Opinion
No. A05-394.
Filed December 6, 2005.
Appeal from the District Court, Ramsey County, File No. FX-86-22595.
Thomas W. Tuft, Valerie Downing Arnold, Tuft Arnold, Pllc, (for appellant).
Marilyn J. Michales, Lisa M. Meier, Honsa Michales, P.A., (for respondent).
Considered and decided by Minge, Presiding Judge; Kalitowski, Judge; and Shumaker, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2004).
UNPUBLISHED OPINION
Appellant David W. Ganyo challenges the district court's orders denying appellant's motions to terminate or reduce spousal maintenance, to reopen the hearing, and to amend the findings. Appellant contends that the district court erred by: (1) failing to find a substantial change in circumstances justifying maintenance modification; (2) failing to terminate his obligation to maintain a life insurance policy as security for maintenance; (3) awarding respondent attorney fees and costs; (4) classifying appellant's request for amended findings as a motion for reconsideration; and (5) denying appellant's motion to reopen the record. Respondent contends that the district court erred by allowing a reduction of appellant's life insurance obligation and seeks attorney fees for this appeal. We affirm.
DECISION I.
The determination of spousal maintenance is within the district court's broad discretion. Stich v. Stich, 435 N.W.2d 52, 53 (Minn. 1989). This court reviews a district court's maintenance award under an abuse of discretion standard. Dobrin v. Dobrin, 569 N.W.2d 199, 202 (Minn. 1997); Erlandson v. Erlandson, 318 N.W.2d 36, 38 (Minn. 1982). For this court to conclude that the district court abused its broad discretion regarding an award of spousal maintenance, the district court's findings must be "against logic and the facts on [the] record." Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984). "Findings of fact concerning spousal maintenance must be upheld unless they are clearly erroneous." Gessner v. Gessner, 487 N.W.2d 921, 923 (Minn.App. 1992); see Minn. R. Civ. P. 52.01.
Appellant argues that the district court clearly erred in finding certain facts, and, therefore, abused its discretion when it denied appellant's motion to terminate or reduce his spousal maintenance obligation. We disagree.
1. Fact findings
Appellant claims that the court erred in finding that he failed to explain how he spent funds withdrawn from his deferred compensation plan (DCP). But the record supports the district court's finding that appellant did not demonstrate how he had depleted those funds. Appellant claimed that he spent his DCP proceeds on "living expenses, medical bills, legal fees, and taxes on the deferred compensation funds." But beyond that general statement, appellant failed to provide any documented proof as to how the funds were spent. Based on that sparse record, the district court's finding that appellant failed to prove where he spent those funds was not clearly erroneous.
Appellant's supplemental affidavit contained a schedule of where he spent his DCP funds. But because the affidavit was filed in August 2004, it was not part of the record for the district court's July 2004 decision. Rathbun v. W.T. Grant Co., 300 Minn. 223, 238, 219 N.W.2d 641, 651 (1974) (stating that when a trial court considers a motion for amended findings, "[i]t may neither go outside the record, nor consider new evidence"). Therefore, this court may not consider that affidavit in its review of the July decision's fact findings. "[A]n appellate court may not base its decision on matters outside the record on appeal, and . . . matters not produced and received in evidence below may not be considered." Plowman v. Copeland, Buhl Co., 261 N.W.2d 581, 583 (Minn. 1977). Even if we could consider that affidavit, it was merely a typed list of expenses that lacked any supporting documentation.
Appellant claims the district court erred in finding that he failed to explain why he no longer receives $16,608 in interest income. He asserts that "[t]here is no evidence in the record to support a finding that Appellant ever earned $16,608 in interest income." But appellant's 2001 federal income tax return, which was filed jointly with his current wife, reports interest income of $16,608. The record contains no documented explanation as to why that income is no longer available to appellant. As such, the district court's finding that appellant failed to explain why he was no longer receiving the $16,608 is not clearly erroneous.
