Source: http://mn.gov/law-library-stat/archive/ctapun/0302/899.htm
Timestamp: 2018-05-20 15:31:34
Document Index: 452493518

Matched Legal Cases: ['§ 518', '§ 518', '§ 518', '§ 518', '§ 518', '§ 518']

In re the Marriage of: Daniel William Handlin, petitioner, Respondent, vs. Barbara Rose Handlin, Appellant. C8-02-899, Court of Appeals Unpublished, February 4, 2003.
C8-02-899
Daniel M. Fiskum (of counsel), Luther, Heckt & Cameron, P.L.L.P., 601 Carlson Parkway, #750, Minnetonka, Minnesota 55305 (for appellant)
On appeal after remand in this maintenance-modification dispute, appellant-wife argues that (a) the district court made its ruling on remand based on a budget that it had previously excluded from the record; (b) the budget overstates respondent-husband’s expenses, resulting in an understatement of his ability to pay maintenance; (c) the district court improperly directed wife’s attorney to present husband’s position regarding husband’s ability to pay maintenance; and (d) the record does not support the finding that wife is voluntarily underemployed. We affirm.
Daniel and Barbara Handlin were divorced in 1995. At that time, Daniel Handlin was a pilot for Northwest Airlines; Barbara Handlin was a homemaker who had been taking courses in graphic design. The stipulated divorce decree provided that Daniel Handlin pay Barbara Handlin maintenance of $2,600 per month until the family home was sold; at that point, maintenance would be reduced to $2,400 per month until the death of either party or Barbara Handlin’s remarriage. If Barbara Handlin obtained employment, maintenance would be further reduced by one dollar for every two dollars of her gross employment income until the overall maintenance was reduced to $1,500 per month, at which level no further automatic reduction would occur. Both parties reserved the right to move for modification under Minn. Stat. § 518.64 (2002).
The next year, Daniel Handlin moved to reduce maintenance on the grounds that Barbara Handlin was not actively seeking employment. The parties then agreed on a stipulation which provided a graduated reduction in maintenance until it reached the sum of $1,500 per month on January 1, 1998. The award would terminate only on Barbara Handlin’s remarriage or the death of either party; no provision was made regarding Barbara Handlin’s finding of work. Both parties still maintained the right to move for modification.
In July 1999, Barbara Handlin moved to increase maintenance and to compel Daniel Handlin to provide proof of life insurance naming her as beneficiary, pursuant to the judgment and decree. She argued that the current amount of maintenance was insufficient for her to meet monthly expenses, and that Daniel Handlin had substantially increased income so that he could afford to pay more maintenance. The district court granted her motion to compel discovery of Daniel Handlin’s responses concerning his expenditures and earnings. The court, however, denied the motion for increased maintenance, noting that although Daniel Handlin had an increased income, the previous award was not unreasonable and unfair based on Barbara Handlin’s income, the investment nature of her household improvements, and substantial liquid assets awarded to her in the judgment and decree. A subsequent motion for amended findings was also denied.
Barbara Handlin then appealed to this court, arguing that the district court had abused its discretion by failing to consider all of the factors listed in Minn. Stat. § 518.552, subd. 2 (2002), in determining whether grounds existed for modifying the maintenance award, including her standard of living before the divorce, her difficulty in obtaining employment since the divorce, and Daniel Handlin’s monthly financial needs and his ability to meet those needs. This court remanded the case for more specific findings under Minn. Stat. § 518.64, and for the imposition of a requirement that Daniel Handlin provide proof of life insurance coverage as security for the outstanding maintenance obligation. See Handlin v. Handlin, C4-01-1294 (Minn. App. Jan. 15, 2002).
