Case Title: Willey v. Willey

Citation: 180 Vt. 421, 2006 VT 106, 912 A.2d 441

Docket Number: 

State: vermont

Court: Vermont Supreme Court

Date: 2006-11-03T00:00:00Z

Document:
Willey v. Willey  (2005-251); 180 Vt. 421; 912 A.2d 441

2006 VT 106

[Filed 03-Nov-2006]

  NOTICE:  This opinion is subject to motions for reargument under V.R.A.P.
  40 as well as formal revision before publication in the Vermont Reports. 
  Readers are requested to notify the Reporter of Decisions, Vermont Supreme
  Court, 109 State Street, Montpelier, Vermont 05609-0801 of any errors in
  order that corrections may be made before this opinion goes to press.


                                 2006 VT 106

                                No. 2005-251


  Carol J. Willey                           Supreme Court

                                            On Appeal from
       v.                                   Washington Family Court


  Philip Willey                             May Term, 2006


  Geoffrey W. Crawford, J.

  David F. Kidney of Rubin, Kidney, Myer & DeWolfe, Barre, for
  Plaintiff-Appellee.
  
  Brian K. Valentine of Downs Rachlin Martin PLLC, Burlington, for
  Defendant-Appellant.


  PRESENT:  Reiber, C.J., Dooley, Johnson and Skoglund, JJ., and Toor,
            Supr. J., Specially Assigned

       ¶ 1.  REIBER, C.J.   Husband Philip Willey appeals from the family
  court's final divorce decree awarding wife Carol Willey $210,000 and
  incorporating other terms of an oral settlement agreement reached by the
  parties during their divorce trial.  Husband also appeals from the family
  court's subsequent order awarding wife attorney's fees and temporary
  maintenance.  Because the family court's finding that the parties intended
  to be bound by the oral settlement agreement was not clearly erroneous, and
  because its decision to award attorney's fees and temporary maintenance was
  not an abuse of discretion, we affirm.
   
       ¶ 2.  The parties were married in 1989; before marrying they executed,
  with advice of counsel, a prenuptial agreement.  That agreement recited
  husband's "intent and desire . . . to provide adequately and fairly for
  [wife] and her minor children by a previous marriage," and also contained a
  seemingly-conflicting provision concerning "Marital Dissolution," which
  provided that "[i]n the event of a separation or divorce, the parties shall
  have no right against each other by way of claims of support, alimony,
  maintenance, compensation or division of any property . . .."

       ¶ 3.  Following their marriage, husband and wife built a home in Barre
  where they lived until separating in the summer of 2003.  At all times
  during the marriage, husband owned a construction company from which he
  derived significant income; wife was employed at times in the construction
  company offices, and that employment was terminated when the parties
  separated.

       ¶ 4.    During the subsequent divorce proceedings, husband filed a
  motion for specific performance of the prenuptial agreement and for partial
  summary judgment based on that agreement.  The family court, after an
  evidentiary hearing in May 2004, issued a decision concluding that the most
  plausible reading of paragraph 2(b) (which recited husband's intent to
  "provide adequately" for wife and her children) was as "an expression of
  [husband's] agreement to 'provide adequately' for [wife] during and,
  especially, after the marriage."  The court based this interpretation on
  the fact that paragraph 2(b) was the only change wife proposed to the draft
  prenuptial agreement and further concluded that "[t]o provide adequately
  means to make payments of money."  The court then concluded, in light of
  the prenuptial agreement's severability clause, that the agreement's
  paragraph 8 (purporting to bar any claim by wife for maintenance or
  support) would be set aside "in order to give meaning to [husband's]
  expressed intent to provide adequately for his wife" in paragraph 2(b).  
   
