Moon v. Moon

• Decision Date: 22 January 1999
• Docket Number: No. 971542-CA,971542-CA
• Citation: 973 P.2d 431
• Parties: 361 Utah Adv. Rep. 15 Mary Ann MOON, Plaintiff and Appellee, v. Stanley W. MOON, Defendant and Appellant.
• Court: Utah Court of Appeals

Page 431

973 P.2d 431

361 Utah Adv. Rep. 15

Mary Ann MOON, Plaintiff and Appellee, v. Stanley W. MOON, Defendant and Appellant.

No. 971542-CA.

Court of Appeals of Utah.

Jan. 22, 1999.

Randy S. Ludlow, Salt Lake City, for Appellant.

Hollis S. Hunt, Draper, for Appellee.

Before GREENWOOD, Associate P.J., and BILLINGS and JACKSON, JJ.

OPINION

JACKSON, Judge:

¶1 Mr. Moon challenges the trial court's construction and enforcement of his divorce decree on three grounds, arguing that: (1) the trial court erred when it considered Ms. Moon's order to show cause, in addition to considering her petition for modification, which was filed on the recommendation of a domestic relations commissioner; (2) the trial court erred when it interpreted the original decree to require that the income from MST Trucking attributed to Mr. Moon's share of ownership be included in the calculations for purposes of enforcing the original alimony award; and (3) the trial court erred when it did not proceed with a modification analysis based on the Jones factors after concluding there had been a material change in the parties' circumstances. He also challenges the trial court's award of attorney fees to Ms. Moon.

¶2 We affirm in part and remand for further proceedings.

BACKGROUND

¶3 The parties were married on September 18, 1971. Four children were born during the marriage. Ms. Moon stayed home with their children while they were young, and she now teaches kindergarten part time. Mr. Moon is a vice president and one-fifth shareholder of MST Trucking.

¶4 After Ms. Moon filed for divorce in April 1990, the parties negotiated an agreement and presented it orally to the court at a pretrial hearing on June 30, 1992. This stipulated agreement became the basis of the trial court's Findings of Fact and Conclusions of Law (1992 Findings) and the final Decree of Divorce. The 1992 Findings provided that

Based upon the incomes of the parties, [Mr. Moon] has agreed to pay to [Ms. Moon] the sum of $2,400.00 per month as alimony. [Mr. Moon] will also pay to [Ms. Moon], as additional alimony thirty percent (30%) of the gross amount of any bonuses he receives as additional income above his annual base salary which is currently $150,000.00 without bonuses. [Mr. Moon] will provide independent verification to [Ms. Moon] of any and all bonuses received. The parties agree that this form of payment of alimony is being adopted and agreed upon because [Mr. Moon] receives a monthly gross income of $12,500.00 per month. Accordingly, after deductions for state and federal taxes, social security, health care premiums, child support and alimony, [Mr. Moon] will be left with approximately $2,500.00 net income to meet his own monthly financial needs. The payment of alimony in the total amounts required when considering [Mr. Moon's] annual income can only be made after [Mr. Moon] has received his bonus. [Mr. Moon] shall make distribution to [Ms. Moon] of thirty percent (30%) of his gross bonus immediately upon his receipt thereof, and the parties recognize that this will qualify as payment of alimony in addition to $2,400.00 per month paid from [Mr. Moon's] base salary. Based upon [Mr. Moon's] current bonus of $100,000.00 per year, the amount of alimony paid from [Mr. Moon's] bonuses would be $30,000.00 additional annual payment of alimony.

¶5 The decree's terms regarding alimony provided only that

[Mr. Moon] shall pay to [Ms. Moon] the sum of $2,400.00 per month as alimony plus thirty percent (30%) of the gross income of any bonus he may receive each calendar year. [Mr. Moon] shall also provide independent verification to [Ms. Moon] of all bonuses [Mr. Moon] receives. He shall pay the 30% to [Ms. Moon] immediately upon receipt of the bonuses.

¶6 The parties' divorce was finalized on August 26, 1992. Shortly thereafter, MST Trucking was reorganized as an S corporation. As a result of this change in corporate structure, Mr. Moon's 1993 base salary increased from $150,000 to $200,000, and he no longer received any additional payments called "bonuses." Rather, he periodically received "distributions," which were reported to the IRS on Schedule K-1 of his federal income tax return as "ordinary income (loss) from trade or business activities."

¶7 Mr. Moon stayed current on his $2,400 monthly obligation to Ms. Moon, and in 1993 also paid her thirty percent of the much smaller reported annual "distributions" he received. ¹ He failed to make an annual payment of alimony in 1994 and the amounts paid in 1993 and 1995 were substantially less than the amounts computed at the time of the decree. Mr. Moon did not verify his annual income for 1993, 1994, or 1995.

