Jennings v. Jennings

• Citation: 12 Va.App. 1187,409 S.E.2d 8
• Decision Date: 27 August 1991
• Docket Number: No. 0480-90-3,0480-90-3
• Parties: Gary JENNINGS v. Glenda C. JENNINGS. Record
• Court: Virginia Court of Appeals

Page 8

409 S.E.2d 8

12 Va.App. 1187

Gary JENNINGS v. Glenda C. JENNINGS.

Record No. 0480-90-3.

Court of Appeals of Virginia.

Aug. 27, 1991.

Stuart H. Dunn (Jane Chittom; Shuford, Rubin, Gibney & Dunn, Richmond, on briefs), for appellant.

Neal S. Johnson (Natkin, Heslep, Siegel & Natkin, P.C., Lexington, on brief), for appellee.

Present: KOONTZ, C.J., and BENTON and DUFF, JJ.

BENTON, Judge.

Gary Jennings appeals from a divorce decree and raises five issues for our consideration: (1) whether the Separation and Property Settlement Agreement into which he entered with his wife, Glenda C. Jennings, is void due to a mutual mistake of fact; (2) whether the Agreement is unconscionable; (3) whether the trial judge erred in awarding the wife spousal support; (4) whether the trial judge erred in awarding the wife pre-separation book royalties pursuant to the Agreement; and (5) whether the wife abandoned the Agreement.

FACTS

We review the evidence contained in the record under familiar principles:

We may only reverse the decree if it is plainly wrong or without evidence to support it. We examine the record in the light most favorable to the prevailing part[y] and determine whether substantial credible evidence supports the chancellor's decision.

Carter v. Carter, 223 Va. 505, 508-09, 291 S.E.2d 218, 220 (1982) (citations omitted); Code § 8.01-680. So viewed, the evidence proves that the parties married in 1972 and lived modestly during the early years of their marriage while the husband pursued his writing career. The husband is an alcoholic and through the years has been prone to cyclical binges. With his wife's help, he has managed on occasion to curb the severity of his alcohol dependence. He is a successful historical novelist and has earned substantial incomes from several novels. Before the parties separated, he conceived, researched, outlined, and signed a publishing contract for a new book.

In June 1986, the wife witnessed the husband committing adultery. She left their home and filed for divorce. During a brief separation, the couple spoke frequently by telephone. The wife returned home on the husband's request to wean him from a drinking episode. He wanted to reconcile; however, for security she insisted on an agreement. In July 1986, the wife agreed to return to the marriage in exchange for the husband's assurances of future support if the reconciliation failed. A year earlier, the wife had filed for a divorce but dismissed the suit when they reconciled. This time, the husband agreed A paper written in the wife's handwriting and signed by the husband provides the following:

to give assurances and dictated the conditions guaranteeing her future security.

I ... agree during the next six months to support Glenda Jennings.... If at the end of those six months we have not come to an amicable solution ..., I will have all our property assessed ..., and we will split proceeds evenly down the middle. In addition I will deed over to her 50% of all my royalties, contracts, subsidiary rights, foreign rights, pending (1) rights and will instruct my agents to pay checks in equal parts to her and myself.

* * * * * *

s/ Gary Jennings

29 July 1986

(1) This will include all monies received or to be received from ... rights on the books Aztec, The Journeyer, Spangle and the book to be written with working title of Raptor.

With this document, the parties went to the wife's attorney's office where a Separation and Property Settlement Agreement was discussed and drafted. While the Agreement was being typed, the husband and wife went for a drive. The Agreement provides in part the following:

... [A]s the court favors settlement of disputes between the parties in lieu of proceedings upon the grounds set forth [in the pending suit], the Wife agrees she will obtain the divorce upon the grounds of six months separation, to-wit: a no-fault divorce.

* * * * * *

Husband agrees that he will make periodic support payments for the remainder of Wife's life, or until she remarries, in an amount to support Wife in the style to which she was accustomed during the marriage of the parties.

* * * * * *

If, at the end of the six months separation period, the parties have not reconciled their differences and resumed cohabitation, then a divorce may be obtained in accordance with the paragraph set forth above. All of the property ... that was obtained during the marriage ... will be appraised.... [T]here shall be a 50/50 division of all said real and personal assets....

* * * * * *

The clear intent of the above paragraph is that there be an equal division between the parties, either in kind or by reducing said property to money.

