Court Opinion

ID: 4568635
Source: CourtListenerOpinion
Date Created: 2020-09-22 23:06:58.950626+00
Date Added: 2024-06-11T13:27:13.265216
License: Public Domain

RENDERED: AUGUST 21, 2020; 10:00 A.M.
                       NOT TO BE PUBLISHED

                Commonwealth of Kentucky
                          Court of Appeals

                           NO. 2019-CA-000608-MR

DALE CORNATZER                                                     APPELLANT

             APPEAL FROM BRECKINRIDGE CIRCUIT COURT
v.              HONORABLE BRUCE T. BUTLER, JUDGE
                       ACTION NO. 04-CI-00075

ANGELA CORNATZER                                                     APPELLEE

                                   OPINION
                                  AFFIRMING

                                 ** ** ** ** **

BEFORE: CLAYTON, CHIEF JUDGE; TAYLOR AND L. THOMPSON,
JUDGES.

THOMPSON, L., JUDGE: Dale Cornatzer (“Appellant”) appeals from an order of

the Breckinridge Circuit Court addressing his motion to enforce a property

settlement agreement (“the Agreement”) entered into with his former wife Angela

Cornatzer (“Appellee”). Appellant argues that the circuit court improperly

interpreted the Agreement; that if the Agreement is ambiguous it should be
construed against the drafter; that there was no meeting of the minds; and that the

interpretation sought by Appellee is unconscionable. For the reasons addressed

below, we find no error and affirm the order on appeal.

                         FACTS AND PROCEDURAL HISTORY

                 The parties were divorced by way of a decree of dissolution of

marriage entered on November 4, 2004. The decree incorporated the Agreement,

which disposed of various matters including real property, custody, child support,

and retirement funds. Notably, Paragraph 101 which is titled “PENSIONS/

RETIREMENTS/401K/459/SAVINGS ACCOUNTS” states,

                 The parties agree that the Petitioner [Appellant] will pay
                 the Respondent [Appellee] $700.00 per month until the
                 last child graduates from high school or is eighteen (18)
                 years of age and is not in school. The Petitioner shall
                 then pay the Respondent 50% of his hazardous duty pay
                 and 38% of the non-hazardous duty pay. When the
                 Respondent retires Mr. Cornatzer will be entitled to his
                 marital share and it shall be credited against sums paid to
                 the Respondent.

                 Pursuant to the Agreement, Appellant began paying to Appellee the

sum of $700 per month in representing Appellee’s marital share of Appellant’s

retirement proceeds. Appellee retired in June 2018, after which the parties,

through counsel, discussed their ongoing obligations. Appellee asserted that

Appellant was required to pay to her 50% of his hazardous duty pay and 38% of

1
    Appellant refers to this as “Paragraph X.”

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the non-hazardous duty pay, subject to a credit representing Appellant’s share of

Appellee’s retirement pay. Appellant maintained that this was not what the

Agreement required, nor was it reasonable or conscionable.

              On October 31, 2018, Appellant filed a motion to enforce the

Agreement on the issue of retirement proceeds. A hearing was conducted on

December 16, 2018, after which the circuit court rendered an order interpreting

Paragraph 10. The court determined that the Agreement gave Appellee 50% of

Appellant’s hazardous duty pay and 38% of his non-hazardous duty pay, minus a

credit for Appellant’s share of Appellee’s retirement pay. The court noted that

Appellee filed an affidavit that her marital share of Appellant’s retirement is

$802.17, with Appellant’s share of Appellee’s retirement being $276.00. The court

accepted these sums as accurate and awarded to Appellee the amount of $525.57

per month representing $802.17 minus $276.60.2 It determined that this obligation

continued as long as Appellee received retirement income. This appeal followed.

                           ARGUMENTS AND ANALYSIS

              Appellant argues that the Breckinridge Circuit Court erred in its

interpretation of Paragraph 10. He maintains that the plain meaning of this

language provides that upon Appellee’s retirement, Appellant’s obligation to pay

2
 The order on appeal incorrectly states that Appellant’s share of Appellee’s monthly retirement
payment is $276.00. The correct amount is $276.60.

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to Appellee her share of his retirement proceeds terminates, and that his marital

share of Appellee’s retirement is then credited against the sums he previously paid

to Appellee. Appellant argues that one could not reasonably conclude from this

language that his obligation to pay to Appellee a portion of his retirement

continues in perpetuity. Rather, the language at issue, he argues, terminated his

obligation at the time of Appellee’s retirement. In support of this interpretation,

Appellant directs our attention to the following sentence he claims disposes of any

alternate interpretations: “[W]hen the . . . [Appellee] retires the . . . [Appellant]

will be entitled to his marital share and it shall be credited against sums paid to the

. . . [Appellee].” Appellant notes that the term “paid” is past tense and must

necessarily refer to payments previously made to Appellee. It cannot, he argues,

refer to future payments to Appellee as the language “to be paid” is not found in

Paragraph 10. In sum, Appellant contends that his payment obligation terminated

at Appellee’s retirement, that he is entitled to a marital share of her retirement to be

credited against sums he previously paid, and that the Breckinridge Circuit Court

erred in failing to so conclude.

