Opinion
No. FA 79-0022037 S
July 28, 2006
MEMORANDUM OF DECISION
The pending motions in the above-entitled action include the parties' cross postjudgment motions for modification of alimony, the defendant's motion for contempt and counsel fees, the plaintiff's motion for attorneys fees and the defendant's motion in limine. The parties were divorced pursuant to a judgment issued by the court, Satter, J., on January 19, 1982 and subsequently amended on August 19, 1982. In the judgment, Judge Satter ordered, inter alia, that the plaintiff pay the defendant alimony consisting of three components: (1) $1000 in cash per month; (2) payment of the premiums on a Blue Cross/Blue Shield health insurance policy for the defendant "until such time as she is employed and may obtain said insurance coverage from her employer, without cost to her"; and (3) payment of the premiums on a fifty-thousand dollar policy insuring the plaintiff's life and naming the defendant as the irrevocable beneficiary "for as long a time as [the plaintiff] is obligated to pay alimony to [the defendant]."
The plaintiff's Motion for Modification of Alimony, Orders Regarding Health Insurance and Life Insurance Post Judgment is dated April 22, 2003 (Entree #300). The defendant's Amended Motion to Modify Alimony and Medical Insurance Benefits Post Judgment is dated June 20, 2005 (Entree #312).
The defendant's Motion for Contempt and Counsel Fees, Post Judgment, dated April 22, 2005 (Entree #'s 310 and 310.1).
The plaintiff's Motion for Attorneys Fees is dated July 15, 2005 (Entree #313).
The defendant's Motion in Limine is dated August 8, 2005 (Entree # 314).
The evidence establishes that the defendant never obtained health insurance through her employment. The language used in the judgment, however, is clearly intended to limit the time within which the plaintiff would be obligated to pay for the defendant's health insurance and to treat the payment of health insurance premiums as alimony.
This language clearly indicates the court's intent to secure the plaintiff's alimony obligation through life insurance and to treat the life insurance premiums as alimony. This court's view that the life insurance premiums were part of the plaintiff's alimony obligation is supported not only by the text of the judgment, but by the conduct of the parties themselves. After the divorce, the plaintiff reported the monthly cash payment as well as the premiums on the health and life insurance policies as a deductible alimony expense for federal income tax purposes. The defendant for her part, reported the aforementioned payments as income for federal income tax purposes. Hence, the language of the judgment and the conduct of the parties demonstrate that the monthly cash payment and the health and life insurance premiums were all part and parcel of the plaintiff's alimony obligation to the defendant.
In 1995 the plaintiff initially moved to amend and/or terminate the health insurance component of the 1981 alimony order, claiming that there was a substantial change in circumstances based on the defendant's employment income and the increased cost of the health insurance premium. After a hearing, the court, Klaczak J., decided on July 3, 1996 to reduce the cash alimony from $1,000 per month to seven-hundred and fifty per month, but made no change regarding the payment of the health or life insurance premiums. The plaintiff filed a second motion to modify, dated December 13, 2000 in which he asked the court, Graziani, J., to modify his obligation to maintain the Blue Cross policy based on the increased cost of that policy and in lien thereof, permit him to pay an increased cash alimony and permit him to substitute less expensive Medicare and Medigap coverage as an alternative to the Blue Cross policy. After holding a hearing, Judge Graziani issued a written decision, dated September 13, 2001, in which he denied the plaintiff's motion for modification and left Judge Klaczak's 1996 modification order intact. Therefore, the only modification to Judge Satter's original 1981 alimony order is Judge Klaczak's 1996 order.
