Marriage of Simms, In re

• Decision Date: 28 March 1994
• Docket Number: No. 93-110,93-110
• Citation: 264 Mont. 317,871 P.2d 899
• Parties: In re the MARRIAGE OF Garnet SIMMS, Petitioner and Respondent, and Arlyn Simms, Respondent and Appellant.
• Court: Montana Supreme Court

Page 899

871 P.2d 899

264 Mont. 317

In re the MARRIAGE OF Garnet SIMMS, Petitioner and Respondent and Arlyn Simms, Respondent and Appellant.

No. 93-110.

Supreme Court of Montana.

Submitted on Briefs Dec. 2, 1993.

Decided March 28, 1994.

Julio K. Morales, Morales Law Office, Missoula, for respondent and appellant.

Neil M. Leitch, Missoula, for petitioner and respondent.

NELSON, Justice.

This is an appeal from Findings of Fact, Conclusions of Law, and a subsequent Decree of Dissolution entered by the Fourth Judicial District Court, Missoula County. We reverse and remand.

The issues on appeal are as follows:

1. Is the oral marital settlement agreement entered into between the parties enforceable?

2. Did the District Court err in distributing the property of the parties?

3. Did the District Court err in awarding maintenance?

4. Did the District Court err in establishing a trust for the minor child's college education?

The petitioner, Garnet Simms (Garnet), and the respondent, Arlyn Simms (Arlyn) were married on August 8, 1959 and had five children. During the pendency of these proceedings, only one of the parties' children, Katy, was a minor.

During the course of the marriage, Arlyn worked outside the home and Garnet worked in the home. The major asset acquired by the parties was a ranch purchased in 1971 from money gifted to Arlyn by his late grandmother. The rest of the assets acquired by Garnet and Arlyn during their marriage consisted of some personal property and various retirement and pension accounts. However, immediately preceding and subsequent to their separation in 1989, Arlyn received substantial inheritances from his family.

Garnet filed for a dissolution of marriage on July 17, 1987; however, the parties apparently reconciled after this pleading was filed. The parties separated on June 6, 1989, and, on September 13, 1989, Garnet filed an Amended Petition for Dissolution of Marriage. Arlyn subsequently requested that a settlement conference be conducted and the presiding judge, Jack Green, invited District Judge John Henson to conduct the conference. Judge Henson met with the parties for the settlement conference on December 3, 1990.

Both parties, with counsel, were present at the settlement conference and entered into an oral "marital settlement agreement". This agreement granted joint custody of the minor child with residential custodianship to Garnet and reasonable visitation to Arlyn, ordered Arlyn to pay $250.00 per month in child support until the minor child reached the age of eighteen, awarded Garnet certain personal property and cash in the amount of $62,500.00, awarded Arlyn certain personal property and the family home, and waived Garnet's claim on maintenance. This agreement was entered on the record and both parties were sworn and testified they agreed to its contents.

Judge Henson approved the agreement and, on March 19, 1991, entered Findings of Fact, Conclusions of Law, and a Decree of Dissolution. On that same day, Judge Green sent a letter to Judge Henson objecting to the entry of the Decree based on Judge Henson's lack of jurisdiction for anything but the settlement conference itself.

Thereafter, on May 20, 1991, Garnet filed a Motion to Vacate Decree of Dissolution, because Judge Henson was not the presiding judge in the case. As a result, Judge Henson filed a memorandum on July 15, 1991, declaring that the Decree was a nullity and declining to assume jurisdiction over the case. However, Arlyn continued to pay $250.00 per month in child support, despite the fact that there was no binding order in place requiring him to do so.

Garnet then filed a Motion to Set Aside Property Settlement Agreement and Request for Trial, alleging that there was possible fraud, mistake, misrepresentation, and undue influence. On February 10, 1992, Judge Green granted Garnet's motion, vacated the parties' oral marital settlement agreement, and ordered the case to be set for trial. In the meantime, on June 19, 1992, Garnet moved for temporary maintenance in the amount of $300.00 per month and for an increase in the child support Arlyn had been voluntarily paying from $250.00 per month to $500.00 per month. Due to time constraints, a hearing on these motions was never held. However, the trial in the matter was held on August 10, 1992.

On December 21, 1992, Judge Green entered Findings of Fact and Conclusions of Law and, on December 23, 1992, entered a Decree of Dissolution incorporating those findings and conclusions. The Decree awarded the parties joint custody of the minor child, with Garnet named as the primary residential custodian. Garnet was awarded the family home worth approximately $100,000 and was awarded her personal property worth approximately $23,056.61. Arlyn was awarded some personal property valued at $60,888.00 and the inheritance he received subsequent to the parties' separation. He received no portion of or credit for the family home. Based on the District Court's finding that Arlyn's total known inheritance was approximately $624,917.00, Arlyn was ordered to pay Garnet $900.00 per month in maintenance until death or marriage. This award was retroactive to June 19, 1992, the date of Garnet's motion for temporary maintenance. In addition, Arlyn was ordered to pay $400.00 per month in child support, also retroactive to the date of the motion for an increase in child support; and to pay all insurance for medical, hospital, ocular, orthodontic, counseling and drug expenses, as well as all medical expenses not covered by insurance. The District Court also ordered Arlyn to set up a trust for the minor child's college education. From the Findings of Fact, Conclusions of Law, and Decree of Dissolution entered by the District Court, Arlyn appeals.

I--ORAL MARITAL SETTLEMENT AGREEMENT

Arlyn contends that the oral marital settlement agreement stipulated to between the parties is enforceable as a property settlement agreement. We disagree.

Section 40-4-201, MCA, allows only one sort of marital settlement agreement (referred to in the statute and in this opinion as a separation agreement), and that is one which is reduced to writing.

That section provides, in pertinent part:

(1) To promote amicable settlement of disputes between parties to a marriage attendant upon their separation or the dissolution of their marriage, the parties may enter into a written separation agreement containing provisions for disposition of any property owned by either of them, maintenance of either of them, and support, custody, and visitation of their children.

(2) ... [T]he terms of the separation agreement, except those providing for the support, custody, and visitation of children, are binding upon the court unless it finds, after considering the economic circumstances of the parties and any other relevant evidence produced by the parties, on their own motion or on request of the court, that the separation agreement is unconscionable. (Emphasis added.)

In this case, there was no written separation agreement. While the parties stipulated on the record to settlement and disposition of the various issues mentioned above, including property distribution, debt distribution, maintenance, custody and support, nevertheless their agreement was never reduced to writing as required by the statute. The fact that the parties may orally agree to a certain disposition of the various matters usually covered by a written separation agreement does not negate the requirement that, to be enforceable as a separation agreement contemplated by the statute, the agreement must be reduced to writing.

It is only when the agreement is reduced to writing that the court is statutorily bound by the agreement as to matters involving property distribution and maintenance (assuming the court finds that the agreement on those matters is not unconscionable). Whether the parties have entered into a written agreement or an oral, in-court stipulation, the court is not bound by the parties' determinations on matters of support, custody and visitation but, on those issues, must apply the appropriate statutory criteria. See § 40-4-201(2), MCA, and In re the Marriage of Mager (1990), 241 Mont. 78, 785 P.2d 198, wherein we held that the district court did not err in refusing to follow the oral stipulations of the parties, but correctly applied the statutory criteria to issues of custody, visitation and support.

We recently dealt with the matter of the enforceability of oral separation agreements and held that a separation agreement not reduced to writing was not enforceable. In re the Marriage of Hayes (1993), 256 Mont. 266, 846 P.2d 272. In Hayes, the terms of the separation agreement were read into the record and the court directed that the terms of the agreement be incorporated into a formal written document. No formal agreement was prepared, but the district court proceeded to enter findings of fact, conclusions of law, and a decree. The husband appealed those findings and conclusions, and argued that the parties had never agreed to the settlement. We stated that:

The pivotal question here is whether an agreement exists between the parties upon which the court could have based its Findings and Conclusions. The record does not contain a written separation agreement. The record does contain the court's directive to counsel to prepare such a document. It is clear that the court understood the importance of having the agreement reduced to writing. And while we commend the court for its efforts in getting the parties to reach a settlement agreement, such agreement of necessity needs to be specific to avoid the type of controversy presented here.

Hayes, 846 P.2d at 273.

Section 40-4-201, MCA, provides that the district court is bound by the parties' separation agreement in matters of property distribution and maintenance if the court finds that the separation agreement is not unconscionable. However, the only separation...