Title: McNutt v. McNutt

State: maine

Issuer: Maine Supreme Court

Document:

MAINE SUPREME JUDICIAL COURT 
Reporter of Decisions 
Decision: 
2018 ME 86 
Docket: 
Lin-17-439 
Submitted 
On Briefs: April 25, 2018 
Decided: 
July 3, 2018 
 
Panel: 
SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ. 
 
 
JANICE MCNUTT 
 
v. 
 
JOHN D. MCNUTT 
 
 
MEAD, J. 
[¶1]  John D. McNutt (Dan) appeals from the judgment of the 
District Court (Wiscasset, Raimondi, J.) finding him in contempt of the parties’ 
earlier divorce judgment and increasing his spousal support obligation to 
Janice McNutt.  19-A M.R.S. § 951-A(4)-(5) (2017); M.R. Civ. P. 66(d).  Dan 
contends that the court clearly erred by finding that he is now able to pay 
increased spousal support and abused its discretion by ordering a temporary 
increase of that support to $1,750 each month.  He further asserts that it was 
error for the court not to address an ambiguity in the divorce judgment 
concerning whether he has a personal obligation to pay Janice the difference 
between the net proceeds from the sale of the marital properties and the 
$180,000 value of Janice’s interests in the marital real estate as established in 
 
2 
the divorce judgment.  He contends that because the court failed to resolve that 
ambiguity and imposed a lien in Janice’s favor that was not provided for in the 
original decree, the order has prevented him from refinancing one of the 
properties and rendered him unable to purge his contempt. 
[¶2]  We conclude that ample competent evidence in the record supports 
the court’s findings that Dan was in contempt of the property disposition 
provisions of the divorce judgment and that he has enjoyed a substantial 
increase in income due to his disregard of the court’s order to sell or refinance 
the two marital rental properties.  The lien, as applied to the proceeds of the 
sale or refinancing of the individual properties, is consistent with the terms of 
the divorce judgment.  We affirm the judgment. 
I.  BACKGROUND 
[¶3]  On March 31, 2014, the court (Billings, J.) issued a divorce judgment 
that incorporated the parties’ settlement agreement to the extent not 
inconsistent with the judgment and awarded Janice $1,000 in general spousal 
support payable each month until she received two lump sum payments for her 
interests in the marital rental properties.  The divorce judgment specifically 
 
3 
provided for spousal support until the rental properties were refinanced or 
sold: 
4.  Spousal Support. As and for general spousal support, [Dan] 
shall pay to [Janice] the sum of $1,000.00 per month, commencing 
with the month of April, 2014. The spousal support provision shall 
remain in place until [Dan] has paid all of his obligations to [Janice] 
under the terms of this Judgment, including $150,000 for the 
Oak/Howard Street property, $30,000 for the McClintock Street 
and Townsend Avenue properties, the debts and attorney’s fees as 
set forth below, and the spousal support itself. Spousal support 
shall terminate once [Dan] has paid [Janice] in full. [Janice] shall 
have a lien against all three parcels of marital real estate to secure 
the spousal support obligation of $1,000 per month, and she shall 
be paid what she is owed at the time of the closing on any given 
property. 
[¶4]  During their marriage, the parties owned two rental properties (the 
McClintock and the Oak properties) in Boothbay Harbor.1  The divorce 
judgment set apart both of those properties to Dan and ordered that Janice was 
to receive two lump sums, as noted above, upon the sale or refinancing of the 
properties.  Throughout these proceedings, Dan has resided in an owner’s unit 
in one of the rental properties. 
[¶5]  Pursuant to Section 3 of the divorce judgment, which relates to real 
estate, Dan was to pay Janice the first $30,000 of the net proceeds from the 
                                         
1  As recited by the court in its order, and noted in the divorce judgment’s reference to “three 
parcels of marital real estate,” the McClintock property consists of two residential structures.  For the 
purposes of clarity, we will refer to both of them together as the McClintock property. 
 
4 
refinancing of the McClintock property by December 31, 2015; if after that date 
Dan had not refinanced or paid Janice, he was to sell the property to the first 
person to make a “commercially reasonable offer” and pay Janice the $30,000 
out of the proceeds from that sale.  As for the Oak property, the court ordered 
it placed on the market “within five days from the date of th[e] judgment and 
sold for the first commercially reasonable offer,” at which time the first 
$150,000 of the net proceeds was to go to Janice.  Each of the two provisions in 
the divorce judgment relating to the sale of the real estate concluded with 
virtually identical language: 
[Janice will or shall] be paid the first [$30,000 or $150,000] from 
the net proceeds of sale . . . plus any amounts due her [pursuant to 
or under] her liens against the property for the debts, attorney’s 
fees and spousal support obligations as set forth below.[2] 
[¶6]  Nearly two and a half years after the court issued the divorce 
judgment, Dan still had not sold the Oak property; had failed to refinance the 
McClintock property by December 31, 2015; and had subsequently failed to list 
the latter property for sale.  On September 27, 2016, Janice filed three motions, 
asking the court to (1) increase her monthly spousal support to $3,000; 
(2) enforce the divorce judgment, see M.R. Civ. P. 120; and (3) find Dan in 
                                         
2  The “obligations as set forth below” consisted of Dan’s obligation to pay $1,000 per month as 
general spousal support, his obligation to pay certain specified marital debts, and the requirement 
that he pay Janice’s attorney fees. 
 
