Opinion
No. FA01 038 54 68S
April 11, 2005
MEMORANDUM OF DECISION
On February 18, 2005, the plaintiff, Katherine Wachtel, formerly known as Katherine Lieberman, filed a postjudgment motion to open and modify the stipulated judgment of dissolution of marriage entered with the defendant, Mark Lieberman on October 19, 2004. The plaintiff moves to modify paragraphs 6.1 and 6.2 of the separation agreement which was incorporated into the judgment.
Paragraph 6.1 of the agreement provides that the defendant shall transfer fifty percent of his Vanguard 401k plan, approximately valued at $444,000 on October 31, 2004, to the plaintiff. The transfer is to be effectuated by a qualified domestic relations order (QDRO).
Paragraph 6.2 of the agreement provides that the defendant shall transfer fifty percent of his interest in his Normura SERP plan, approximately valued at $212,107 on October 31, 2004, to the plaintiff. The transfer was also to be effectuated by QDRO. By the terms of this agreement the plaintiff was to receive approximately $328,000; an amount that the parties stipulated represented one-half the current value of the two accounts. The plaintiff was to receive cash; the defendant was to bear any risk associated with owning the remainder of the pension accounts. The parties are in agreement that the SERP plan is not a qualified pension plan, therefore, it cannot be divided by a QDRO.
SERP stands for Supplemental Executive Retirement Plan.
In order to receive the assets agreed to in ¶ 6.2, the plaintiff moves to open the judgment and modify ¶ 6.1 to provide that the defendant retain the entire value of his SERP plan and transfer seventy-four percent of the Vanguard 401k plan to the plaintiff. The defendant opposes the plaintiff's motion to modify and argues that increasing the amount of the transfer of the 401k funds would cause him to sustain an unfair risk. For example, the defendant claims that by increasing the plaintiff's credit in the 401k increases his risk of loss because the plaintiff would have the benefit of accrued assets of the 401k and he would be exposed to losing the entire SERP account in the event that his employer files bankruptcy. He also contends that increasing the percentage of assets transferred to the plaintiff would increase his tax exposure.
The plaintiff argues that seventy-four percent of the 401k, valued as of October 19, 2004, is $328,054.
DISCUSSION
"It is well recognized that our courts have inherent power to open, correct and modify judgments, but that authority is restricted by statute and the rules of practice . . . A motion to open a judgment is governed by General Statutes § 52-212a and Practice Book § 17-4. Section 52-212a provides in relevant part: `Unless otherwise provided by law and except in such cases in which the court has continuing jurisdiction, a civil judgment or decree rendered in the Superior Court may not be opened or set aside unless a motion to open or set aside is filed within four months following the date on which it was rendered or passed . . .' Practice Book § 17-4 states essentially the same rule." (Citation omitted.) Richards v. Richards, 78 Conn.App. 734, 739-40, 829 A.2d 734, cert. denied, 266 Conn. 922, 835 A.2d 473 (2003). "A judgment rendered may be opened after the four month limitation if it is shown that the judgment was obtained by fraud, in the absence of actual consent, or because of mutual mistake." Id., 739.
In this case both parties were mutually mistaken as to whether a QDRO could be used to transfer the funds from the SERP account. "The kind of mistake that would justify the opening of a stipulated judgment under § 52-212a must be mutual; a unilateral mistake will not be sufficient to open the judgment." Magowan v. Magowan, 73 Conn.App. 733, 741, 812 A.2d 30 (2002), cert. denied, 262 Conn. 934, 815 A.2d 134 (2003).
Despite this mutual mistake the defendant argues that the judgment should not be opened because the alteration of the QDRO would change the amount of risk of loss that he had agreed to in the stipulated judgment. The defendant contends that this alteration is unfair because it changes the scope and intent of the agreed-upon transfers. In other words, the defendant argues that he would not have agreed to the stipulated judgment if he was aware that the 401k would be split in such a manner.
The language of the agreement is unambiguous. "[T]he intent of the parties, which is determined from the language used interpreted in the light of the situation of the parties and the circumstances connected with the transaction . . . is to be ascertained by a fair and reasonable construction of the written words and . . . the language used must be accorded its common, natural, and ordinary meaning and usage where it can be sensibly applied to the subject matter of the contract . . . Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms. A court will not torture words to import ambiguity where the ordinary meaning leaves no room for ambiguity . . ." Fusco v. Fusco, 266 Conn. 649, 655, 835 A.2d 6 (2003).
Due to the parties' mutual mistake, the unambiguous language of the judgment needs to be altered to reflect the intent of the parties. This can best be accomplished by removing the sum of approximately $328,000 or 74% of the account, from the 401k, the fund which is legally divisible by QDRO. This approach has the added advantage of effecting a severance of the parties' economic ties, and avoids extended supervision and enforcement by the courts, thereby saving the parties and the courts the time and expense of future litigation. Bender v. Bender, 258 Conn. 733, 785 A.2d 197 (2001). The defendant assumed risk and tax implications when he entered into the original agreement and because of the mutual mistake of both parties he will endure a similar risk now.
The plaintiff's Motion to Open is granted. The plaintiff's Motion to Modify is also granted.
CAROL A. WOLVEN, J.