Opinion ID: 4509466
Heading Depth: 1
Heading Rank: 2

Heading: The COLA Modification

Text: ¶ 15. However, defendant argues that the court’s conclusion that the parties entered a binding agreement to waive the COLA was error for several other reasons. First, she asserts that the higher standard for establishing changed circumstances to modify the compensatory component of permanent maintenance established in Weaver v. Weaver, 2017 VT 58, 205 Vt. 66, 171 A.3d 374, deprives the court of the ability to find that defendant had agreed to waive the COLA. Second, she argues that if an agreement to waive the COLA existed, it is nonetheless unenforceable because such a waiver offends public policy. Third, she posits that one of the findings underlying the court’s determination of the existence of the COLA modification agreement was clearly erroneous, and therefore the finding of the contract’s existence cannot stand. Finally, she asserts that even if a valid agreement was reached regarding waiver of her right to receive COLAs, the agreement was unconscionable and therefore unenforceable. We find no merit in the first two arguments, but agree that the trial court’s legal conclusions are undermined by a clearly erroneous finding. Given this result, we do not reach her final contention. ¶ 16. With respect to defendant’s first argument, we reiterate that this case is not about an attempt by plaintiff to modify the existing order by court process. Rather, plaintiff asserts a contractual agreement whereby defendant agreed to waive receipt of the COLA. We have previously recognized that parties may make such agreements. Zink, 2016 VT 46, ¶ 21 (holding that argument that parties entered into agreement whereby wife accepted reduced spousal maintenance payments “whether based upon principles of contract, equitable estoppel, or waiver, 8 is distinct from an argument that the court-ordered spousal maintenance obligation was itself modified by the parties’ agreement or conduct”). We see no reason why the higher standard for family-court modification of the compensatory component of permanent maintenance precludes an agreement to waive the COLAs. Thus, if the parties agreed that plaintiff would assume the children’s college tuition expenses in exchange for being relieved of the obligation to pay COLA on the maintenance payments, the fact that the COLA may have been related, in whole or in part, to a compensatory permanent maintenance obligation is of no moment. ¶ 17. Although this divorce preceded this Court’s clarification of the compensatory aspect of permanent maintenance in Weaver v. Weaver, the trial court recognized in its divorce order that the maintenance award contained a substantial permanent component to compensate defendant for her contributions to the marriage. See 2017 VT 58, ¶ 30 (“Because the necessary showing for changed circumstances for the compensatory portion of permanent maintenance is more exacting, when a court orders permanent maintenance and a portion of the permanent award is intended to compensate the recipient spouse for contributions made during marriage, the court should identify what portion of the permanent award is made on that basis.”). The court did not make a specific allocation of the compensatory component of the permanent award. Defendant contends that if an agreement to waive the COLA existed, it should nonetheless be unenforceable because such a waiver offends public policy, likening the compensatory component of permanent maintenance to child support. The trial court acknowledged defendant’s contention but did not resolve it. We do so here. ¶ 18. We first note that defendant’s analogy to child support is wholly inapposite. As we recognized in Weaver, child support and spousal maintenance payments “serve[] entirely different purposes, [are] governed by different statutory regimes, and [are] not interchangeable.” 