5 
contempt for failing to refinance or sell the McClintock property, allowing the 
Oak property’s listing to lapse, and refusing to proceed in good faith with the 
sale of the properties.  See M.R. Civ. P. 66(d).3 
[¶7]  After a hearing on the motions, the court (Raimondi, J.) found by 
clear and convincing evidence that Dan was in contempt of the divorce 
judgment because, despite his ability to comply, he allowed the Oak property 
listing to lapse; refused to pay Janice $30,000 although his attorney held that 
exact sum for him in escrow; and had not refinanced or listed the McClintock 
property for sale.  The court’s order, dated July 31, 2017, imposed a suspended 
term of incarceration, remedial sanctions requiring Dan to comply with the 
unfulfilled divorce decree mandates, and an award of attorney fees to Janice. 
[¶8]  On Janice’s motion to modify her spousal support, the court found 
that her financial circumstances were substantially worse than at the time of 
the divorce, in large part because she had received none of the lump sum 
compensation for her interests in the rental properties.  Dan, on the other hand, 
had benefitted from rental income generated from the two properties, neither 
of which he had refinanced or sold in order to pay Janice.  Thus, the court 
                                         
3  On September 27, 2016, Janice personally, and not through counsel, filed a motion for contempt 
that was not properly served on Dan.  She then filed a nearly identical motion for contempt on 
April 10, 2017.  Dan does not contest that Janice served him with the more recent contempt motion. 
 
6 
ordered a temporary increase in general spousal support to $1,750 each month, 
with all support to cease after Dan fully paid his debts to Janice.  The July 31 
order reaffirmed the liens on the parties' real estate that were created in the 
divorce judgment for the monthly spousal support, attorney fees, and certain 
marital debts, but also created a new lien in Janice’s favor, something that the 
divorce judgment had not imposed, “on [both parcels of] the formerly marital 
real estate . . . to secure the property settlement obligations,” i.e., the first 
specified amounts of the net proceeds from each property’s refinancing or sale. 
[¶9]  On August 7, 2017, a little over a week after the final order on 
Janice’s motions, the Oak property was sold, netting $116,867 in proceeds that 
were paid to Janice.  That same day, Dan released the $30,000 held in escrow to 
Janice and moved for the court to make further findings relating to its July 31 
Order.  See M.R. Civ. P. 52(b).  Two days later, he moved for the court to grant 
him a new trial or amend the judgment to clarify his personal liability for the 
deficiency in the Oak property’s sale proceeds.  The court denied the motions, 
deeming that the issue of Dan’s personal liability for any shortfall in the total 
proceeds from the rental properties was not properly before the court.  Dan 
timely appealed.  See M.R. App. P. 2B(c). 
 
7 
II.  DISCUSSION 
[¶10]  Dan does not take issue with the court’s judgment finding him in 
contempt of the property disposition provisions of the divorce judgment or the 
court’s finding that Janice had an increased need for spousal support since the 
divorce.  He asserts, rather, that the court abused its discretion by ordering an 
increase in spousal support as a remedial contempt sanction and he contests 
the finding that he now has a substantially greater ability to pay more in spousal 
support.  He further contends that it was error for the court to decline to 
address the divorce judgment’s apparent ambiguity regarding his personal 
liability to Janice for any shortfall in the net proceeds from the Oak property’s 
sale, and that it was error for the court to modify the property division terms of 
the divorce judgment by imposing an additional lien against both marital 
properties to secure the individual lump sum payments. 
A. 
Increased Spousal Support and the Remedial Sanctions 
[¶11]  We quickly dispense with Dan’s first argument, that the court’s 
increase in spousal support was somehow an impermissible form of remedial 
contempt sanction, because it is apparent from the judgment that the increase 
in spousal support was not imposed as a sanction.  Maine Rule of Civil 
Procedure 66(d)(3) governs the remedial contempt sanctions imposed in this 
 