In his pending motion for modification, the plaintiff claims that circumstances have substantially changed in that the private health insurance and life insurance premiums have each doubled over time and that there is far less expensive Medicare and Medigap insurance available with which to provide the defendant with substantially equivalent health care protection. He asks this court to eliminate his obligation to pay the Blue Cross comprehensive insurance premium and life insurance premium because the premiums are excessive in relation to the benefits for each policy. In the alternative, the plaintiff asks that he be permitted to pay the premiums for the Medicare and Medigap health insurance coverage instead of the premiums for the private health insurance. The plaintiff also asks that the defendant be ordered to pay him the $3,366 she received in 2001 when her health insurance company "demutualized". He alleges that because he has paid the policy premiums, he is entitled to the demutualization funds. Finally, the plaintiff claims that he is entitled to attorneys fees to compensate him for defending the defendant's contempt allegation.
The credible evidence shows that in 1996 the Anthem Blue Cross medical insurance cost approximately $11,500 and is currently is more than $23,000 per year. There is no clear evidence about the cost of the life insurance premium in 1996. However, the evidence shows that the life insurance premium was $2,000 per year in 1981 and is currently $5,500 per year. Therefore, assuming that the premium remained level between 1981 and 1996, it has, at a minimum, more than doubled since 1996.
The persuasive credible evidence establishes that Medicare Part A, Part B, Part D and Medigap F or G private insurance coverage carry a total combined premium and out of pocket cost of approximately $6,324 per year.
The defendant claims that the plaintiff should be held in contempt because he unilaterally substituted the cheaper Anthem/Blue Cross Medigap J insurance for her comprehensive medical coverage in order to save himself money on alimony costs. She argues that the Medicare and Medigap J coverage is inferior to her comprehensive policy in terms of hospitalization, skilled nursing care and prescription drug coverage. Further, the defendant asserts that since 1996 the plaintiff's income has more than doubled, that he has reduced his personal debt and increased his personal and real property holdings. The defendant claims that after 1996 her health has steadily declined to the point where she is unemployable, her assets have been depleted and her debt is unmanageable. She asserts that the plaintiff's improved financial circumstances, coupled with her declining financial circumstances and declining health represent a substantial change in circumstances which justify an increase in her cash alimony or at least the maintenance of her private health insurance. The defendant also asks this court to reject the plaintiff's claim for the demutualization funds and award her attorneys fees.
In her motion in limine, the defendant asks that this court limit its review of the evidence to the time period after Judge Graziani's 2001 decision because she claims that his decision is res judicata as to any changes prior to that decision. The plaintiff asks this court to reject the defendant's claim and asserts that it should consider any evidence of substantial change from 1981 forward. Both parties apparently assert that Judge Klaczak's 1996 modification order was strictly limited to the plaintiff's cash alimony and was not a decision regarding the life and health insurance premiums, notwithstanding that the cash payment and premium payments are all part of the plaintiff's alimony obligation.
Facts
The court finds the following facts based on the credible evidence. The plaintiff is seventy years old and the defendant is sixty-nine years of age. The parties were married to each other for close to twenty-three years and have been divorced for over twenty-five years. The plaintiff remarried in 1984 and lives with his current wife and their teenage daughter, who will be enrolling in college this fall. The plaintiff has a number of health problems, but has not been burdened with any significant medical expenses. The defendant is single and lives with the parties' adult son and his wife. The defendant suffers from a variety of medical problems. She also suffered a work-related injury in 2004 which, when combined with her health problems, make her unemployable for all intents and purposes.
To the extend that the previous section of this memorandum contains factual findings, they too are based on credible evidence in the record.
The plaintiff has high blood pressure, sleep apnea, depression and several other medical problems.
The defendant illnesses include Sjogren's Syndrome, hearing loss, depression, fibromyalgia and other maladies.
At the time of the divorce, the plaintiff earned $50,000 per year as a veterinarian and the defendant was a trained registered nurse, but had no income. The plaintiff retired as a veterinary practitioner in the mid 1990s and started his own business in which he brokers the sale of veterinary practices. In 1996 the plaintiff had a net yearly income of approximately $72,000. In recent years, he has typically earned commissions of approximately $50000 per sale after expenses and has sold between three and five practices per year. Since 1996 the plaintiff, in addition to significantly increasing his income, has managed to reduce his debt and add to his equity in real estate and personal property.