¶8 On July 6, 1995, Ms. Moon petitioned the court for an order to show cause. She asked the court to enforce the decree by (1) requiring Mr. Moon to verify his annual income from MST Trucking and (2) entering judgment for all delinquent sums Mr. Moon should have paid her as alimony. Mr. Moon responded that, because MST Trucking no longer paid him "bonuses," he was only required to pay $2,400 per month to Ms. Moon, and that he need not verify that he did not receive any bonuses. This dispute revealed a basic disagreement over the meaning and interpretation of the decree's alimony terms.

¶9 The Order to Show Cause was heard before a domestic relations commissioner, who filed a Minute Entry opining that "this is a modification issue to be dealt with under a petition to modify," and recommending that the trial court dismiss Ms. Moon's Order to Show Cause. Acting on the commissioner's recommendation, Ms. Moon next filed a Petition for Modification on March 22, 1996, asking that the court "modify" the decree by requiring Mr. Moon to pay $2,400 per month plus thirty percent of his income over $150,000. Later, because Ms. Moon did not object, the trial court signed the commissioner's order.

¶10 Following a pretrial conference, the trial court stated that "this should be before the court on the order to show cause and not on the petition to modify." These issues went to trial on May 29, 1997. However, during the trial, the court also concluded that, although it was treating the case as an order to show cause, the change of corporate structure and resulting change in the nature of Mr. Moon's income were material changes of circumstance sufficient to support Ms. Moon's petition to modify. The court construed the decree to require alimony payments of $2,400 per month, and thirty percent "of all amounts he receives [from MST Trucking] over that, whether that's income or bonuses or distributions or anything else," and ordered Mr. Moon to verify his income ² whether or not he receives "bonuses." The court also awarded attorney fees to Ms. Moon.

¶11 This appeal followed.

I. PROCEEDINGS ON THE ORDER TO SHOW CAUSE

¶12 Mr. Moon argues the trial court erred in reconsidering the order to show cause, and not considering only the petition to modify as the commissioner had recommended. Whether the trial court erred in doing so is a question of law which we review for correctness, according no particular deference to the trial court's actions. See State v. Pena, 869 P.2d 932, 936 (Utah 1994).

¶13 We conclude the trial court did not commit reversible error when it reconsidered and decided to proceed on the order to show cause. Judges routinely sign domestic relations commissioners' recommendations unless a party objects. In this case, Ms. Moon did not file an objection to the commissioner's recommendation dismissing the order to show cause, nor did she object to the suggestion that she file a petition to modify. Thus, as a matter of course, the judge signed an order adopting the commissioner's recommendation. ³

¶14 Before the court entered that order, Ms. Moon filed a Petition for Modification seeking to "enforce" the decree. No appeal was filed or pending from the order to show cause when the trial court also considered the petition to modify. Given these facts, the equitable nature of divorce proceedings, and the court's continuing jurisdiction in divorce cases, there was no reversible error in the trial court's consideration of the order to show cause along with the petition to modify. See Utah Code Ann. § 30-3-5(3) (1998) (establishing court's continuing jurisdiction); Gillmor v. Wright, 850 P.2d 431, 439 (Utah 1993) (Orme, J., concurring) (noting that law of the case doctrine does not prevent court from "catching a mistake and fixing it").

¶15 Thus, the trial court was free to reconsider the commissioner's recommendation in light of the evidence presented at trial, and disregard, alter, or adopt the commissioner's recommendation, as it saw fit.

II. ALIMONY

¶16 Mr. Moon argues the trial court erred in ordering him to pay Ms. Moon as alimony $2,400 per month plus thirty percent of any income he receives from MST Trucking over $150,000 per year. He contends that under the decree he must pay Ms. Moon only $2,400 per month plus thirty percent of any "bonus" he receives from MST Trucking. Because part of his MST Trucking annual income is now called "distributions" rather than "bonuses," he argues that he must pay only $2,400 per month. Mr. Moon also argues that he must verify his income only if he receives "bonus" income.

¶17 Ms. Moon responds that the parties intended Mr. Moon to pay $2,400 per month, plus thirty percent of his income over $150,000 per year, for a total annual alimony payment of $58,800. She further argues that Mr. Moon must verify his income each year regardless of whether he considers any annual alimony payments to be owed.

A. Order to Show Cause/Construing the Decree

¶18 The parties and the trial court essentially treated this case as presenting a question of the proper construction of the original divorce decree, which was ambiguous as to the meaning of the term "bonus," an approach with which we agree. "We interpret a divorce decree according to established rules of contract interpretation.... 'When...