Appellant also challenges the district court's findings as to respondent's monthly income and expenses. The court found that respondent's monthly living expenses were over $4,000 with net monthly income of $922.33. Those amounts were supported by a pay stub and expense schedules in the record.
At the time of the district court's proceedings, respondent was 62 years old. At age 62, respondent was eligible to receive social security benefits, but she chose to wait until she reached the full-time retirement age of 65 to receive them. Appellant urged the district court to impute respondent's potential social security benefits to her as income. The court declined to do so, reasoning that "[w]orking until 65 will give respondent the ability to collect a greater amount of social security and be better able to provide for her necessary expenses, without the income offsets which earlier withdrawal entails." The record supports the district court's decision. Appellant claims that the district court applied a "double standard" when it imputed social security income to him in a decision in 2000 but did not impute respondent's potential social security benefits to respondent here. But the district court's earlier determination, which was affirmed by this court on direct appeal in 2001, is not properly before us now. See State v. Knaffla, 309 Minn. 246, 252, 243 N.W.2d 737, 741 (1976).
We reject appellant's claim that the district court clearly erred by accepting respondent's expenses while disregarding appellant's expenses. Appellant cites Laumann v. Laumann, 400 N.W.2d 355 (Minn.App. 1987), review denied (Minn. Nov. 24, 1987), as support for that proposition. But Laumann is distinguishable from the case here. In Laumann, the trial court reduced the wife's claimed expenses by over 40% while accepting the husband's expenses " in toto." Id. at 359. In a fact-specific holding, this court concluded that the district court erred because there was no justification in the record for reducing wife's expenses. Id. Here, the district court did not reduce all of appellant's claimed expenses, but merely rejected the proof offered for his medical expenses, noting the alleged expenses were not reflected in appellant's tax returns.
We conclude that the evidence supports the district court's findings as to respondent's monthly income and expenses and the court provided sufficient reason to exclude respondent's potential social security benefits from her income. Therefore, the district court's findings as to respondent's monthly income and expenses were not clearly erroneous.
2. Substantial change in circumstances
Under Minnesota law, a maintenance order may be modified upon a showing of one or more of the following:
(1) substantially increased or decreased earnings of a party;
(2) substantially increased or decreased need of a party or the child or children that are the subject of these proceedings;
(3) receipt of assistance under the AFDC program . . .;
(4) a change in the cost of living for either party as measured by the Federal Bureau of Statistics . . .;
(5) extraordinary medical expenses of the child . . .; or
(6) the addition of work-related or education-related child care expenses of the obligee or a substantial increase or decrease in existing work-related or education-related child care expenses.
Minn. Stat. § 518.64, subd. 2(a) (2004). "[T]he essential consideration [in awarding maintenance] is the financial need of the spouse receiving maintenance, and the ability to meet that need, balanced against the financial condition of the spouse providing the maintenance." Novick v. Novick, 366 N.W.2d 330, 334 (Minn.App. 1985).
A party seeking modification must demonstrate first that "there has occurred a substantial change in one or more of the circumstances identified in the statute and second, . . . that the substantial change has the effect of rendering the original award unreasonable and unfair." Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn. 1997); see also Minn. Stat. § 518.64, subd. 2.
Appellant contends that respondent's financial resources increased while appellant's income decreased due to his poor health and depletion of his DCP funds. Therefore, appellant argues that he established a substantial change in circumstances and the district court erred by finding he failed to carry that burden. We disagree.
The district court made specific findings regarding appellant's failure to credibly explain the disappearance of resources that were once available to him. Where a moving party "fail[s] to present a complete picture of his assets and debts," a trial court may be justified in refusing to modify the decree. Tuthill v. Tuthill, 399 N.W.2d 230, 232 (Minn.App. 1987). The court also made findings as to respondent's income and expenses, explaining why it was not including her potential social security income in its calculations.
