Court Opinion

ID: 4704547
Source: CourtListenerOpinion
Date Created: 2021-07-19 12:03:03.200761+00
Date Added: 2024-06-11T08:05:27.504059
License: Public Domain

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          NATALIE BRAY v. DWAYNE BRAY, SR.
                     (AC 43309)
                       Moll, Cradle and Pellegrino, Js.

                                   Syllabus

The defendant, whose marriage to the plaintiff previously had been dis-
   solved, appealed to this court challenging an order issued by the trial
   court in connection with its denial of the plaintiff’s postjudgment motion
   for contempt. Under the parties’ separation agreement, which was incor-
   porated into the judgment of dissolution, the defendant was required
   to pay to the plaintiff, as child support, alimony, and/or property distribu-
   tion, certain percentages of the net income that he received from his
   employer in the form of cash bonuses and stock awards. In 2015, the
   plaintiff filed a postjudgment motion for contempt, claiming that the
   defendant had failed to pay certain amounts required under the separa-
   tion agreement. The trial court issued an order in connection therewith,
   requiring that the annual amounts paid with respect to the defendant’s
   bonus and stock funds be based on his effective tax rate from the prior
   year. The plaintiff filed another motion for contempt alleging, inter alia,
   that the defendant violated the dissolution judgment by deducting extra
   amounts from his bonus and stock payments for taxes that he did not
   actually pay. The defendant asserted that these amounts were properly
   deducted because his net proceeds were to be calculated using his
   marginal tax rate rather than his effective tax rate. After a four day
   hearing, during which neither of the parties ever mentioned the 2015
   order, the trial court found that the defendant’s noncompliance was not
   wilful, but it issued a remedial order that required that he reimburse
   the plaintiff for certain funds based on its conclusion that the term
   ‘‘net,’’ as used in the separation agreement, clearly and unambiguously
   did not contemplate the consideration of his net income to calculate the
   amount of his bonus and stock income that was subject to distribution
   to the plaintiff, and the defendant appealed to this court. Held that the
   trial court’s analysis underlying its conclusion that the meaning of the
   term ‘‘net,’’ as used in the separation agreement, was clear and unambigu-
   ous was erroneous because it failed to take into consideration the stipula-
   tion of the parties set forth in the 2015 order, which provided specific
   directions as to how the net amounts of the defendant’s bonus and
   stock income were to be calculated; accordingly, the remedial order
   was vacated.
             Argued March 8—officially released July 20, 2021

                             Procedural History

   Action for the dissolution of a marriage, and for other
relief, brought to the Superior Court in the judicial dis-
trict of Hartford, where the court, Ficeto, J., rendered
judgment dissolving the marriage and granting certain
other relief in accordance with the parties’ separation
agreement; thereafter, the court, Bozzuto, J., granted
the plaintiff’s motion for contempt; subsequently, the
court, Johnson, J., granted the plaintiff’s motion for
contempt; thereafter, the court, Nguyen-O’Dowd, J.,
denied the plaintiff’s motion for contempt and entered
a remedial order, and the defendant appealed to this
court. Order vacated.
   Adam J. Teller, for the appellant (defendant).
  Christopher P. Kriesen, with whom were Qing Wai
Wong and Emily Covey, certified legal interns, for the
appellee (plaintiff).
                          Opinion

