Case Title: Lipe v. Lipe

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1986-12-05T00:00:00Z

Document:
Lipe v. Lipe1986 WY 209728 P.2d 1124Case Number: 86-103Decided: 12/05/1986Supreme Court of Wyoming
 
 
Jean M. LIPE, as 
executrix of the Estate of Gordon C. Lipe, and as trustee of the Lipe Family 
Trust, Appellant (Plaintiff),

v.

Phyllis B. LIPE, Appellee 
(Defendant).

Appeal from District Court,TetonCounty, Elizabeth A. Kail, 
J.

Don W. Riske, 
Cheyenne, for appellant.

Bret F. King of 
King & King, Jackson, for 
appellee.

Before THOMAS, C.J., and BROWN, CARDINE, URBIGKIT 
and MACY, JJ.

URBIGKIT, 
Justice.

[¶1.]     This appeal addresses 
the issue whether a separation agreement obligating the ex-husband to make 
support payments for his ex-wife survives his death in order to bind his estate. 
We decide this case by application of New 
York law by affirming the trial court 
which construed the agreement in favor of the divorced wife and against the 
estate for which the succeeding wife is executrix. The actual probate estate in 
Wyoming is de 
minimis.

[¶2.]     Gordon and Phyllis Lipe 
were married on May 7, 1949 in New 
YorkState 
and were favored by five children. In 1973, when the disaffinity in the marital 
relationship surfaced by separation proceedings, three of the children were 
substantially under the age of majority. On November 15, 1973, a separation 
agreement was executed, followed by a divorce in New York in 1975. Jean succeeded Phyllis as 
wife, and Gordon died in 1983 as a resident of TetonCounty 
(Jackson, Wyoming), with an indicated estate of about 
$5,000 and creditors' claims of at least $3,500.1

[¶3.]     This litigation 
commenced when ex-wife Phyllis filed a creditor's claim for post-death support 
in the TetonCounty probate estate. At 
about the same time, Phyllis filed an action to collect continuing support in 
New York, 
naming Jean as the defendant, both as executrix and trustee. Jean countered by 
filing this separate lawsuit in TetonCounty for a declaratory judgment to void 
the creditor's claim.

[¶4.]     The parties later 
agreed by stipulation that the claims in the New York proceedings would be 
dismissed and incorporated by reference in the Teton County proceedings, so that 
the complaint in New York would become a counterclaim in the Teton County 
litigation.

[¶5.]     Following reciprocal 
motions for summary judgment, the district court granted summary judgment in 
TetonCounty in favor of ex-wife 
Phyllis against Jean as executrix. No resolution or disposition of the claim 
against Jean as trustee was included, and after interim processing, including an 
aborted appeal, another order was entered dismissing the claim of Phyllis 
against Jean as trustee, without prejudice. The order now challenged on appeal 
to this court is the original summary-judgment decision in favor of ex-wife 
Phyllis against Jean as executrix.

[¶6.]     The parties have 
stipulated, as provided by the separation agreement, that their claims will be 
interpreted pursuant to New York law.2

[¶7.]     The parties agree and 
this court recognizes that the New York case of Cohen v. Cronin, 39 N.Y.2d 42, 
382 N.Y.S.2d 724, 346 N.E.2d 524, 5 A.L.R. 4th 1146 (1976), in which a support 
obligation was enforced against the husband's estate, is controlling as a 
dispositive statement of New York law on the question of the survival of support 
rights of an ex-wife following the husband's death. The trial court determined 
that this case was factually similar and consequently controlled by the Cohen 
result. Appellant now seeks to distinguish the contractual provisions in this 
case from those in Cohen, and urges this court to hold that the trial court 
erred in applying Cohen to enforce a support obligation against the Lipe 
estate.

