Opinion
A23-0918
07-09-2024
In re the Marriage of: Scott Ryan Olson, petitioner, Respondent, v. Tera Leigh Olson, n/k/a Tera Leigh Johnson, Appellant.
Dakota County District Court File No. 19AV-FA-20-2188
Considered and decided by Larkin, Presiding Judge; Bratvold, Judge; and Frisch, Judge.
ORDER OPINION
Diane B. Bratvold Judge
BASED ON THE FILE, RECORD, AND PROCEEDINGS, AND BECAUSE:
1. Appellant Tera Leigh Olson, now known as Tera Leigh Johnson (wife), seeks review of the district court's findings of fact, conclusions of law, and order dated December 23, 2022 (December 2022 order), and the related amended findings of fact, conclusions of law, and order dated April 25, 2023 (April 2023 amended order).
2. Respondent Scott Ryan Olson (husband) petitioned for dissolution in August 2020. The district court entered stipulated permanent partial findings of fact, conclusions of law, order for judgment and decree in November 2022 (2022 decree). The 2022 decree reserved two issues relevant to this appeal: (A) whether husband should be required to maintain life insurance as security for the permanent spousal maintenance awarded to wife and (B) whether husband should pay wife's need- and conduct-based attorney fees.
3. After receiving written submissions on the two open issues, the district court denied wife's requests in the December 2022 order.
4. In January 2023, wife moved for amended findings and/or a new trial. The district court granted wife's motion in part and denied it in part in the April 2023 amended order. The district court, among other things, denied wife's requests that husband be required to maintain life insurance as security for spousal maintenance and that he pay her attorney fees.
5. The district court's findings about the parties' income and needs provide relevant context for the issues on appeal. In the 2022 decree, the district court found that husband is general manager and chief sales officer for a corporation and that his "total compensation package" is $145,890.60 in base pay, commissions, and bonuses, "which may vary from year to year" and totaled $64,757.16 in 2022. The district court found that husband has monthly expenses of $6,500.
6. The district court also found that wife's gross annual income was $13,761 in 2021 while she was working part-time at a grocery store and earning less than $10,000 from a divorce-mediation business. The district court found that wife "is capable of earning $20 per hour and working 35 hours per week, for a total gross annual income of $36,400," and that wife's monthly expenses are $6,500.
7. The district court determined that wife "has a need for a contribution to her monthly need" from husband. Accordingly, the district court ordered husband to pay $2,850 per month in "Tier I" permanent spousal maintenance and one half of his net bonuses and commissions as "Tier II" permanent spousal maintenance, with an annual cap of $13,800 for the Tier II support payments.
8. Wife raises two issues in her brief to this court. First, wife contends that the district court abused its discretion by denying her request for husband to secure his spousal-maintenance obligation. We review a district court's decision about securing spousal maintenance with life insurance for an abuse of discretion. Katter v. Katter, 457 N.W.2d 750, 754 (Minn.App. 1990). "A district court abuses its discretion by making findings of fact that are unsupported by the evidence, misapplying the law, or delivering a decision that is against logic and the facts on record." Woolsey v. Woolsey, 975 N.W.2d 502, 506 (Minn. 2022) (quotation omitted).
9. Under Minn. Stat. § 518A.71 (2022), "[i]n all cases when maintenance or support payments are ordered, the court may require sufficient security to be given for the payment of them." A district 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), rev. denied (Minn. Nov. 24, 1987). "Factors justifying security for a spousal-maintenance award include the obligee's age, education, vocational experience, and employment prospects." Kampf v. Kampf, 732 N.W.2d 630, 635 (Minn.App. 2007), rev. denied (Minn. Aug. 21, 2007).
10. Wife argues that the district court abused its discretion when it stated that "insurance as security for spousal maintenance is awarded only in 'exceptional cases.'"
11. Wife is correct that the district court cited outdated caselaw in its order; specifically, the district court stated that, "in the exceptional case, the reasons which justify granting permanent alimony . . . also justify the securing of that alimony," citing Arundel v. Arundel, 281 N.W.2d 663, 667 (Minn. 1979). In Kampf, which was decided in 2007, we concluded that a district court abused its discretion by applying the "exceptional case test" to an appellant's request that life insurance be required as security for spousal maintenance. 732 N.W.2d at 635. We explained that "the 1985 statutory amendments" to the spousal-maintenance statutes "eliminated the exceptional-case requirement for awarding permanent spousal maintenance" and accordingly determined that "the 1985 statutory modification for awarding permanent maintenance also eliminated the parallel exceptional-case test for securing permanent maintenance awards with life insurance." Id.
