Granger v. Granger

• Decision Date: 26 May 2016
• Docket Number: No. 20140196–CA,20140196–CA
• Parties: Troy M. Granger, Appellee and Cross-appellant, v. Cindy D. Granger, Appellant and Cross-appellee.
• Court: Utah Court of Appeals

374 P.3d 1043

2016 UT App 117

Troy M. Granger, Appellee and Cross-appellant

v.Cindy D. Granger, Appellant and Cross-appellee.

No. 20140196–CA

Court of Appeals of Utah.

Filed May 26, 2016

David Pedrazas, Attorney for Appellant

Melissa M. Bean and Martin N. Olsen, Attorneys for Appellee

Judge Stephen L. Roth authored this Opinion, in which Judges Gregory K. Orme and J. Frederic Voros Jr. concurred.

Amended Opinion¹

ROTH, Judge:

¶ 1 Cindy D. Granger (Wife) appeals several rulings of the district court in a divorce proceeding. Troy M. Granger (Husband) cross-appeals, challenging the court's denial of his request for attorney fees. We reverse and remand to the district court for further fact finding regarding the distribution of Husband's 401(k) retirement account and for entry of appropriate findings to support its decision on the issue of attorney fees.

BACKGROUND

¶ 2 Husband and Wife married in 2003. Husband filed for divorce in April 2011. In his petition for divorce, Husband requested that any retirement accounts be divided in accordance with the Woodward formula. See generally Woodward v. Woodward , 656 P.2d 431, 433–34 (Utah 1982). Wife responded that any retirement benefits should be “equitably divided.”

¶ 3 Before trial, both parties submitted trial briefs. Wife's brief stated, “Retirement accounts shall be divided pursuant to the Woodward formula.” Husband's brief also requested division of retirement benefits according to the Woodward formula. Husband's brief proposed the amount he believed Wife was entitled to under the formula. However, as with a different figure Husband had provided in an earlier settlement proposal, the number was not accompanied by any explanation of how it had been calculated.

¶ 4 In July 2013, the district court held a two-day trial. During opening statements and closing arguments, counsel for both Husband and Wife said that the retirement accounts should be divided according to the Woodward formula. There was no further discussion regarding the Woodward formula or the division of the retirement accounts during the trial. The district court entered its findings of fact, conclusions of law, and order on September 3, 2013. In its findings of fact, the court referenced the retirement accounts once, noting that “[t]he parties stipulated to the division of their retirement accounts pursuant to the Woodward formula.”² It also ordered Husband's counsel to prepare the final decree of divorce, later signed on October 18, 2013. Following the court's order, contentions between Husband and Wife over issues unrelated to this appeal continued for months.

¶ 5 On January 28, 2014, Husband's counsel sent Wife's counsel a copy of the qualified domestic relations order (the QDRO³ ), which he proposed to file with the district court to implement division of the retirement account. In an email accompanying the document, Husband's counsel explained that “the retirement will be divided according to the Woodward formula” and, for the first time, he provided a mathematical calculation showing “how [he] arrived at the amount set forth in the QDRO.” Wife's counsel responded by email later that same day, stating, “I am not sure how the figure ... was arrived at[,] but that is completely wrong.” Wife's counsel continued, “This is not working out. I simply suggest that I will draft [the] QDRO[ ] based upon the Woodward formula.” Husband's counsel responded that the calculation he used was based on the Woodward formula, explaining that he “multipl[ied] one-half of the value of the account by the number of years the parties were married and divide[d] by the number of years [Husband] has worked.” Wife's counsel responded that the calculation Husband's counsel used was “wrong” and insisted that counsel should have “simply divide[d] what was acquired during the marriage.”

¶ 6 Wife filed an objection to the QDRO as well as a motion under rule 60(b) of the Utah Rules of Civil Procedure to set aside or clarify the divorce decree. Wife also provided notice that she was issuing a subpoena to obtain records from the plan administrator of Husband's retirement account. Husband filed a response to Wife's objection to the QDRO and rule 60(b) motion and also moved to quash the subpoena. The district court granted Husband's motion to quash and set a hearing on both Wife's rule 60(b) motion to set aside the divorce decree and her objection to the QDRO.

¶ 7 At the hearing, Wife's counsel stated,

I will admit that I stipulated to the Woodward formula. The problem that I've always had, and I guess I've had different results from all of the [c]ourts is basically it's always been my understanding the Woodward formula basically means you just divide whatever contributions were made to the retirement during the marriage.

