Miles v. Miles, 26980.

• Decision Date: 31 May 2011
• Docket Number: No. 26980.,26980.
• Citation: 711 S.E.2d 880,393 S.C. 111
• Court: South Carolina Supreme Court
• Parties: James Richard MILES, Petitioner,v.Theodora MILES, Respondent.

393 S.C. 111

711 S.E.2d 880

James Richard MILES, Petitioner,

v.Theodora MILES, Respondent.

No. 26980.

Supreme Court of South Carolina.

Heard Dec. 1, 2010.Decided May 31, 2011.

Matthew P. Turner and Michael Turner, Sr., both of Laurens, for Petitioner.C. Rauch Wise, of Greenwood, for Respondent.Justice HEARN.

In this appeal from the family court, we are asked to determine whether an agreement between the parties for the provision of health insurance is a modifiable form of support. We hold that unless the agreement provides otherwise, the obligation to maintain health insurance is an incident of support. Because there is no language in this agreement limiting the court's power to modify it, we find a modification is warranted based on a substantial change in circumstances. We remand this case to the family court for a determination of what form this modification is to take and whether the party receiving the modification is entitled to reimbursement for excess support paid during the pendency of this appeal.

FACTUAL/PROCEDURAL BACKGROUND

In March 2000, Theodora Miles (“Wife”) petitioned for a divorce from James Richard Miles (“Husband”) on the ground of adultery and sought custody of the couples' two minor children, child support, equitable division of the marital assets, alimony, and attorney's fees. Prior to the final hearing, the parties reached an agreement as to many of the issues, which provided in pertinent part:

5. [Husband] shall continue to maintain health and dental insurance on [Wife] through his place of employment until such time as [Wife] remarries or until [Wife] attains employment which provides health insurance to employees as part of its fringe benefits package; both [Husband] and [Wife] waive alimony.

The remainder of the agreement divided the parties' property, determined custody and visitation of their children, established child support, and awarded attorney's fees. The family court approved the agreement, and by order dated August 16, 2000, granted Wife a divorce and incorporated the parties' agreement. The following language is contained in the order:

5. [Husband] is hereby ordered to cover [Wife] through his place of employment with health and dental insurance until such time a[s Wife] remarries or obtains employment which provides such coverage to [Wife] as a fringe benefit.

6. Alimony is denied to each party.

The agreement contained no language limiting or otherwise restricting modification of its terms.

Six years later, Husband filed this action seeking to modify various aspects of the final order. Specifically, he sought a reduction in his child support obligation, attorney's fees, and the termination of the requirement that he maintain health and dental insurance on Wife due to a substantial change in circumstances.¹ The parties did agree to a reduction in Husband's child support obligations, but the remaining issues were left for the court to decide.² At the time of the proposed modification, Wife did not have insurance coverage through her employer and had not re-married, both of which would terminate Husband's obligation by the terms of the agreement and the court's order. Therefore, the issue before the court was whether the agreement to provide health insurance was a modifiable support obligation or a non-modifiable agreement similar to a property division.

The family court found the fact that Wife waived alimony in the agreement “unambiguously shows the intent of the parties that the health insurance maintenance provision was not in the form of support.” Further, the court held “the language of the parties' agreement is plain, unambiguous, and I therefore decline to construe that the maintenance [of] the health insurance pursuant to this agreement is actually support. The parties further clarified their intent when they inserted the sentence that both parties waive alimony.” Accordingly, the court denied Husband the modification he sought. The court of appeals affirmed, agreeing the agreement unambiguously did not create a support obligation. Miles v. Miles, Op. No. 2009–UP–007 (S.C. Ct.App. filed Jan. 7, 2009). We granted certiorari.

ISSUE PRESENTED

Did the court of appeals err in affirming the family court's conclusion that the parties' agreement unambiguously did not create a support obligation and therefore Husband's obligation to maintain health insurance is non-modifiable?

STANDARD OF REVIEW

In an appeal from a decision of the family court, this Court may find facts in accordance with its own view of the preponderance of the evidence. Rutherford v. Rutherford, 307 S.C. 199, 204, 414 S.E.2d 157, 160 (1992). Thus, our review of a family court's order on whether to modify support awards is de novo.

LAW/ANALYSIS

I. Whether Agreement Is Modifiable

Husband argues the court of appeals erred in affirming the determination his obligation to provide insurance benefits to Wife was unambiguously not a form of support. We agree.

