual income from employment." She argued that this includes all income that the plaintiff received as a result of his employment, regardless of the line of the K-1 used to report the income. She further argued that the plaintiff's reliance on the reference in § 1.1 D to line 1 of the K-1 issued by MPH was misplaced because the initial paragraph of § 1.1 makes clear that the parties only intended line 1 of the K-1 issued by MPH to be used because that was how the plaintiff's income from employment, at that time, was "presently defined."
At the hearing on the underlying motion for contempt, the parties' expert witnesses were in conflict as to whether the $605,000 reported on line 4 of the plaintiff's K-1 issued by MPH was income for purposes of the agreement. The defendant's expert witness, Richard Buggy, testified that, on the basis of the amounts recorded on the plaintiff's two K-1s, the plaintiff's total income from employment was $741,732. He also acknowledged though that the payment of the $605,000, as shown on line 4 of the MPH K-1, was related to the plaintiff's sale of his interest in MPH. He also described it as a "departure payment" in exchange for the plaintiff terminating his partnership interest in MPH. He further testified that one should look at the MPH partnership agreement to see how the payment should be treated, but that he never looked at the agreement. After the plaintiff presented the testimony of his accountant and expert witness, Margaret Mayer, to explain why the $605,000 on line 4 of the MPH K-1 was not income, the defendant recalled Buggy in her rebuttal case to respond to Mayer's analysis. Buggy testified that, even under Mayer's methodology, the plaintiff owed true up alimony of $14,264. The court decided the defendant's motion for contempt based solely on the language of the agreement, in particular, § 1.1 D. According to the court: "Section 1.1 D of the agreement sets forth the calculation of true up alimony for 2014 and beyond. The defendant's argument that the amounts listed on both lines 1 and line 4 of the K-1s should be considered income requires the court to ignore the language in § 1.1 ... D.... In reaching their agreement, the parties were free to define income in any way they wished. They did not have to use [the] K-1 as a reference. If they wished to do so, they could have referenced lines 1 and 4, line 4, line 1, lines 1, 2, 3, and 4 or any combination of the lines in [the] K-1 .... They chose to specify line 1. If [the initial paragraph of] § 1.1 [was] sufficient to define the plaintiff's true up alimony obligation ... § 1.1 D would be wholly unnecessary and completely superfluous." (Internal quotation marks omitted.) The court's analysis, however, does not discuss the language in the initial paragraph of § 1.1 that the plaintiff's income "for purposes of the alimony formula herein, is presently defined as Line 1 on [the plaintiff's] annual K-1 from ... MPH." (Internal quotation marks omitted.) Consequently, the court's memorandum of decision does not explain what meaning, if any, the court attached to the clause "presently defined as."
The majority agrees with the court's conclusion. In doing so, the majority similarly ignores the "is presently defined as" language in § 1.1. My colleagues make no attempt to ascribe any meaning to those words or attempt to read them with the language of § 1.1 D to give all of the language of § 1.1 meaning. Instead, they offer a variety of reasons, none of which I find persuasive, to essentially read the "is presently defined as" language out of the parties' agreement. I address each of them in turn. First, the majority, as did the trial court, notes that the parties could have defined income any way they wanted and could have identified lines other than line 1 of the K-1 from which to compute income. The majority then states that it "cannot ignore or disregard the language of the agreement because in hindsight an additional or more expansive term would have been better for one of the parties." The majority's reasoning ignores the fact that the parties specifically chose to define the plaintiff's income as his "annual income from employment." Section 1.1 D then sets forth that line 1 of the plaintiff's K-1 from MPH was to be used at the time of drafting because that was how the plaintiff's annual income from employment was "presently defined." There was no need to provide a different way to identify the plaintiff's income because the parties could not have anticipated, when the agreement was signed, that the plaintiff's employment would change or whether the manner of reporting his income would change. It is a reasonable reading of the agreement that by defining the plaintiff's obligation to pay alimony broadly as based on his "annual income from employment," the defendant protected herself from any such contingency, while also setting forth precisely how the plaintiff's income was calculated at the time of the dissolution.
Although not stated as a reason to conclude that the agreement is clear and unambiguous, the majority takes the time to note that both parties are attorneys, who also were represented by counsel when they entered into the agreement. To the extent that the majority sets forth these facts for the purpose of lending support for its conclusion, I am not persuaded. First, the parties' professions and whether they were represented by counsel are extrinsic facts that can be considered only if the agreement is not clear and unambiguous. Second, it is not unusual for sophisticated parties who are represented by highly skilled and experienced attorneys to enter into ambiguous agreements. See, e.g., Gold v. Rowland , 325 Conn. 146, 171–89, 156 A.3d 477 (2017).