       ¶ 5.  The divorce case proceeded to a final hearing on September 22
  and 23, 2004.  Before the second day of the hearing, husband's attorney
  initiated settlement negotiations with wife's attorney, proposing to pay
  wife a lump sum, in exchange for which she would waive any further claim to
  the Barre house or to spousal maintenance.  After wife's attorney consulted
  with wife, the parties orally agreed that husband would pay wife $210,000
  and she would waive any claim to maintenance or to the house.  Among other
  things, the parties also agreed to keep the $210,000 payment confidential,
  as husband was concerned about keeping his financial dealings as private as
  possible.  The parties did not immediately reduce this agreement to a
  formal writing, but the meeting did result in a "term sheet" containing the
  basic terms of the agreement, annotated with notes made by husband's
  counsel.  In addition, the parties prepared a list of wife's personal
  property left at the Barre house; each entry on the list was accompanied by
  "yes" or "no" in husband's handwriting to denote whether that item was to
  be removed by wife.

       ¶ 6.  Following the settlement negotiations on September 23, counsel
  for both parties advised the family court in chambers that they had reached
  a settlement and the divorce trial could be terminated.  The parties
  further advised the court that they would reduce the agreement to a writing
  "shortly."  Before leaving the courthouse that day, husband's attorney
  handed wife's attorney a check for $50,000 made out to wife and signed by
  husband; the memorandum line on the check read "Toward Settlement." 
  Neither husband nor his attorney stated that the check should be held in
  escrow pending execution of a written settlement agreement.  Wife
  immediately deposited the check in her personal account, without objection
  from husband or his attorney.  
   
       ¶ 7.  In the next few days, wife's attorney sent two drafts of the
  settlement agreement to husband's attorney.  Husband's counsel responded,
  on October 4, with a letter proposing several changes to the draft, none of
  which varied the terms of the draft as to the lump-sum payment, the
  quitclaim deed, or the need for confidentiality.  On October 7, wife's
  attorney sent husband's attorney a new draft incorporating most of the
  changes proposed in the October 4 letter.  Husband did not reply to this
  draft, and on October 22 new counsel filed her notice of appearance for
  husband.  Since that date husband has maintained that he never intended to
  be bound by the September 23 negotiations.

       ¶ 8.  After it became clear that husband did not intend to sign the
  settlement agreement sent on October 7, wife filed a motion to enforce the
  terms of the settlement agreement.  After an evidentiary hearing on the
  motion, the family court issued findings of fact and conclusions of law on
  April 27, 2005.  The court found, in pertinent part, that husband's
  assertion that he did not intend to be bound by the oral negotiations was
  "not credible," that he had partly performed the agreement before later
  "chang[ing] his mind," and that the court would therefore enforce the
  settlement agreement.  The family court directed counsel for wife to
  prepare a draft final divorce decree based on the April 27 findings of fact
  and conclusions of law.

       ¶ 9.  A final decree of divorce was filed on June 1, 2005.  By that
  decree, husband was awarded-and wife was required to quitclaim any interest
  in-the home the parties built together in Barre.  Husband also retained
  sole ownership of his construction company and certain real estate in
  Calais.  The decree mandated that husband would pay wife $210,000 "in the
  nature of a property settlement."  Further, both parties renounced any
  claim against the other for attorney's fees incurred prior to October 7,
  2004.  Husband appealed from this order.
   
       ¶ 10.  The first question presented for our review is whether the
  parties' oral settlement agreement, coupled with the attorneys' notes,
  unexecuted drafts, and other surrounding circumstances, created an
  enforceable agreement.  Husband argues, first, that the family court erred
  in construing the prenuptial agreement to allow wife to make any claim for
  maintenance.  Second, husband contests the family court's finding that the
  parties intended to be bound by their oral agreement on September 23, 2004. 
  Finally, husband asks us to set aside the award of attorney's fees to wife,
  contending that the family court failed to properly consider wife's
  financial resources.   We consider the second argument first.

       ¶ 11.  Whether husband and wife will be bound by their oral settlement
  agreement depends on their intent at the time of the oral settlement, which
  is a question of fact.  Bixler v. Bullard, 172 Vt. 53, 58,