12. But the district court's error in referring to the "exceptional case test" does not end our analysis. The district court denied wife's motion for life insurance as security for the spousal-maintenance obligation based on its assessment of the Kampf factors, including wife's "age, education, work experience, and employment prospects." Id. The district court found that wife was 48 years old at the time of the order, had "limited work experience," "owns a family law mediation business," "has education and training in a professional field," and has no "known issues preventing her from working full time" other than the fact she "has been out of the full-time work-force for many years." The district court also found that wife was "very close to meeting her agreed-upon monthly expenses" with her stipulated income and the ordered Tier I spousal maintenance. Based on these findings, the district court denied wife's motion to require life insurance as security for permanent spousal maintenance.
13. We conclude that, although the district court erred by citing outdated caselaw in its order, the district court applied the correct legal standard under Kampf when it denied wife's motion. We also observe that wife's brief to this court does not argue that the district court abused its discretion in its application of the Kampf factors. Thus, we discern no abuse of discretion in the district court's decision to deny wife's request that husband be required to maintain life insurance as security for his spousal-maintenance obligation.
Although wife's brief to this court makes other arguments about the district court's order denying her request for life insurance as security for spousal maintenance, we conclude that her other arguments are unrelated to the Kampf factors, and therefore, we do not discuss them.
14. Wife raises a second issue: that the district court abused its discretion by denying her motion for need-based and conduct-based attorney fees. "In a dissolution proceeding, Minn. Stat. § 518.14, subd. 1 (2000), allows the district court to award both need-based and conduct-based attorney fees." Geske v. Marcolina, 624 N.W.2d 813, 814 (Minn.App. 2001) (citing a version of the statute identical to the current version).
15. Need-based attorney fees are meant to "enable a party to carry on or contest the proceeding." Minn. Stat. § 518.14, subd. 1 (2022). A district court shall award need-based attorney fees if it finds that (1) "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) "the party from whom fees . . . are sought has the means to pay them"; and (3) "the party to whom fees . . . are awarded does not have the means to pay them." Id. All three requirements must be met to require the district court to order need-based attorney fees.
16. Only the second factor is at issue on appeal. The district court found that husband "borrowed money to pay his own attorney fees [and] has incurred costs for [a] custody and parenting time evaluation, a chemical dependency evaluation, counseling, a Moderated Settlement Conference, mediation, and Dax Stoner analysis" and that, based on the financial information provided to the district court, husband "does not have the ability to pay [wife's] attorney fees." The record supports these findings. Therefore, the district court's finding that husband was unable to pay wife's attorney fees is not clearly erroneous and the district court did not err by determining that wife did not meet the statutory requirements for need-based attorney fees and denying her motion. See Peterka v. Peterka, 675 N.W.2d 353, 357-58 (Minn.App. 2004) (stating that we review a district court's findings of fact for clear error and that those findings are not clearly erroneous if we determine the evidence reasonably supports the findings).
17. Conduct-based attorney fees are also governed by Minn. Stat. § 518.14, subd. 1, which allows a district court to award attorney fees against a party "who unreasonably contributes to the length or expense of the proceeding." Appellate courts review a district court's denial of a motion for conduct-based attorney fees for an abuse of discretion. Szarzynski v. Szarzynski, 732 N.W.2d 285, 295 (Minn.App. 2007).
18. The district court determined that husband "did not unreasonably contribute to a delay in this litigation." The record supports the district court's determination because the parties stipulated to the 2022 decree and reserved the two issues that were litigated after the 2022 decree. Thus, we conclude that the district court did not abuse its discretion by denying wife's request for conduct-based attorney fees.
IT IS HEREBY ORDERED:
1. The district court's order denying appellant's requests to require respondent to maintain life insurance and for attorney fees is affirmed.
2. Pursuant to Minn. R. Civ. App. P. 136.01, subd. 1(c), this order opinion is nonprecedential, except as law of the case, res judicata, or collateral estoppel.