2017 VT 58, ¶ 39. “Our cases have sought to protect children against loss of child support” through the actions of their parents, and the resulting prohibition on a parent’s waiver of child support is 9 consistent with the Legislature’s articulation of the public policy underlying the child-support statute. Id. ¶ 40; see also 15 V.S.A. § 650 (“The legislature . . . finds and declares as public policy that parents have the responsibility to provide child support . . . .”). In contrast, “[s]pousal maintenance is intended to provide for the recipient spouse’s own needs, not the needs of the parties’ children[.]” Weaver, 2017 VT 58, ¶ 39. The recipient spouse is therefore free to use the maintenance award as he or she sees fit—including maintenance awards with compensatory components. ¶ 19. We have long recognized the importance of freedom of contract. Osgood v. Cent. Vt. Ry. Co., 77 Vt. 334, 344, 60 A. 137, 140 (1905) (“[T]he right of private contract is no small part of the liberty of the citizen . . . .” (quotation omitted)); Kneebinding, Inc. v. Howell, 2018 VT 101, ¶ 61, 208 Vt. 578, 201 A.3d 326 (observing that private parties may contract to waive even rights of constitutional magnitude). In fact, undergirding compensatory maintenance “is the recognition that some marriages can include circumstances analogous to a contractual bargain”; the award itself is “an attempt to continue to enforce that bargain” following the dissolution of marriage. Weaver, 2017 VT 58, ¶ 23. It would be wholly at odds with this principle to hold that, once a court has determined that an obligee is entitled to compensatory maintenance in order to receive the benefits of the marital bargain post-divorce, she or he is forbidden to alienate the benefit of that bargain as desired, including—as permissible with other forms of maintenance—waiving it as consideration for an agreement with the obligor. Finally, we note that the power to declare a contract void because it violates public policy “ ‘is a very delicate and undefined power, and like the power to declare a statute unconstitutional, should be exercised only in cases free from doubt.’ ” Barrett v. Carden, 65 Vt. 431, 434, 26 A. 530, 531 (1893) (quoting Richmond v. R.R. Co., 1868 WL 315,  (Iowa 1868)). The agreement by the parties whereby defendant would waive the COLA to spousal maintenance, if it was made, does not raise concerns sufficient to offend public policy. 10 ¶ 20. Defendant also contends the court made erroneous findings concerning the agreement for plaintiff to pay all of the youngest child’s tuition in exchange for defendant waiving the right to have COLAs applied to the maintenance she was receiving. As a basis for concluding the parties had modified the tuition agreement, the trial court found “defendant sent a note to plaintiff asking plaintiff to address the failure to include cost of living increases and also indicating that she did not want to continue paying 25% of the college tuition as the parties had previously agreed.” The note in question states, in pertinent part: Jerry This check for $564.00 is for the following: 99.00 for fridge + 465.00 towards Lauren’s tuition. Balance remaining on tuition bill is $3000.00. Also, I have not received a cost of living increase in my spousal maintenance money in a very long time. Why? I believe you should look into this. .... MaryAnn While the note does acknowledge both defendant’s agreement to pay at least some portion of her daughter’s college tuition and defendant’s failure to receive COLAs, it simply cannot reasonably be construed to indicate that she no longer wanted to pay 25% of the college tuition. It says nothing in this regard. Therefore, this finding by the trial court is clearly erroneous. Alberino v. Balch, 2008 VT 130, ¶ 7, 185 Vt. 589, 969 A.2d 61 (mem.) (“Findings are clearly erroneous if there is no credible evidence in the record to support them.”). While the trial court made additional findings concerning the course of conduct by the parties over the next several years as providing additional support for the existence of a modification, because “it is not the role of this Court to reweigh the evidence or assess the credibility of witnesses,” we cannot determine whether, absent the erroneous 11 finding that defendant broached the topic of modifying the initial agreement, the trial court would still be persuaded that the modification existed. Sweet, 2018 VT 122, ¶ 13. ¶ 21. However, defendant is incorrect in asserting that one party’s “sole subjective testimony” is per se insufficient to support a finding that two parties intended to enter or modify a contract. See, e.g., George Pridemore & Son v. Traylor Bros., 311 S.W.2d 396, 397 (Ky. 1958) (“If there is sufficient evidence to show a meeting of the minds even though [one party] denies it, then a court or jury may be justified in finding a contract existed.”). We remand not because excising the erroneous finding would render the remaining findings insufficient to support the existence of a contract. Rather, we remand because we cannot speculate as to whether the court’s finding of a contract would survive in the absence of the erroneous