Conley v. Bonasera

• Decision Date: 21 July 2020
• Docket Number: Record No. 1510-19-2
• Parties: Matthew Thomas CONLEY v. Brenda Lynn BONASERA
• Court: Virginia Court of Appeals

72 Va.App. 337

845 S.E.2d 242

Matthew Thomas CONLEY

v.Brenda Lynn BONASERA

Record No. 1510-19-2

Court of Appeals of Virginia.

JULY 21, 2020

Jacqueline W. Critzer (Bowen Ten Cardani, PC, on brief), Richmond, for appellant.

Sarah J. Conner (Rick A. Friedman, II ; Lindsay G. Dugan; Friedman Law Firm, P.C., on brief), for appellee.

Present: Judges Petty, O'Brien and Senior Judge Frank

OPINION BY JUDGE MARY GRACE O'BRIEN

Matthew Thomas Conley moved to terminate his court-ordered monthly support obligation to his former wife, Brenda Lynn Bonasera, pursuant to Code § 20-109(A). Following a hearing, the court found, by clear and convincing evidence, that Bonasera cohabited in a relationship analogous to marriage for a period exceeding one year. The court reduced the monthly payment, but held that termination of spousal support was unconscionable. Conley assigns error to the court's unconscionability finding and its subsequent failure to terminate his support obligation. He also challenges the court's denial of his request for attorney's fees and costs. For the following reasons, we reverse the court's award of spousal support, but affirm its denial of Conley's attorney's fees and costs.

BACKGROUND

The parties married on August 25, 2001, and divorced on July 15, 2016. Their marital property included ownership interest in three window installation franchises located in Virginia, New York, and Colorado. In determining equitable distribution, the court awarded Conley ownership interests in the window installation businesses in New York and Colorado, with a buy-out to Bonasera for her shares. The court took no action concerning the Richmond business, known as Window World of Richmond, where both parties were employed in July 2016. The parties each owned 25% of the business; other investors controlled the remaining 50%.

At the time of the divorce, the court found that Bonasera's annual salary was $31,200 and Conley's salary was "approximately" $600,000, although it was "difficult to determine and varies from year to year because of the business cycle and distribution from his companies." In the divorce decree, the court awarded Bonasera permanent spousal support of $13,500 a month. Conley subsequently acquired an additional 50% ownership interest in Window World, giving him 75% ownership in the business. Bonasera retained 25% ownership.

On January 16, 2018, pursuant to Code § 20-109(A), Conley filed a motion to terminate or reduce his spousal support due to Bonasera's continued cohabitation in a relationship analogous to marriage for a period exceeding one year. As an alternative ground, Conley alleged a material change in income for both parties under Code § 20-109(B). In response, Bonasera filed a motion to increase spousal support on the ground that Conley's income had increased substantially after he acquired additional ownership interest in Window World.

At a March 11, 2019 hearing, Conley presented evidence that Bonasera had been residing with D.P. since February 2018 in the former marital home. Bonasera and D.P. had a child together, born in April 2018, who lived with them. The court also considered other evidence of Bonasera and D.P.’s cohabitation.

Conley presented additional evidence concerning the parties’ current financial situation. Previously, when Conley owned only 25% of Window World, he and his business partner determined the amount of distributions from the company. However, when Conley became the majority shareholder in 2018, he acquired sole responsibility for making distributions to himself and Bonasera. Conley explained that he determined the timing and amount of distributions by considering the "[e]conomic climate, season, ... marketing decisions [and] forecast expenses of the company."

Conley acknowledged that his total income for 2016 was $666,492, an increase from 2015. He presented his 2017 tax return, reflecting a reduction in income, which he attributed to a downturn in the business. Conley also testified that he earned additional income by liquidating "defective or mis-measured" windows purchased by Window World. He did not give Bonasera any of those proceeds because he did not consider them "company income;" the company had already been compensated for the windows from deductions in the salesperson's commissions. Additionally, Conley, who has remarried, has use of a company car and credit card, unlike Bonasera. The court determined that Conley's 2017 income was approximately $500,000, based on his salary and added business benefits.

The court found that Bonasera's 2017 income was $191,200, before spousal support. Her income was comprised of disbursements and her salary from the company.

