Orr v. Orr, DA 17-0095

Citation389 Mont. 400,2017 MT 291,410 P.3d 181
Decision Date28 November 2017
Docket NumberDA 17-0095
Parties In re the Marriage of: Daniel E. ORR, Petitioner and Appellant, v. Melinda J. ORR, Respondent and Appellee.
CourtUnited States State Supreme Court of Montana

For Appellant: Jamie J. McKittrick, Thomas H. Stanton, Wells & McKittrick, P.C.; Missoula, Montana.

For Appellee: Raymond P. Tipp, Tipp Coburn Schandelson, P.C.; Missoula, Montana.

Justice Jim Rice delivered the Opinion of the Court.

¶1 Daniel E. Orr (Daniel) appeals the order denying his motion to modify maintenance, entered in the Fourth Judicial District, Missoula County. We affirm, and address the following issue:

Did the District Court err when it determined that maintenance, incorporated into the decree from the marital property settlement agreement, was not modifiable by the court?
FACTUAL AND PROCEDURAL BACKGROUND

¶2 Daniel and Melinda Orr, k/n/a Melinda Koffler, (Melinda) were married in 1985 and have three adult children. Daniel filed a petition for dissolution of marriage in July 2013. Both parties were represented by counsel and engaged in lengthy negotiations that ultimately resulted in a Marital and Property Settlement Agreement (the Agreement) on May 16, 2014, in which the parties consented to entry of a Decree of Legal Separation. The District Court entered a Final Decree of Legal Separation the same day, incorporating the Agreement and, although the record before us does not include the transcript of the hearing, the Decree states the District Court found the Agreement was reasonable, equitable, and not unconscionable.

¶3 The Agreement divided assets and debts between the parties. Section 11 addressed maintenance, and section 13 distributed property, including the couple's business, Iron Orr Welding, Inc. (the business).1 The Agreement provided that if the matter remained a legal separation, Melinda was entitled to 30% monthly distributions from the business, but would receive no maintenance. However, if the matter was converted into a marriage dissolution, then Melinda would relinquish her interest in the business and Daniel would pay Melinda $3,000 per month in maintenance for a period of three and one-half years. Section 21 stated as follows, including a provision regarding modification:

21. ENTIRE AGREEMENT: This Agreement contains the entire agreement of the parties. There are no representations, warranties, covenants, or any other undertakings of any sort of nature other than those expressly set forth or discussed herein. Time is of the essence of the terms and condition of this Agreement. This Agreement may not be amended or modified except by an agreement in writing, duly subscribed and acknowledged with the same formality that has been employed in the execution of this Agreement .

(Underline and bold in original, emphasis added.)

¶4 On November 19, 2014, on Daniel's motion, the District Court converted the Decree of Legal Separation to a Decree of Dissolution of Marriage, triggering Melinda's relinquishment of her interest in the business and Daniel's obligation to pay her $3,000 monthly maintenance payments, beginning December 2014. At that time, Daniel was operating the business in the Bakken oil fields in North Dakota, and he made maintenance payments to Melinda for six months, totaling $18,000. However, when the oil market declined, Daniel was unable to find work in North Dakota, and he moved back to Montana. He then began employment in a non-welding position, earning about $3,000 per month in take-home pay.

¶5 Citing a change in circumstances, Daniel moved the court to modify the maintenance provision in the Agreement in March 2016, asking that he be completely relieved of any maintenance obligation. The matter was assigned to a Standing Master, who conducted a hearing. Melinda testified that she agreed to relinquish her share in the business,which she had helped to build, only because of the maintenance provision. She testified she was paying off significant debts assigned to her under the Agreement, and without the maintenance money, she would have to file for bankruptcy. For his part, Daniel testified that "I had to make this deal in order for [Melinda] to sign the divorce and [I] kept telling everybody that the oil field was not going to last." Daniel testified he had almost no assets and no retirement savings, and he was living in a fifth-wheel trailer for which he was making payments. Daniel also testified his welding business was now in poor financial condition, and believed he was earning more in his non-welding job than he would earn if he returned to welding.

¶6 The Standing Master reduced the maintenance, citing her equitable powers, ordering Daniel to pay $500 a month for 24 months. The Standing Master also ordered Daniel to sell a broken-down race car he owned for a minimum of $4,000, and pay Melinda the proceeds. These provisions would have relieved Daniel of approximately $96,000 he still owed to Melinda in maintenance under the Agreement.