   PER CURIAM. This appeal arises from a postjudg-
ment motion for contempt filed by the plaintiff, Natalie
Bray, alleging that the defendant, Dwayne Bray, Sr.,
wilfully failed to comply with certain provisions of the
parties’ separation agreement, which had been incorpo-
rated into their judgment of dissolution. The provisions
at issue required the defendant to pay to the plaintiff,
as child support, alimony and/or property distribution,
certain portions of income that he received from his
employer in the form of cash bonuses and stock awards
(bonus and stock income). Although the court found
that the defendant had not complied with those provi-
sions of the separation agreement, it concluded that
his noncompliance was not wilful, and, therefore, it
denied the plaintiff’s motion for contempt.1 On appeal,
the defendant challenges the court’s remedial order that
required him to reimburse the plaintiff for certain funds
based on the court’s conclusion that the term ‘‘net,’’
as used in the applicable provisions of the separation
agreement, clearly and unambiguously did not contem-
plate the consideration of his net income in order to
calculate the amount of his bonus and stock income
that was subject to distribution to the plaintiff. The
defendant specifically claims that the trial court (1)
incorrectly determined that the term ‘‘net’’ was clear
and unambiguous as used in the parties’ separation
agreement, and (2) erred in interpreting the term ‘‘net’’
to exclude from those income sources ‘‘only the
amounts withheld by his employer, disregarding the
defendant’s actual income tax obligations, despite clear
evidence that the parties intended to consider his actual
marginal tax obligations and not merely the employer’s
withholding for those obligations.’’ We conclude that
the analysis underlying the trial court’s conclusion that
the term ‘‘net’’ was clear and unambiguous was errone-
ous in that it failed to take into consideration a stipula-
tion of the parties, which was entered as an order of
the court, between the date of dissolution and the hear-
ing on the motion for contempt. That stipulation specifi-
cally directed how the ‘‘net’’ amounts of the defendant’s
bonus and stock income were to be calculated. Accord-
ingly, we vacate the remedial order.
   The following procedural history and undisputed
facts are relevant to our resolution of the issues on
appeal. The parties’ marriage was dissolved on October
10, 2014. They executed a separation agreement on
that date, which was incorporated into the judgment
of dissolution. The separation agreement provided,
inter alia, that the defendant would pay to the plaintiff
alimony, various portions of marital assets and child
support for their minor child. Specifically, as to alimony,
§ 4.1 of the parties’ separation agreement provided that
the defendant would pay to the plaintiff periodic ali-
mony in the amount of $1000 per week for fifteen years,
plus ‘‘15 [percent] of any and all net cash bonus(es)
received by the [defendant].’’ Section 4.5 of the separa-
tion agreement provided in relevant part: ‘‘So long as
there is an alimony obligation payable to the [plaintiff],
as additional alimony, the [plaintiff] shall be entitled to
15 [percent] of any and all such future stock earned
from Disney2 once liquidated as cash by the [defendant].
The 15 [percent] shall be payable from the liquidated
net amount.’’ (Footnote added.)
   As to the marital assets, specifically, as to restricted
stock units that had been awarded to the defendant,
but had not vested, as of the date of dissolution, § 5.1
of the separation agreement provided, inter alia, that
‘‘the [plaintiff] shall be entitled to 50 [percent] of the
net value of the stock upon vesting, after provision for
payment of all associated taxes and fees . . . .’’
   As to child support, the separation agreement
required the defendant to pay periodic support in accor-
dance with the child support guidelines. Section 11.2
of the separation agreement provided that, as additional
child support, ‘‘the [defendant] shall pay 15 [percent]
of his net yearly bonus (non-stock bonus(es)), to the
[plaintiff] so long as child support is due and owing
. . . .’’
   On January 5, 2015, the defendant informed the plain-
tiff that he believed that the ‘‘net’’ of his cash bonus
and stock income should be calculated by employing
a federal tax rate of 33 percent, which was his marginal
tax rate, instead of the 25 percent that his employer
withheld. Accordingly, he told the plaintiff that he
would subtract an additional 8 percent from the amount
that he received from his employer before calculating
the plaintiff’s percentage of each distribution.
