Shaughnessy v. Shaughnessy

• Decision Date: 22 February 1990
• Docket Number: No. 2,CA-CV,2
• Parties: In re the Marriage of Gerald R. SHAUGHNESSY, Petitioner/Appellee/Cross-Appellant, v. Frances L. SHAUGHNESSY, Respondent/Appellant/Cross-Appellee. 89-0138.
• Court: Arizona Court of Appeals

Page 1116

793 P.2d 1116

164 Ariz. 449

In re the Marriage of Gerald R. SHAUGHNESSY, Petitioner/Appellee/Cross-Appellant, v. Frances L. SHAUGHNESSY, Respondent/Appellant/Cross-Appellee.

No. 2 CA-CV 89-0138.

Court of Appeals of Arizona Division 2, Department A.

Feb. 22, 1990.

Reconsideration Denied March 29, 1990.

Review Denied July 3, 1990. ^*

[164 Ariz. 450] Victoria Ann King, Tucson, for petitioner/appellee/cross-appellant.

John D. Kaufmann, Tucson, for respondent/appellant/cross-appellee.

OPINION

HOWARD, Judge.

The parties appeal from an order modifying spousal maintenance obligations set forth by final decree in 1987. Four issues are raised on appeal. Appellant Frances Shaughnessy contends the trial court (1) erred in refusing to distribute as community property retirement benefits received by Mr. Shaughnessy for early retirement and (2) abused its discretion by reducing the amount of spousal maintenance established in the dissolution decree. Appellee Gerald Shaughnessy contends on cross-appeal that the trial court erred when it refused to (1) admit evidence concerning the construction of the decree's spousal maintenance provision and (2) establish a termination date for the payment of spousal maintenance.

FACTS

In October 1987, a decree of dissolution of marriage was entered ending the parties' 36-year marriage. The decree allocated to Gerald: "Any and all retirement and/or pension benefits due from IBM" and required him to make Frances the "irrevocable beneficiary of the proceeds of Life Insurance Proceeds, current face amount $50,000.00, due from [Gerald's] current employer, IBM." Testimony indicated that this insurance policy terminated at the end of Gerald's employment with IBM.

In December 1988, Gerald voluntarily retired from his management position in exchange for a lucrative incentive package. He received twice his annual salary of about $68,000 plus $25,000 in bonuses. In addition, he received a $25,000 life insurance policy under which his current wife was named beneficiary.

Frances petitioned for an order to show cause which was combined with a review hearing provided for in the decree. ¹ After a hearing on these issues, the trial court reduced Gerald's spousal maintenance obligation from $2,000 per month to $1,000 per month upon a finding of "continuing and significant changes of circumstance as to [Gerald's] ability to earn income." Moreover, the trial court refused to grant Frances a portion of the retirement benefits Gerald had received from IBM because the decree clearly established that these benefits were the sole property of Gerald. This appeal followed.

DISCUSSION

Frances first contends that the trial court erred in disallowing her community property rights to the IBM retirement benefits. We disagree.

The decree states that Gerald is entitled to "[a]ny and all" benefits regarding his retirement and subsequent pension from IBM. This provision clearly means that Gerald's rights to the incentive payments are free from any community property claim Frances may otherwise have had. Absent a claim based on 16 A.R.S. Rules of Civ.Proc., Rule 60(c), the decree with respect to property disposition is final. A.R.S. § 25-327; Schmidt v. Schmidt, 158 Ariz. 496, 763 P.2d 992 (App.1988). The record indicates that the agreement as mutually agreed upon by Gerald and Frances, that both parties were represented by counsel and that the trial court subsequently adopted the settlement. We therefore can find no reason to reverse the trial court based on this contention. However, we are in agreement with Frances' next contention that the trial court abused its discretion by ordering a reduction in the amount of spousal maintenance established in the decree.

An order for spousal maintenance is binding on the trial court unless it is unfair. Marquez v. Marquez, 132 Ariz. 593, 647 P.2d 1191 (App.1982). The standard for modifying spousal maintenance is whether there are substantial and continuing changed circumstances which would affect one's ability to pay spousal maintenance. A.R.S. § 25-327(A). Ability to pay spousal maintenance is to be determined by earning capacity rather than the amount of voluntarily reduced income. Ellis v. Ellis, 262 N.W.2d 265 (Iowa 1978). Voluntary retirement does not, in and of itself, provide grounds for reduction of spousal maintenance. See Reeves v. Reeves, 146 Ariz. 471, 706 P.2d 1238 (App.1985); Servies v. Servies, 524 So.2d 678 (Fla.Dist.Ct.App.1988); Ward v. Ward, 502 So.2d 477 (Fla.Dist.Ct.App.1987); Huber v. Huber, 527 So.2d 382 (La.Ct.App.1988); Smith v. Smith, 419 A.2d 1035 (Me.1980); Villano v. Villano, 98 Misc.2d 774, 414 N.Y.S.2d 625 (1979); but see McFadden v. McFad den,, 386 Pa.Super. 506, 563 A.2d 180 (1989). The only evidence of change was Gerald's early retirement and reduction of income. There was no evidence that appellee's early retirement was forced or involuntary.

Frances also contends the trial court abused its discretion by not ordering Gerald to name her as the beneficiary of the insurance policy given to him as part of...