Furthermore, the cases relied on by the majority do not support its conclusion. Our Supreme Court in Crews v. Crews , 295 Conn. 153, 169, 989 A.2d 1060 (2010), addressed the high burden a party faces when challenging the enforceability of a premarital agreement. In doing so, the court set forth the unremarkable proposition that parties are free to contract for whatever terms they choose. In the present case, the parties chose to qualify the reference to the plaintiff's K-1 from MPH by stating that that was how his income was "presently defined." The use of such a qualifier reasonably can be read as expressing an understanding that his income might not always be defined that way, and that a change in circumstances might require that it be defined differently. In fact, had the parties intended otherwise, there would have been no reason to include the "is presently defined as" language in the agreement.
Yet another reason that the language of § 1.1 is not clear and unambiguous is that it refers to "line 1 of [the plaintiff's] K-1" from MPH. It does not mention the possibility of multiple K-1s from different firms. Despite this, the plaintiff, the trial court, and the majority, without comment, simply ignore the reference to a single K-1 from MPH and assume that true up alimony is to be calculated from line 1 of all of the K-1s issued to the plaintiff.
Similarly, Chang v. Chang , 170 Conn. App. 822, 155 A.3d 1272, cert. denied, 325 Conn. 910, 158 A.3d 321 (2017), also is inapplicable to the present case. In Chang , the defendant challenged the court's award of alimony to the plaintiff because the parties' premarital agreement did not provide for the possibility of alimony upon the dissolution of the parties' marriage. This court rejected the defendant's argument because there was "no provision in the agreement that even tangentially govern[ed] the parties' rights to alimony upon the dissolution of the marriage." Id., at 830, 155 A.3d 1272. In the present case, the defendant is not asking that a new term be added to the parties' agreement. Rather, she simply is asking that the court interpret the parties' agreement to give meaning to all of its terms.
The majority next states that, to the extent that the general language in the first paragraph of § 1.1 conflicts with the specific language in § 1.1 D, the specific language in § 1.1 D must govern. I disagree with the majority's reasoning for three reasons.
First, the principle relied on by the majority applies when reliance on the general language of the agreement would render the specific language meaningless. For example, in Issler v. Issler , 250 Conn. 226, 737 A.2d 383 (1999), another case on which the majority relies, the parties disputed the manner in which the defendant's alimony obligation should be determined. Id., at 234, 737 A.2d 383. The parties' separation agreement explicitly provided that an accountant would prepare a letter setting forth the defendant's income from his employer, H. H. Brown. Id., at 231, 737 A.2d 383. The plaintiff argued that the letter was insufficient because it did not capture all of the defendant's income from H. H. Brown, and the parties' agreement provided that the defendant was to pay alimony based upon his "gross earnings" from H. H. Brown. Id., at 234, 236–37, 737 A.2d 383. The court rejected the plaintiff's argument because it would render meaningless the language in the agreement relating to the accountant's letter. Id., at 239, 737 A.2d 383. Instead, the court held that the agreement should be construed to give full meaning and effect to all of its provisions. Id., at 240, 737 A.2d 383. In the present case, the majority's reasoning violates this rule by rendering entirely meaningless the "is presently defined as" language at issue here.
The trial court did apply this rule, but reached what I believe to be the erroneous conclusion that the defendant's interpretation renders § 1.1 D "wholly unnecessary and completely superfluous." The initial paragraph of § 1.1 does not set forth the formula for calculating true up alimony. It merely states that the plaintiff must pay true up alimony on income, which the agreement defines as annual income from employment, between $550,000 and $750,000. Section 1.1 D provides the specific percentages that are to be applied to income between $550,000 and $700,000 and between $700,000 and $750,000. It also sets forth when such payments must be made and that the defendant is entitled to a copy of the plaintiff's K-1. Consequently, under the defendant's interpretation, § 1.1 D is far from superfluous; rather, it absolutely is necessary to the determination of the plaintiff's obligation.
I acknowledge that § 1.1 D provides that the income used to calculate true up alimony is that "reflected on line 1 of [the plaintiff's] K-1." That language, as the majority concedes, must be interpreted in conjunction with the language in the initial foundational paragraph of § 1.1, which the trial court failed to do. Reading § 1.1 in its entirety, I conclude that the defendant has offered a reasonable interpretation of the agreement.
Second, "[w]here two clauses which are apparently inconsistent may be reconciled by a reasonable construction , that construction must be given, because it cannot be assumed that the parties intended to insert inconsistent and repugnant provisions." (Emphasis in original; internal quotation marks omitted.) Thoma v. Oxford Performance Materials, Inc. , 153 Conn. App. 50, 61, 100 A.3d 917 (2014). As noted previously, the defendant has offered a construction that reconciles the foundational paragraph of § 1.1 with § 1.1 D.