For example, between 2000 and 2004 the plaintiff's net profit from business has ranged from a low of $101,000 in 2002 to a high of $281,000 in 2004. The timing and number of veterinary practices the plaintiff sells in any given year varies.
For example, the plaintiff shares an equity interest with his wife in real estate in both Connecticut and New Hampshire.
The defendant earned a college degree after the divorce and gained employment as a per diem nurse for the state of Connecticut from 1990 to 2004. In 1996 she earned a net yearly salary of about $30,300. She has not worked since her 2004, however, due to a work related injury and currently has no employment income. In addition, the defendant's debts have dramatically increased since she stopped working and she has received support from family. The defendant, however, is not without financial resources. She owns real estate with a fair market value somewhere between $325000 and $650000, including equity of $166000 or more. In addition, the defendant receives social security benefits of approximately $12500.00 per year over and above her cash alimony.
At trial the defendant testified that she currently is in debt in the sum of approximately one-hundred thousand dollars. The court notes that when the defendant was covered by the Anthem Blue Cross comprehensive health insurance in 2002, she had out-of-pocket medical expenses of about $23,000 and in 2003, she had out-of-pocket medical expenses of approximately $30,500. In 2004, however, when she was covered under Medicare Parts A and B as well as Medigap Part J, her out of pocket medical expenses substantially decreased to $9,362 for the year.
On December 1, 2001, the defendant turned sixty-five and obtained coverage for herself under Medicare Parts A and B. In the April of 2003 the plaintiff filed his current motion to modify. In August of that year and again in December, the defendant made two separate applications to health insurance providers for the purpose of replacing her Blue Cross comprehensive policy with Medigap J coverage. Apparently the defendant made these applications in connection with then ongoing negotiations with the plaintiff regarding his motion to modify. In August the defendant applied for AARP Medigap coverage and in her application, she clearly indicated that she intended to replace her Anthem/Blue Cross comprehensive policy with the AARP Medigap J policy. The defendant's AARP application was ultimately rejected and she thereafter made her second application in December. The second application was made to Anthem Blue Cross and in it, the defendant again clearly indicated that she intended to replace the Anthem/Blue Cross comprehensive policy with the Anthem Medigap J coverage. Her second application was accepted and her Anthem Medigap J policy went into effect in January of 2004 in lieu of her comprehensive Anthem/Blue Cross policy.
At trial the defendant testified that she never intended to replace her Anthem Blue Cross comprehensive insurance with either AARP or Blue Cross Medigap insurance and was not aware that such change would occur if either of her applications was accepted. The court does not credit this testimony.
At trial the plaintiff offered the expert testimony of Attorney Pamela Meliso on the subject of Medicare and Medigap health insurance coverage. She reviewed, inter alia, the terms of the defendant's Anthem/Blue Cross comprehensive plan, the general nature of the defendant's medical needs, the types of prescription medications the defendant uses and then compared the coverage available to the defendant under the Anthem/Blue Cross comprehensive policy to the coverage available to the defendant under Medicare and Medigap. Meliso opined that given the defendant's medical needs, there is a substantial equivalence between the coverages for hospital stays, skilled nursing services, prescription drug benefits and other medical coverage between Medicare and Medigap coverage on one hand and the defendant's Anthem comprehensive policy coverage on the other hand. The expert also indicated that the in 2006 the maximum premium and out of pocket costs for Medicare Parts A, B, D and Medigap F or G will be $6325, compared to the cost of approximately $23000 for the Anthem Blue Gross comprehensive coverage.
The witness recommends that the defendant drop her Medigap J policy, add Medigap F or G and add Medicare Part D prescription drug coverage. By making these changes, Meliso indicates that the defendant will be able to obtain health care coverage and prescription drug benefits that are substantially equivalent to those available under her Anthem policy and at a substantially reduced cost.