On remand, the district court issued an order containing findings as to each of the factors listed in Minn. Stat. § 518.552, subd. 2. The court concluded that Barbara Handlin’s reasonable monthly living expenses had not changed substantially since 1995, and that she had unjustifiably failed to make reasonable efforts toward her financial independence, so that imputing income to her was appropriate under Hecker v. Hecker, 568 N.W.2d 705 (Minn. 1997). The court concluded that after imputation of income, she had failed to establish a need for increased maintenance. The court also concluded that although Daniel Handlin’s income had increased substantially since 1996, his reasonable monthly living expenses had substantially and reasonably increased since the time of the last order concerning maintenance, so that he had no ability to pay an increased maintenance award. After considering the statutory factors, the court concluded that Barbara Handlin had failed to meet her burden of proof and denied the modification motion. This appeal followed.
The district court has broad discretion to modify spousal maintenance obligations, and its determination will not be reversed absent an abuse of discretion. Rubenstein v. Rubenstein, 295 Minn. 29, 32, 202 N.W.2d 662, 663-64 (1972). A district court abuses its discretion if it resolves the matter in a manner that is against logic and the facts on the record. Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984). The district court’s findings of fact regarding maintenance shall not be set aside unless they are clearly erroneous on the record as a whole. McCulloch v. McCulloch, 435 N.W.2d 564, 566 (Minn. App. 1989). See also Minn. R. Civ. P. 52.01. A finding is clearly erroneous if the reviewing court has “the definite and firm conviction that a mistake has been made.” Vangsness v. Vangsness, 607 N.W.2d 468, 472 (Minn. App. 2000) (quotation omitted).
The district court, in considering a motion to modify maintenance, must examine “in addition to all other relevant factors, the factors for an award of maintenance under section 518.552 that exist at the time of the motion.” Minn. Stat. § 518.64, subd. 2(c) (2002). These factors include the financial resources of the party seeking maintenance, the time necessary for that person to obtain appropriate employment, the standard of living during the marriage, the duration of the marriage and its effect on employment opportunities and benefits, the age and capacity of the person seeking maintenance, each spouse’s contribution to marital property or the other’s employment, and the ability of the party from whom maintenance is sought to provide maintenance. Id.; Cisek v. Cisek, 409 N.W.2d 233, 236 (Minn. App. 1987), review denied (Minn. Sept. 18, 1987). The court must make findings concerning the relevant statutory factors in determining the amount of maintenance. Stich v. Stich, 435 N.W.2d 52, 53 (Minn. 1989).
In order to modify maintenance, the person seeking modification must show a substantial change in circumstances and that the change has made the original maintenance award unreasonable and unfair. Minn. Stat. § 518.64, subd 2(a) (2002); Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn. 1997). When requesting modification, the moving party bears the burden of proof to demonstrate both a substantial change in circumstances and unfairness caused by that change. Abuzzahab v. Abuzzahab, 359 N.W.2d 329, 332 (Minn. App. 1984). A substantial increase in an ex-spouse’s income, by itself, does not make the terms of a divorce decree unreasonable and unfair. Cisek, 409 N.W.2d at 236.
Barbara Handlin first argues that the district court on remand erroneously considered Daniel Handlin’s monthly expense budget of $9,834.52 in denying her motion for increased maintenance. She argues that the budget was first submitted to the court in connection with a motion for amended findings, and that the district court had stated that it would not rely on the budget. She contends that the $3,000 budget submitted at the time of the divorce in 1995 constitutes the only relevant evidence of Daniel Handlin’s expenses. Daniel Handlin, on the other hand, argues that the later budget, to which he attested in 1999, was submitted to Barbara Handlin’s counsel in response to the court’s statement of intent to award attorney fees, but that counsel simply chose not to present it to the court in his motion for increased maintenance.
On remand, the district court has the duty to execute the mandate of the remanding court strictly according to its terms. Halverson v. Vill. of Deerwood, 322 N.W.2d 761, 766 (Minn. 1982). In this case, Daniel Handlin’s revised budget was part of the district court record. See Minn. R. Civ. P. 52.01 (noting that findings of fact are “based on oral or documentary evidence”). Although the increased budget was originally presented in the context of a motion for attorney fees, this court, in the first appeal, implicitly gave permission to the district court to consider such a budget on remand when it noted the lack of findings on Daniel Handlin’s ability to provide for his own needs. The district court thus did not abuse its discretion in basing its new findings in part on this budget.
