By Nicole Killoran
Molleur v. Molleur, 2012 VT 8.
Today’s opinion provides a glimpse into how the courts go about equitably divvying up marital property after a divorce; it also gives us a dirty peep into the private disputes between spouses that are inevitably aired during divorce proceedings.
The couple in today’s case was married for approximately twenty years, during which time they raised two children. During their marriage, they lived rent-free in a home owned by Husband’s father. Husband served as a recruiter and then active military in the Army National Guard, and otherwise worked for his father’s business. Wife was a depressed homemaker who worked an occasional part-time sales job when she was not home with the kids, and struggled with alcoholism and mental health issues throughout the marriage.
At the time of divorce, the only significant asset that would count as marital property was Husband’s military pension, which does not kick in until 2013. As such, when the couple petitioned the trial court for a divorce shortly after the kids left the nest, the only asset the court had to split up was each spouse’s share of the future pension. In addition to splitting up the marital property, the court also had to determine how much Husband would pay Wife for an ongoing maintenance award.
The family division of the trial court granted Wife under the property award 75% of the marital component of Husband’s pension—roughly 42% of Husband’s total monthly pension payment, or $1,444—and under the maintenance award $1900-2100/month until retirement, and $500 from Husband’s pension benefits per month thereafter, for life and subject to adjustment for inflation. The issues on appeal were whether the trial court judge abused his discretion or erred in his conclusions on the property award and the maintenance award.
Before proceeding to its main analysis, the SCOV makes a “general observation.” The considerations for property and maintenance awards are governed by two different statutes (property under 15 V.S.A. § 751, and maintenance under 15 V.S.A. § 752). As such, the courts normally may not “mix property settlement and maintenance award considerations.” But because the pension is the only marital property and would be the source of the ongoing maintenance once Husband retires, the trial court issued a combined property and maintenance award. The SCOV declines to take the bait Husband dangles before them, challenging the Trial court’s decision to combine considerations for these two separate components, and instead approves of the trial court’s combination under the circumstances.
The SCOV then turns to the property award where the majority of the drama in this case resides. On appeal, Husband raised two issues. He claimed that the trial court erred in concluding that he had approved of Wife remaining unemployed during the bulk of their marriage. He also claimed that the trial court had abused its discretion by awarding Wife 75% of the marital portion of Husband’s pension payment, because when the trial court weighed the statutory factors under 15 V.S.A. § 751, it gave greater weight to those factors favoring Wife than those factors favoring Husband.
With regards to the mutual decision to allow Wife to remain home and assume the role of homemaker, Husband argues that he neither supported nor agreed to the arrangement, that the decision was not made jointly, and that Wife did a crappy job as a housewife as her emotional problems worsened, forcing him to assume a greater share of domestic duties. (We call this later point, the Warranty Defense). Wife also apparently assaulted Husband once ten years prior to the divorce, was “financially irresponsible” while he was deployed to Iraq, and had collected two DUIs as evidence of her continuing alcohol problems.
Based on these facts, and the relatively paltry contribution Wife provided from an occasional part-time retail sales job, the trial court found that factors (10)–(12) under § 751 weighed in favor of Husband, considering the relative contributions of each spouse to the marital estate, and the “respective merits of the parties.” In favor of Wife, however, the trial court noted factors (1), (3)–(4), and (6)–(8), considering the length of the marriage, the educational and economical disparities between the spouses, and the opportunities each spouse had to better their circumstances after the divorce. After weighing these against each other, the Court found that the factors favoring Wife justified the resulting award: 75% of the spousal portion of Husband’s pension payments.
Husband raised several arguments trying to overturn the award, but the SCOV in turn finds no reason to disturb the trial court’s conclusions. The record supports the trial court’s conclusion that Husband tacitly allowed Wife to remain relatively unemployed and contribute less. The trial court had broad discretion to grant an award favoring the factors benefitting Wife. And given the length of the marriage and the disparity between Husband’s future potential (mid-40s, substantial retirement income, college education, and ample opportunity for future employment) and Wife’s future potential (GED high school education, a history of alcoholism and mental health issues, and no job skills beyond retail sales), the Trial court did not err in crafting the award as it did, regardless of Husband’s merits and Wife’s relative contributions to the marital assets.