We encourage litigants in family court to reach extrajudicial agreements on marital issues. The interpretation of such agreements is a matter of contract law. Hardee v. Hardee, 348 S.C. 84, 91–92, 558 S.E.2d 264, 267 (Ct.App.2001). Where an agreement is clear on its face and unambiguous, “the court's only function is to interpret its lawful meaning and the intent of the parties as found within the agreement.” Smith–Cooper v. Cooper, 344 S.C. 289, 295, 543 S.E.2d 271, 274 (Ct.App.2001). However, if the agreement is ambiguous, it is the court's duty to determine the intent of the parties. Id. It may do so by examining extrinsic evidence. McKinney v. McKinney, 274 S.C. 95, 97, 261 S.E.2d 526, 527 (1980). An agreement is ambiguous if it is susceptible to more than one interpretation or its meaning is unclear. Smith–Cooper, 344 S.C. at 295, 543 S.E.2d at 274. The interpretation of an unambiguous contract is a question of law. S.C. Dep't of Natural Res. v. Town of McClellanville, 345 S.C. 617, 623, 550 S.E.2d 299, 303 (2001). Similarly, whether a contract is ambiguous is a question of law. Id. at 617, 550 S.E.2d at 302–303. If the court finds it necessary to examine extrinsic evidence to discern the intent of the parties, the determination of intent is a question of fact. Id. at 617, 550 S.E.2d at 303.³

Initially, we note that because the agreement is silent as to the family court's power to modify it, it remained modifiable by the court. See Moseley v. Mosier, 279 S.C. 348, 353, 306 S.E.2d 624, 627 (1983) ( “[U]nless the agreement unambiguously denies the court jurisdiction, the terms will be modifiable by the court....”). As to whether Husband's obligation is an incident of support, the maintenance of health insurance has the hallmark of spousal support: it provides the receiving spouse a benefit which is normally incident to the marital relationship. See Craig v. Craig, 365 S.C. 285, 292, 617 S.E.2d 359, 362 (2005). Additionally, our courts have previously awarded health insurance as a form of support. Sharpe v. Sharpe, 307 S.C. 540, 542, 416 S.E.2d 215, 216 (Ct.App.1992); Wood v. Wood, 292 S.C. 43, 48–49, 354 S.E.2d 796, 799–800 (Ct.App.1987). ⁴ Awards of spousal support do not become property divisions, and therefore non-modifiable, absent something more. See Mattox v. Cassady, 289 S.C. 57, 62, 344 S.E.2d 620, 623 (Ct.App.1986) (“To show that the alimony award was part of a property settlement agreement, it must be shown that the wife surrendered property rights in return for the husband's agreement to pay the stated sums.”).

Here, the agreement simply states Husband will provide health and dental insurance for Wife. It does not indicate Wife surrendered property rights in exchange for it, nor does the agreement provide any indication that Husband's obligation is anything other than support. Additionally, this requirement terminates automatically upon Wife's remarriage or her obtaining employment that provides similar coverage, both instances in which she would be able to obtain this benefit through means other than Husband. The language creating Husband's obligation in the agreement even appears in the same paragraph as the language pertaining to alimony. In fact, it is in the same sentence. Looking squarely at the face of the agreement, we cannot find it is unclear or susceptible to more than one interpretation. Therefore, although we agree with the family court and the court of appeals that the agreement is unambiguous, we hold that it unambiguously creates a support obligation. See In re Marriage of Johnson, 781 N.W.2d 553, 557 (Iowa 2010) (“[W]e conclude as a matter of law that a provision in a dissolution decree requiring one spouse to provide medical support in the form of health insurance payments to the other spouse is modifiable spousal support....”).

Wife argues that her decision to waive alimony unambiguously demonstrates the insurance obligation is not an incident of support. However, alimony is not the only form of support available in a divorce. See S.C.Code Ann. § 20–3–130 (Supp.2009) (discussing the different forms of alimony and “[s]uch other form of spousal support ... as appropriate under the circumstances”); Whitfield v. Hanks, 278 S.C. 165, 165, 293 S.E.2d 314, 315 (1982) (holding an award of possession of the marital home is an incident of support). Wife and the family court have placed too much emphasis on the language that the parties “waive[d] alimony.” Such semantic distinctions have been abolished in family law. Moseley, 279 S.C. at 352–53, 306 S.E.2d at 627. As we said in Moseley,

[t]he parties' intent is rarely revealed from the agreement's words of art. Generally, those terms are used without intending or implying any particular legal consequences. Later, courts impose the consequences upon the unsuspecting parties. Today, we overrule those cases which hold that words of art make a major distinction in the operation of divorce law.

Id. The mere fact the parties waived alimony—i.e., permanent and periodic,...