Finally, "[i]rreconcilable inconsistent provisions have been treated by this court and our Supreme Court as creating an ambiguity within the contract." Id., at 60, 100 A.3d 917. Thus, to the extent that there is an irreconcilable conflict between the foundational paragraph of § 1.1 and § 1.1 D, the court should have considered extrinsic evidence to determine the intent of the parties in light of the conflict.
The majority also posits that the defendant has abandoned her claim that the agreement is ambiguous because she failed to brief this issue adequately. I disagree. In her principal brief, the defendant argues why the language of the agreement does not clearly and unambiguously lead to the result advocated by the plaintiff and argues what the court should have done if it did not accept the defendant's argument regarding the clear and unambiguous meaning of the agreement. The plaintiff clearly understood the defendant's argument and addressed it in his brief on appeal. In addition, most of the defendant's reply brief is devoted to this issue. I conclude that the issue has been briefed fully and sufficiently. Furthermore, because the question of whether the agreement is ambiguous is a legal one, and is a "threshold question," it properly is before us regardless of how it was briefed. Parisi v. Parisi , supra, 315 Conn. at 380, 107 A.3d 920. It is our duty in considering a judgment on a motion for contempt to determine first whether the agreement was ambiguous even if both parties offered what they claimed were competing clear and unambiguous interpretations. Id. ; In re Leah S. , 284 Conn. 685, 693, 935 A.2d 1021 (2007). In fact, in Parisi , neither party argued at the trial court or on appeal that the agreement was ambiguous. Parisi v. Parisi , supra, at 378–79, 107 A.3d 920. Nevertheless, our Supreme Court addressed the "threshold question" of whether the parties' separation agreement was clear and unambiguous. Id., at 380–81, 107 A.3d 920. It held that, the arguments of the parties notwithstanding, "each of the parties has set forth a plausible construction of the alimony buyout provision, with both constructions having bases in the language used in the separation agreement. We conclude, therefore, that the agreement ... is ambiguous, with its meaning presenting a question of fact that the trial court should have fully considered and resolved." Id., at 385, 107 A.3d 920. That is precisely the situation in the present case. Both parties have presented plausible arguments based on the language of the parties' agreement. In my opinion, the agreement, therefore, is ambiguous. See id.
The majority's interpretation of § 1.1 also is problematic because it leads to absurd results. Under the majority's analysis, if the plaintiff's employment income is reported in some manner other than on line 1 of a K-1, the defendant would be entitled to no true up alimony. This would be true even though neither party disputes that the line on which income is reported on a K-1 is largely in the discretion of the preparer. It also would be true if the plaintiff's law firm changed its organizational structure from a partnership reporting income on a K-1 to a professional corporation that would report its members' incomes on W-2 forms. Similarly, under the majority's interpretation, the defendant would be entitled to no true up alimony if the plaintiff, instead of working in a law firm, practiced law as the general counsel of a major corporation, and his income was reported on a W-2 form or a 1099 form. I cannot square such outcomes with the parties' express statement in their agreement that the plaintiff's obligation to pay alimony is based on his "annual income from employment."
The majority ignores such absurdities by stating that because the plaintiff did not receive a W-2 form for 2015, it is "inappropriate to speculate about the possible effect, if any, on the application of the agreement of his receipt of such other income reporting forms." No speculation is necessary though. The majority's holding spells out very clearly what would happen if the plaintiff's income is reported in some manner other than on line 1 of a K-1. The defendant would be entitled to no true up alimony. This is the undeniable consequence of the majority's interpretation and in no way is speculative. In sum, I conclude that the plaintiff has offered a reasonable, if not more reasonable, interpretation of the agreement. The foundational paragraph of § 1.1 explicitly provides that alimony payments are to be made on the basis of the plaintiff's annual income from employment. At the time the agreement was executed, that income was "presently defined as" what was shown on line 1 of the plaintiff's K-1 from MPH. The reference to "presently defined" reasonably can be read as temporal, meaning that the plaintiff's income is currently reflected on his MPH K-1, but that it could be reflected in some other manner in the future. Such an interpretation works hand in hand with the formula in § 1.1 D, while still preserving the parties' clearly stated intention to base the plaintiff's obligation to pay alimony on his employment income if his employment, or the manner in which his income is reported, changed from the state that existed when the parties signed the agreement.
The majority states that the defendant has provided no analysis nor cited to any legal authority to support her contention that the addition of the word "presently" somehow transforms the definition of "income" provided by § 1.1 into a mere example. I disagree. The defendant carefully analyzed § 1.1, including pointing out that the trial court's interpretation rendered the "presently defined" language superfluous. I also disagree that the defendant needed to cite legal authority as to how the word "presently" modified the definition of true up alimony. The defendant properly relied on the common meaning of "presently," which the majority defines as "now" or "at the present time." That definition is completely consistent with the defendant's argument and my analysis.
