Gilfillin v. Gilfillin, 25267.

• Court: United States State Supreme Court of South Carolina
• Citation: 544 S.E.2d 829,344 S.C. 407
• Docket Number: No. 25267.,25267.
• Parties: Melanie J. GILFILLIN, Respondent, v. Eugene A. GILFILLIN, II as Personal Representative of the Estate of James M. Gilfillin, Jr., Petitioner.
• Decision Date: 26 March 2001

344 S.C. 407
544 S.E.2d 829

Melanie J. GILFILLIN, Respondent,
v.
Eugene A. GILFILLIN, II as Personal Representative of the Estate of James M. Gilfillin, Jr., Petitioner

No. 25267.

Supreme Court of South Carolina.

Heard June 20, 2000.

Decided March 26, 2001.

344 S.C. 409

David H. Wilkins, Timothy E. Madden and Joseph M. Ramseur, Jr., all of Wilkins & Madden, P.A., of Greenville, for petitioner

Gwendolynn W. Barrett, of Barrett & Mackenzie, LLC, of Greenville, for respondent.

ON WRIT OF CERTIORARI TO THE COURT OF APPEALS

TOAL, Chief Justice:

James Gilfillin ("Husband") was granted a divorce from his wife Melanie Gilfillin ("Wife"). Part of the family court's order required Husband to establish a $300,000 alimony trust to secure periodic alimony payments to Wife in the event he predeceased her. Husband appealed and the Court of Appeals affirmed, but also modified the order so that Husband could meet his obligation by securing life insurance. See Gilfillin v. Gilfillin, 334 S.C. 213, 512 S.E.2d 534 (Ct.App. 1999). Husband has appealed. We reverse.

FACTUAL/PROCEDURAL BACKGROUND

Husband and Wife were married for over fourteen years and had one child. During the marriage, Husband worked for his family's insurance business while Wife primarily stayed at home and raised their son. Wife worked only occasionally as a substitute schoolteacher. Two years prior to their separation, Husband inherited a stock portfolio worth over $4.8 million and began taking steps to retire. Husband was 58 years old at the time of the divorce and Wife was 46 years old.

344 S.C. 410

Wife suffers from schizoaffective disorder and her condition had an enormous impact on the marriage. Husband testified that Wife's illness led her to believe that he was engaged in numerous adulterous affairs. At the hearing, Wife introduced no evidence that Husband had committed adultery. While her condition is treatable, Wife often failed to take her medication. These lapses in medication resulted in a need for hospitalization. During the marriage, Wife was hospitalized on at least six occasions. These hospital stays ranged from a few days to several months

On January 7, 1994, Wife changed the locks on their marital residence and left a note stating, "On the advice of my psychiatrist we are to stay away from each other. I have moved most of your clothes from the bedroom and your toiletries over to 12 Ashley Avenue. My attorney has a call into your attorney." As a result, Husband moved out of the marital residence. Wife then filed an action for separate maintenance and support. Husband sought a divorce based on desertion.

Under their equitable distribution settlement, Wife received marital assets valued at $121,395, including the marital home. Husband received $28,678 in marital assets and each party retained their respective nonmarital assets. Among the non-marital assets Husband retained was his valuable stock portfolio.

While the family court granted Husband a divorce on the ground of desertion, he was ordered to pay $3,200 a month in periodic alimony. The court denied Wife's request for lump sum alimony. The family court also required Husband to establish a trust with $300,000 in cash or liquid securities to provide Wife with security for the payment of alimony in the event he predeceased her. Husband was to be the income beneficiary of the trust during his lifetime. After his death, Wife would be entitled to the interest and dividends and could invade the corpus of the trust as necessary to receive an amount equal to the periodic alimony payments. Upon Wife's death, the remaining corpus of the trust was to pass to a beneficiary designated by Husband.

