Johnson v. Johnson

Decision Date30 April 1980
Docket NumberNo. 12600,12600
PartiesDonald Keith JOHNSON, Plaintiff and Appellant, v. Muriel Eunice JOHNSON, Defendant and Appellee.
CourtSouth Dakota Supreme Court

Robert E. Hayes of Davenport, Evans, Hurwitz & Smith, Sioux Falls, for plaintiff and appellant; Robert C. Heege of Davenport, Evans, Hurwitz & Smith, Sioux Falls, on brief.

Haven L. Stuck of Lynn, Jackson, Shultz & Lebrun, Rapid City, for defendant and appellee.

MORGAN, Justice.

This is an appeal from an Eighth Judicial Circuit Court final order enforcing an alimony provision of a Wyoming decree of divorce granted to the appellant, Donald Keith Johnson, from the appellee, Muriel Eunice Johnson, which required appellant to guarantee monthly sum payments to appellee. We reverse in part, affirm in part, and remand to the trial court.

Having been previously married and divorced, the parties remarried in March of 1974. On June 18, 1977, they entered into a separation and property settlement agreement. Appellant drafted the agreement, entitled "TO WHOM IT MAY CONCERN," and both parties signed it. Then on July 11, 1977, appellant obtained an uncontested divorce in Crook County, Wyoming. The Wyoming court approved the agreement and repeated its language in the divorce decree.

The portion of the agreement which forms the basis of the current dispute reads as follows:

I, Donald Keith Johnson, do hereby agree to pay to Muriel Eunice Johnson the sum of Sixty Thousand Dollars, in cash, immediately, and subsequently Fifteen Hundred Dollars a month, for the rest of her natural life; such monthly sum to be guaranteed by annuties (sic) or securities, beyond my lifetime.

The divorce decree ordered appellant "to pay to (appellee) the sum of $60,000.00 in cash, immediately and subsequently Fifteen Hundred Dollars ($1,500.00) a month, for the rest of her natural life; such monthly sum to be guaranteed by annuities and securities, beyond (appellant's) lifetime."

During December 1977 appellant executed a will containing, among other provisions, the following:

THIRD: I am obligated to provide my former wife, MURIEL E. JOHNSON, with an annuity of One Thousand Five Hundred Dollars ($1,500.00) a month for the rest of her natural life. I recognize that obligation and authorize my Executor to establish a trust to fund it, and at the death of Muriel E. Johnson the balance of such trust is to be paid in equal shares to my five children, namely, SUSAN KLINE, LYNDA FLANNERY, NANCY HANSON, LORENE JOHNSON and GUSTAV JOHNSON, or to their children by right of representation should any of them die before my former wife, MURIEL E. JOHNSON.

In conformity with SDCL Chapter 15-16A, the Uniform Enforcement of Foreign Judgments Act, appellee, through her attorney, filed in the office of the clerk of courts of Lawrence County, South Dakota, an affidavit for filing foreign judgment and an exemplified copy of the judgment and decree entered by the Wyoming court. In conjunction therewith appellee requested that the trial court order appellant to show cause why he should not be required to guarantee the monthly $1,500.00 payments, which to that date he had not done.

The trial court signed and filed an order to show cause and then held a hearing on the matter. At the hearing appellant appeared by and through his attorney, as did appellee through hers, and the court heard no oral testimony. Relying on the judgment and decree of divorce entered by the Wyoming court, the affidavits and briefs submitted and filed by counsel, and the oral arguments given by counsel, the trial court ordered "that the monthly payments be forthwith guaranteed by an annuity or trust which shall be funded by securities or other assets transferred by (appellant) in an amount calculated to be sufficient to meet the required payments . . . ." It is from this order that appellant appeals.

This court recognizes the rule that a trial court's rulings and decisions are presumed to be correct, and this court will not seek reasons to reverse. Lytle v. Morgan, 270 N.W.2d 359 (S.D.1978); Shaffer v. Honeywell, 249 N.W.2d 251 (S.D.1976); Custer County Bd. of Ed. v. State Com'n on E. & S. Ed., 86 S.D. 215, 193 N.W.2d 586 (1972). This presumption does not exist, however, when the appellate review is based entirely on a written record. National Surety Corporation v. Shoemaker, 86 S.D. 302, 195 N.W.2d 134 (1972); Brewster v. F. C. Russell Company, 78 S.D. 129, 99 N.W.2d 42 (1959); Credit Management Service v. Wendbourne, 76 S.D. 80, 72 N.W.2d 926 (1955). In this case there is no presumption that the lower court is correct, so this court's review of the record is the same as the trial court's.

