Opinion ID: 2332987
Heading Depth: 3
Heading Rank: 2

Heading: Irreducible Increase in Spousal Support

Text: [¶ 44] The court specified that the spousal support award would increase to $2000 a month on December 30, 2009, more than eight years after the court's order. It also specified that this award would survive Barry's death and could not be decreased. As reflected in the court's order on the motions to reconsider, this doubling of the amount of spousal support was tied to Barry's anticipated receipt of a 20% share of the Robert Lyon Warner Trust, which is to be distributed in 2009. The court determined that the trust's value as of September 1999 was $7,487,509.67. [¶ 45] Certainly, receipt of a 20% share of a trust, worth approximately $1.4 million dollars to Barry, could, if and when received, constitute a substantial change of circumstances justifying an increase in the spousal support payment. However, in other respects, mandating that there by a $2000 monthly payment beginning in December 2009 and barring reduction of that payment are heavily based on speculative predictions of the parties' future economic circumstances. First, it assumes that Barry's estate will be entitled to receive his share of Robert Lyon Warner Trust proceeds if he dies prior to the distribution. Neither party introduced a copy of the trust instrument, nor did the court receive any testimony which specifically addressed the trust's provisions as they pertain to whether trust proceeds are payable to a beneficiary's estate. Although the court found that the trust was irrevocable, it received no evidence from which it could determine whether Barry's right to receive a distribution from the trust in 2009 is contingent upon his survivorship. [19] It also received no evidence from which it could determine whether the trust is permitted or required to make distributions to other individuals or payments (for example, the payment of administration expenses) prior to its termination in 2009 that would diminish the value of Barry's 20% share. [¶ 46] The court's order also assumes that the trust, eight years hence, will have a value similar to that which it had in September of 1999, although the court received no evidence regarding the nature of the assets comprising the trust's corpus. However, the recent history of stock valuations demonstrates the speculative nature of predicting the future value of investment assets without considering the assets' market volatility. We take judicial notice of the fact that stock values are dramatically lower today than they were six months ago. Recent history demonstrates the potential for unforseen events to dramatically and adversely affect stock values. [¶ 47] Because spousal support is necessarily based to some extent on prediction of future economic events, some future uncertainty is appropriate in developing spousal support obligation calculations. Dramatic changes for better or worse in the circumstances of the payor or the payee can be accommodated by the capacity of either party to return to court and request a change in the amount of spousal support based on a demonstrated substantial change of circumstances. 19-A M.R.S.A. § 951-A(4) (Supp.2001); see also Spencer v. Spencer, 1998 ME 252, ¶ 9, 720 A.2d 1159, 1162. That possibility is taken away when, as here, a court orders, as authorized by law, that a spousal support award be guaranteed to survive after death of the payor and that it not be decreased. 19-A M.R.S.A. § 951-A(3)(A), (4), (8) (Supp.2001). [¶ 48] When such an order prohibiting change is entered, we must necessarily review much more carefully the extent to which the future economic conditions of the parties may be based upon speculative prediction. We have stated on several occasions that spousal support awards may not be based on speculative predictions of future economic circumstances. Ketchum v. Ketchum, 1998 ME 62, ¶ 5, 707 A.2d 803, 804-05, aff'd 2000 ME 13, 743 A.2d 1270; Ryan v. Ryan, 1997 ME 136, ¶ 8, 697 A.2d 60, 61-62. Here, the award is unduly speculative because there is no evidence from which the court could determine the likely value of Barry's share of the Robert Lyon Warner Trust eight years in the future, nor was there evidence from which the court could determine whether the Robert Lyon Warner Trust proceeds would be paid to Barry's estate if he is not alive at the time of the distribution in 2009. The predictive judgment required of the court is often difficult and requires a careful analysis of the evidence as it pertains to future events and circumstances. In this case, closer scrutiny of the terms of the trust instrument, as well as the nature of the investments comprising the trust corpus and the degree of market risk associated with them, would be essential to determine whether Barry or his estate will receive a trust distribution in 2009 that approaches the amount forecasted in 2001. It is incumbent upon the party seeking an unmodifiable award of general support to provide the court with competent evidence from which a predictive judgment can be made. [¶ 49] Accordingly, the immediate award of spousal support in the amount of $1000 per month must be vacated because of the adjustments that should be made to the parties' respective incomes, and the future award of spousal support, as it relates to the $2000 monthly payments to be instituted as of December 30, 2009, must also be vacated because it is unduly speculative. We therefore remand for full reconsideration of the spousal support award. On remand, the court should redetermine the amount of its spousal support award effective as of the entry of the divorce judgment, taking into consideration the adjustments discussed above. In addition, in view of the passage of time, the court may receive evidence to determine whether there has been a substantial change in the parties' financial circumstances since the entry of the divorce judgment and, if so, order a prospective modification of the spousal support award.