Opinion
No. C4-99-1374.
Filed February 8, 2000.
Appeal from the District Court, Ramsey County, File No. F18931829.
Susan C. Rhode, (for appellant)
Brian L. Sobol, (for respondent)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1998).
UNPUBLISHED OPINION
Appellant Claude Benavides moved to terminate his spousal maintenance obligation, claiming that a decrease in income caused by his retirement was a substantial change warranting modification; the district court denied his motion. But on motion of respondent Geraldine Benavides, the district court granted a cost-of-living adjustment (COLA) to the maintenance award, basing the COLA on a maintenance figure higher than the amount ordered in the original judgment. The district court also awarded attorney fees to respondent. We affirm denial of appellant's modification motion, modify the COLA, and reverse the attorney fees award. We also deny attorney fees on appeal.
FACTS
Appellant and respondent were married in 1954. In September 1991, when appellant was 58 years old and respondent was 59 years old, the marriage was terminated by a stipulated judgment. Appellant is a surgeon; respondent had been a traditional homemaker throughout the marriage. Although appellant was ordered in the judgment to pay $4,000 per month in permanent spousal maintenance, he actually paid $2,000 every two weeks, in effect $4,333 per month.
In January 1998, appellant moved to terminate spousal maintenance, claiming: (1) he had a "substantial decrease in income" following his December 1997 retirement at age 65; and (2) respondent had a "substantial increase in income" because she now receives social security and pension benefits totaling about $2,000 per month.
The trial court denied appellant's motion for modification, but granted a motion by respondent asking for a COLA increase; the court based the COLA on the amount of maintenance actually paid ($2,000 every two weeks) rather than the amount ordered in the judgment ($4,000 per month). The trial court also awarded $3,200 in attorney fees to respondent. This appeal followed.
DECISION I. Modification
Modification of spousal maintenance is discretionary with the district court. Claybaugh v. Claybaugh, 312 N.W.2d 447, 449 (Minn. 1981). A district court's decision represents an abuse of discretion only if its resolution of the issue is "clearly erroneous * * * against logic and the facts on the record." Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984). Factual findings are not set aside unless clearly erroneous. McCulloch v. McCulloch, 435 N.W.2d 564, 566 (Minn.App. 1989).
Modification requires that the moving party show both (1) a substantial change in circumstances, and (2) that this change renders the existing award unreasonable and unfair. Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn. 1997). Under the relevant portion of the statute, a substantial change can be shown by proving: (1) a substantial increase or decrease in the earnings of a party; (2) a substantial increase or decrease in the needs of a party; (3) receipt of assistance; or (4) a change in the cost of living of either party. Minn. Stat. § 518.64, subd. 2(a) (1998). An award of maintenance is to be modified "only upon clear proof of facts showing a substantial change of circumstances from those existing at the time of the dissolution." Wiese v. Wiese, 295 N.W.2d 371, 372 (Minn. 1980). It is only when the moving party has demonstrated that modification is warranted that the issue becomes one of setting the amount by balancing the needs of the spouse receiving maintenance against the financial condition of the spouse providing maintenance. Erlandson v. Erlandson, 318 N.W.2d 36, 39-40 (Minn. 1982).
That the parties stipulated to the original judgment does not bar a modification motion. Hecker, 568 N.W.2d at 709. But the trial court should "carefully and only reluctantly" exercise its discretion to modify such a judgment because "the stipulation represents the parties' voluntary acquiescence in an equitable settlement." Beck v. Kaplan, 566 N.W.2d 723, 726 (Minn. 1997).
In a modification proceeding, particularized findings from the district court are necessary to show that the relevant statutory factors have been considered. Tuthill v. Tuthill, 399 N.W.2d 230, 232 (Minn.App. 1987). But if the moving party fails to present a
complete picture of his assets and debts making such findings impossible * * * [he] cannot complain where inadequate documentation leads at least in part to the trial court's refusal to modify a decree.