[¶8.]     The Cohen court stated 
the general principles as follows:

"We start with the 
well-accepted proposition that a husband's obligation to support his wife 
terminates with the husband's death. However, the husband might, by agreement, 
impose upon his estate a duty to make alimony or support payments after his 
death. * * * In order to bind the estate, a separation agreement must either 
specifically provide for the continuation of payments or evince, from the terms 
of the agreement read as a whole, a clear intention that support payments 
continue, notwithstanding the husband's death. * * * While explicit agreement by 
the parties is obviously much to be preferred, where such explicit agreement is 
lacking, the court must read the document as a whole in its total context and 
examine each of its provisions in order to ascertain the overriding intention of 
the parties. * * Since the burden of proof is borne by the claimant, the wife 
must establish, to the satisfaction of the court, that the parties actually 
intended to extend the obligation to make support payments beyond the husband's 
lifetime." 382 N.Y.S.2d  at 725-727, 346 N.E.2d  at 526-527.

[¶9.]     In further discussion, 
the Cohen court concluded that in the absence of an explicitly stated intent, 
the following should be considered as persuasive by inclusion or 
exclusion:

(1) The lack of any 
termination provision upon death of the husband;

(2) An express statement 
"that termination of the payments of support would only occur where the wife has 
either remarried or died";

(3) A statement that the 
payments were "in full satisfaction for her support and 
maintenance";

(4) A waiver of the right 
to share in the husband's estate;

(5) A conclusion by the 
court that the payments would be the wife's sole source of 
income.

[¶10.]  The court in Cohen distinguished three 
earlier New 
York cases which refused to allow post-death support 
payments: In re Kahn's Estate, 21 N.Y.2d 653, 287 N.Y. So.2d 86, 234 N.E.2d 250 
(1967); Cooke v. Cooke, 2 A.D.2d 128, 154 N.Y.S.2d 757 (1956); and Matter of 
Porter's Estate, 208 Misc. 611, 137 N.Y.S.2d 271 (1954). Kahn was distinguished 
because in that case the wife received a payment separately in discharge of any 
claim she might have against the husband or his estate," and she was designated 
as an irrevocable beneficiary of his insurance policies. The trial court in Kahn 
found no intent to extend payments beyond the husband's lifetime. Cooke and 
Porter were distinguished because in those cases the husband's periodic payments 
were subject to change if his income decreased. Those courts reasoned that since 
the husband's death would eliminate the standard by which the payments were to 
be measured, the obligation to make the payments was not intended to survive his 
death.

[¶11.]  In Cohen, on the other hand, no such 
provisions were included, and the court held:

"Although this separation 
agreement does not specifically provide for the continuation of payments after 
the husband's death, we believe that the tenor of the separation agreement 
reflects an intent to obligate the estate, in the event of the husband's death, 
to make the support payments called for in the agreement. [We have not] been 
shown any evidence extrinsic to the agreement that would support a contrary 
interpretation * * *." 382 N.Y.S.2d  at 727, 346 N.E.2d  at 
528.

[¶12.]  Appellant now, in recognizing the 
controlling purview of Cohen, argues that the following factors distinguish this 
case: (1) The parties' agreement required a cash payment of $133,550 and medical 
and educational expenses for the children; (2) Gordon Lipe assigned to Phyllis 
his interest in an insurance policy; (3) the agreement included a provision to 
modify the amount of the payment; and (4) each party contractually waived and 
relinquished any and all rights which he or she might have or hereafter acquire 
regarding the estate of the other.

[¶13.]  Consequently, we apply both appellant's 
contended distinctions and the criteria announced in Cohen to the facts of this 
case.

Cash 
Payment

[¶14.]  The initial payment of $133,550, agreed 
upon by Gordon and Phyllis, consisted of:

1. attorney's fees 
$5,000;

2. new automobile 
$2,000;

3. cash 
$10,000;

4. one month support 
before the agreement for the other support provisions went into effect 
$1,550;

5. a settlement 
arrangement whereby the husband retained the family home and agreed to pay to 
the wife, for her interest, $115,000 in installments, fully payable not later 
than June 1, 1978.

[¶15.]  Except for the one monthly installment, 
which was a gap payment before the regular monthly support-payment provision commenced, 
none of these payments could be reasonably defined as support. The 
property-settlement arrangement does not affect the parties' agreed support 
obligation. Consequently, we do not find that the Lipe's settlement arrangement 
takes this case out of the purview of Cohen.

