Opinion ID: 1745516
Heading Depth: 1
Heading Rank: 3

Heading: tax addendum

Text: Pat moved to enforce an Addendum to Stipulation which had not been filed with the divorce court in 1984. This Addendum said: 1. Boyd shall also pay Patricia's income tax resulting from the alimony payments for 1984, 1985 and 1986. Based on the Addendum, the trial court ruled that Boyd was liable for any taxes payable by [Pat] for the tax years 1984, 1985 and 1986. On appeal, Boyd argued that the Addendum was not intended to be part of the divorce settlement. He contended that the Addendum was unenforceable because it was unsupported by consideration and because Pat had delayed in enforcing it. Pat responded that Boyd's attorney prepared the Addendum for the divorce settlement and that it was intended to protect her from adverse tax aspects of allocating more of the payments to alimony than to child support. The trial court heard considerable evidence on the subject. Pat testified that, in early negotiations, she was to receive $2,000 split evenly, $1,000 for child support and $1,000 for alimony. The split was shifted to $1,500 alimony and $500 child support in the final settlement and the Addendum was then prepared to protect her from any adverse tax consequences of that shift. Pat testified that, because Boyd deducted all of his alimony payment as support on his tax returns, her tax assessments arose when she did not report the property portion of $500 as income. According to Pat, her tax problems were caused by Boyd's failure to comply with the 1985 court ruling that $500 of the alimony was property division. Boyd's first attorney testified about preparing the settlement and the Addendum: Apparently Boyd and Pat had agreed that they wanted additional items covered in regards to their property settlement, such as who's going to pay income tax.... Pat testified that she had been assured that the Addendum was binding even though not filed with the divorce settlement. Evidence on income tax deficiencies assessed against Pat for 1985 was submitted, as was evidence on the possibility of future assessments for 1986, 1987, and 1988. See Baird v. Ridl, 455 N.W.2d 188 (N.D.1990). The trial court found that [t]he parties by separate contemporaneous written agreement and valuable consideration provided that Dr. Addy would be liable for any taxes payable by Patricia Addy for the tax years 1984, 1985 and 1986.... Generally, separate instruments relating to the same transaction and contemporaneously executed are read and construed together. Nantt v. Puckett Energy Co., 382 N.W.2d 655, 658 (N.D.1986). We see no lack of consideration in these contemporaneous agreements. 17 Am.Jur.2d Contracts § 264 (1964). Mere delay in enforcing contractual rights does not ordinarily estop a party from doing so. Kouba v. Great Plains Pelleting, Inc., 372 N.W.2d 884 (N.D.1985). We conclude that the trial court's finding that the Addendum was enforceable was not clearly erroneous. We affirm the trial court in all respects.