Court Opinion

ID: 4202715
Source: CourtListenerOpinion
Date Created: 2017-09-12 16:18:00.952787+00
Date Added: 2024-06-11T08:33:26.942673
License: Public Domain

J-A16028-17

NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P 65.37

LINDA M. FRY,                            :   IN THE SUPERIOR COURT OF
                                         :         PENNSYLVANIA
                Appellee                 :
                                         :
                   v.                    :
                                         :
DANIEL JAMES FRY,                        :
                                         :
                Appellant                :   No. 1645 WDA 2016

            Appeal from the Order Entered September 28, 2016,
            in the Court of Common Pleas of Armstrong County,
                  Civil Division at No(s): 2011-1815-CIVIL

LINDA M. FRY,                            :   IN THE SUPERIOR COURT OF
                                         :         PENNSYLVANIA
                Appellant                :
                                         :
                   v.                    :
                                         :
DANIEL JAMES FRY,                        :
                                         :
                Appellee                 :   No. 1646 WDA 2016

            Appeal from the Order Entered September 28, 2016,
            in the Court of Common Pleas of Armstrong County,
                   Civil Division at No(s): 2011-1815-Civil

BEFORE:    STABILE, J., FORD ELLIOTT, P.J.E., and STRASSBURGER,* J.

MEMORANDUM BY STRASSBURGER, J.:              FILED SEPTEMBER 12, 2017

      Linda M. Fry (Wife) and Daniel James Fry (Husband) appeal from the

order entered September 28, 2016, which decreed that the two of them

were divorced and ordered equitable distribution of the marital property. We

affirm.

*Retired Senior Judge assigned to the Superior Court.
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        We provide the following background. On August 27, 1996, three days

before their marriage, Husband and Wife signed a pre-nuptial agreement

(the Agreement).      The Agreement provided for disposition of the marital

assets in the event of the termination of the parties’ marriage. See Petition

for Special Relief, 11/22/2011, at Exhibit A.    Specifically, the Agreement

provided for numerous items of separate property, which would be excluded

from being considered as marital property, and therefore not subject to

equitable distribution in the event of divorce. Id.        Wife came into the

marriage with significantly more separate property than Husband, including

three businesses which she owned and from which she earned a living.1

        The parties married on August 30, 1996.2       In 2002, the parties

purchased land for the purpose of building a home. Over the course of the

next three years, their home was constructed. They resided there together

until Husband moved out on September 29, 2011. When Husband moved

out of the marital residence, he left without Wife’s knowledge while she was

away on a trip. According to Wife, when she returned, she found “a stripped

house” with “no furniture.” N.T., 8/10/2015, at 29. “Everything was gone.”

Id.

1
  Wife’s businesses were “Infiniti Health Market, Knepshield & Bielek Tax
Service, and [an] Accupressure Therapist business.” Trial Court Opinion,
9/28/2016, at 5 n.1.
2
    This marriage was Wife’s second and Husband’s third.

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      On    November   14,   2011,   Wife    filed   a   complaint   for   divorce.

Additionally, on November 22, 2011, Wife filed a petition for special relief

asking the trial court enter an order requiring Husband to return separate

property he removed from the marital residence when he moved out.               On

January 6, 2012, the trial court entered an order directing that Husband

return certain items to Wife, including “[a]ll business records and income tax

returns.” Order, 1/6/2012, at ¶ 1(D).       On January 24, 2012, Wife filed a

petition for contempt averring that Husband had not yet returned certain

items, including the business records and tax returns.

      On February 13, 2012, after a hearing, the trial court found Husband

in civil contempt. Litigation over the return of various documents as well as

contested items of separate property occurred throughout 2012.                  On

December 12, 2012, the trial court again found Husband in civil contempt.

After the filing and dismissal of a fourth motion for contempt, the trial court

ordered the appointment of master to resolve the issues between Husband

and Wife.

      After holding hearings, on February 5, 2016 the master issued a report

and recommendation for an equitable distribution scheme consistent with

the Agreement. A significant amount of the litigation was spent concerning

the marital residence and whether Wife’s contributions to its construction

rendered it her separate property.

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      The master made the following factual findings with respect to the

residence.   On October 19, 2004, the marital residence had an appraised

value of $850,000. Master’s Report, 2/5/2016, at ¶ 14. On June 4, 2015,

the marital residence’s appraised value was only $500,000. Id.        Between

2002 and 2008, the parties spent $853,309.06 on the construction of the

marital residence and the purchase of “equipment, furnishings, and

appliances” for the marital residence. Id. at ¶ 17.    The master concluded

that 90% of these funds were provided by Wife from her separate property.