finding. See Kanaan v. Kanaan, 163 Vt. 402, 407, 659 A.2d 128, 132 (1995) (“[W]e will not speculate as to the basis upon which the court made its findings and reached its conclusions, where the court’s decision does not spell out this basis.”); cf. Town of Rutland v. City of Rutland, 170 Vt. 87, 90, 743 A.2d 585, 587-88 (1999) (explaining that existence of contract “depends on facts as well as the reasonable inferences to be drawn from them, and is also influenced by the situation of the parties and the subject matter”). As a result, remand is necessary for the trial court to determine whether the parties entered an agreement with corrected factual findings. In connection with this remand, we note that below, the trial court considered defendant’s receipt of ten years of maintenance payments without COLA to constitute “waiver by performance.” However, it is unclear whether the court was referring to waiver in the context of evidence that defendant made an oral agreement to waive the COLA, or whether it was referring to waiver as the relinquishment of a known right through 12 defendant’s failure to seek enforcement of the COLA sooner than she did.5 Upon remand, the trial court should clarify its conclusion regarding defendant’s “waiver by performance.”6 ¶ 22. Defendant also contends that even if a valid agreement was reached regarding waiver of her right to receive COLA adjustments, the agreement was unconscionable and therefore unenforceable. We do not reach this argument because it will become relevant only if the trial court finds the existence of a contract on remand. By the same token, we do not reach plaintiff’s assertions that promissory estoppel, equitable estoppel, laches, or quasi-contractual theories afford him alternative grounds for relief; they will become relevant only if the trial court concludes the parties did not have a contract. See Hayes v. Town of Manchester Water & Sewer Bds., 2014 VT 126, ¶ 37, 198 Vt. 92, 112 A.3d 742 (holding that doctrine of promissory estoppel applies only “where there is no contract” (quotation omitted)); DJ Painting, Inc. v. Baraw Enters., Inc., 172 Vt. 239, 243, 776 A. 2d 413, 417 (2001) (noting that although existence of a contract does not necessarily preclude remedy in quasi-contract, “the terms of the contract and the remedies exercised under it become highly relevant in determining whether denying further payment to 5 Plaintiff asserts that defendant’s claim is barred by laches, rendering the meaning of “waiver by performance” even more uncertain. 6 Such clarification is necessary because, to the extent the court intended to suggest that defendant relinquished a known right through her failure to seek enforcement of the COLA sooner than she did, it erred. Section 606(a) of Title 15 provides that, where a party is entitled to receive spousal-maintenance payments pursuant to a court order, he or she may seek determination and payment of the amount due thereunder at any time if the order is “still in force.” Here, the parties do not dispute that the divorce order—under which maintenance payments to defendant were ongoing—was still in force when defendant filed her enforcement motion. Therefore, unless defendant otherwise waived her right to seek enforcement, her motion was timely. However, defendant’s delay alone “cannot be construed as a waiver of her rights because waiver is not created by mere oversight and cannot be inferred from silence.” Kanaan, 163 Vt. 402, 413-14, 659 A.2d at 136 (holding that wife’s delay in filing motion to enforce oral agreement for husband to pay spousal maintenance following their separation was not waiver, because “waiver requires proof of a voluntary and intentional relinquishment of a known and enforceable right”). Defendant’s right to enforce the COLA provision of the maintenance order while it was still in force could not be waived through mere inaction. Something more—such as the affirmative oral agreement alleged by plaintiff—was required. 13 plaintiff is unjust, such that we should imply a contract where there is none”); Beecher v. Stratton Corp., 170 Vt. 137, 140, 743 A.2d 109, 1096 (1999) (explaining that “[a]ll of the circumstances of the case must be evaluated in determining whether the doctrine [of equitable estoppel] applies”); Preston v. Chabot, 138 Vt. 170, 172, 412 A.2d 930, 931 (1980) (observing that “a trial court’s determination on the issue of laches is a matter of much discretion”). Reversed and remanded for further proceedings consistent with this opinion. FOR THE COURT: