Mayville v. Mayville

• Decision Date: 21 October 2010
• Docket Number: No. 09–462.,09–462.
• Citation: 12 A.3d 500,2010 VT 94
• Parties: Judy MAYVILLEv.William MAYVILLE.
• Court: Vermont Supreme Court

12 A.3d 500

2010 VT 94

Judy MAYVILLE

v.William MAYVILLE.

No. 09–462.

Supreme Court of Vermont.

Oct. 21, 2010.

Mary G. Kirkpatrick of Kirkpatrick & Goldsborough, PLLC, South Burlington, for Plaintiff–Appellee.Catherine E. Clark of Clark, Werner & Flynn, P.C., Burlington, for Defendant–Appellant.Present: REIBER, C.J., DOOLEY, JOHNSON, SKOGLUND and BURGESS, JJ.DOOLEY, J.

¶ 1. Husband, William Mayville, who was recently laid off from his job, seeks to terminate the spousal maintenance payable to his ex-wife, Judy Mayville, pursuant to a 2003 court order. After husband filed a motion to terminate spousal maintenance, the Chittenden Family Court issued an order requiring him to pay $3000 per month—the same amount set forth in the 2003 order—until he stopped receiving unemployment compensation benefits and $1500 per month thereafter. Husband appeals from this order, alleging numerous errors. We affirm.

¶ 2. Husband and wife divorced in 2003, after twenty-seven years of marriage. At the time of the divorce, husband earned more than $100,000 per year working as an information technology manager for IBM. Wife is disabled and has never worked. Pursuant to an agreement made between the parties at the time of their divorce and incorporated into a court order, husband was to pay wife $3000 per month in spousal maintenance until he turned sixty-five years old. The 2003 court order granted wife fifty percent of husband's pension, among other assets, with husband retaining the other fifty percent.

¶ 3. Six years later, in April 2009, husband lost his job with IBM through no fault of his own. He was fifty-nine years old on the date he was laid off and had been with the company since age nineteen—for approximately forty years—working his way into a senior management position despite having only a high school education. He earned $110,000 in 2007 and $126,000 in 2008, including bonuses. Upon being laid off, husband received a severance package that included six months salary—$52,000—plus health benefits. His income for 2009, including his salary, pension, and unemployment compensation benefits, totaled $135,000; in other words, his income actually increased for 2009, the year in which he was laid off.

¶ 4. Husband currently lives with his new wife, who earns approximately $50,000 annually, and his major assets include a home with $136,000 equity in it and a 401(k) account valued at $150,000. Husband has made little effort to seek new employment since being laid off. He plans to retire from work and live off of his $3715 monthly pension and his unemployment compensation benefits until they expire. This plan is possible, in part, because his household expenses are reduced as a result of his new wife's contribution to them.

¶ 5. Wife presently lives off of her spousal maintenance and $1405 a month in Social Security benefits. She has never worked, due to her disabilities, and she incurs significant medical expenses. She was sixty-five years old at the time of the modification hearing.

¶ 6. On April 17, 2009, ten days before his position at IBM ended, husband filed a motion to terminate spousal maintenance with the Chittenden Family Court. The court held a preliminary hearing on the motion in June and an evidentiary hearing in October. The court concluded that there had been “no substantial change of circumstances for 2009” in that husband's annual income for that year was actually higher than the income for previous years. The court accordingly ordered husband to pay $3000 in spousal maintenance for November and December 2009. The court further concluded there would be “no substantial change of circumstances during the period for which [he] receive[d] unemployment benefits” either, as “[a]dding up his monthly pension, unemployment payments, imputed income at a minimum wage, full-time job and his wife's contribution to the household income, leaves [him] close to what he had been earning at the time of the final order.” The court did, however, conclude that a substantial change of circumstances would occur once husband's unemployment compensation benefits ended. At that point, the court ordered that husband's maintenance obligation be reduced to $1500 per month, until he reached age sixty-five, when it would terminate completely pursuant to the 2003 court order and agreement between the parties.

¶ 7. Husband argues on appeal that the family court erred in concluding that the loss of his job would not result in a “real, substantial, and unanticipated change of circumstances” until his unemployment compensation benefits ran out. See 15 V.S.A. § 758. In particular, husband argues that the court erred by: (1) considering his pension as a source of income; (2) presuming that he could receive unemployment compensation benefits and a full-time minimum-wage income at the same time; (3) considering his new wife's income; (4) failing to consider his increased health insurance expenses; (5) failing to consider wife's improved financial circumstances; and (6) ruling in a manner inconsistent with reasonableness, fairness, or equity. We address these arguments in turn.

¶ 8. A court may not modify a maintenance order unless it finds that there has been a “real, substantial, and unanticipated change of circumstances.” 15 V.S.A. § 758. As we have previously held, “[t]he burden for showing a change in circumstances is a heavy one, and lies with the party seeking the modification,” in this case, husband. Wardwell v. Clapp, 168 Vt. 592, 594, 720 A.2d 862, 864 (1998) (mem.). We evaluate whether a change is substantial “in the context of the surrounding circumstances,” Braun v. Greenblatt, 2007 VT 53, ¶ 11, 182 Vt. 29, 927 A.2d 782 (quotation omitted), and we will not disturb a trial court's decision on whether to modify spousal maintenance unless “the discretion was erroneously exercised, or was exercised upon unfounded considerations or to an extent clearly unreasonable in light of the evidence.” Taylor v. Taylor, 175 Vt. 32, 36, 819 A.2d 684, 688 (2002); accord Stickney v. Stickney, 170 Vt. 547, 548–49, 742 A.2d 1228, 1231 (1999) (mem.) (“A court has broad discretion in determining the amount and duration of a maintenance award, and we will set it aside only when there is no reasonable basis to support it.”). Our review is therefore “limited to determining whether the family court's exercise of discretion was proper and whether a reasonable basis supports the award.” Golden v. Cooper–Ellis, 2007 VT 15, ¶ 47, 181 Vt. 359, 924 A.2d 19.

¶ 9. We now turn to husband's various claims of error. Husband first argues that the family court improperly considered his pension as a source of income. As a general matter, although pensions may be viewed as marital assets, “they may also be considered as a source of income upon which an award of spousal maintenance may be based.” Sachs v. Sachs, 163 Vt. 498, 502–03, 659 A.2d 678, 680 (1995); see C. Marvel, Annotation, Pension of Husband as Resource Which Court May Consider in Determining Amount of Alimony, 22 A.L.R.2d 1421, § 2 (1952) (“As a general proposition, it has been held or stated in numerous cases that the pension of a husband may properly be considered as a resource in determining the amount of alimony to be awarded to the wife.”). Husband maintains, however, that pensions must be considered as either a source of income or a marital asset, but not both. Because the family court divided husband's pension between the two parties at the time of divorce, husband argues that the court erred in taking into account his income from the pension in determining whether to terminate maintenance. In his view, after the termination of unemployment compensation benefits, he must be treated as if he has no income available to pay maintenance.

¶ 10. We note at the outset that we can find no support for husband's theory in the statutes governing maintenance awards or in our general treatment of income-producing assets. The statutes governing maintenance authorize the court to award such amount “as the court deems just” considering “all relevant factors,” including the “property apportioned to the [obligee],” and “the ability of the [obligor] ... to meet his or her reasonable needs while meeting those of the spouse seeking maintenance.” 15 V.S.A. § 752(b). Nothing in the language suggests income from marital assets cannot be considered in determining ability of the obligor spouse to pay maintenance and the amount of such maintenance. Consistent with the statutory language, we have routinely held that in determining the amount of maintenance, the family court can consider the income available to the obligor from assets distributed as part of the property award. See, e.g., Golden, 2007 VT 15, ¶ 53, 181 Vt. 359, 924 A.2d 19 (holding that husband's stock options could be expected to generate income and that “[t]his income must be considered in determining an appropriate maintenance award”); Kasser v. Kasser, 2006 VT 2, ¶¶ 11–14, 179 Vt. 259, 895 A.2d 134 (affirming trial court in awarding hotel business to husband and taking into account income derived from that business in awarding maintenance); Root v. Root, 2005 VT 93, ¶ 4, 178 Vt. 634, 882 A.2d 1202 (mem.) (noting that husband was ordered to pay maintenance specifically from income derived from rental properties). Under our precedents, the issue is simply whether one party has a need for maintenance and whether the other party has the ability to pay maintenance.

¶ 11. We see no obvious rationale for distinguishing pension income from this general rule. A pension is just another type of income-producing asset. See, e.g., In re Marriage of Haney, 267 Mont. 107, 882 P.2d 497, 499 (1994); Rattee v. Rattee, 146 N.H. 44, 767 A.2d 415, 419 (2001). Pension income is therefore “always an important factor in determining whether alimony should be paid and how much either spouse should receive. Any source of income is material to such a determination.” G....