As of October 1, 2011, the combined mortgage and line of credit for the

marital residence was $377,759.37. Id. at ¶ 18. While the parties resided

together, Husband made the mortgage and line of credit payments. Id.

      The master concluded that at the time of separation, the property had

equity of $110,000.    The master also concluded that between 2002 and

2008, Wife spent $135,574.13 of her separate funds on “plumbing,

electrical, lumber/structure, and heating” for the property. Id. at ¶ II(A).

Thus, the master concluded that these expenditures “wipe[d] out the equity

in the marital residence” and therefore the martial residence “and all equity”

were awarded to Wife. Id.

      The parties also litigated several other issues. Specifically, the master

ordered Husband to pay Wife several amounts for property purchased by

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Wife during the marriage,3 as well as $44,941.87 for counsel fees, and

$15,200 for pre-marital expenses that were provided for in the Agreement.

      Husband filed exceptions, and on September 28, 2016, the trial court

issued an opinion and order.     Relevantly, the trial court concluded “the

[m]aster erred in finding that the [$853,309.06 in] funds constituted

[Wife’s] ‘separate property’ under the terms of the [A]greement.” Trial Court

Opinion, 9/28/2016, at 6. Although the trial court reached this conclusion, it

still awarded the marital residence to Wife.     Additionally, the trial court

reduced Husband’s counsel fees payment to Wife to $15,000.4        Moreover,

the trial court, after doing numerous calculations, concluded that Husband

owed Wife $25,400 total, which was significantly less than the amount

ordered by the master.5

      Both Husband and Wife filed notices of appeal, and the trial court and

parties complied with Pa.R.A.P. 1925. Husband and Wife set forth numerous

3
   Husband was ordered to pay Wife $31,875 for “personal property
purchased during the marriage that [was] paid for out of [Wife’s] separate
funds that have been retained by [Husband].” Master’s Order, 2/5/2016, at
¶ 8. The master valued all marital property at $89,330.90, which, on a 50-
50 split provided $44,665.45 to each party. Husband’s share included
$35,000 worth of guns and ammunition and $9,665.45 in property retained
by Husband. Husband was ordered to return $14,264.45 worth of property
to Wife and pay Wife $30,401.
4
 Husband had already paid $5,000, so the net amount owed to Wife was
$10,000.
5
  The trial court accepted the master’s conclusion that the guns and
ammunition were marital property valued at $35,000. However, the trial
court concluded the master undervalued the amount of separate property
removed by Husband when he moved out of the marital residence.

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issues for our consideration, which we narrow down to three topics: 1) the

marital residence, 2) amount payable to Wife, and 3) counsel fees.6

      We review all of the issues mindful of the following principles.

      It is well established that absent an abuse of discretion on the
      part of the trial court, we will not reverse an award of equitable
      distribution. [In addition,] when reviewing the record of the
      proceedings, we are guided by the fact that trial courts have
      broad equitable powers to effectuate [economic] justice and we
      will find an abuse of discretion only if the trial court misapplied
      the laws or failed to follow proper legal procedures. [Further,]
      the finder of fact is free to believe all, part, or none of the
      evidence and the Superior Court will not disturb the credibility
      determinations of the court below.

Lee v. Lee, 978 A.2d 380, 382-83 (Pa. Super. 2009) (quoting Anzalone v.

Anzalone, 835 A.2d 773, 780 (Pa. Super. 2003)).           Additionally, we are

cognizant that “a pre-nuptial agreement is a contract and, therefore, is to be

evaluated under the same criteria as other contracts; absent fraud,

misrepresentation or duress, spouses should be held to the terms of their

agreements.” Lugg v. Lugg, 64 A.3d 1109, 1112 (Pa. Super. 2013). “When

interpreting an antenuptial agreement, the court must determine the

6
  In reviewing the briefs of Wife and Husband, we admonish both for their
failure to comply with Pa.R.A.P. 2119(a), which provides that “[t]he
argument shall be divided into as many parts as there are questions to be
argued[.]” Wife’s brief sets forth 10 separate questions in her statement of
questions involved, see Wife’s Brief at 8-9, but provides no numbering
system whatsoever in her argument section, see id. at 14-27. Similarly,
Husband sets forth six questions in his statement of questions involved, see
Husband’s Brief at 1, but divides his argument section into four sections,
see id. at 5-12.        “While this Court is authorized to [dismiss] a
nonconforming brief,” we decline to do so where the “procedural misstep[s]
do[] not substantially impede our ability to perform appellate review.” M.G.
v. L.D., 155 A.3d 1083, 1099 (Pa. Super. 2017).