Id. (upholding denial of modification when moving party failed to provide documentation for all debts and asset information, including equity in home, and refused to be deposed regarding finances).
Here, the district court denied the modification motion on the ground that both parties had a full opportunity to negotiate the 1991 stipulation with no provision for terminating spousal maintenance after retirement. In addition, the district court found that appellant had not made complete disclosure of his income and expenses, by (a) failing to produce his 1997 tax return, (b) disclosing only what he identified as his "primary sources" of income and a "rough sketch" of expenses, (c) failing to show what expenses he shared with his current wife, and (d) failing to rebut evidence that he planned to continue working in Washington state (where he moved after retirement). The district court found that these non-disclosures prevented it from determining that the existing order was unreasonable and unfair.
On review of the record, we cannot say that the district court abused its discretion in denying appellant's modification motion. The district court properly weighed that the parties had stipulated to the original judgment and that the judgment contained no provision for termination of maintenance on retirement. Both parties were close to 60 years old at dissolution, so retirement was not unforeseen.
Further, it is the moving party who bears the burden of proving a substantial change warranting modification. This entails producing evidence to meet that burden. Appellant's single assertion that he has now fully retired is not sufficient, especially in the face of contrary evidence suggesting that appellant may continue to work. The trial court's finding of failure to disclose is not clearly erroneous.
Appellant further claims that the trial court failed to consider alternative grounds for the modification motion; that is, whether there was a substantial change in the income of respondent, as she has also retired and now receives social security and pension benefits. A substantial change in the income of respondent is a separate and independent basis for modification. Minn. Stat. § 518.64, subd. 2(a). Notwithstanding this, the receipt of pension benefits (about $1,400 per month) cannot be considered an increase in the earnings of respondent because these pension benefits were awarded to her in the original property settlement. See Kruschel v. Kruschel, 419 N.W.2d 119, 122-23 (Minn.App. 1988) (receipt of pension benefits awarded in property settlement cannot be considered additional earnings). Therefore, the only increase supported by the record is receipt of social security ($638 per month). Appellant bears the burden of proving this increase is a "substantial change" that renders the existing award "unreasonable and unfair." Appellant did not make that showing.
II. COLA
The discretion of the district court is limited to determining whether all or part of the COLA increase should take effect. Braatz v. Braatz, 489 N.W.2d 262, 264 (Minn.App. 1992), review denied (Minn. Oct. 28, 1992).
Here, the district court based the COLA increase on the amount appellant had been paying ($2,000 every two weeks), rather than the amount ordered in the original judgment ($4,000 per month). The district court erred in basing the increase on the amount of maintenance actually paid, rather than on the amount ordered in the original judgment. The transcript from the settlement hearing shows that the original judgment correctly reflects the agreement of the parties. Respondent never moved to modify the original judgment and there was no evidence of a subsequent "settlement" that increased the level of maintenance. Appellant should not be penalized for the error, or generosity, that caused him to pay maintenance at a level greater than ordered. We modify the maintenance obligation to $4,718 per month, effective January 15, 1998, which reflects the COLA increase applied to the amount ordered in the original judgment.
If either party disputes the effective date or accuracy of this calculation, that party may move in the district court for the proper effective date or calculation, applying our underlying decision.
III. Attorney Fees
The court shall award attorney fees if the fees are necessary for a good-faith assertion of rights because one party has the means to pay and the other party does not have the means to pay. Minn. Stat. § 518.14, subd. 1 (1998). The standard of review for examining an award of attorney fees is whether the trial court abused its discretion. Gully v. Gully, 599 N.W.2d 814, 825 (Minn. 1999).
The district court awarded $3,200 in fees to respondent, finding that respondent was in need of financial assistance to protect her rights. But respondent has significant assets to draw on to pay her own attorney fees. The district court abused its discretion in awarding attorney fees. That award is reversed.
Respondent also seeks attorney fees on appeal. Such fees are not justified and are denied.