Darroch v. Willis

• Citation: 690 S.E.2d 410
• Decision Date: 01 March 2010
• Docket Number: No. S09A1623.,S09A1623.
• Parties: DARROCH v. WILLIS.
• Court: Supreme Court of Georgia

690 S.E.2d 410

DARROCH v. WILLIS.

No. S09A1623.

Supreme Court of Georgia.

March 1, 2010.

Warner, Mayoue, Bates & McGough, Barry B. McGough, Elinor H. Hitt, Atlanta, for appellant.

Segal, Fryer, Shuster & Lester, William R. Lester, Atlanta, for appellee.

NAHMIAS, Justice.

This appeal involves a contempt order arising from a 2007 divorce decree. The decree required Robert Malcolm Darroch to remove Donna Overholt Willis's name from the mortgage on the marital residence within 30 days of remarrying. Darroch remarried on August 10, 2008, but he did not remove Willis's name from the mortgage. On March 6, 2009, the trial court held Darroch in contempt of court and ordered him to purge the contempt either by completing a pending refinancing or by listing the marital residence for sale and accepting any cash offer for at least 95% of the list price. We granted Darroch's application for discretionary appeal.

We affirm the trial court's finding that Darroch was willfully in contempt of the divorce decree. We conclude, however, that the trial court's requirement that Darroch sell the house if he did not refinance it constituted an improper modification of the decree's property division awarding ownership of the house to Darroch. Accordingly, although the trial court's alternatives for enforcing the divorce decree may prove more onerous to Darroch than the contempt remedy the trial court crafted, we must reverse the court's contempt judgment to the extent that it requires the sale of the marital residence.

1. Willis and Darroch were married on June 26, 1993. The couple separated in May 2007, and on August 23, 2007, they entered into a marital dissolution agreement (MDA) that was incorporated into a September 24, 2007 divorce decree. Among the assets that were divided in the MDA, Paragraph 3(B) provided that Darroch would have "exclusive ownership" of the marital residence subject to an existing mortgage on which Darroch and Willis were joint obligors. Darroch agreed to assume responsibility for the mortgage and to remove Willis as a co-obligor within 30 days of the earlier of either: (1) his remarriage or cohabitation with anyone other than a relative; or (2) the point at which he was able to refinance the mortgage at a rate equal to or less than the current rate.¹ Paragraph 7 of the MDA required the parties to "execute all documents, perform all acts and do all things necessary ... to effectuate any of the provisions and conditions set forth in this Agreement."

In the 11 months after the divorce decree was entered, Darroch did not refinance the mortgage. Darroch then remarried on August 10, 2008. Just five days before the wedding, he made his first inquiry into the process for refinancing the mortgage to remove Willis as a co-obligor. Darroch did not refinance the mortgage or otherwise remove Willis's name by the September 9, 2008 deadline set in the divorce decree, even though he received offers for refinancing from both Bank of America and Brightpath Mortgage, LLC. Six weeks later, Darroch still had not removed Willis's name from the mortgage, and Willis filed a motion for contempt. Darroch answered and filed a cross-motion for contempt, which he later withdrew. On February 5, 2009, six months after Darroch remarried, the trial court conducted a contempt hearing. Both Darroch and Willis testified.

At the contempt hearing, Darroch essentially pled procrastination and requested more time. Darroch explained that he had arranged to borrow money from his father to pay down the mortgage to the point that he could refinance the balance, thereby removing Willis's name from the mortgage. He testified that he was in the process of refinancing the mortgage through Bank of America, that December and January closing dates had been unavoidably delayed, and that the closing was now set for the week following the contempt hearing. Darroch's counsel further assured the trial court that Darroch "expects that loan to close at that time and then the refinance to be complete," and that there was therefore nothing the court needed to do to ensure compliance with the divorce decree.

At the end of the hearing, the trial court directed Willis's attorney to prepare an order holding Darroch in contempt of court for failing to remove Willis's name from the mortgage as required by the divorce decree and giving him 30 days to close on the pending Bank of America refinancing. The trial court instructed that the order would provide that if the refinancing did not close within 30 days of the hearing, then "the default provision would be to proceed to put the house up for sale." The trial court expressed hope that the mortgage "will be refinanced and that won't be necessary."

Darroch did not refinance the mortgage the following week or at any time within the next 30 days. Accordingly, on March 6, 2009, the trial court entered a written order in accordance with its prior directive, nunc pro tunc to the date of the February 5 hearing, holding Darroch in willful contempt of court for violating the provision of the divorce decree requiring him to remove Willis's name from the mortgage within 30 days of remarrying. The court ordered Darroch to purge the contempt by taking immediate steps to refinance the mortgage and directed that if Darroch had not refinanced the mortgage by March 7, 2009, he must immediately list the house for sale with a real estate broker selected by Willis at the price specified in a new appraisal to be paid for by Darroch. Darroch was ordered to cooperate with the listing agent in marketing the property and to pursue the sale in a good faith and expeditious manner. Finally, the contempt order required Darroch to accept any cash offer for at least 95% of the list price, but the order also included a provision allowing him to avoid the forced sale at any time by refinancing the mortgage.

2. Darroch contends there was no evidence of willful contempt on his part. However, if there is any evidence to support a trial court's determination that a party has willfully disobeyed its order, the finding of contempt will be affirmed on appeal. See Killingsworth v. Killingsworth, 286 Ga. 234, 237, 686 S.E.2d 640 (2009). In essence, Darroch is attempting to raise an inability to pay defense. But Darroch did not raise this argument in his answer to the contempt motion, and the transcript is devoid of evidence that he lacked the ability to refinance the property. Instead, he testified that he was close to completing a refinancing. Moreover, Darroch presented no evidence showing that he was unable to remove Willis as a co-obligor on the mortgage by any means before the deadline set in the divorce decree. He cannot blame the trial court for his decision to wait until five days before the wedding— an event whose timing he presumably had some control over—to begin inquiring into the possible avenues for removing Willis's name from the mortgage and complying with the clear terms of the decree.

Inability to pay is a defense only where the contemnor demonstrates that he has exhausted all resources and assets available and is still unable to secure the funds necessary to enable compliance with the court's order. He must show "clearly that he has in good faith exhausted all the resources at his command and has made a diligent and bona fide effort to comply with the order of the court," Snider v. Snider, 190 Ga. 381, 386, 9 S.E.2d 654 (1940) (citation and punctuation omitted), and that he cannot borrow sufficient funds to comply with the obligation, see Weiner v. Weiner, 219 Ga. 44, 44, 131 S.E.2d 561 (1963).

Darroch admitted he has other financial assets, such as his 401(k), that he had not investigated using, and he acknowledged his ability to borrow significant sums of money from his father that would enable him to refinance the mortgage. Other evidence showed that Darroch could borrow against his equity line of credit and that he is an attorney with a high income generally exceeding half a million dollars a year. Finally, as discussed further below, Darroch might sell his house to generate the funds needed to comply with the divorce decree. Darroch initially tried to delay his obligations and then made only cursory efforts to refinance, failed to actively pursue applications, failed to provide requested information to potential lenders, and generally behaved in a...