The court finds Meliso's testimony to be credible. The Medicare/Medigap coverage will meet the defendant's health insurance needs to substantially the same degree as those provided under the Anthem policy. In addition, the Medicare/Medigap option costs dramatically less than the Anthem comprehensive policy. The court notes, however, that even if the Medicare/Medigap coverages are construed as inferior to the Anthem policy, the defendant cannot take advantage of the Anthem policy coverage in any event because she is no longer eligible for such coverage. The rules and regulations of the Anthem Blue Cross comprehensive health insurance plan indicate that benefits under the plan are only available to individuals who are less than 65 years old and not eligible for Medicare. As previously indicated, the defendant is sixty-nine years old and is enrolled in Medicare. Therefore, even if the court were to order the plaintiff to reinstate the Anthem Blue Cross comprehensive policy, the company would not accept the defendant.
In addition to what is in the plan statement, both Meliso and the plaintiff testified that the Blue Cross comprehensive policy is no longer available. The court finds that testimony credible.
Discussion
In determining whether to grant a requested modification to alimony, this court must decide, pursuant to General Statutes Section 46b-86, whether the party seeking the modification has shown that a "substantial change in circumstances" has occurred. See Bokowski v. Bokowski, 228 Conn. 729 (1994). "The date of the most recent prior proceeding in which an alimony order was entered is the appropriate date to use in determining whether a significant change in circumstances warrants a modification of an alimony award." (Internal quotation marks omitted.) Shearn v. Shearn, 50 Conn.App. 225, 228. In light of this rule, this court is limited to deciding whether there has been a substantial change in circumstances since the last modification of alimony. The last modification of alimony occurred in 1996 when Judge Klaczak ordered a reduction in the cash alimony. In 2001 Judge Graziani did not modify any order in the file. He simply denied the plaintiff's motion to modify. The existence of a substantial change in circumstances is measured from the last change in alimony, not from the date of the court's refusal to modify the alimony. See Pearl v. Pearl, 43 Conn.App. 541 (1996) "Once a trial court determines that there has been a substantial change in the financial circumstances of one of the parties, the same criteria that determine an initial award of alimony . . . are relevant to the question of modification." (Internal quotation marks omitted.) Borkowski v. Borkowski, supra, 737. The criteria under General Statute Section 46b-82 include "the length of the marriage, the causes forte annulment, dissolution of the marriage or legal separation, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate and needs of each of the parties . . ." The trial court must consider all of the delineated statutory criteria pursuant to 46b-82, however, "no single criterion is preferred over the others, and the court is accorded wide latitude in varying the weight placed upon each item under the peculiar circumstances of each case. Valante v. Valante, 180 Conn. 528, 531, 429 A.2d 964 (1980).
Between the time of the 1996 alimony modification and each party's current motion to modify there has been a substantial change in circumstances in several respects. First, the cost of the Anthem/Blue Cross comprehensive medical insurance has more than doubled and the defendant is now eligible to acquire roughly equivalent health care coverage at a dramatically reduced cost through Medicare and private Medigap insurance. Second, the plaintiff's income has more than doubled and his debts have decreased. Third, the defendant has gone from earning an income of approximately thirty thousand dollars per year to having no income apart from her cash alimony and social security benefits. She is now unemployable due to a number of debilitating health problems and is heavily in debt. Fourth, the plaintiff is at or near retirement age, has a reduced work capacity due to his own health issues and advancing age and has an increased financial responsibility to provide for his teenage daughter who is about to enter college.