8 
case.  We have interpreted that Rule as requiring an alleged contemnor to 
“comply to the fullest extent possible” with a court judgment or order to avoid 
being found in contempt.  Efstathiou v. Efstathiou, 2009 ME 107, ¶ 13, 
982 A.2d 339 (quotation marks omitted).  Further, as Rule 66(a)(2)(C) 
provides, the function of remedial sanctions is “to coerce the termination of an 
ongoing contempt or to compensate a party aggrieved by contempt.”  We 
review the factual findings underlying the contempt order for clear error and 
the remedial sanctions imposed for an abuse of discretion.  See Sullivan v. 
Tardiff, 2015 ME 121, ¶¶ 17, 20, 124 A.3d 652. 
[¶12]  Here, the court properly found that the divorce judgment 
unambiguously required Dan (1) to list the Oak property and maintain the 
listing until it sold for the first commercially reasonable offer; and (2) to 
refinance the McClintock property by December 31, 2015, or immediately 
thereafter list and sell it for the first commercially reasonable offer.  As of the 
June and July 2017 motion hearings, it was undisputed that Dan had allowed 
the Oak property listing to lapse for several months in 2016 and had not 
refinanced or listed the McClintock property; furthermore, the court found 
Dan’s excuses for his noncompliance unpersuasive.  Accordingly, the court’s 
finding, based upon clear and convincing evidence, that Dan violated the 
 
9 
provisions of the divorce judgment despite having the ability to comply, is well 
supported by the evidentiary record.  See Efstathiou, 2009 ME 107, ¶¶ 11, 
13-14, 982 A.2d 339. 
[¶13]  The court imposed remedial sanctions giving Dan the choice to 
either (1) serve a sentence of fifteen days’ incarceration; or (2) release the 
$30,000 held by his attorney in escrow; take immediate steps to apply for 
refinancing of the McClintock property with at least three lending institutions; 
actually refinance them by March 1, 2018, or list them for sale immediately 
after that date; and pay Janice the attorney fees incurred in prosecuting her 
contempt motion.  See M.R. Civ. P. 66(d)(3).  The court’s order, however, 
contains no indication that it intended the increased spousal support obligation 
to serve as a contempt sanction.  To the contrary, the order independently 
analyzed and reached completely separate conclusions regarding the contempt 
and spousal support issues.  All of the sanctions imposed serve to ensure that 
Janice receives the lump sum settlement payments that Dan had 
contemptuously withheld.  The court’s imposition of sanctions did not 
constitute an abuse of discretion.  See Murphy v. Bartlett, 2014 ME 13, ¶ 18, 
86 A.3d 610; Efstathiou, 2009 ME 107, ¶¶ 14-15, 982 A.2d 339. 
 
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B. 
Increase in Spousal Support 
[¶14]  Dan next challenges the sufficiency of the evidence supporting the 
court’s findings that since the 2014 divorce judgment he now earns more and 
can afford to pay Janice $1,750 each month in support.  We review for clear 
error a court’s findings regarding a payor spouse’s income, see Efstathiou v. 
Aspinquid, Inc., 2008 ME 145, ¶ 48, 956 A.2d 110, and for an abuse of discretion 
a court’s modification of spousal support, see McLeod v. Macul, 2016 ME 76, ¶ 6, 
139 A.3d 920.  Title 19-A M.R.S. § 951-A(4) grants the court authority to modify 
spousal support upon finding “a substantial change in circumstances affecting 
the payor’s ability to pay spousal support and the payee’s need for spousal 
support.”  McAllister v. McAllister, 2011 ME 69, ¶ 12, 21 A.3d 1010 (quotation 
marks omitted). 
[¶15]  The court found that as of the 2014 divorce judgment, Janice “had 
virtually no debt” but had nearly depleted all of the funds left in her checking 
account.  By the time of the motion hearing, however, Janice had accumulated 
approximately $16,000 in debt, part of which was unpaid taxes on her spousal 
support, and she had an annual income of $15,600.  She qualifies for Medicaid 
and food stamps.  Regarding Dan’s income and earning potential, the court 
found that in 2016 the rental properties generated nearly $55,000 more in 
 
11 
gross rent than in 2014, and Dan received all of that rent because he had neither 
refinanced nor sold those properties.4  The court did not find credible Dan’s 
assertion that he finds himself with “virtually no income” after taxes.  The court 
was not required to accept Dan’s asserted lack of income, see Handrahan v. 
Malenko, 2011 ME 15, ¶ 14, 12 A.3d 79; instead it could rely on the competent 
evidence in the record supporting a finding that Dan now has a substantially 
increased ability to pay spousal support.  Thus, the court acted well within its 
discretion when it ordered a temporary increase in spousal support.  
See 19-A M.R.S. § 951-A(4)-(5); McCarthy v. Goroshin, 2016 ME 98, ¶ 15, 
143 A.3d 138. 
C. 
Ambiguity in the Divorce Judgment and the Added Lien 
[¶16]  Dan finally contends that it was error for the court to decline to 
address the divorce judgment’s apparent ambiguity regarding any personal 
liability on his part to pay Janice for the shortfall in the net proceeds from the 
Oak property’s sale.  He further contends that the court erred by impermissibly 
                                         
4  More specifically, the court found that Dan had paid down nearly all of the $25,000 of marital 
debt assigned to him by the divorce judgment, save for $4,000-$5,000 of his son’s student loans; 
invested $500,000 in “cash outlay and sweat equity” into the rental properties; paid $8,000 of his 
post-judgment attorney fees; made all of his spousal support payments; and still had adequate 
income to avoid having to apply for food stamps. 
 