Appellant also argues that the district court failed to consider all of the statutory factors for maintenance modification. But the district court is not required to make specific findings on every statutory factor if the findings that were made reflect that the district court adequately considered the relevant statutory factors. Rosenfeld v. Rosenfeld, 311 Minn. 76, 83, 249 N.W.2d 168, 171-72 (1976). Here, the district court considered the relevant factors concerning the needs and earnings of the parties and held that appellant had not met his burden of showing that they had changed. Specifically, appellant failed to adequately explain his decrease in income. The failure to show such a change precludes a modification of maintenance obligations under Minn. Stat. § 518.64, subd. 2.
We conclude that there was sufficient evidence in the record supporting the district court's conclusion that appellant failed to meet his burden of showing a substantial change in circumstances. The district court did not abuse its discretion in denying appellant's motion to reduce or terminate spousal maintenance.
II.
The parties' original dissolution judgment, which provided for temporary maintenance, required appellant to maintain a life insurance policy with $50,000 coverage naming respondent as beneficiary "so long as he has an obligation to provide maintenance." When the order was modified to require permanent maintenance, the life insurance requirement was not changed. In the order on appeal, the district court granted in part appellant's motion to terminate his life insurance obligation, allowing him to reduce the coverage amount "never to be less than the total of what petitioner will owe between the present and the date upon which respondent reaches age 65."
Both parties challenge the district court's order regarding life insurance. Appellant argues that the district court erred by not terminating his obligation to provide life insurance to secure the spousal maintenance. And respondent argues that appellant's life insurance obligation should continue at the previous $50,000 coverage level.
A trial court "has discretion to consider whether the circumstances justifying an award of maintenance also justify securing it with life insurance." Laumann v. Laumann, 400 N.W.2d 355, 360 (Minn.App. 1987), review denied (Minn. Nov. 24, 1987). "The decision whether to require security and how much under the circumstances, lies within the broad discretion of the trial court." Head v. Metropolitan Life Ins. Co., 449 N.W.2d 449, 453 (Minn.App. 1989), review denied (Minn. Feb. 21, 1990). Factors justifying security of maintenance include an award of permanent maintenance, the duration of a marriage, and the spouse's age and lack of marketable skills. Arundel v. Arundel, 281 N.W.2d 663, 667 (Minn. 1979).
Applying the Arundel factors here, we conclude that the district court did not abuse its discretion in continuing appellant's life insurance obligation. The spousal maintenance award is permanent. The parties were married for approximately 27 years. Respondent was 62 years old at the time of the district court's order. She has a high-school education and has worked as a retail salesperson since 1969. Due to a brain hemorrhage in 1996, respondent is limited to working part time.
And neither party provided persuasive legal or factual support as to why the level of security in the district court's order was inappropriate. Appellant contends that he is unable to afford life insurance, but he provides no proof or documentation to support that contention. Respondent insists that the $50,000 coverage level be reinstated. But when asked by the district court to provide legal support for requiring the district court to continue life insurance on maintenance beyond the parties' retirements, respondent only cites Arundel. And Arundel is distinguishable because the obligee in Arundel was not employed and the district court had terminated the life insurance obligation when the obligee reached age 60. Id. at 666-67. On appeal, respondent fails to provide any legal support or explain based on the parties' financial situations why the reduced coverage as ordered will not reasonably secure the maintenance payments.
Both the decision to require security for life insurance and the amount of that security are within the district court's discretion. Under these facts, we cannot say that the district court abused its discretion in maintaining appellant's life insurance obligation at a reduced coverage amount.
III.
Appellant argues that the district court erred by awarding respondent $4,398.20 in need-based and conduct-based attorney fees. We disagree. An award of attorney fees under Minn. Stat. § 518.14, subd. 1 (2004), "rests almost entirely within the discretion of the trial court and will not be disturbed absent a clear abuse of discretion." Crosby v. Crosby, 587 N.W.2d 292, 298 (Minn.App. 1998) (quotation omitted), review denied (Minn. Feb. 18, 1999).
