Opinion
No. A05-144.
Filed January 10, 2006.
Appeal from the District Court, Olmsted County, File No. F6-96-850.
Lawrence Downing, Terence J. Swihart, Lawrence Downing Associates, (for respondent)
David W. VanDerHeyden, VanDerHeyden and Ruffalo, (for appellant)
Considered and decided by Klaphake, Presiding Judge; Halbrooks, Judge; and Wright, 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This opinion will be unpublished and may not be cited except as provided by Minn.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UNPUBLISHED OPINION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 challenges the district court's post-dissolution order, arguing that the district court (1) erred by directing appellant to reimburse respondent for health-care premiums for which appellant was obligated to pay by the parties' judgment and decree and (2) abused its discretion by ordering appellant to pay attorney fees. Respondent moves to strike certain portions of appellant's appendix. We affirm the decision of the district court and grant respondent's motion to strike.
FACTS
The parties' marriage was dissolved by judgment and decree on October 19, 1999. The judgment provided, among other things, that:
[XI].C.[Appellant] shall maintain health care insurance coverage through his place of employment for the benefit of [respondent] if such privileges are determined to be available pursuant to [Minn. Stat. §] 62A.21. . . . [Respondent] shall pay for her portion of the insurance coverage which equals 20% of the family premium, or $18.00 per month.
[Appellant] will continue said coverage, or coverage similar thereto, for the benefit of [respondent] until [respondent] becomes eligible to be covered under any other group health plan or she remarries. . . .
At the time, appellant was apparently entitled to obtain health-care insurance coverage for respondent at no extra cost to him, even after the dissolution. But soon after the parties' dissolution, appellant's employer was required by Minnesota law to change its method of handling insurance for former spouses of employees. Effective November 1, 1999, respondent's health-insurance coverage was changed from the "family premium" as indicated in the judgment, to a single COBRA continuation coverage, which was significantly more expensive for appellant. Respondent could only be covered under COBRA for three years under the new plan.
In late December 2000, appellant moved the district court to order that respondent share the cost of the premiums for her health-care COBRA coverage and dental COBRA coverage and that she assume the cost of her own health-care and dental insurance coverage 36 months after November 1, 1999. Whether this motion was heard is unclear from the record. But appellant contends that the parties agreed to a stipulation regarding respondent's medical premiums on January 9, 2001, the hearing date on the motion. The alleged stipulation was not read into the record at that time but a court log indicates that the parties agreed to a stipulation, the contents of which are unknown, and that appellant's attorney was to draft a stipulation agreement. Appellant's counsel scheduled a hearing for February 21, 2001, for a motion on child support, but not any of the other issues raised at the January 9, 2001 hearing.
During early 2001, counsel for the parties exchanged correspondence relating to a proposed stipulation to amend the judgment, including a proposed stipulation for amended judgment and decree that required the parties to share the costs of respondent's health-care and dental premiums for 36 months and then for respondent to assume responsibility for her own health-care and dental coverages. Respondent never signed the proposed stipulation.
On May 16, the district court heard arguments on several motions. At the hearing, respondent's counsel stated, "I believe that the re-stated motion that we filed dated May 8 distills down what's left [along with appellant's child support motion]." Respondent's motion dated May 8 requested, among other things, that "[appellant] be responsible for [respondent's] unreimbursed medical and dental expenses incurred as a result of his failure to obtain and/or document such insurance coverage."
Appellant's counsel requested clarification stating, "I sent a stipulation concerning the payment of medical and dental premiums some time ago that we arrived at at our January 8 hearing. And I want to know that we do in fact have a stipulation with respect to those matters. . . ." Respondent's counsel responded, "That is the case. We do have an agreement with respect to the handling of those premiums." Respondent's counsel then affirmed to the district court that his client would sign the stipulation and the district court moved on to other issues. The contents of the stipulation were never placed on the record.
On August 9, 2001, the district court filed an order which stated in relevant part:
2. By agreement of the parties, [respondent] and [appellant] shall pay the cost of Blue Cross Blue Shield COBRA continuation health insurance coverage on a single contract basis at a current total cost of $179.70 per month for 36 months commencing November 1, 1999 and effective January 1, 2001.
3. By agreement of the parties, [respondent] and [appellant] shall pay the cost of Delta Dental COBRA continuation dental insurance coverage on the family dental contract basis at a current total cost of $49.88 per month for 36 months commencing October 19, 1999 and effective January 1, 2001.
4. By agreement of the parties, [respondent] shall maintain her own dental insurance coverage effective 36 months commencing October 19, 1999. . . .