Barbara Handlin argues that the 1999 budget is overinflated, including a “projected” car purchase, an expense for a 401(k) loan repayment without showing a commensurate amount of income, and failure to account for tax consequences of spousal maintenance payments. Although she challenged some of these items in an affidavit supporting the motion for increasing maintenance, her counsel chose largely to rest on the contention that Daniel Handlin’s expenses had not increased beyond those set forth in the 1995 decree. It was for the district court to determine Daniel Handlin’s expenses. See Kucera v. Kucera, 275 Minn. 252, 254, 146 N.W.2d 181, 183 (1966) (stating “it is not within the province of [appellate courts] to determine issues of fact on appeal”). We hold that the district court did not err in accepting the monthly expense figures presented by Daniel Handlin.
Barbara Handlin contends that she met her burden of proof by alleging that Daniel Handlin’s expenses had not increased since the 1995 divorce. But the party moving for increased maintenance has the overall burden to show a change in circumstances. See Peterson v. Peterson, 304 Minn. 578, 580, 231 N.W.2d 85, 87 (1975) (indicating moving party has burden of proof in maintenance modification proceedings). In addition, the district court’s reluctance to increase maintenance based solely on Barbara Handlin’s allegations that Daniel Handlin’s expenses had not increased, essentially constituted a determination that her allegations were not credible. Appellate courts defer to district court credibility determinations. Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988).
Barbara Handlin also challenges the district court’s calculation of Daniel Handlin’s income. The district court found that respondent’s gross annual earnings, based on his 1998 tax returns, were $141,928, and after adjusting for taxes, his net monthly income was $9,177. But in fact, as Barbara Handlin correctly notes, respondent’s gross annual wages for 1998 were $157,907, while his gross income for 1997 was $141,928. It thus appears that the district court erred by using the income figure from the tax returns for 1997, rather than 1998. To determine ability to pay maintenance, however, the court determines the spouse’s net or take-home pay. Kostelnik v. Kostelnik, 367 N.W.2d 665, 670 (Minn. App. 1985), review denied (Minn. July 26, 1985). “Net income is properly calculated based upon money available to the taxpayer.” Lenz v. Wergin, 408 N.W.2d 873, 876 (Minn. App. 1987). In this case, if dividend and capital gains income and losses are factored in, and the sum of $1,610 is deducted for taxable dividends received by his current wife, Daniel Handlin’s total net income in 1998 would be calculated as $143,141. This figure is only $1,213 more income per year than that found by the district court, resulting in a net monthly income of $9,278.83—about $100 per month more than the findings of the district court. In view of the total circumstances, the difference is de minimis and constitutes harmless error. See Minn. R. Civ. P. 61 (harmless error to be disregarded when it does not affect the substantial rights of parties).
Barbara Handlin also argues that there was no credible evidence to support the district court’s conclusion that she had unjustifiably failed to make reasonable efforts that would result in her financial independence. She cites the case of Carrick v. Carrick, 560 N.W.2d 407 (Minn. App. 1997), in which this court held that when a spouse was underemployed during the marriage, her continuing work at the same level, absent a showing of intent to reduce income for the purpose of obtaining maintenance, does not reduce her entitlement to maintenance. But Carrick, unlike this case, did not involve a permanent maintenance award. The district court may attribute income to a spouse in fashioning a permanent maintenance award that balances a lack of reasonable effort with the spouse’s inability to provide for her reasonable needs. Hecker, 568 N.W.2d at 710. At the time of the motion hearing, Barbara Handlin was employed at the wage of $14.38 per hour. She has provided no further documentation to substantiate her claim that she was not able to support herself due to her physical and mental condition. The district court therefore did not abuse its discretion in imputing income to Barbara Handlin or in denying the motion for maintenance modification.