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intention of the parties.” Sabad v. Fessenden, 825 A.2d 682, 688 (Pa.

Super. 2003). “When the words of a contract are clear and unambiguous,

the intent of the parties is to be discovered from the express language of the

agreement. Where ambiguity exists, however, the courts are free to

construe the terms against the drafter and to consider extrinsic evidence in

so doing.” Id (internal citations and quotation marks omitted).

I. Marital Residence

      Wife first contends that the trial court erred or abused its discretion in

interpreting   the    Agreement    by   attributing   income   earned   from   her

businesses, which she contributed to the building of the marital residence,

as marital property when it is her position that this income should have been

treated as separate property. See Wife’s Brief at 14-20.            The relevant

portions of the Agreement provide the following.

                     Article II. Retention of Separate Property

            A. Each party shall, during his or her remaining lifetime,
      retain the sole and exclusive ownership of all of his or her
      respective Separate Property, as that term is hereinafter
      defined, …

            B. For all purposes of this [Agreement] as used herein,
      the term “Separate Property” shall be defined as, all of such
      party’s right, title and interest, legal or beneficial, in and to any
      and all property and interests in property, real, personal titled,
      or mixed, wherever situate and regardless of how titled, which
      each of the parties owned or had a beneficial, legal expectancy
      interest in at the time of their marriage …

            C. “Separate Property” shall also be defined as: (a)
      all income, capital gain or increase or appreciation in value of
      all property, defined above; (b) all property acquired hereafter

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     by either party out of the proceeds from the sale, transfer,
     conveyance, mortgaging or use of such separate property; (c)
     any interest presently held in a “Business.” “Business” for
     purposes of this [Agreement] shall mean an entity, whether a
     partnership, sole proprietorship, corporation, joint venture or
     otherwise, and whether or not the party is actively engaged
     therein; (d) any life insurance proceeds received by either party
     as a beneficiary of any insurance at the time of the death of any
     third party whether the proceeds are received prior to or during
     the marriage….

                            Article III. Marital Property

           Except as specifically set forth in this [Agreement], all
     assets acquired in joint names by the parties from the date of
     their marriage to the date of their separation shall be marital
     property.

           Notwithstanding this provision, however, it is expressly
     agreed that in the event that any of the parties’ separate
     property, commingled with marital property, is used to
     acquire or maintain marital assets, then, to the extent
     that the separate property so commingled or contributed
     is traceable, that traceable separate property shall remain
     the separate property of the party contributing same in
     the event of divorce or death or either party.

Petition for Special Relief, 11/22/2011, at Exhibit A (emphasis added).

     The    trial   court   offered   the     following     conclusions   about   the

interpretation of this Agreement.

           In fashioning his recommendations, the [m]aster traced
     $853,309.06 paid by [Wife] via one or more of her three
     businesses toward the costs of constructing and furnishing the
     marital [residence]. The [m]aster did likewise for the purchase
     of additional items of personalty that were made from time to
     time after the parties married but before they separated. The
     effect of the tracing was to substantially decrease the amount of
     marital property that was subject to equitable distribution.

          In so doing, the [m]aster interpreted the second
     paragraph of Article III as requiring him to do so. In the case of

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     the marital home, the [m]aster found that the above-mentioned
     expenditure of $853,309.06 came “from [Wife’s] separate
     funds.” In the case of the additional items of personalty, the
     [m]aster found that the purchase money was not “from joint
     funds”; in other words, the money came from [Wife’s] business
     accounts.

           [Wife] testified that all these expenditures were, at the end
     of each year, treated like a “draw.”

           For the reasons explained below, [the trial court] believes
     that the [m]aster erred in finding that the funds constituted
     [Wife’s] “separate property” under the terms of the
     [Agreement].

           Article III of the [A]greement does indeed provide that
     separate property, when used to acquire what would otherwise
     be marital property, remains separate property to the extent it is
     traceable. However, the [m]aster incorrectly labeled the draws
     or payments from [Wife’s] business accounts as “separate
     property” defined in Article II.