¶7 Melinda objected, requesting review of the Standing Master's decision by the District Court. The District Court first reasoned that the Agreement is a contract, which must, under § 28-3-401, MCA, be construed according to its "clear and explicit language," and concluded "[w]hile the [non-modification] provision is in fact one sentence out of a larger paragraph, it is still quite ‘clear and explicit’ that the [Agreement] cannot be modified absent a written agreement of the parties." The District Court also reasoned that § 40-4-201(6), MCA, and Montana case law, precludes a District Court from modifying maintenance when an agreement prohibits modification. Daniel appeals.

STANDARD OF REVIEW

¶8 The construction and interpretation of a written agreement are questions of law that we review for correctness. Moore v. Goran, LLC , 2017 MT 208, ¶ 7, 388 Mont. 340, 400 P.3d 729 (citations omitted).

DISCUSSION

¶9 Did the District Court err when it determined that maintenance, incorporated into the decree from the marital property settlement agreement, was not modifiable by the court?

¶10 We affirm the District Court's holding, but on an alternate basis. Regarding modification of maintenance, Daniel argues the District Court erred as a matter of law because the non-modification language in the clause titled "Entire Agreement" does not preclude judicial modification of maintenance. Referencing various authorities, Daniel offers that the purpose of an "entire agreement" or "merger" clause is to "avoid litigation over the questions of whether there were oral representations made outside the written agreement...." (quoting 17A Am. Jur. 2d Contracts § 378 (2008) ). Daniel thus argues that non-modification language contained in a merger clause is merely intended to prevent extrinsic evidence from being used to modify the terms of the Agreement, and does not operate to foreclose judicial modification of maintenance on the ground of changed circumstances. Melinda responds that the District Court correctly applied the law, and that the plain language of the Agreement prevents modification, regardless of where the language was placed in the Agreement, a principle consistently upheld by this Court.

¶11 The Legislature has addressed judicial modification of maintenance provisions. Section 40-4-208, MCA, provides:

(1) Except as otherwise provided in 40-4-201(6), a decree may be modified by a court as to maintenance or support only as to installments accruing subsequent to actual notice to the parties of the motion for modification.
...
(2) (b) [W]henever the decree proposed for modification contains provisions relating to maintenance or support, modification under subsection (1) may only be made:
(i) upon a showing of changed circumstances so substantial and continuing as to make the terms unconscionable....

(Emphasis added.) However, this provision cross-references § 40-4-201(6), MCA, which provides an exception allowing decrees of dissolution to preclude or limit future modification upon the parties' agreement:

[E]xcept for terms concerning the support, parenting, or parental contact with the children, the decree may expressly preclude or limit modification of terms set forth in the decree if provided for in the separation agreement . Otherwise, terms of a separation agreement set forth in the decree are automatically modified by modification of the decree.

(Emphasis added.) Consequently, we have held that "where a separation agreement expressly precludes modification or limitation of maintenance, a District Court is barred from later modifying the terms of the agreement." In re Marriage of Bolstad , 203 Mont. 131, 135, 660 P.2d 95, 97 (1983) ; see also Rowen v. Rowen , 199 Mont. 315, 320, 649 P.2d 1259, 1262 (1982) (when a separation agreement does not expressly limit modification, the district court has the power to modify...

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3 cases
  • Simpson v. Simpson
    • United States
    • Montana Supreme Court
    • 18 Septiembre 2018
    ...to her contempt motions.STANDARD OF REVIEW¶10 The construction and interpretation of a written agreement are questions of law. Orr v. Orr, 2017 MT 291, ¶ 8, 389 Mont. 400, 410 P.3d 181. We review a district court's conclusions of law for correctness. In re Marriage of Pospisil, 2000 MT 132,......
  • Simpson v. Simpson, DA 18-0067
    • United States
    • Montana Supreme Court
    • 18 Septiembre 2018
    ...to her contempt motions.STANDARD OF REVIEW¶10 The construction and interpretation of a written agreement are questions of law. Orr v. Orr, 2017 MT 291, ¶ 8, 389 Mont. 400, 410 P.3d 181. We review a district court's conclusions of law for correctness. In re Marriage of Pospisil, 2000 MT 132,......
  • In re Simpson
    • United States
    • Montana Supreme Court
    • 27 Noviembre 2018
    ...her contempt motions.STANDARD OF REVIEW ¶ 10 The construction and interpretation of a written agreement are questions of law. Orr v. Orr , 2017 MT 291, ¶ 8, 389 Mont. 400, 410 P.3d 181. We review a district court’s conclusions of law for correctness. In re Marriage of Pospisil , 2000 MT 132......

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