  On May 7, 2015, the plaintiff filed a motion for con-
tempt, alleging, inter alia, that the defendant had not
complied with the periodic child support or alimony
orders, or the provisions of the separation agreement
that required him to pay to her a certain portion of his
bonus and stock income.3 As a result of that motion,
on November 2, 2015, the trial court, Johnson, J., issued
an order that provided, inter alia: ‘‘The parties stipulate
to the following . . . [t]he parties shall each receive
their bonus and stock funds based upon the [defen-
dant’s] effective tax rate from the previous year and
not his marginal tax rate. At the end of each tax year,
the parties shall reconcile within thirty (30) days of the
[defendant] filing his tax returns. The reconciliation
shall be done to determine if the [defendant] over with-
held or under withheld. The parties shall adjust their
earnings based on this determination by the parties’
accountants. The difference after reconciliation, if any,
shall be paid within thirty (30) days of reconciliation to
the party who is owed money.’’ (Emphasis in original.)
  On March 28, 2018, the plaintiff filed another motion
for contempt, alleging, inter alia, that the defendant
violated the dissolution judgment by deducting ‘‘extra
money from bonuses and stock payments for ‘extra
taxes’ ’’ that he does not actually pay. The plaintiff
argued that the ‘‘net’’ proceeds from the defendant’s
bonus and stock income were to be calculated by sub-
tracting the actual taxes paid by the defendant, which
she referred to as the defendant’s ‘‘effective tax rate.’’
The defendant maintained his position that his marginal
tax rate of 33 percent should be applied to calculate
the net proceeds.
   Following a four day hearing beginning on September
5, 2018, and concluding on May 9, 2019, the trial court
filed a memorandum of decision on August 2, 2019. In
its memorandum of decision, the court stated, inter
alia:4 ‘‘The parties provided the court with extensive
testimony and argument to support their position that
the parties’ [separation] agreement, specifically [§§] 4.1,
4.5, 5.1 and 11.2, requires the court to define the term
‘net income’ before it can determine how . . . addi-
tional alimony and child support payments are to be
calculated. Specifically, the defendant argues that the
term ‘net income’ as contemplated by the parties in the
[separation] agreement is defined as his marginal tax
rate. The plaintiff argues the opposite, claiming that
‘net income’ is defined as his effective tax rate.’’ The
trial court concluded that it did ‘‘not need to resolve
the issue presented by the parties as to the definition
of ‘net income’ pursuant to the parties’ [separation]
agreement’’ because ‘‘neither party has established a
plausible argument for their position that the parties’
[separation] agreement for the defendant to make addi-
tional alimony and child support payments is linked to
his net income and how the term ‘net income’ is defined.
To the contrary, each of the provisions in the [separa-
tion] agreement that are the subject of the plaintiff’s
motion for contempt are clear and unambiguous and
nothing within the parties’ [separation] agreement
requires a definition of the defendant’s net income in
order to enforce the provisions.’’ The court addressed
each of the specific provisions of the separation agree-
ment and explained: ‘‘In each of the sections that is the
subject of the plaintiff’s motion for contempt, the term
‘net’ has been attached to the specific type of additional
compensation received by the defendant—cash
bonuses, stocks or distribution from [restricted stock
units].’’ The court further reasoned: ‘‘[I]n reviewing the
[separation] agreement as a whole, there is no language
to suggest that the defendant’s net income has any effect
on his obligation to make additional alimony and child
support payments. Nothing within the [separation]
agreement requires the parties to reconcile payments
related to cash bonuses and stock distributions after
the defendant files his tax returns. Presumably, this
(nonexistent) condition would allow the parties to con-
duct a forensic accounting and determine the defen-
dant’s tax rate for that particular year. There is also no
language in the [separation] agreement that ties the
exchange of the end-of-year statements for bonuses and
stock distribution to the payments of additional alimony
and child support. Instead, the provisions in the [separa-
tion] agreement that are at issue stand alone and are
clear and unambiguous as to when and how much addi-
tional alimony and child support payments should be
paid to the plaintiff by the defendant, regardless of
