Opinion
No. 61737-1-I.
September 21, 2009.
Appeal from the Superior Court, Whatcom County, No. 02-3-00668-0, Steven J. Mura J., entered April 25, 2008.
Reversed and remanded by unpublished opinion per Grosse, J., concurred in by Appelwick and Leach, JJ.
A challenge to a dissolution decree entered under chapter 26.09 RCW is a continuation of the original action brought under the statute. Attorney fees may therefore be awarded under the statute on a motion to vacate. Moreover, a trial court may award attorney fees if one spouse's intransigence increased the legal fees of the other party. Both mechanisms provide a basis for an award of attorney fees to Hazel Murray. We reverse the order on revision to the extent the court determined there was no authority to order Brian Murray to pay Hazel's attorney fees and remand for the court to award Hazel reasonable attorney fees.
FACTS
Except where noted, the following facts are undisputed. In 1996, Hazel and Brian Murray were married. No children were born of the marriage. During the marriage Hazel was involuntarily committed for mental health treatment on several occasions. In September 2002, Brian and Hazel filed a joint petition to dissolve their marriage. Neither of them was represented by counsel. In October 2002, Hazel was again involuntarily committed for mental health treatment on two occasions. The following month she was awarded disability benefits effective January 2003. In December 2002, Hazel and Brian filed a bankruptcy petition. On February 14, 2003, the decree of dissolution was entered. Brian was awarded the house and business, two vehicles, and some furniture and personal property. He assumed the $90,000 mortgage on the house and additional debt of approximately $10,000. Hazel was awarded one vehicle and some furniture and personal property and assumed debt of approximately $20,000. No maintenance was awarded. On April 3, 2003, the parties' debts were discharged in bankruptcy. During April and May 2003, Hazel was involuntarily committed for mental health treatment several times. Although the dissolution petition stated that Hazel and Brian separated in September 2002, they continued to live together until approximately September 2004, 18 months after the decree was entered, when Brian wanted to end the relationship.
Brian and Hazel agree that they filed the dissolution petition primarily to obtain financial assistance with Hazel's medical expenses.
On October 31, 2007, Hazel filed a motion to vacate the decree under CR 60(b)(1), irregularity in obtaining a judgment; (2), erroneous proceedings against a person of unsound mind; (4), fraud, misrepresentation or misconduct of an adverse party; (5), void judgment; and (11), other reasons justifying relief from operation of the judgment. In her supporting declaration Hazel stated that although she continued to suffer from and receive treatment for psychiatric illness, she had improved in the last few months and contacted an attorney. She further stated that the decree unfairly distributed the parties' property and debts and failed to distribute all their property, including Hazel's inheritance from a relative and Brian's individual retirement account (IRA). Brian responded that Hazel had prepared the division of property and debts in the petition and proposed decree and that Hazel's inheritance and his IRA were spent on Hazel's medical bills long before the dissolution. The court set a show cause hearing for November 16, 2007. Both Hazel and Brian were represented by counsel.
On November 4, 2007, Brian contacted Hazel and asked to talk to her about settling the matter before the hearing. Hazel agreed and asked a friend to be present during the meeting. Brian asked Hazel what it would take for her to settle the matter. Following a discussion, Hazel agreed to accept $20,000 in lieu of going forward with the hearing on her motion to vacate the decree. Hazel prepared a written agreement, which provided that she "agree[d] to accept $20,000 as full settlement in the divorce action." Hazel and Brian signed the agreement, and Hazel's friend signed as a witness. Their attorneys were not present and did not participate in the agreement.
On November 13, 2007, Brian's attorney filed the agreement with the court attached to a sealed financial source document. On November 15, 2007, Hazel's attorney wrote to Brian's attorney confirming that Hazel and Brian had settled the matter, noting that Brian's attorney had filed the agreement and that Brian was making arrangements to pay Hazel by December 5. Hazel's attorney agreed to strike the hearing. Brian's attorney did not respond, and the hearing was stricken. According to Hazel, during the month of December Brian repeatedly said he would be paying her, but he never did so.
On January 17, 2008, Hazel filed a motion to enforce the settlement agreement. Brian filed a response, arguing that although Hazel agreed to accept $20,000 as a full and final settlement, Brian never agreed to pay her so there was no consideration for the agreement. In his declaration Brian also stated that the day after they entered the agreement, Hazel called him and said she had changed her mind. Hazel responded, acknowledging that she told Brian her father thought she should get more, but she was satisfied with $20,000. Hazel denied that she had disavowed the agreement and noted that subsequently Brian's attorney filed the agreement, the hearing was stricken, and Brian did not deny repeatedly promising to pay. Hazel sought attorney fees she incurred based on Brian's intransigence. Brian opposed an award of attorney fees on the ground that it was a contract dispute and there was no provision for attorney fees in the agreement.