An award of attorney fees is appropriate when "necessary to enable a party to carry on or contest the proceeding." Minn. Stat. § 518.14, subd. 1. A court shall award need-based attorney fees to a party if it finds:
(1) that the fees are necessary for the good-faith assertion of the party's rights in the proceeding and will not contribute unnecessarily to the length and expense of the proceeding;
(2) that the party from whom fees, costs, and disbursements are sought has the means to pay them; and
(3) that the party to whom fees, costs, and disbursements are awarded does not have the means to pay them.
Id. A court can also award conduct-based attorney fees against a party who "unreasonably contributes to the length or expense of the proceeding." Id. Conduct-based fees can be awarded "based on the impact a party's behavior has had on the costs of the litigation regardless of the relative financial resources of the parties." Dabrowski v. Dabrowski, 477 N.W.2d 761, 766 (Minn.App. 1991).
In awarding fees, the district court "must indicate to what extent the award [is] based on need or conduct or both" and, if based on conduct, what conduct justified the award. Geske v. Marcolina, 624 N.W.2d 813, 816, 819 (Minn.App. 2001). Findings do not necessarily have to be specific, but they must be sufficient enough for appellate review. See Gully v. Gully, 599 N.W.2d 814, 825-26 (Minn. 1999) (finding district court's language was sufficient to uphold award of need-based attorney fees because the language used reasonably implied such a result).
Here, the district court awarded need-based and conduct-based attorney fees, reasoning that appellant's failure to completely respond to discovery contributed to the length and expense of the proceedings. Appellant argues that the district court erred by granting respondent attorney fees because the record does not indicate that appellant can afford to pay the fees and because appellant did not contribute unnecessarily to the length and expense of the proceedings.
The district court did not make specific findings as to appellant's income, because, as was discussed above, appellant failed to provide sufficient information regarding his resources. In addition, the record supports the district court's conclusion that appellant has unreasonably contributed to the length and expense of the proceedings. We conclude that the district court did not abuse its wide discretion in awarding respondent legal fees.
IV.
Appellant argues that the district court erred by classifying appellant's request for amended findings as a motion for reconsideration. We disagree. "The purpose of a motion for amended findings is to permit the trial court a review of its own exercise of discretion." Lewis v. Lewis, 572 N.W.2d 313, 315 (Minn.App. 1997) (quotations omitted), review denied (Minn. Feb. 19, 1998). A proper motion for amended findings must explicitly identify the alleged defects and explain why the challenged findings are defective. Id. at 315. If there is conflicting evidence, a court is not compelled to amend. Id. at 316.
Although Lewis was overruled as it pertained to the tolling effects of a motion for amended findings, this court has expressly stated that district courts "should . . . continue to use Lewis to determine whether a motion for amended findings has the necessary components." State by Fort Snelling State Park Ass'n v. Minneapolis Park Recreation Bd., 673 N.W.2d 169, 178 n. 1 (Minn.App. 2003).
Where a motion for amended findings does not make any new legal or factual arguments, so that it does no more than reargue a prior motion, it is really a motion for reconsideration. See Carter v. Anderson, 554 N.W.2d 110, 113 (Minn.App. 1996), review denied (Minn. Dec. 23, 1996). The Minnesota Rules of General Practice set out procedural requirements for reconsideration.
Motions to reconsider are prohibited except by express permission of the court, which will be granted only upon a showing of compelling circumstances. Requests to make such a motion, and any responses to such requests, shall be made only by letter to the court of no more than two pages in length, a copy of which must be sent to opposing counsel.
Minn. Gen. R. Pract. 115.11.
In its July order, the district court found, inter alia, that "[n]o explanation is given by petitioner as to why the $16,608 in interest was no longer being paid" and "[n]either has petitioner explained how it was that his deferred income was spent." Appellant made a motion to amend the court's findings. The district court denied that motion in its December 2004 order, finding that "[t]o the extent that petitioner seeks a review of those determinations contained in the findings of fact, etc., he seeks a motion for reconsideration, for which no authorization was sought or granted."
