Mills v. Mills

• Decision Date: 14 May 2019
• Docket Number: Record No. 1630-18-2
• Citation: 827 S.E.2d 391,70 Va.App. 362
• Parties: Melinda Newman MILLS v. Robert Alexander MILLS
• Court: Virginia Court of Appeals

70 Va.App. 362

827 S.E.2d 391

Melinda Newman MILLS

v.Robert Alexander MILLS

Record No. 1630-18-2

Court of Appeals of Virginia, Richmond.

MAY 14, 2019

Eileen McNeil Newkirk (The McNeil Law Group, on briefs), for appellant.

Benjamin R. Rand (Blackburn, Conte, Schilling & Click, P.C., on brief), Richmond, for appellee.

Present: Judges Russell, Malveaux and Senior Judge Clements

OPINION BY JUDGE WESLEY G. RUSSELL, JR.

Melinda Mills (wife) appeals the circuit court’s rulings finding her in contempt for violating three provisions of the parties’ property settlement agreement, which was incorporated into their final decree of divorce. Wife also challenges the reasonableness of the court’s award of attorney’s fees to Robert Mills (husband). For the reasons that follow, we affirm in part, reverse in part, and remand the case to the circuit court for further proceedings consistent with this opinion.

BACKGROUND

"When reviewing a [circuit] court’s decision on appeal, we view the evidence in the light most favorable to the prevailing party, granting it the benefit of any reasonable inferences." Kahn v. McNicholas, 67 Va. App. 215, 220, 795 S.E.2d 485 (2017) (alteration in original) (quoting Congdon v. Congdon, 40 Va. App. 255, 258, 578 S.E.2d 833 (2003) ). Accordingly, we review the evidence in the light most favorable to husband as the prevailing party below.

The parties were divorced by final decree dated May 20, 2015. The final decree incorporated the parties’ July 19, 2012 property settlement agreement (PSA), which included terms governing issues related to their two children, one of whom had reached the age of majority before commencement of the instant proceedings.

Section 6.1 of the PSA required wife "to maintain in full force and effect the existing policy or policies of life insurance insuring her life, providing coverage of at least $ 50,000 and to name and maintain the children as the irrevocable sole primary beneficiaries thereof, until the youngest child turns age 25" and further directed that wife "not pledge or hypothecate said insurance or borrow against any cash value." Section 8.2 provided that once the elder child was no longer eligible for dependent status, "the tax dependency exemption for [the younger child] shall be alternated and claimed by each parent every other year ...."

In addition to these financial obligations, the PSA included provisions related to the custody and care of the parties’ children. Section 2.3 of the PSA required the parties "to foster love, affection, and respect between the children and both parents" and to refrain from doing "anything to interfere with the love and affection of the children for the other party."

Finally, Sections 11.2 and 11.3 of the PSA provided for one party to pay the other’s expenses, including attorney’s fees and costs, incurred upon enforcement or breach of the agreement.

In April 2018, husband filed a motion to show cause alleging that wife had violated Sections 6.1 and 8.2 of the PSA. He alleged that wife, in violation of Section 6.1 of the PSA, had cashed out the existing whole life insurance policy that named the children as beneficiaries. He further asserted that wife had claimed the parties’ youngest child as a dependent on her tax returns in violation of Section 8.2 of the PSA, which assigned that right to him for the tax years in question. In June 2018, husband filed another motion to show cause, in which he alleged that wife had violated Section 2.3 of the PSA "by talking negatively and vulgarly to the children about [him]."

In response, wife denied that she had willfully violated any provision of the PSA. Additionally, she filed a motion for sanctions arguing that the show cause related to Section 6.1 of the PSA had been filed in bad faith.

Ultimately, the circuit court held a hearing on the motions to show cause on August 9, 2018. Prior to the hearing, wife withdrew her motion for sanctions. At the outset of the hearing, in addition to reiterating her position that none of her conduct constituted a willful violation of the PSA, wife argued that at least some of the contempt allegations sounded in criminal contempt as opposed to civil contempt and that she had not been afforded certain procedural safeguards regarding criminal cases. Having heard wife’s argument in this regard, the circuit court elected to proceed with the hearing.

Regarding the allegations related to Section 6.1 of the PSA, wife admitted that, without notifying husband, she stopped paying the premiums for and cashed out the whole life insurance policy that had been in effect since 2005. Furthermore, in response to husband’s questioning, when asked if this action violated the terms of Section 6.1 of the PSA, wife responded: "That section, yes, sir."