Appellant stopped paying for respondent's health-care insurance premium in late 2002, believing that his obligation terminated at that time, based on the August 9 order. Respondent filed a motion on February 6, 2003, to compel appellant to comply with the insurance provisions in the judgment and decree by maintaining health insurance for respondent. At the February 20, 2003 hearing on respondent's motion, respondent argued that appellant failed to show the substantial change in the parties' circumstances that rendered the existing award unreasonable or unfair. See Minn. Stat. § 518.64 (2004). Respondent emphasized that the August 9, 2001 order never modified the original judgment with respect to appellant's obligation to maintain and continue health-care insurance coverage for respondent so the original judgment "still stands."
Appellant argued that the August 9, 2002 order terminated his obligation to pay for health-care insurance 36 months after November 1, 1999. Appellant's counsel stated, "that order . . . modifies and amends the decree specifically and expressly pursuant to the agreement of the parties with respect to the obligations of medical and dental insurance." Appellant's counsel then argued that because the order modified the judgment, respondent must show a substantial change to modify the spousal maintenance.
The district court issued an order dated April 30, 2003, finding that appellant failed to comply with the insurance provisions of the judgment and decree. The order directed appellant to reimburse respondent for the costs of the premium payments for the months of December 2002 through February 2003.
Appellant again moved the district court for amended findings that appellant had no obligation to provide for respondent's health-care insurance. At the hearing, appellant produced the May 16, 2001 transcript, which indicates that the parties had agreed in court to execute a stipulation that terminated appellant's obligation as of November 1, 2002. In an order dated October 30, 2003, the district court denied appellant's motion, treating it as a motion for reconsideration, and reaffirmed the April 30, 2003 order that appellant failed to comply with the judgment's provisions relating to health-insurance coverage.
Appellant appealed from the April 30 and October 30 orders, but this court dismissed the appeals without prejudice, concluding that the orders were not appealable because judgment had not been entered on the monetary awards. Appellant moved the district court to enter a judgment on the monetary awards and the district court did so on December 13, 2004. This appeal follows.
On appeal, respondent moved to strike certain affidavits submitted by appellant from the record.
DECISION
An obligation to provide medical insurance is treated as a form of spousal maintenance. Hughes v. Hughley, 569 N.W.2d 534, 536 (Minn.App. 1997). "The trial court's findings of fact concerning the stipulated judgment will be upheld unless they are clearly erroneous." Bone v. Bone, 438 N.W.2d 448, 451 (Minn.App. 1989). If a judgment is ambiguous, a district court may construe or clarify it. Stieler v. Stieler, 244 Minn. 312, 319, 70 N.W.2d 127, 131 (1955). Absent ambiguity, however, it is not proper for a court to interpret a stipulated judgment. See Starr v. Starr, 312 Minn. 561, 562-63, 251 N.W.2d 341, 342 (1977).
At the February 20, 2003 hearing on respondent's motion, appellant asserted that the parties had reached a stipulation, but presented no evidence of an executed stipulation to the district court. To determine whether a purported stipulation is to be accorded binding effect, a court considers whether "(1) the party was represented by competent counsel; (2) negotiations were extensive and detailed; (3) the party agreed to the stipulation in open court; and (4) when questioned by the judge, the party acknowledged understanding the terms and considering them fair and equitable." Toughill v. Toughill, 609 N.W.2d 634, 639 (Minn.App. 2000).
Here, the evidence before the district court after the February 20, 2003 hearing was not sufficient to show that the parties stipulated to an agreement on health-care insurance. While appellant provided evidence that the parties negotiated, the parties never executed a written stipulation. Further, the record does not reflect that the parties agreed to stipulate to terminate appellant's obligation in open court or that a judge questioned the parties as to the terms of the stipulation.
The district court analyzed the language in the August 9, 2001 order and concluded that the parties had agreed on some parts of appellant's proposed stipulation, but not to a provision concerning whether and when appellant's obligation to provide health-care insurance would terminate. And the district court noted that the August 9 order did not include a finding that the parties' circumstances had substantially changed since entry of the original decree. Therefore, the district court concluded that it was reasonable to interpret the August 9 order as not terminating appellant's obligation. Based on the evidence before the district court at that time, we cannot say the district court clearly erred in its April 30, 2003 order.
After the district court issued the April 30, 2003 order, appellant moved for amended findings or additional findings because respondent "agreed on the record to execute a stipulation . . . as follows." Appellant then included language from the proposed stipulation that he sent to respondent in 2001 including a provision that appellant's obligation to provide health-care insurance coverage terminated 36 months after November 1, 1999. At the August 22, 2003 hearing, appellant produced a transcript from the May 16, 2001 hearing in which respondent's counsel affirmed that respondent would sign a stipulation that had been exchanged between the parties.
