Blum v. Blum

• Decision Date: 01 September 1983
• Docket Number: No. 1300,1300
• Citation: 477 A.2d 289,59 Md.App. 584
• Parties: Jerome W. BLUM, Jr. v. Diane M. BLUM. ,
• Court: Court of Special Appeals of Maryland

Page 584

59 Md.App. 584

477 A.2d 289

Jerome W. BLUM, Jr. v. Diane M. BLUM.

No. 1300, Sept. Term, 1983.

Court of Special Appeals of Maryland.

July 12, 1984.

Thomas Bowie McCarty, Catonsville, for appellant.

Sharon L. Rhodes, Baltimore, with whom was James K. Eagan, III, Columbia, on brief, for appellee.

Argued before MOYLAN, LOWE ^* and BELL, JJ.

BELL, Judge.

A decree of the Circuit Court for Baltimore County which set aside the separation agreement and granted a monetary award and attorney's fees is the subject of this appeal. The husband, the aggrieved litigant, has raised a number of errors on the part of the chancellor which we summarize:

1. It was error to set aside the separation agreement and impose a constructive trust based on the factual findings.

2. The pleadings did not specify the relief afforded.

3. There was error in determining what property was marital property and in failing to consider and review all the factors as specified in the Property Disposition in Divorce and Annulment Act.

4. There was error in awarding counsel fees.

BACKGROUND

Jerome W. Blum, Jr., and Diane M. Blum were married in 1972. They were both high school graduates and held full-time jobs throughout the marriage. Early in the marriage they purchased a home. About three and a half years later, having paid off the mortgage, they sold it at a profit and purchased a larger home for $110,000. They settled on the house with a $65,000 mortgage and the balance in cash. Mr. Blum's parents lent them $25,000, evidenced by a note, which provided the parents could reside on the property for the rest of their lives subject to a number of contingencies. The proceeds of the loan from Mr. Blum's parents were used immediately to reduce the mortgage to $40,000. A unique feature of the house was that while it appeared to be a single family dwelling, it contained two separate self-contained dwelling units. This provided separate living quarters for Mr. Blum's parents.

THE SEPARATION

Mr. Blum kept a very tight rein on spending in the household and in all aspects of their lives. Mrs. Blum became dissatisfied with these controls and the marriage. As a result she left the home in October of 1979. She left a note explaining her discontent. Mr. Blum pursued her and persuaded her to return. The reconciliation was of short duration and in June of 1980, they agreed to separate. The details of what happened next are in dispute, but this much is agreed: on June 11, Mr. and Mrs. Blum appeared together in the office of an attorney who had represented them in the past; Mr. Blum stated the terms of the agreement and Mr. and Mrs. Blum signed a handwritten agreement that night; counsel did not discuss with them their financial situation or their respective rights. By deed dated June 12, Mrs. Blum transferred her interest in their residence to Mr. Blum. Three days later, Mrs. Blum moved to her own apartment. On July 31, 1980, the parties signed a typewritten instrument which formalized the June 11 agreement.

THE DIVORCE

In June of 1981, Mr. Blum filed suit for divorce on the grounds of voluntary separation and asked that the agreement of July 31, 1980 be approved. Mrs. Blum submitted an answer alleging the agreement was fraudulently induced. She also filed a cross bill. Mr. Blum filed an amended bill (entitled Supplemental Bill) followed by an Amended Supplemental Bill. To each bill an appropriate answer was filed.

The court heard the testimony and in an oral opinion granted the divorce on the grounds of mutual and voluntary separation to Mrs. Blum under the cross bill of complaint. He also granted substantial additional relief, which will be set forth in detail later.

THE SEPARATION AGREEMENTS

The court in its order set aside the agreements of June 11, 1980 and July 31, 1980.

The agreement of July 31, 1980 recited that the parties had mutually and voluntarily separated and agreed that (1) they would continue to live separate and apart; (2) they mutually waived alimony; (3)(a) the wife would convey her interest in the home to the husband; (b) Mr. Blum could remain in the home as long as he wished; (c) upon sale after payment of the mortgage balance and the $25,000 to his parents, Mr. Blum would pay Mrs. Blum five percent of the net or a minimum of $5,000; (4) they confirmed their division of all personal property; (5) Mrs. Blum would receive $6,100 with which she could purchase a car for herself; (6) the wife would release the husband's credit union account to him; and (7) the husband could keep his two cars. The balance of the agreement contained mutual releases and acknowledgements that they both were fully informed of the other's circumstances. It further confirmed that each had had an opportunity to consult counsel and the agreement was freely and voluntarily made.