On March 19, 2008, the parties appeared for a contested hearing. The commissioner entered findings of fact, conclusions of law, and an order amending the decree and awarding Hazel attorney fees. The court found that on November 4, 2007, Brian made an offer of settlement, which Hazel accepted in lieu of the court proceeding; that on November 13, 2007, Brian filed the agreement in court; that the agreement fully resolved the pending litigation and that the hearing was stricken by agreement of the parties; that between November 16 and mid-December 2007 Brian repeatedly promised to pay Hazel $20,000 in compliance with the agreement, but he failed to pay; that Brian had provided neither substantive facts nor legal defense to Hazel's declarations and motions; and that Brian's conduct had caused Hazel to unnecessarily incur substantial attorney fees. Based on these findings, the court concluded that the agreement was enforceable pursuant to CR 2A as settlement in full of Hazel's motions for amendment of the decree and enforcement of the agreement and that Brian should be ordered to pay reasonable attorney fees Hazel had incurred since November 16, 2007. The court ordered:
1. Hazel['s] . . . Motion for Entry of Order Amending Decree of Dissolution and for Award of Attorney Fees is granted.
2. The Decree of Dissolution is hereby amended to award the sum of $20,000 to Hazel . . as and for her sole and separate property as distribution of the marital estate. Brian . . . shall pay this amount to Hazel . . . within 10 days of entry of this order.
3. Brian . . . shall pay Hazel['s] . . . reasonable attorneys fees incurred by her since November 16, 2007. . . . Hazel . . . shall present a cost bill and proposed order on attorneys fees for subsequent entry, which shall be paid within 60 days thereof. Brian['s] . . . failure to comply with this order . . . may be grounds for additional sanctions.
Brian filed a motion to revise, challenging the determination that the agreement was enforceable and the award of attorney fees. The court on revision upheld the commissioner's ruling that the agreement was enforceable, but revised the ruling as to attorney fees. The court reasoned that Hazel was required to elect between two remedies, enforcing the settlement contract or pursuing her motion to vacate the decree of dissolution. If she chose the former, she was not entitled to attorney fees because there was no attorney fee provision in the agreement. If she chose the latter and succeeded in amending the decree, the court would have statutory authority to award attorney fees. Hazel continued to object, but elected to take the $20,000 settlement. She now appeals the decision to deny her attorney fees.
ANALYSIS
In Washington attorney fees may be awarded when authorized by a contract, a statute, or a recognized ground in equity. Whether a specific statute, contractual provision, or recognized ground in equity authorizes an award of attorney fees is a question of law we review de novo. RCW 26.09.140 provides in part:
Fisher Props., Inc. v. Arden-Mayfair, Inc., 106 Wn.2d 826, 849-50, 726 P.2d 8 (1986).
Kaintz v. PLG, Inc., 147 Wn. App. 782, 785-86, 197 P.3d 710 (2008).
The court . . . after considering the financial resources of both parties may order a party to pay a reasonable amount for the cost to the other party of maintaining or defending any proceeding under this chapter and for reasonable attorney's fees . . . in connection therewith, including sums for legal services rendered and costs incurred . . . [in] enforcement or modification proceedings after entry of judgment.
A challenge to a decree entered under the dissolution statute is a continuation of the original action brought under chapter 26.09 RCW. Fees may therefore be awarded under the statute on a motion to vacate.
In re Marriage of Moody, 137 Wn.2d 979, 994, 976 P.2d 1240 (1999).
Hazel brought a CR 60(b) motion in an effort to modify the dissolution decree. Before the hearing, Hazel and Brian signed a written agreement that Hazel agreed to accept $20,000 as full settlement in the dissolution action. In response to the order to show cause for relief from judgment, Brian filed the agreement. The actions constituted a continuation of the original dissolution action brought under chapter 26.09 RCW. The trial court had authority to award attorney fees under the statute. Under the circumstances here, the fact that the parties chose to resolve the dispute by settlement instead of continuing with litigation does not alter the fundamental nature of the proceeding.
Moody, 137 Wn.2d at 994; In re Marriage of Knight, 75 Wn. App. 721, 729, 880 P.2d 71 (1994).
Moreover, it is well settled that a trial court may award attorney fees if one spouse's intransigence increased the legal fees of the other party. Intransigence includes foot-dragging and obstruction. This is an alternate basis on which the trial court had authority to award attorney fees. Brian does not challenge the trial court's determination that the settlement is enforceable. Nor does he challenge the findings regarding his conduct: Brian made an offer of settlement, which Hazel accepted in lieu of the court proceeding; Brian filed the agreement in court; the agreement fully resolved the pending litigation; the hearing was stricken by agreement of the parties; Brian repeatedly promised to pay Hazel $20,000 in compliance with the agreement, but he failed to pay; Brian provided neither substantive facts nor legal defense to Hazel's declarations and motions; and Brian's conduct caused Hazel to unnecessarily incur substantial attorney fees. These unchallenged findings are verities on appeal. Brian's foot-dragging and obstruction, after agreeing to the settlement in lieu of litigation, filing the agreement two days before the scheduled show cause hearing, and then refusing to pay, supports a finding of intransigence that unnecessarily increased Hazel's attorney fees. We reverse the order on revision to the extent the court determined Brian was not obligated to pay Hazel's attorney fees and remand for the court to award Hazel reasonable attorney fees she has incurred since November 16, 2007 in enforcing the settlement agreement, including reasonable attorney fees on appeal.
Burrill v. Burrill, 113 Wn. App. 863, 873, 56 P.3d 993 (2002).
Matter of the Marriage of Greenlee, 65 Wn. App. 703, 708, 829 P.2d 1120 (1992).
Young v. Young, 164 Wn.2d 477, 482 n. 2, 191 P.3d 1258 (2008).
Reversed and remanded for proceedings consistent with this opinion.
WE CONCUR.