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modifying the divorce judgment when it imposed an additional lien against the 
marital properties to secure the lump sum payments. 
[¶17]  The original divorce judgment did not establish a lien with respect 
to the allocation of the proceeds from selling or refinancing the rental 
properties.  It required Dan to pay Janice's share first out of the net proceeds 
from the sale or refinancing of the particular properties.  Each allocation of a 
portion of proceeds is specifically designated to be taken from the proceeds of 
one or the other of those specific property transactions, not both.  The express 
language of the divorce judgment with regard to those provisions does not 
establish liens upon those properties.  See Lien, Black’s Law Dictionary 
(9th ed. 2009).  The divorce court’s simple allocation of the sale proceeds 
created no legal encumbrance upon the properties themselves—it did so only 
with the other three obligations (the spousal support, attorney fees, and marital 
debt).  The sole enforcement mechanism for Janice’s right to the first share of 
proceeds was the motivation provided by the fact that the monthly spousal 
support obligation would continue until all sums due were satisfied. 
[¶18]  The July 31 order confirmed the liens established in the divorce 
judgment and created new liens on the existing property settlement 
obligations: 
 
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[Janice] shall have a lien on the formerly marital real estate 
as identified in the Divorce Judgment to secure the spousal support 
obligation, the property settlement obligations, and liability for past 
and present attorney's fees or any other obligations owed by [Dan] 
to [Janice]. 
(Emphasis supplied.) 
[¶19]  The lien placed by the court in its order on Janice's motions is 
explicitly directed to "the property settlement obligations," and thus invokes 
the provisions of the divorce judgment that created two separate obligations: 
Dan was to pay specific amounts to Janice from the net proceeds of each 
particular property’s sale or refinancing.  The terms of the divorce judgment do 
not explicitly require Dan to take proceeds from the sale of one property to 
make up a shortfall on the net proceeds of the other’s sale or refinancing.5  
Accordingly, the imposition of a lien upon a particular property to secure 
Janice’s entitlement to the first proceeds of the sale or refinancing is fully 
consistent with the terms of the divorce judgment, imposes no additional legal 
                                         
5  Dan asked the court to resolve what he characterizes as an ambiguity in the divorce judgment: 
whether he is personally obligated to make up the difference between the amount designated to 
Janice upon the sale of either of the properties and the actual net proceeds.  The answer to that 
question may turn on the question of whether the amounts of proceeds, $150,000 and $30,000 
respectively, are deemed a form of spousal support or property division.  See McAllister v. McAllister, 
2011 ME 69, ¶¶ 8-10, 13, 21 A.3d 1010.  The court declined to address that issue because no sale had 
taken place by the date of the hearing or decision; that question may properly be addressed in future 
proceedings.  The court may, at a future proceeding, also address the issue of Dan’s claimed inability 
to purge his contempt, which purportedly resulted from actions by Janice subsequent to its contempt 
order. 
 
14 
obligation, and does not otherwise modify the terms of the property settlement 
obligations.  Cf. Wardwell v. Wardwell, 458 A.2d 750, 752-53 (Me. 1983).6 
The entry is: 
 
The July 31, 2017, order of the District Court is 
affirmed. 
 
 
 
 
 
 
 
 
Clarke C. Hambley, Esq., Miller Law and Mediation, LLC, Portland, for appellant 
John D. McNutt 
 
Sarah Irving Gilbert, Esq., Camden Law LLP, Camden, for appellee Janice McNutt 
 
 
Wiscasset District Court docket number FM-2012-82 
FOR CLERK REFERENCE ONLY 
                                         
6  “In the absence of statutory authorization to modify a judgment dividing marital property, the 
courts are without jurisdiction to do so.”  Wardwell v. Wardwell, 458 A.2d 750, 752 (Me. 1983).  
Although 19-A M.R.S. § 951-A(4) (2017) authorizes the modification of a judgment’s spousal support 
provisions, there is no similar statutory authority to modify the final property disposition of a divorce 
decree.  See McAllister, 2011 ME 69, ¶ 8, 21 A.3d 1010.  Motions to modify spousal support “do[ ] not 
give the court authority to amend or modify the division of marital property in [the divorce] 
judgment,” even upon finding a substantial change in circumstances.  See Bonner v. Emerson, 
2014 ME 135, ¶ 12, 105 A.3d 1023.