Husband appealed the family court's order establishing the alimony trust. Initially, the Court of Appeals upheld the

344 S.C. 411

family court order in an unpublished opinion. Husband's petition for a rehearing en banc was denied. The Court of Appeals then published an opinion modifying the family court order so that Husband could purchase life insurance in lieu of creating the alimony trust. Husband appealed the Court of Appeals' decision. During the pendency of the current appeal, Husband died unexpectedly. The issues before the Court are

I. Did the family court have the authority to require a payor spouse to establish an alimony trust to secure the payment of periodic alimony beyond the payor spouse's death?

II. If the family court did have the authority to create the alimony trust, was it proper to require Husband to fund the trust at an amount greater than his share of the equitable division?

III. Did the Court of Appeals err in amending the family court order to allow Husband to maintain life insurance for payment of periodic alimony beyond his death as an alternative to the alimony trust?

LAW/ANALYSIS

I. The Family Court's Authority to Establish an Alimony Trust Securing Periodic Alimony Beyond the Payor Spouse's Death

Husband argues the family court did not have the authority to establish an alimony trust to secure payment of periodic alimony beyond his death. We agree.

At common law, the obligation to pay periodic alimony ended at death. See McCune v. McCune, 284 S.C. 452, 327 S.E.2d 340 (1985). Before 1990, a family court did not have the authority to require a payor spouse to secure the payment of periodic alimony beyond the payor spouse's lifetime. See Hardin v. Hardin, 294 S.C. 402, 365 S.E.2d 34 (Ct.App.1987). In Hardin, the Court of Appeals found a family court needed both statutory authority and a finding of special circumstances before it could require a payor spouse to secure periodic alimony beyond his death by means of life insurance. Id. Several subsequent cases also struck down family court orders attempting to secure periodic alimony payment beyond the life of the payor spouse. See, e.g., Ferguson v. Ferguson, 300 S.C.

344 S.C. 412

1, 386 S.E.2d 267 (Ct.App.1989); Hickman v. Hickman, 294 S.C. 486, 366 S.E.2d 21 (Ct.App.1988).

In 1990, the Legislature amended S.C.Code Ann. § 20-3-130 (Supp.1999). Section 20-3-130(B)(1) now codifies the common law rule that periodic alimony terminates at death. That section also states that a family court has the power to order "[p]eriodic alimony to be paid but terminating ... upon the death of either spouse (except as secured in subsection (D))." Id. (emphasis added). Therefore, a family court can require payments of periodic alimony beyond the death of the payor spouse only when that alimony is "as secured in subsection (D)."

Subsection 20-3-130(D) states:

In making an award of alimony or separate maintenance and support, the court may make provision for security for the payment of the support including, but not limited to, requiring the posting of money, property, and bonds and may require a spouse, with due consideration of the cost of premiums, insurance plans carried by the parties during marriage, insurability of the payor spouse, the probable economic condition of the supported spouse upon the death of the payor spouse, and any other factors the court may deem relevant, to carry and maintain life insurance so as to assure support of a spouse beyond the death of the payor spouse.

The Court of Appeals held the phrase "but not limited to" gave the family court the authority to require Husband to create the alimony trust to secure payment of periodic alimony beyond his death.

Husband argues that subsection 20-3-130(D) has two purposes: (1) it allows the family court to secure payments of alimony during the lifetime of the payor spouse by requiring the posting of money, property, and bonds; and (2) the section also creates the statutory authority Hardin found the family court lacked to require a payor spouse to obtain life insurance to secure payment of periodic alimony beyond the payor's death. Husband's contention is that the phrase "but not limited to" only modifies the first portion of the section listing how the family court may secure payment of alimony during the lifetime of the payor spouse. Husband argues that the

344 S.C. 413

only method sanctioned by the Legislature for securing payment of periodic alimony beyond the life of the payor spouse is life insurance. We agree with Husband.

The cardinal rule of statutory construction is for the Court to ascertain and effectuate the intent of the Legislature. See Mid-State Auto Auction of Lexington, Inc. v. Altman, 324 S.C. 65, 476 S.E.2d 690 (1996). If a statute's language is plain and unambiguous,...