             “The terms of a settlement agreement set forth in a decree

of dissolution of marriage are enforceable as contract terms. [Kentucky Revised

Statute (KRS)] 403.180(5). The construction and interpretation of a contract is a

matter of law and is reviewed under the de novo standard.” Money v. Money, 297

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S.W.3d 69, 71 (Ky. App. 2009) (citing Cinelli v. Ward, 997 S.W.2d 474, 476 (Ky.

App. 1998)). “Absent an ambiguity in the contract, the parties’ intentions must be

discerned from the four corners of the instrument without resort to extrinsic

evidence. . . . The fact that one party may have intended different results, however,

is insufficient to construe a contract at variance with its plain and unambiguous

terms.” Money, 297 S.W.3d at 72 (citations and internal quotation marks omitted).

              The primary question before us is whether the circuit court correctly

interpreted the Agreement as continuing Appellant’s obligation as long as he

receives retirement income. We must answer this question in the affirmative. The

Agreement expressly states at Paragraph 8 that the parties waived any entitlement

to maintenance, and as Paragraph 10 is titled “PENSIONS/RETIREMENTS/401K/

459/SAVINGS ACCOUNTS,” we may reasonably construe this language as

disposing of the parties’ marital property. While the parties are entitled to dispose

of their marital property in any way they see fit so long as the Agreement is not

unconscionable, id., the underlying statutory scheme for the division of marital

property centers on a division “in just proportions.” KRS 403.190(1); KRS

403.180(3). All property acquired by either spouse after the marriage is presumed

to be marital property. KRS 403.190(3). If the parties sought to mirror the

statutory scheme, Appellant’s obligation to distribute Appellee’s share of

                                         -5-
Appellant’s retirement income would necessarily continue as long as he was

receiving such income.

             Irrespective of the statutory scheme, from which the parties may agree

to depart, nothing in Paragraph 10 can properly be interpreted as terminating

Appellant’s obligation when Appellee retires. Notably, there is no language in

Paragraph 10, express or implied, which terminates Appellee’s right to her share of

this marital asset nor his right to hers. In contrast, the preceding sentence

addressing a $700 monthly payment to Appellee does expressly set forth a fixed

termination date, i.e., when the minor child graduates or reaches the age of

majority. The parties could have, but did not, incorporate similar express terms

terminating Appellant’s obligation to pay Appellee her share of his ongoing

retirement proceeds.

             Under the terms of the Agreement, the parties distributed their fixed

marital assets such as the marital home, vehicles, and personal property. Due to

the indeterminate nature of their retirement assets, however, and because the

parties could not know if they would receive retirement proceeds for one year or

30 years after the dissolution, the distribution of those assets to the parties must

necessarily occur on an ongoing basis. Further, Appellant acknowledges that

Appellee’s obligation to credit to him a portion of her retirement assets is also

ongoing. As there is no language in Paragraph 10 terminating Appellee’s right to a

                                          -6-
division of Appellant’s retirement proceeds on an ongoing basis, we find no error

in the Breckinridge Circuit Court’s conclusion on this issue.

             Appellant goes on to argue that the rule of contra proferentem, i.e.,

that ambiguities in a contract are construed against its drafter, required the circuit

court to adopt his interpretation of Paragraph 10 over the interpretation forwarded

by the Appellee. See McMullin v. McMullin, 338 S.W.3d 315 (Ky. App. 2011). In

the alternative, he contends that there was no meeting of the minds sufficient to

form a contract, and that the interpretation asserted by the Appellee is

unconscionable. We are not persuaded by these arguments. Paragraph 10 is not

ambiguous or unconscionable. It states in clear terms that Appellant shall pay the

Appellee 50% of his hazardous duty pay and 38% of the non-hazardous duty pay,

subject to a credit for his share of Appellee’s retirement income. If the distribution

of retirement assets had been accomplished by the circuit court pursuant to KRS

Chapter 403 and the “just proportions” standard applied, rather than a distribution

agreed to by the parties, the result likely would have been substantially similar.

We find no error.

                                   CONCLUSION

             The Breckinridge Circuit Court properly interpreted Paragraph 10 of

the Agreement as requiring ongoing payments to Appellee representing a portion

of Appellant’s retirement income, subject to a credit for Appellant’s entitlement to

                                          -7-
a portion of Appellee’s retirement income. Paragraph 10 disposes of marital assets

in a manner substantially similar to the scheme set out in KRS Chapter 403, does

not contain a termination date, and is not ambiguous or unconscionable. For the

foregoing reasons, we affirm the order of the Breckinridge Circuit Court.

            ALL CONCUR.

BRIEF FOR APPELLANT:                      BRIEF FOR APPELLEE:

Hollyn Richardson                         Brett Butler
Louisville, Kentucky                      Hardinsburg, Kentucky

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