Wife's counsel explained that he “never intended to use this formula of doing the number of years” but that he believed the actual mathematical formula set forth in Woodward applied only to defined benefit plans and not to defined contribution plans such as Husband's 401(k) retirement account. Husband's counsel argued that Wife's agreement to the Woodward formula was a “one-sided mistake”—if there was a mistake made at all—made entirely by Wife “because the Woodward formula has been around for 32 years” and “the formula is clear.”

¶ 8 The district court took the matter under advisement and issued a written ruling in March 2014 denying Wife's rule 60(b) motion to set aside or clarify the divorce decree and her objection to the QDRO. The court determined that “the Rule 60 motion was not filed in a timely fashion, and although [Wife's] counsel may not agree with it, the Woodward formula does not require clarification. Moreover, [Husband's] settlement proposal and trial brief each set forth the calculation being proposed, so it does not appear that [Wife] was unaware of what she was stipulating to when she agreed to a division of retirement contributions.”

¶ 9 On appeal, both Husband and Wife agree that as of the date of divorce, the balance of Husband's retirement account was $591,938.64. But it is from this figure that Husband and Wife diverge. The QDRO prepared by Husband and signed by the district court divided this figure by two, multiplied the result by the number of years the parties were married (10.5 years), and then divided that result by the number of years Husband worked (18.8 years). Husband therefore concluded that $165,302.01 represents Wife's portion of the retirement account under the Woodward formula. Wife asserts that the $591,938.64 account balance should be reduced by Husband's premarital contributions of $193,526.04, leaving $398,412.60, which should then be divided equally with Husband and Wife each receiving $199,206.30. Wife claims that “pursuant to Woodward,” “the portion of the retirement account accumulated during the marriage shall be equally divided” between her and Husband because “[t]o do otherwise ... creates an injustice and inequity that was never intended by the Woodward Court.” Wife asserts on appeal that it was only in January 2014, when she reviewed Husband's proposed QDRO in which Husband provided the actual calculations used to determine the final figure he believed was Wife's share of the retirement account, that “it became apparent that the parties intended different results [from] the division of the retirement account pursuant to Woodward ” because “there was a serious misapplication and/or interpretation of the ‘Woodward formula’ ” by Husband.

ISSUES AND STANDARDS OF REVIEW

¶ 10 There are two primary issues on appeal. First, Wife's appeal rests on her assertion that the district court erred in dividing Husband's 401(k) retirement account under the Woodward formula because, Wife contends, division under the Woodward formula means that the retirement account was to be “equally divided based upon marital contributions made during the marriage.” “We will disturb the [district] court's division only if there is a misunderstanding or misapplication of the law ... indicating an abuse of discretion.” Johnson v. Johnson , 2014 UT 21, ¶ 23, 330 P.3d 704 (alteration in original) (citation and internal quotation marks omitted).

¶ 11 Second, Husband cross-appeals, contending the district court erred in denying his request for attorney fees related to the rule 60(b) motion and the motion to quash. Because we reverse the district court and remand for further consideration of the division of Husband's 401(k) account, Husband is no longer the prevailing party below, and his attorney fees issue related to the rule 60(b) motion and the motion to quash is essentially moot at this point. See Osguthorpe v. Osguthorpe , 872 P.2d 1057, 1058 (Utah Ct. App. 1994) (“Generally, we do not consider mooted questions on appeal. Whether to consider a mooted controversy is a matter of judicial policy and not law.” (citation omitted)).

ANALYSIS

¶ 12 Generally, there are two types of pension plans: a defined benefit pension plan and a defined contribution retirement plan. The retirement account at issue is not a defined benefit plan like the pension at issue in Woodward. Instead it is a defined contribution plan, specifically a 401(k) retirement account that Husband had paid into before and during the marriage. In Oliekan v. Oliekan , 2006 UT App 405, 147 P.3d 464, we explained the difference between these two types of plans:

A defined contribution plan is comprised of funds held in an account established by the employee through his employer. A defined contribution plan is one in which the employee and the employer both make contributions to a retirement plan account.... By contrast, a defined benefit plan defines an employee's benefits as a certain amount per period of time.

Id. ¶ 5 n. 3 (citation and internal quotation marks omitted); see also Employee Benefit Plan , Black's Law Dictionary (10th ed. 2014) (“Retirement benefits under a defined-benefit plan generally are based on a formula that includes such factors as years of...