Simms v. Simms
| Decision Date | 09 July 1991 |
| Docket Number | No. 9024,9024 |
| Citation | 593 A.2d 161,25 Conn.App. 231 |
| Court | Connecticut Court of Appeals |
| Parties | Donna SIMMS v. Robert SIMMS |
Daniel W. Moger, Jr., Greenwich, for appellant (plaintiff).
Michael A. Meyers, with whom was Patricia C. Reath, Bridgeport, for appellee (defendant).
Before DUPONT, C.J., and SPALLONE and NORCOTT, JJ.
The plaintiff in this action appeals from the trial court's denial of her motion for modification of alimony. She claims that the court improperly determined that the defendant's receipt of certain moneys in exchange for United States treasury bonds was not income and therefore did not warrant modification of her alimony award. We affirm the trial court's judgment.
The following facts are necessary to our resolution of this appeal. The marriage of the parties was dissolved on September 24, 1979. The judgment of dissolution incorporated the terms and provisions of a settlement agreement entered into by the parties on August 24, 1979. That agreement provides, inter alia, for unallocated alimony and child support to be paid to the plaintiff, with alimony payments to increase automatically beginning in August, 1982, by the lesser of 33 1/3 percent of the defendant's net income over $52,000 or 5 percent of the alimony payments to which the plaintiff was entitled for the previous calendar year. For purposes of this calculation, the agreement defines "net income" as "the gross income of the Husband from all sources, excluding capital gains, capital losses or S corporation losses, including that income to which he shall be entitled as a partner, sole proprietor or employee, less the federal, state and local income taxes for which the Husband is obligated on the same, less the amount contributed to the capital account of the Husband and which he shall not be entitled to physically receive." The agreement also stipulates that the unallocated alimony and child support payments were nonmodifiable by the plaintiff until August, 1982.
At the time of the dissolution, the defendant had just become a partner at Bear, Sterns and Company, a brokerage firm in New York. On his September 18, 1979 financial affidavit, the defendant disclosed a gross balance of $102,400 in his capital account with Bear, Sterns and Company. That amount represented the defendant's capital contribution to the partnership. When the defendant left Bear, Sterns and Company in April, 1984, his capital account had risen to between $3 and $4 million. He received slightly over $1 million in cash and the remaining $2 million was distributed to him in the form of United States treasury bonds. Although the defendant received the bonds in 1984, he was permitted under an arrangement with the Internal Revenue Service to defer the tax consequences of the 1984 distribution until he redeemed the bonds for cash. The defendant redeemed $647,000 of the bonds for cash in 1989; at the time of the hearing on the plaintiff's motion for modification of alimony, he anticipated receiving $670,000 in 1990 and $683,000 in 1991 when he redeemed the remainder of the bonds.
In 1982, the plaintiff and the defendant entered into the first in a series of yearly agreements increasing the alimony payments to $48,000 a year, double the amount that the defendant was required to pay under the separation agreement. These yearly increases, which were not the subject of any court ordered modification, continued until the spring of 1989, when the defendant unilaterally chose to revert to the schedule of payments provided in the separation agreement.
The plaintiff moved to modify the alimony award on April 17, 1989. She claimed that the moneys received by the defendant from the treasury bonds were income and represented an uncontemplated substantial change in circumstances warranting a modification of alimony under General Statutes § 46b-86(a). The defendant argued that the exchange of bonds for cash was merely an exchange of assets, and that any increase in the value of his capital account was received in 1984, when he withdrew his share of the capital assets of Bear, Sterns and Company, which he had acquired by virtue of his partnership interest in the company. On March 20, 1990, the trial court denied the plaintiff's motion, finding that she had failed to sustain her burden of...
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