Bonasera acknowledged that when the final decree was entered, the court calculated spousal support by considering only her wage income, not the amount she received from company distributions. According to Bonasera, in 2014 and 2015, before the parties were divorced, Conley "intercepted" her distributions. She stated that during 2015, she did not receive any distributions because Conley "took a shareholder allowance out for [approximately] $56,000." Between 2016 and 2018, Bonasera received an annual salary of $31,200 from Window World. She also received company distributions during that time period: in 2016, Bonasera received distributions of approximately $137,000 at the end of the year, in 2017 and 2018, she received distributions nearly every month totaling $160,000 and $144,750, respectively. Bonasera asserted that she began receiving distributions "when [she] started receiving spousal support because [Conley] had to get that income from the company and ... he can't take unequal shareholder distributions."

Bonasera stated that she cannot depend on her distributions because she is uncertain of the amount she will receive each year. She expressed concern that Conley could "cut off" disbursements from the business, "and there's nothing [she] can do aside from [initiating litigation, which would involve an] exhaustive or astronomical amount of attorney's fees." Bonasera stated that if she did not receive distributions, "[t]hat's when the [financial] problems will happen." She testified that if the court terminated spousal support, she would likely have to sell her home and her vehicle and would be unable to pay her "astronomical" legal expenses.

On cross-examination, Bonasera agreed that she told a psychologist who conducted the parties’ custody evaluations that she could manage financially without spousal support. However, at trial she stated that the psychologist was not aware of all of Conley's business dealings.

Despite continuing to receive her salary, Bonasera has not conducted day-to-day work at Window World since March 2014 because Conley "got unbearable to be around." Before then, she worked approximately forty hours a week handling "all the inside operations from day to day." The CPA who provides outside bookkeeping for Window World testified that Bonasera's access to the company's daily financial records ended when Conley became the majority shareholder.

The court concluded that Conley met his burden of establishing that Bonasera was cohabiting in a situation analogous to marriage and noted that D.P. "writes checks from [Bonasera's] account and uses her credit cards." However, it determined that termination of spousal support would be unconscionable. The court found that the parties enjoyed a high standard of living during the marriage, and Conley's earning capacity was "in the past and present ... far great[er] than that of [Bonasera]." The court also noted Conley's "high levels of spending that are derived from his benefits from the business that are not enjoyed" by his former wife. The court reduced spousal support to $4,000 a month effective February 1, 2018, and ordered that Bonasera repay $123,500 to Conley in thirty monthly installments. The court declined to award attorney's fees and denied a subsequent motion to reconsider.

ANALYSIS

Conley assigns error to the court's failure to terminate Bonasera's spousal support pursuant to Code § 20-109(A) based on her cohabitation with D.P. Conley also contends that he was entitled to recover his attorney's fees.

A. Spousal Support

Code § 20-109 addresses modification and termination of spousal support. It provides, in relevant part, as follows:

Upon order of the court based upon clear and convincing evidence that the spouse receiving support has been habitually cohabiting with another person in a relationship analogous to a marriage for one year or more ... the court shall terminate spousal support and maintenance unless ... the spouse receiving support proves by a preponderance of the evidence that termination of such support would be unconscionable.

Code § 20-109(A). The court found that Bonasera had been "habitually cohabiting with [D.P.] in a relationship analogous to a marriage for one year," a conclusion clearly supported by the evidence. She does not contest the finding on appeal. Conley argues that therefore, based on a plain reading of Code § 20-109(A), the court erred by merely reducing, not terminating, Bonasera's spousal support. He disputes the court's decision that termination of spousal support would be unconscionable. He contends that his argument is supported by evidence showing that Bonasera's income of $191,200 sufficiently met her needs and that she financially supported D.P.

Although factual findings made by a court in support determinations are entitled to great deference and will be overturned only for an abuse of discretion, we review statutory determinations de novo. Luttrell v. Cucco, 291 Va. 308, 313-14, 784 S.E.2d 707 (2016). See also Ragland v. Commonwealth, 67 Va. App. 519, 530, 797 S.E.2d 437 (2017) ("[T]o the extent the appellant's assignment of error requires ‘statutory interpretation, it is a question of law reviewed de novo on appeal.’ " (quoting Grimes v. Commonwealth, 288 Va. 314, 318, 764 S.E.2d 262 (2014) )). "[The] de novo...