his net income.’’ The court found that the defendant’s
failure to comply with the provisions of the separation
agreement by deducting additional taxes from his pro-
ceeds was based on a ‘‘legitimate misunderstanding by
the defendant . . . .’’ On that basis, the court con-
cluded that the defendant’s failure to comply with the
separation agreement was not wilful and, therefore,
denied the plaintiff’s motion for contempt. The court
further concluded, however: ‘‘Despite this misunder-
standing, the defendant is still responsible to pay the
plaintiff her percentage share under the [separation]
agreement without the additional 8 [percent] removed
on the net amount he received from his cash bonuses,
stock or distribution from [restricted stock units]. The
court orders that the defendant reimburse the plaintiff
the payments made pursuant to [§§] 4.1, 4.5, 5.1 and 11.2,
consistent with this decision.’’ This appeal followed.
   The defendant argues that the court’s remedial order
requiring him to reimburse the plaintiff for the addi-
tional 8 percent that he had deducted from his bonus
and stock income was based on an incorrect interpreta-
tion of the separation agreement. As noted, both parties
argued to the trial court that the plaintiff’s portion of
the defendant’s bonus and stock income was dependent
on the applicable tax rate, but the trial court rejected
those arguments, reasoning that, if the parties had
intended ‘‘net’’ to be a factor of the defendant’s net
income, they would have provided for an exchange of
tax information or annual accountings. The November
2, 2015 order did just that. The November 2, 2015 order5
expressly provided for an annual reconciliation of the
amounts due each year based on the defendant’s income
tax returns, as determined by their accountants.6 Thus,
the rationale underlying the court’s remedial order—
that the separation agreement clearly and unambigu-
ously did not contemplate the consideration of the
defendant’s net income because it did not provide for
an annual reconciliation of the amount owed to the
plaintiff based on the defendant’s tax obligations—is
inconsistent with the November 2, 2015 order that
directed the parties to employ that exact procedure.
Accordingly, the court’s remedial order cannot stand.
      The August 2, 2019 remedial order is vacated.
  1
     The plaintiff has not cross appealed from the denial of her motion for con-
tempt.
   2
     At all times relevant herein, the defendant was employed by ESPN, which
is owned by Disney Worldwide Services, Inc.
   3
     The plaintiff also had filed a motion for contempt on January 26, 2015,
alleging that the defendant had stopped paying child support and alimony,
both the periodic orders and those stemming from his bonus and stock
income. As a result of that motion, an order for immediate wage withholding
was entered on April 7, 2015, to secure the defendant’s periodic obligation.
The court also issued another order, by agreement of the parties, pertaining
to the parties’ exchange of financial information. Of particular note, the
court ordered: ‘‘Each party shall authorize their respective accountants to
speak with the other regarding applicable tax rates, 2014/2015 income,
and any other information necessary to determine net proceeds due to the
[plaintiff] pursuant to the [separation] agreement dated October 10, 2014.’’
(Emphasis added.) Like the November 2, 2015 order discussed subsequently
in this opinion, this order is indicative of the parties’ intent and understanding
that the defendant’s net income and the tax rate applied to calculate that
income were relevant to the calculation of the ‘‘net’’ amounts contemplated
in the separation agreement. Also, like the November 2, 2015 order, this
order belies the court’s determination that the term ‘‘net’’ clearly and unam-
biguously was not a factor of the defendant’s net income.
   4
     The court addressed additional issues that are not relevant to this appeal.
   5
     We note that the November 2, 2015 order reflects that both parties were
present in court with counsel at the time that the order was entered.
   6
     Our review of the parties’ respective filings and arguments before the
trial court, including the transcripts of the four day contempt hearing, reveals
that neither the parties nor the trial court mentioned the November 2, 2015
order. On April 15, 2021, this court issued an order directing the parties to
file supplemental briefs ‘‘addressing what effect, if any, this order has on
the appeal presently pending in this matter.’’ Both parties filed supplemental
briefs in accordance with the April 15, 2021 order.