Although I have identified what I perceive to be significant problems with the interpretive approach of the trial court and the majority, I am not prepared to dismiss their interpretation as wholly unreasonable; instead, I would conclude that because the agreement is subject to more than one reasonable interpretation, it is ambiguous. See Parisi v. Parisi , supra, 315 Conn. at 385, 107 A.3d 920. As such, the trial court should have considered the extrinsic evidence submitted to it to determine how the ambiguities in § 1.1 should be resolved. See id. In fact, the plaintiff specifically offered, through his testimony, extrinsic evidence as to the parties' negotiations and why § 1.1 was drafted in the way it was drafted. In particular, the plaintiff testified that the language of § 1.1 was intended to record properly "any income I, actually, received from the practice of law." He also testified that on which line GTV reported his income on the K-1 would not impact his obligation to pay true up alimony. Unfortunately, the trial court, by finding the agreement to be clear and unambiguous, did not consider such extrinsic evidence. I conclude that this was an error that requires a new hearing.
The defendant objected to the admission of any evidence regarding the parties' negotiation of the agreement claiming that parol evidence is not admissible where an agreement is clear and unambiguous. In response, plaintiff's counsel argued that because the evidence was not offered to vary or alter the terms of the agreement, which he also claimed was clear and unambiguous, the evidence did not "run afoul of the parol evidence rule." The court overruled the defendant's objection and admitted the evidence. The argument of plaintiff's counsel and the ruling of the court reflect a misunderstanding of the parol evidence rule. The law is clear that parol evidence is not admissible where the agreement is clear and unambiguous. HLO Land Ownership Associates Ltd. Partnership v. Hartford , 248 Conn. 350, 357–58, 727 A.2d 1260 (1999). Only if the agreement is ambiguous may parol evidence be admitted, and then only if such evidence does "not vary or contradict the terms of the contract." Id., at 359–60, 727 A.2d 1260.
Having reached this conclusion, I turn to the plaintiff's alternative arguments for affirmance. First, the plaintiff argues that if the agreement is ambiguous, he cannot be held in contempt because a finding of contempt must be made on the basis of the intentional violation of a clear and unambiguous court order. Brody v. Brody , 315 Conn. 300, 319, 105 A.3d 887 (2015). I agree that my conclusion that the agreement is ambiguous would preclude a finding that the plaintiff is in contempt of court because he disputed the defendant's claim to true up alimony. Nevertheless, the trial court still can order relief in the form of true up alimony payments if it concludes, on the basis of the language of the agreement interpreted in light of relevant extrinsic evidence, that the defendant's interpretation of the agreement is correct and that the plaintiff has under calculated his income for 2015. See O'Brien v. O'Brien , 326 Conn. 81, 99, 161 A.3d 1236 (2017) ("[i]n a contempt proceeding, even in the absence of a finding of contempt, a trial court has broad discretion to make whole any party who has suffered as a result of another party's failure to comply with a court order" [internal quotation marks omitted] ); Parisi v. Parisi , supra, 315 Conn. at 381, 107 A.3d 920 ("court's inherent authority to effectuate its prior judgments, either by summarily ordering compliance with a clear judgment or by interpreting an ambiguous judgment and entering orders to effectuate the judgment as interpreted, is not dependent upon a predicate finding that a noncompliant party is in contempt" [internal quotation marks omitted] ); Pressley v. Johnson , 173 Conn. App. 402, 408–409, 162 A.3d 751 (2017) (although not finding defendant in contempt, trial court had authority "to fashion an order consistent with protecting the integrity of the dissolution judgment").
Second, the plaintiff argues that the $605,000 payment he received from MPH when he left the firm clearly was not income, but was instead the purchase of his ownership interest in the firm. Although I agree that the plaintiff submitted a significant amount of evidence to support his position, it is not the function of this court to find facts. See Parisi v. Parisi , supra, 315 Conn. at 385, 107 A.3d 920 ("[i]t is elementary that neither [our Supreme Court] nor the Appellate Court can find facts in the first instance ... but may only review such findings to see whether they might be legally, logically and reasonably found" [emphasis in original; internal quotation marks omitted] ). Because the trial court did not resolve this question, there are no findings for this court to review. Consequently, I would reverse the trial court's judgment denying the defendant's motion for contempt and remand the case to the trial court for a new hearing on the motion.
Having concluded that the agreement is ambiguous and that a further hearing is required on the defendant's motion, I agree with the majority's conclusion in part II of its opinion that the court did not err in denying the plaintiff's request for attorney's fees. Consequently, I respectfully dissent only from part I of the opinion.