Despite the admission, wife argued that she should not be held in contempt because she had term insurance through her employer, and thus, there was in place a policy of insurance with at least $ 50,000 in coverage. According to wife, this constituted "substantial compliance" with the provision, and thus, contempt should not lie. Furthermore, she argued that husband could not be damaged by any noncompliance with the provision unless and until she died without coverage in place, and therefore, contempt could not lie until that time.¹

In response to the allegations regarding Section 8.2 of the PSA, wife testified that she claimed the younger child on her income taxes for tax years 2015, 2016, and 2017, and conceded that, pursuant to the terms of the PSA, she should not have done so for 2016. Given that husband’s entitlement to claim the parties’ younger child as a dependent was contingent on the older child no longer being eligible to be claimed as a dependent on husband’s return, wife asserted that she did not know she was not supposed to claim the younger child until husband brought up the issue in October 2017. She noted that the younger son had not lived with husband between 2015 and 2017 and that husband never notified her that the older son, despite having reached majority, was no longer eligible to be claimed as a dependent. Wife further testified that, upon learning of her error, she offered to pay husband the difference in his tax liability or refund amount for the year in question. Evidence established, however, that when wife first was alerted to the issue, she argued that, regardless of the language of the PSA, she was entitled to claim the younger child as a dependent because he lived with her and that to do otherwise would violate IRS rules, a claim she now concedes was in error.² The parties stipulated that the difference in husband’s liability for tax year 2016 was $1,066.

Wife denied violating Section 2.3 of the PSA. In an attempt to establish the alleged violation, husband played a video of an argument between wife and the parties’ older child that the child had recorded and sent to husband. The video showed wife making numerous negative statements about husband using what, charitably, could be described as colorful language. Wife did not dispute the behavior shown on the video, but denied that it was part of a larger pattern or that she had acted similarly in front of her younger child. She argued that, because the older son was no longer a minor at the time of the incident, her conduct towards him did not run afoul of the terms of Section 2.3 of the PSA.

Husband also sought a total of $ 5,130 in attorney’s fees for having to litigate to obtain the benefits he was entitled to under the PSA. Although wife had withdrawn her motion for sanctions at the beginning of the hearing, the requested amount included the costs associated with preparing to defend against the motion. Wife objected to the total, arguing that it was unreasonable "considering the amount in controversy and the remedies that were sought." She acknowledged that the charges incurred prior to June 7, 2018 were reasonable, but contested any amount above that. She argued that certain discovery was unnecessary and that fees incurred preparing to defend against the motion for sanctions she filed were unnecessary because the motion had been withdrawn and no preparation was needed in any event because "the only thing necessary to preclude a motion for sanctions is to prevail in the underlying show cause[,]" which husband’s counsel had to prepare for regardless of what she had filed.

The circuit court issued an opinion letter, which it eventually incorporated into its final order in the case. The letter opinion expressed that the court, despite wife’s objections, viewed the matters before it as civil contempt proceedings. In its order, the court found wife in "civil contempt pursuant to [Code] § 18.2-456(5) for intentional violations of Section[s] 2.3, 6.1 and 8.2 of the [PSA]." Based on "the plain language" of the PSA and wife’s testimony "that she withdrew the cash value of the policy and ceased paying its premiums[,]" the court ordered wife "to obtain, within thirty days ... a whole life insurance policy that ... include[s] a death benefit of not less than $ 50,000.00 [and] name[s] and maintain[s] the children as the irrevocable sole primary beneficiaries thereof, until the youngest child turns age 25." Finding that wife "intentionally prevented [husband] from claiming the child dependency tax exemption in 2016 in violation of the" PSA, the court further ordered her to pay husband $ 1,066, which the court found "represent[ed] the damages incurred by [husband] on his 2016 taxes." The court also found that wife "had intentionally interfered with the love, affection, and respect of the children for [husband]" and imposed a fine of $ 1,000 as "the most appropriate sanction to remedy the situation and prevent further violations ...." The fine was suspended in its entirety, "conditioned upon no future violations." The court then awarded $ 5,130, "representing reasonable attorney’s fees," to husband.

Wife filed a motion to reconsider. Wife challenged the classification of the contempt...