The July 31 document formalized the terms of the June 11 agreement and added the specific releases and formalities.

THE COURT'S DECISION

After the trial the chancellor rendered his decision orally from the bench. He later changed a part of that decision by a memorandum in which he stated that the relief he awarded in his oral opinion was not permitted by law.

First we will address the court's oral decision. The chancellor discussed the procedural problems and the relief sought by Mrs. Blum and held "I don't think it needs to be specifically pleaded that the Court impose a constructive trust and that specifically the deed be set aside because if the Court finds that the separation agreement is invalid and ought to be set aside, then by the domino theory, that causes the others to fail."

The chancellor then proceeded to make findings as a result of which he concluded that Mr. Blum was the "forceful personality" in the marriage, although the chancellor admitted that the specific acts which occurred during the marriage were not in and of themselves sufficient to substantiate that conclusion.

The chancellor said:

There has been the argument by the wife that the agreement was facially invalid. The cases which have found agreements to be unjust and inequitable on their face involve agreements that were completely lacking in any reasonable consideration, and that's basically the wording from Bell v. Bell.

This agreement is not lacking in any reasonable consideration.

* * *

* * *

I don't believe that there was fraud involved. I think there was a full disclosure. There certainly was not any physical force applied upon the wife to cause her to enter into the agreement.

The chancellor went on to conclude that there was a confidential relationship between the parties based on Mr. Blum's domination. He reviewed the assets of the parties and opined

When this agreement is viewed in its totality, it's clear to me that the husband breached that confidential relationship. Setting the house aside for a moment, and just looking at the division that was made of the remaining property, the husband comes out on the heavy side, but when you add the house to it, it's so lopsided as to shock the conscience of this Court, and responsibility is on the part of the person who has had that trust and confidence placed in him to show by clear and convincing evidence that he did not violate that trust.

* * *

* * * Well, I find as a fact that that's what he said it would be, and that there was no negotiation in this case. It was dictated to her, and it was dictated to Mr. Muhl who dictated to his secretary who put it in that 31st of July agreement. Having found as I have just stated, the separation agreement is set aside.

The chancellor directed that the house, furniture and personal property which he "determined as marital property" be sold and the net proceeds equally divided. At that point he had not in his opinion labeled or advised what was marital property or its value.

He further directed that the husband hold the property in trust for himself and his wife. He concluded by stating there would be no monetary award based on "the division of property as established" and awarded $4,000 toward the wife's counsel fees.

The chancellor prior to the signing a written order and without further hearing or argument, sua sponte, filed a Memorandum in which he stated that since he did not have authority to order a sale of the house, he intended to make a monetary award to adjust the equities of the parties. In the Memorandum, the chancellor identified the marital property, found its value and went on to state that

The Old Frederick Road Property is titled in the husband's name only, while the mortgage is the obligation of both as is the note held by the husband's parents.

Since this Court cannot relieve the wife of her responsibilities under the mortgage and the note, it is necessary to fashion the monetary award in such a way so as to provide her with the funds to meet her share of these joint obligations, and an amount equal to approximately one-half the value of the marital property after satisfaction of these obligations.

The order awarded a divorce to Mrs. Blum, set aside the separation agreement, ordered that a figurine collection was the property of Mrs. Blum, made a monetary award of $62,500 and attorney fees to Mrs. Blum of $4,000, and certain incidental relief.

Mr. Blum appeals from so much of that decree which set aside the agreements, granted a monetary award and awarded counsel fees. We agree with Mr. Blum that the trial court was in error at least in part; we will reverse and remand.

THE SEPARATION AGREEMENT

At one time in Maryland it was uncertain whether a husband and wife could enter into a separate maintenance agreement. The Court commented on this in Wallingsford v. Wallingsford, 6 H. & J. 485 (1825) and said at p. 489

Whether an agreement for a separate maintenance will be enforced, where such agreement rests in articles between the husband and wife, appears not to be settled.

Many years later, the Court concluded that separation agreements were valid to establish...