First, we conclude that appellant's motion to amend the findings did not meet the requirements for such a motion under Lewis. Appellant's motion suggested changes in the district court's findings but did not explicitly identify defects or explain why the challenged findings were defective. Appellant's suggested changes merely restated the arguments made to, and rejected by, the district court, namely that appellant never had $16,608 in interest income and that he had spent his DCF funds on living expenses, medical bills, and legal fees.
Second, because appellant's motion to amend merely reargued its original arguments before the district court, the district court properly characterized it as a motion for reconsideration. Under Minn. Gen. R. Pract. 115.11, a movant must request the motion by letter to the district court. Because the record indicates that appellant never sent a letter to the court requesting reconsideration, his motion for reconsideration was procedurally barred under rule 115.11. The district court correctly stated that "no authorization was sought or granted" for the reconsideration. We conclude that the district court did not err in denying appellant's motion for amended findings because that motion was actually a procedurally barred motion for reconsideration.
V.
Appellant claims that the district court erred by denying appellant's motion to reopen the record. We disagree. A district court's decision regarding whether to reopen a judgment will be upheld unless the court abused its discretion. Harding v. Harding, 620 N.W.2d 920, 922 (Minn.App. 2001), review denied (Minn. Apr. 17, 2001). The district court's findings as to whether the judgment was prompted by mistake or fraud will not be set aside unless clearly erroneous. Hestekin v. Hestekin, 587 N.W.2d 308, 310 (Minn.App. 1998) (citing Kornberg v. Kornberg, 542 N.W.2d 379, 386 (Minn. 1996)).
A court may reopen the record and relieve a party from an order or grant other relief where it finds "fraud, whether denominated intrinsic or extrinsic, misrepresentation, or other misconduct of an adverse party." Minn. Stat. § 518.145, subd. 2(3) (2004). Where a motion to reopen a dissolution judgment is made within one year after the entry of the judgment, the legal standard to be applied is ordinary fraud, not fraud on the court. Doering v. Doering, 629 N.W.2d 124, 130 (Minn.App. 2001), review denied (Minn. Sept. 11, 2001). Under the ordinary fraud standard, "failure of a party to a dissolution to make a full and complete disclosure constitutes sufficient reason to reopen the dissolution judgment." Id. at 129.
One month after the district court denied appellant's motion to terminate or modify spousal maintenance, appellant moved to reconsider respondent's financial need in light of her ownership interest in a North Dakota residence. He alleged that her failure to disclose the interest was fraudulent. The court denied the motion, finding that respondent had not fraudulently concealed her interest. In addition, the court noted that respondent's interest in the home would not have altered its earlier decision.
Here, the district court's finding of a lack of fraud in its earlier judgment was not clearly erroneous. The record indicates that respondent owns a one-third interest in a North Dakota residence valued at $48,900. She shares the interest with her brother and sister. Her elderly brother lives in the house and does not pay rent. There was no evidence in the record indicating that respondent fraudulently concealed that interest. Moreover, the record shows that appellant was aware of respondent's interest in the North Dakota property. In 2000, he argued to this court, as he does now, that the district court's refusal to modify maintenance was defective because it did not consider that property. Ganyo v. Engen, No. CX-01-263, 2001 WL 1124400, at *3 (Minn.App. Sept. 25, 2001). This court rejected appellant's argument in 2000 and there is no indication that circumstances have changed since then. We conclude that the district court did not abuse its discretion in denying appellant's motion to reopen the record.
VI.
Finally, respondent seeks attorney fees on appeal. But a motion for attorney fees must be made in a separate motion to this court and respondent has not made such a motion here. See Minn. R. Civ. App. P. 139.06, subd. 1. Because no motion was filed, respondent's request for fees on appeal is not properly before this court.