Express 
Statement

[¶16.]  The Cohen agreement provided for payment 
for the wife's separate maintenance and support "until she shall remarry or 
expire." 382 N.Y.S.2d  at 725, 346 N.E.2d  at 526. The Lipe agreement 
provided:

"In the event that a 
divorce shall occur between the parties and the Wife should remarry, or upon the 
death of the Wife, all support payable by the Husband for the Wife shall cease 
and terminate.",

and:

"So long as the Wife is 
not remarried * * [p]ayments to the Wife shall remain constant and not be 
diminished, despite there no longer being dependent children. If the Wife 
remarries * * * the Husband shall pay to the Wife $ * * * for the support of 
each child in the custody of the Wife until such child shall reach 21 years or 
ceased schooling and becomes gainfully employed."

 

[¶17.]  Neither agreement contained a provision 
for the termination of support payments upon the death of the husband. Rather, 
each agreement explicitly stated that the criteria for termination were 
remarriage or death of the ex-wife. The Cohen court concluded that such a 
provision,

"* * * without any 
qualifying or limiting language, obligates the husband's estate to make the 
payments for the lifetime of the wife. * * * [T]he agreement expressly states 
that termination of the payments of support would only occur where the wife has 
either re-married or died." 382 N.Y.S.2d  at 727, 346 N.E.2d  at 
527.

Full Satisfaction 
Statement

[¶18.]  Cohen provided:

"* * * `[T]he parties 
have taken into consideration that the WIFE is not now employed and that she 
accepts the provisions herein made for her in full satisfaction for her support 
and maintenance'. The parties agreed to release each other from any claims not arising from the agreement and 
waived their respective rights to `share' in the other's estate." (Emphasis 
added.) 382 N.Y.S.2d  at 725, 346 N.E.2d  at 526.

[¶19.]  The Lipe agreement 
provides:

"Subject to the provisions of this 
Agreement, and any escrow agreement between the parties, each party has 
remised, released and forever discharged and by these presents does for himself 
or herself, and his or her heirs, legal representatives, executors, 
administrators and assigns, remise, release and forever discharge the other of 
and from all cause or causes of action, claims, rights or demands whatsoever, in 
law or in equity, which either party hereto ever had nor now has against the 
other, except any or all cause or causes of action for divorce." (Emphasis 
added.)

[¶20.]  In both cases the release clauses are 
similarly subject to the agreement provisions. The Cohen court found that the 
entire agreement, wherein claims for support were excepted from release, 
reflected the parties' intent that the support payments continue after the 
husband's death. Since the same analysis applies to this case, the 
claims-release clause in Lipe cannot be construed as a waiver of any claim for 
post-death support payments. Rather, the release applies only if the agreement, 
read as a whole, indicates that the parties did not intend the payment 
obligation to survive Gordon's death. We are constrained to follow the Cohen 
analysis and conclude that the existence of this type of release clause does not 
of itself constitute a waiver of any claim for post-death support 
payments.

Sole Source of 
Income

[¶21.]  Excluding the interim litigative type of 
expenses, one month support, and the property settlement provisions, it is 
apparent that the $13,000 annual amount was the sole source of income afforded 
to Mrs. Lipe by the separation agreement. She did not receive any annuity or 
apparent incomeproducing property. Likewise, in Cohen, the support payments 
after property settlement were the wife's sole source of income. That court 
emphasized this fact in concluding that the parties intended the payments to 
continue after the husband's death. The parties' agreement in this case supports 
the same conclusion.

Assignment of Insurance 
Policy

[¶22.]  The Lipe insurance policy assignment 
provision stated:

"The Husband shall assign 
to the Wife all his right, title and interest, if any, to a certain [life 
policy] of which the Wife is presently the owner and beneficiary, and the 
Husband agrees to execute the necessary instruments as provided by the insurance 
company to effectuate such transfer."

We determine 
that this provision was a property-settlement disposition of an asset previously 
vested in the wife, not an arrangement designed to fulfill Mr. Lipe's prior 
post-death obligation for ex-wife support. 