The SCOV then turns to the maintenance award, noting that it is inextricably synchronized with the property award given the limited marital property. The statute governing maintenance awards is 15 V.S.A. § 752, but the unique nature of the maintenance award, supported by the property award, causes the SCOV to consider the factors under § 751 in reaching its conclusion. Thus, the SCOV notes, its analysis will consider past merit (Husband’s greater relative contribution and support where Wife failed) and present need (the length of the marriage and the asymmetry in the parties’ financial circumstances and future prospects). Again, given the broad discretion granted the trial court in crafting its maintenance award, the SCOV concludes that the totality of the circumstances support the court’s decision regarding the maintenance award.
The SCOV then considers Husband’s argument that the trial court erred in awarding a permanent maintenance award (as opposed to rehabilitative or temporary maintenance). Here again, the SCOV finds that the trial court did not overstep its broad discretionary bounds. The court can, if it sees fit, award whatever type of maintenance it believes is necessary to provide for a spouse lacking sufficient income. Given Wife’s “extremely limited financial prospects,” and the modest award (representing roughly 25% of Husband’s income before retirement, and 42% after retirement), the court was within its discretion to grant the maintenance award as such.
Next, the SCOV examines a point both parties raised: whether the court’s formula for adjusting the award for inflation was proper. The standard mark for inflationary increases is the Consumer Price Index (CPI). The trial court ordered an increase of the greater of 7.5% or three times the CPI every three years on the $500 after-retirement maintenance award to Wife.
The SCOV concludes that this formula does not satisfy either of the court’s requirements for automatic inflation adjustment. A flat increase of three times the CPI must be based on the percentage change in the CPI over the previous year in order to track inflationary increases in the cost of living, and an increase of 7.5% does not reflect actual inflation any more accurately. In addition, the formula does not provide a “safety valve” for Husband if his income does not keep pace with inflationary increases in the cost of living. The SCOV remands to the trial court on the automatic inflation adjustment point, with instructions for how the court can craft the formula to reflect its dual requirements and any future changes in circumstances.
Finally, the SCOV addresses Wife’s request for attorney’s fees and costs by quickly dismissing the request, and directing Wife to take up the issue with the trial court.
The dissent in this case by Justice Burgess, joined by the outgoing Justice Johnson, takes issue with the Trial court’s maintenance award of 75% of the marital portion of Husband’s pension benefits. The dissent, unlike the majority, does not find support in the record for this “windfall” given Wife’s relatively minors contributions to the marriage and the assets.
The dissent emphasizes the more sordid details of this “lopsided” marriage—it calls the twenty-year marriage “superficial and but a marriage ‘on paper.’” The trial court stated several times in its opinion that Wife failed to contribute meaningfully to child care, and that Husband had to step in on multiple occasions to take over the children’s day-to-day care, in addition to assuming other domestic duties beyond child care.
In particular, the dissent takes issue with the trial court’s conclusion that Husband tacitly accepted Wife’s unemployment. The court described this unspoken agreement as the result of “the parties’ choice (by attrition, if not positive decision).” However, the dissent points out, there is no further description in the opinion or evidence in the record of this supposed “erosion by attrition of Husband’s stated preference that wife work.”
The dissent would find that Wife’s failure to contribute domestically, economically, or parentally in the marriage, despite its length, and despite the claimed disparities, means that “Wife had little or no sweat-equity in the marriage to redeem.” The dissent would not award “the lion’s share” of Husband’s pension to Wife for these reasons.
Because the dissent disfavors the property award, it would also order the Trial court to reassess the maintenance award. The trial court explicitly avoided considering the “equitable concerns” under § 751 when considering the maintenance award under § 752. On the one hand, a maintenance award should not be punitive against the supporting spouse, regardless of the circumstances. On the other hand, the dissent notes, to not take into account a spouse’s responsibility for her own disparate circumstances “serves, rather than defeats, the objective of § 752 to establish a ‘just’ maintenance obligation.” “[T]he industrious spouse should not be made to pay for the other’s dereliction,” lest the maintenance award continue the subsidy beyond the marriage.
The dissent concludes this half-marathon of an opinion by acknowledging that homemaker contributions have been read into the statutory scheme to account for one spouse’s non-economic contributions to a marriage that enhance the other spouse’s economic capacity. The dissent finds it consistent with the statutory scheme to temper one spouse’s maintenance obligation where the other spouse has failed to contribute, and would in this situation have found no recompense due where Wife did not prove she sacrificed any opportunity to enhance Husband circumstances and the marriage.