Windisch v. Windisch, 112520 PASUP, 255 EDA 2020

Docket Nº:255 EDA 2020
Opinion Judge:McLAUGHLIN, J.
Case Date:November 25, 2020
Court:Superior Court of Pennsylvania




No. 255 EDA 2020

Superior Court of Pennsylvania

November 25, 2020


Appeal from the Order Dated December 23, 2019 In the Court of Common Pleas of Lehigh County Civil Division at No(s): 2015-FC-1430




Patricia Windisch ("Wife") appeals from the trial court order modifying the amount of alimony owed to her by Jerry Windisch ("Husband"). Wife claims the trial court erred in granting the petition to modify, in calculating the new alimony amount, and in failing to treat as income the debts that Husband discharged in bankruptcy. We affirm.

Husband and Wife were married for 40 years before separating in 2015. They reached a settlement agreement in 2017, in which Husband agreed to pay Wife alimony for 11½ years and the parties agreed that the alimony amount would be modifiable upon a "significant change in circumstances": Alimony - or APL will be modifiable based on a significant change in circumstances in accordance with the law. And upon modification, will be calculated in the manner as APL is calculated under the Rules of Civil Procedure, that is, 40 percent of the difference in the parties' net incomes. It is understood that the parties are both nearing retirement age. Husband is 64 and . . . [W]ife is 65. And they will stop working at some point in the foreseeable future. And that would be a basis for modification at that time.

N.T., 9/18/17, at 9. Pursuant to the agreement, Husband assumed sole responsibility for all unsecured marital debts, totaling $179, 297. Id. at 5; Trial Court Opinion, filed Feb 10, 2020, at 1 n.1 ("Rule 1925(a) Op."). The parties were divorced in June 2019, and the divorce decree incorporated the settlement agreement.

In May 2019, Husband filed a petition for modification of alimony due to a substantial and continuing change in income. A divorce master held a hearing at which Husband testified that he had retired because he had reached retirement age and his employer was eliminating his position. N.T., 7/31/19, at 9. He also testified that he had filed for bankruptcy and he would receive a discharge of the remaining debts he had assumed in the marital settlement, which amounted to $126, 230. Id. at 15-18. However, he said he had paid down the debts before declaring bankruptcy, and had reaffirmed some debts after the bankruptcy. Id. at 17-18. In addition, Husband testified that he had formed a company "to look at opportunities in the future to do something, although [the business] was primarily set up to help [his girlfriend]." Id. at 19. However, he said the business had not yet generated income. Id. at 29.

In October 2019, the Master recommended, and the trial court approved, an order that granted Husband's petition, and reduced Husband's monthly alimony to $370. The Master concluded: Excluding the pension-derived income based upon its characterization as equitable distribution, the parties' respective incomes consist of Social Security benefits. Wife receives approximately $1, 430.00 per month and Husband receives approximately $2, 860.00 per month in such benefits. The parties then have deductions made for Medicare benefits which result in net incomes of approximately $2, 150.00 for Husband and $1, 225.00 for Wife. Based upon the parties' agreement that any modification would utilize the formula set forth in the old guidelines of forty percent (40%) of the net difference between incomes and the fact that the parties' agreement regarding post-divorce alimony was made prior to January 1, 2019, it is concluded that Husband's obligation should be reduced to $370.00 per month effective June 1, 2019.

Order of Court, filed Oct. 22, 2019, at 1 n.1.

The Master also addressed the debts Husband had discharged in bankruptcy: Testimony offered by Husband at the time of the Hearing on his Petition for Modification of Alimony seemed to lend credence to the allegations that he in fact incurred numerous expenses for a girlfriend he was involved with prior to the parties' separation. Thus, accepting responsibility for debts in place at the time of separation was not entirely benevolent on his part. However, the parties certainly had truly martial obligations in place at the time of separation and Husband assumed sole responsibility for payment of same. While Husband in fact filed for bankruptcy protection and discharged some of the debts following the parties' agreement, he paid a portion of the debts prior to the bankruptcy filing and affirmed another portion of the debts so that same in reality survive the bankruptcy action.

Notwithstanding these debt issues, the parties equitably divided their assets by agreement at the time of the Hearing in September, 2017. In addition to division of assets and liabilities, of paramount importance is the fact that Husband stated on the record that based upon his age and the status of his employment with his company at the time of the Hearing, he anticipated a "forced" retirement in the near future following that Hearing. Both Husband and Wife were nearing retirement age at the time of the Hearing and so Wife could have been under no illusions that Husband would likely have paid eleven and one-half (11½) years of alimony. However, that term was agreed upon by the parties in the event Husband continued some form of employment in conjunction with further agreement as to provision of health insurance coverage for Wife based upon such employment.


Wife filed exceptions, which the trial court denied. It explained that the Master "considered the fact that [Husband] filed for bankruptcy protection which discharged some of the debts that he assumed as part of the parties' equitably dividing their assets by agreement." Order, filed Dec. 20, 2019, at 1 n.1. The trial court found Husband's retirement provided a reasonable basis for modifying the alimony amount and concluded that the Master appropriately "determined the amount of alimony due to [Wife] to be $370.00 per month, based on the parties' incomes, which properly did not include [Husband's] debt discharged in bankruptcy." Id. The court explained in its Rule 1925(a) Opinion that in light of the totality of the circumstances, including the fact that federal tax law does not treat the discharge of indebtedness in bankruptcy as income, and because the parties agreed to the division of their assets and liabilities in the settlement agreement, it did not include the Husband's discharged debts as income for purposes of calculating alimony. Wife filed a timely Notice of Appeal.

Wife raises the following issues: A. Did the trial court commit an error of law or abuse of discretion in granting [Husband's] petition for modification of alimony as the totality of the circumstances did not justify a modification?

B. Did the trial court commit an error of law or abuse of discretion in calculating the modified amount of alimony as it failed to consider all relevant factors?

C. Did the trial court commit an error of law or abuse of discretion in calculating the modified amount of alimony as it failed to give appropriate consideration to [Husband's] discharge of over $125, 000.00 in debt?

Wife's Br. at 4.

Wife first argues that the court erred in...

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