* * * * * *

[Husband] does hereby acknowledge that the Wife, as her part under the equitable distribution as provided by Virginia law, is entitled to 50% of all royalties ... and pending rights. Husband agrees to instruct his agents to pay by separate checks in equal parts from the above to the Wife and Husband.

* * * * * *

It is agreed that Wife's 50% of equitable distribution shall include ... all monies received or to be received in the future, from [all rights] on ... Aztec, The Journeyer, Spangle, and a book to be written ... which has a working title of Raptor.

* * * * * *

It is understood and agreed by the parties herein that each will be responsible for his or her own attorney's fees.

* * * * * *

In the event of a reconciliation and resumption of the marital relationship between the parties, all of the provisions of this Agreement ... shall continue in full force and effect without abatement of any terms.

After the Agreement was typed, all the provisions were explained to the husband by the wife's attorney. The husband was given an opportunity to obtain legal counsel; however, he read the Agreement, initialled each page, and insisted on signing the Agreement after he read it. The husband claims to have been woozy at the time and to remember little of the incident. The wife and her attorney observed no indication that the husband had been drinking or was under the influence of alcohol. The After signing the Agreement, the couple returned home and resumed their marital relationship for fourteen months. The wife again left the home in September 1987 and filed for divorce on the grounds of cruelty and constructive desertion. The trial judge awarded the wife a no-fault divorce and $1000 per month for permanent spousal support, but did not award attorney's fees. The Agreement was affirmed, ratified, and incorporated by reference in the decree of divorce. Code § 20-109.1.

wife's attorney testified that the husband spoke intelligently and firmly.

MUTUAL MISTAKE OF FACT AND LAW

The husband argues that the Agreement should be rescinded because the parties entered the contract while sharing misconceptions of the tax consequences and Virginia's equitable distribution statute. The trial judge found no mutual mistake. We conclude the trial judge reached a proper result.

Generally, "[i]f certain facts are assumed by both parties as the basis of the contract, and it subsequently appears that such facts did not exist, the contract is inoperative." Virginia Iron, Coal & Coke Co. v. Graham, 124 Va. 692, 708, 98 S.E. 659, 664 (1919).

The mistake may be common to both parties to a transaction, and may consist either in the expression of their agreement, or in some matter inducing or influencing the agreement, or in some matter to which the agreement is to be applied. Nothing is more clear in equity than the doctrine that a contract founded in mutual mistake of the facts constituting the very basis or essence of it will avoid it.

Briggs v. Watkins, 112 Va. 14, 25, 70 S.E. 551, 554 (1911) (citation omitted). On the other hand, relief will not be granted where the parties, operating with knowledge of all material facts, enter the agreement under a mutual mistake of law. See Piedmont Trust Bank v. Aetna Cas. & Sur. Co., 210 Va. 396, 401, 171 S.E.2d 264, 267-68 (1969).

We need not decide, however, whether this case, as it concerns the parties' understanding of the tax consequences, constitutes a mistake of fact or law requiring rescission of the Agreement. The Supreme Court wrote in Printz v. McLeod, 128 Va. 471, 104 S.E. 818 (1920):

[T]he contract under consideration falls within that class ... in which, due to the mutual mistake of both parties, there is error which consists in the use of language which is broader in its ordinary meaning than was in fact intended.... "1. By means of the error the contract may include within its terms certain subject matters ... which were not intended by the parties to come within its operation, in which case the parol evidence will show that such subject matters should be omitted, and the relief demanded will be a correction which shall exclude them, and confine the operation of the agreement to the remaining subject matters mentioned in it to which alone it was intended by the parties to apply."

* * * * * *

Hence the court below was plainly right "in restraining the instrument to the purposes of the bargain."

Id. at 484, 104 S.E. at 822. This doctrine is more aptly applied to the case at bar than the former recitations. The husband's argument focuses neither on the actual or precise impact of applicable tax laws nor on the wife's understanding of the tax consequences. Rather, he discusses what the parties truly intended when they agreed to divide equally the "royalties." The true issue presented is whether the term "royalties," as used in the Agreement, meant net or gross royalties.

The evidence convincingly demonstrates that the parties intended to divide the after-tax royalties rather than rest the tax burdens entirely on the husband. The handwritten agreement the husband signed evidences an intent to "split proceeds evenly down the middle." The plain import of the phrase is that the parties would receive equal sums for their disposal. This intent was...