Support Modification 
Factor

[¶23.]  Only one difference worth noting exists 
between the Cohen and Lipe agreements. Unlike Cohen, the Lipe agreement included 
a provision for an upward adjustment of the support payment based on the net 
income of the husband and the following retirement 
provisions:

"When the Husband reaches 
the age of 62 and is contemplating retirement, the Wife consents that the 
parties hereto may renegotiate this section of this Agreement as it relates to 
support payments, and if the parties cannot agree to a fair and equitable 
renegotiation satisfactory to both, then the support question may be submitted 
to a court of competent jurisdiction entitled to the full enforcement of law 
where the Wife may reside at the time."

[¶24.]  We do not find that the existence of 
either modification provision is sufficient to take this case out of the reach 
of the Cohen result. Unlike the agreements in Cooke and Porter, where the amount 
of the support payment was to decrease as the husband's income decreased, this 
agreement does not set up Gordon's income as a measuring device which fails at 
his death. Rather, this agreement provides for a flexible support payment 
without demonstrating an intent that the payments cease when Gordon 
dies.

Other 
Contentions

[¶25.]  Appellant argues that Paragraph 16 of the 
instant agreement constitutes a post-death waiver for the remaining estate. We 
are not so persuaded upon review of the initiating parenthetical clause which 
serves to clarify the agreement obligations as nonreleased: "Subject to the 
provisions of this Agreement, each party may * * * dispose * * *; and each party 
* * * hereby waives * * *." This introductory clause relates to the subject 
matter of the paragraph and not just the first independent clause. The parallel 
terminology of Paragraph 15, earlier quoted, substantiates this linguistic 
resolution as to the intent manifested by the agreement. Furthermore, Paragraph 
20 provides:

"This Agreement shall 
inure to the benefit of and be binding upon the parties and their respective 
estates and legal representatives."

[¶26.]  Will of Weed, 63 A.D.2d 823, 406 N.Y.S.2d 180 (1978) is distinguished as differing from this case, where here the 
insurance policy in pre-agreement status was the property of the wife in legal 
title, to be then retained by her in the separation agreement 
property-settlement provisions. Differing also is Matter of Estate of Bardol, 51 A.D.2d 341, 381 N.Y.S.2d 558, 560 (1976), where initially there was no insurance 
policy but the agreement then provided that "the claimant may obtain insurance 
on her husband's life in order to secure herself `adequate support' in the event 
of his death." Also in Bardol, the court found that Cohen test criteria were not 
included since the agreement lacked any waiver of rights in the estate of the 
spouse, but included only a waiver of interest in the estates of 
relatives.

Conclusion

[¶27.]  When read as a whole, the Lipe agreement, 
like that of Cohen, demonstrates the parties' strong general intent that the 
support obligation was of the essence of her post-divorce status and was to 
continue, without regard for Gordon's death, until her death or remarriage. The 
decision to be made is one of law, and we agree that the rule in Cohen supports 
the conclusions of the trial court:

"2. That New York law 
provides that as a general proposition a husband's obligation to support his 
wife terminates with the husband's death but that the husband might by 
agreement, impose upon his estate the duty to make alimony or support payments 
after his death.

"3. That reading the 
Separation Agreement dated November 15, 1973, and the affidavits the Court finds 
that the intent of the parties was that the alimony payments were to continue 
after the death of Gordon C. Lipe.

"4. The Separation 
Agreement provides for the continuation of payments notwithstanding the death of 
Gordon C. Lipe as evidenced from the terms of the agreement read as a whole. 
Cohen vs. Cohen [Cronin] 39 N.Y.2d 42 [382 N.Y.S.2d 724, 346 N.E.2d 524]."

[¶28.]  In agreement with those conclusions, we 
affirm.

FOOTNOTES

1 The record suggests that 
some time after his divorce and remarriage (about 1977) Gordon transferred 
essentially all his assets to the Lipe Family Trust, naming Jean M. Lipe, his 
new wife, as trustee.

2 It is apparent that a 
decision in this case will not be dispositive of the controversy between Phyllis 
and Jean Lipe, since the probate estate will not afford any significant funding 
for payment of the creditor's claim. The action likely to follow our affirmation 
of the trial court will be a proceeding to set aside the transfer of assets by 
Gordon Lipe to the Lipe Family Trust. That subject was removed from the present 
litigation by the dismissal without prejudice of the claim against Jean as trustee of the Lipe Family 
Trust.