Appellant argues that he should not have been required to forthwith guarantee all monthly payments to appellee. It is undisputed between the parties that any payments due during appellee's lifetime and after appellant's death must be guaranteed, but they disagree as to when the guarantee is to be made and what additional payments, if any, the guarantee is to cover. Appellant argues that the guarantee is to be established at the time of his death for any payments due thereafter, while appellee argues that appellant is to guarantee all payments now.

"The primary rule in the construction of contracts is that the court must, if possible, ascertain and give effect to the mutual intention of the parties." Huffman v. Shevlin, 76 S.D. 84, 89, 72 N.W.2d 852, 855 (1955). In order to determine the intent of the parties in this case, we must interpret their agreement as written. Kansas City Life Ins. Co. v. Wells, 133 F.2d 224 (8th Cir. 1943). We are not modifying the agreement which they made, since modification of an agreement is not included in the interpretation of it. Chaffee v. Chaffee, 19 Wash.2d 607, 145 P.2d 244 (1944).

Also, a contract must be construed as a whole, not just a detached portion of it. City of Sioux Falls v. Henry Carlson Co., 258 N.W.2d 676 (S.D.1977); Eberle v. McKeown, 83 S.D. 345, 159 N.W.2d 391 (1968); Bedell v. Steele, 71 S.D. 609, 28 N.W.2d 369 (1947). The latter portion of the provision currently in question cannot be detached and construed without regard to the entire provision.

Although both parties agree that no ambiguity exists in the provision, even though they reach different conclusions as to its meaning, determination whether or not words used in a contract are ambiguous is usually a question of law to be decided by the court. Jensen v. Pure Plant Food Intern., Ltd., 274 N.W.2d 261 (S.D.1979); Employers Liability Assurance Corporation v. Morse, 261 Minn. 259, 111 N.W.2d 620 (1961). In addition, an ambiguity is not of itself created simply because the parties differ as to the interpretation of the contract. Burns v. Burns, 169 Colo. 79, 454 P.2d 814 (1969); Brunton v. International Trust Co., 114 Colo. 298, 164 P.2d 472 (1945). So even though the parties differ as to the interpretation of the provision at issue here, we find no ambiguity to exist.

Although a semicolon is placed toward the end of the controverted provision, "(t)he words, not the punctuation, are the controlling guide in construing a contract. If the meaning of the words is clear the court will interpret a contract according to their meaning and without regard to the punctuation marks or the want of them." Anderson & Kerr Drilling Co. v. Bruhlmeyer, 134 Tex. 574, 580, 136 S.W.2d 800, 803 (1940).

That no specific time for the making of the guarantee is set forth in the provision is of little import. It has been held that under such circumstances the time involved is to be a reasonable one. Papaioannou v. Britz, 285 App.Div. 596, 139 N.Y.S.2d 658 (1955). In order to determine just what a reasonable amount of time is when time is not of the essence, we must look at the circumstances of each individual case. Huffman v. Shevlin, supra; First Nat. Bank of Yankton v. Wagner, 51 S.D. 225, 213 N.W. 3 (1927).

Reading the agreement in conformity with the above rules and giving the maximum benefit to the arguments of both parties, we hold that the agreement and the decree incorporating it require that the appellant forthwith guarantee only such payments to which the appellee would be entitled during her lifetime and after his death, by either purchasing an annuity or by depositing in trust securities in such amount as will actuarily satisfy the requirements of the guarantee to be approved by the trial court.

Appellant argues that to require him to guarantee the payments forthwith is inequitable. He is the principal shareholder in a highway construction business and a substantial net worth on his balance sheet is required for business purposes. The record does not reflect, nor are we permitted to speculate, what effect the purchase of annuity or deposit of sufficient security would have on a net worth which approached $2,000,000.00 two years ago and which showed a history of steady increase. Inasmuch as we have determined that we are presented with a question of interpretation rather than modification, we do not perceive any valid reason to look to a balancing of the equities which may or may not result in our remaking the agreement for the parties; a result which, if reached, would be a modification, not an interpretation. Flowers v. Flowers, 334 So.2d 856 (Ala.1976); Knapp v. Breeding, 77 S.D. 551, 95 N.W.2d 535 (1959).

We have examined appellant's final argument that he has provided for funding the guarantee by a testamentary disposition. It does not, however, fulfill the agreement as we have interpreted it. It fails to guarantee the payment now, for indeed, the will can readily be changed at any time prior to testator's death. It assures that appellant's estate will be sufficient to fund the bequest, an assumption that we cannot indulge in. A will does not satisfy the obligation assumed by appellant in the agreement.

The order of the trial court is reversed to the extent that the appellant is not...

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