Civil contempt involves a wilful failure to comply with an outstanding court order. Turgeon v. Turgeon, 190 Conn. 269, 284 (1983). "To constitute contempt, a party's conduct must be wilful . . . Noncompliance alone will not support a judgment of contempt . . . A finding of contempt must be established by sufficient proof that is premised upon competent evidence presented to the trial court . . ." (Citation omitted; internal quotation marks omitted.) Sheppard v. Sheppard, 80 Conn.App. 202, 219 (2003). In the present case the defendant alleges that the plaintiff is in contempt because he unilaterally stopped paying the premiums on the Anthem comprehensive policy, began paying the Anthem/Blue Cross Medigap J policy premiums in lieu thereof and refused to do anything to reinstate the comprehensive health insurance policy. The defendant has failed to prove her contempt allegations. The credible evidence shows that the plaintiff did not unilaterally terminate the Anthem comprehensive policy, substitute the Medigap J policy for it or refuse to reinstate the policy. In fact the defendant's conduct led to the termination of the Anthem comprehensive policy when she voluntarily applied for the Anthem Medigap J policy and on the application acknowledged that she wanted such coverage in lieu of her existing comprehensive policy. Further, there is no credible evidence that the plaintiff could reinstate the Anthem comprehensive policy even if this court ordered him to do so. To the contrary, the credible evidence establishes that the Anthem/Blue Cross comprehensive policy is no longer available to the defendant due to her age and her eligibility for Medicare. A financial order requiring one spouse to maintain health insurance for another spouse must be based on evidence of the availability and cost of such insurance. See Lake v. Lake. 49 Conn.App. 89 (1998). As indicated, there is no credible evidence that the Anthem comprehensive policy is still available to the defendant.
Given the court's factual findings and the appropriate legal standards, the court denies the defendant's motion in limine in which she asks that the court only consider evidence of a substantial change in circumstances from 2001 forward. As previously indicated, the proper starting point for determining a substantial change in circumstances is forward from 1996. The court also denies the plaintiff's motion to require the defendant to return the "demutualization" funds. The Anthem/Blue Cross comprehensive policy was issued in the defendant's name and owned by her since it was issued. In addition, both parties have always treated the defendant as the owner of the policy. There is no persuasive evidence suggesting the plaintiff is entitled to reimbursement by the defendant.
Because there is credible evidence of a substantial change in circumstances from 1996 forward, the court enters the following modified order in light of the relevant statutory criteria: CT Page 13552
Alimony:
1. The plaintiff shall pay the defendant cash alimony in the amount of one thousand one-hundred dollars ($1,100) per month.2. The plaintiff shall continue to pay the premium on the fifty-thousand dollar life insurance policy naming the defendant as irrevocable beneficiary. The credible evidence shows the cost of such policy currently to be five-thousand five hundred dollars ($5,500) per year.
3. The plaintiff shall pay all the premiums, to the extent that they exist, on the defendant's Medicare Part A, B, D and Medigap F or G policies, and shall pay any out-of-pocket medical and/or prescription drug co-pay expenses not covered by the aforementioned health care coverages. The credible evidence establishes that at this time such costs are at most approximately six thousand three-hundred twenty-four dollars ($6,324) per year.
The defendant shall, in lieu of Medigap J coverage, obtain Medigap F or G, at her option.
The modified cash alimony shall be retroactive to the defendant's motion to modify filed in June 2005. The modified health insurance cost component of the plaintiff's alimony obligation shall be effective as of the date of this order. The parties shall cooperate with each other in implementing the health insurance modification by making any necessary applications for Medicare and Medigap coverage and the plaintiff shall pay any required costs in connection with the defendant obtaining such coverage.
Each party moves that the court order the other to pay his or her attorneys fees. The court has discretion to order the payment of attorneys fees in dissolution proceedings pursuant to General Statutes Section 46b-62 and the specific criteria spelled out in 46b-82. In connection with contempt allegations the court has discretion to award attorneys fees in accordance with General Statutes Section 46b-87. The court has considered the criteria under the aforementioned statutes and orders that the plaintiff pay the defendant two-thousand five hundred dollars ($2,500) toward her attorneys fees.