But in its October 30, 2003 order, the district court noted that appellant's motion "ignore[d] the court's previous consideration and resolution of the same issue," and the district court treated the motion as a motion for reconsideration. The district court then stated that "[m]otions for reconsideration are not opportunities for presentation of facts or arguments available when the prior motion was considered," citing Minn. R. Civ. Pract. 115.11. Finally, the district court concluded that, even if the parties had agreed to handle payment of future premiums by stipulation, the May 16, 2001 transcript does not indicate that the parties agreed that appellant's obligation would terminate. And clearly, no stipulation was ever entered on the record nor were the parties questioned by the judge as to the terms. Therefore, the district court did not clearly err by denying appellant's motion.
While we affirm the decision of the district court, we would be remiss if we did not address an ethical issue of particular concern in this case: we do not condone respondent's counsel's conduct in which he avowed to the district court during the May 16, 2001 hearing, on the record, that his client would sign a stipulation, then refused to do so, and did not acknowledge this agreement years later when this litigation arose. Appellant and appellant's counsel apparently relied on that assertion to their detriment rather than pursuing the matter at the May 16, 2001 hearing or securing an executed stipulation from respondent after the hearing. While we cannot inquire into respondent's counsel's intent when he affirmed his client's agreement to the district court, or his memory of that affirmation, we point out that ethical rules require candor toward the district court. See Minn. R. Prof. Conduct. 3.3(a)(1) ("A lawyer shall not knowingly make a false statement of fact to a tribunal."). This litigation may have been avoided had counsel for both parties resolved all issues after the August 9, 2001 order was issued. But we cannot act on hindsight alone in our role as an error-correcting court.
II.
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). A trial court shall award attorney fees when such award is necessary for a party to assert his or her rights in an action, that the payor has the financial means to pay the fees, and that the payee lacks the means to pay the fees. Minn. Stat. § 518.14, subd. 1. The court may award, "in its discretion, additional fees, costs, and disbursements against a party who unreasonably contributes to the length or expense of the proceeding." Id.
Here, the district court awarded attorney fees to respondent in its October 30, 2003 order because appellant's "motion does not have merit and does reflect his bad faith." The district court noted that respondent lacked funds to respond to or bring a motion to seek appellant's compliance with any portion of the judgment and decree. The district court found respondent's income to be limited because of her medical ailments, and modest compared to appellant's income. The district court concluded "[t]he record is void of evidence of a stipulation that could reasonably be construed to terminate [appellant's] ongoing obligation to provide health insurance coverage for [respondent]."
And the district court treated appellant's motion seeking relief from the provisions of the judgment and decree as a motion to reconsider. "A motion to `reconsider' is permitted under limited circumstances." Limongelli v. GAN Nat'l Ins. Co., 590 N.W.2d 167, 168 (Minn.App. 1999). But the district court found that appellant had failed to show a need for his motion. The district court concluded that on the merits, appellant's claim for relief is "unfounded." Because we agree that no evidence of a stipulation to end appellant's obligation to provide health-care insurance existed in the record, and because appellant has the means to pay respondent's attorney fees, we conclude the district court's award to respondent of attorney fees was not an abuse of discretion.
III.
Respondent argues that certain of appellant's submissions on appeal must be stricken from the appellate record. "The papers filed in the [district] court, the exhibits, and the transcript of the proceedings, if any, shall constitute the record on appeal." Minn. R. Civ. App. P. 110.01. "An appellate court may not base its decision on matters outside the record on appeal, and may not consider matters not produced and received in evidence below." Theile v. Stich, 425 N.W.2d 580, 582-83 (Minn. 1988).
Appellant argues that by appealing the October 30, 2003 order, he appealed all orders involving "the merits or affecting the judgment." Respondent argues that appellant did not raise on appeal the district court's decision to strike the affidavits so he cannot argue now that the affidavits are part of the record. But whether or not appellant properly raised this issue on appeal, when reviewing evidentiary rulings, absent erroneous interpretation of the law, the question of whether to admit or exclude evidence is within the district court's discretion. Kroning v. State Farm Auto. Ins. Co., 567 N.W.2d 42, 45-46 (Minn. 1997).
The district court noted in its memorandum of law that "[a]lthough the Court is waiving the prerequisites for reconsideration under Minn. Gen. R. Pract. 115.11, reconsideration does not invite expansion or supplementation of the record." See Sullivan v. Spot Weld, Inc., 560 N.W.2d 712, 716 (Minn.App. 1997), review denied (Minn. Apr. 24, 1997). "Thus, [respondent's] motion to strike the affidavits of [appellant] and [appellant's counsel] is granted." Here, the district court did not abuse its discretion by striking the affidavits because appellant attempted to introduce new evidence to the district court in its motion to reconsider the May 2, 2003 order. That is not permitted under Minn. Gen. R. Pract. 115.11.
We grant respondent's motion to strike the affidavits of appellant and his attorney because the district court did not abuse its discretion by striking the affidavits. Because the documents were stricken by the district court, they are not part of the record on appeal.