                                    ***

     Nowhere is earned income, like salary, wages, or sole
     proprietorship or partnership profits, defined to be separate
     property.

           The word “income” in Article II’s phrase “all income and
     capital gain, or increase in value of such property” refers to
     income generated by the property. (Examples of such income
     would be rent paid by tenants; royalties paid by a natural gas
     well operator to the landowner; dividends paid to a shareholder;
     interest paid by a back to the owner of a certificate of deposit;
     royalties paid for intellectual property, such as a patent; etc.)
     Capital gain derives from ownership of property; appreciation in
     value derives from ownership of property. Therefore, income as
     the term is used in Article II, must also be income deriving from
     ownership of property.

           The conclusion that post-marriage, pre-separation earned
     income is not separate property and therefore not protected
     from being labeled as marital property, is buttressed by the fact
     that the prenuptial agreement could have easily contained a

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         crystal clear provision such as “All of [Wife’s] earned income []
         received after the date of marriage, together with all assets or
         property, real, personal or mixed, purchased or acquired with
         such income to the extent it is traceable, will be considered to be
         separate property.”

Trial Court Opinion, 9/28/2016, at 6-8.

         Wife suggests these conclusions are wrong in a number of respects.

According to Wife, it was the intent of the parties to “protect all aspects of

her separately-owned businesses.” Wife’s Brief at 15. She further contends

that there was no ambiguity in the meaning of the term “income” and

therefore the trial court erred in conducting an analysis of the term. Id. at

17-18. Husband responds that “if [Wife’s] interpretation of the Agreement

on this matter were to be followed through, the result would be that [Wife]

would get 100% of what she earned during the marriage plus she would get

50% of what [Husband] earned during the marriage.” Husband’s Brief at 6.

         Instantly, we conclude the trial court did not err in finding that there

was an ambiguity in the word “income” in the Agreement as it was not

defined by the parties and could be subject to different meanings.

Moreover, we discern no error or abuse of discretion in the trial court’s

interpretation of income and subsequent conclusion that the martial

residence is martial property.7      Thus, Wife is not entitled to relief on this

basis.

7
  We are cognizant of the trial court’s conclusion that “the parties each lost a
ton of money by building a house for more than its fair market value.” Trial
Court Opinion, 9/28/2016, at 8.

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II. Amount Payable to Wife

      Husband sets forth several arguments with respect to the equitable

distribution order and the amount of money he owes to Wife. Husband’s

Brief at 10-12.   He contends the trial court erred in its interpretation of

Article VIII of the Agreement, which provides the following.

      Article VIII.   Possible   Termination   of Marriage: Equitable
      Distribution

            A.  In the event that the marriage of the parties is
      terminated for any reason by a divorce, dissolution or
      annulment, [Wife] and [Husband] specifically agree as follows:

                  1. [Husband] shall not be entitled to receive from
      [Wife] any share of her Separate Property….

                 2.  [Wife] shall not be entitled to receive from
      [Husband] any share of his Separate Property….

                  3. Except as provided in this [Agreement], any
      marital assets as defined by Article III, herein, shall be divided
      equally by the parties upon divorce as the only Equitable
      Distribution that the parties would be entitled to upon divorce.
      Neither shall make any claims to or be entitled to any portion of
      the other’s solely owned Separate Property as that term has
      been defined in this [Agreement]. Further, upon divorce
      [Husband] shall pay to [Wife] the lump sum of
      $10,200.00 in full satisfaction of the note payable to
      [Wife] in the aforementioned amount as executed by
      [Husband]. Finally, it is further agreed that upon divorce
      [Husband] shall pay to [Wife] the lump sum of $5,000.00
      in full satisfaction of her monetary contribution to the
      improvement of [Husband’s] residence….

Petition for Special Relief, 11/22/2011, at Exhibit A (emphasis added).

      Included in its calculations, the trial court held that Husband owed

Wife, in addition to the $15,200 provided in Article VIII, $13,200 from a

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promissory note. Trial Court Opinion, 9/28/2016, at 16. Husband contends

that Wife failed to present sufficient evidence that she had a note for

$13,200. Husband’s Brief at 11 (“Strangely, [Wife], who is obsessive and

fastidious in the keeping of her records only provided a copy of one Note [for

$15,200] as part of her exhibits.”).

      In considering this issue, all parties acknowledge that the Agreement

is clear that Wife is entitled to a $15,200 payment from Husband. The issue

then is whether this $13,200 is an additional promissory note, as Wife

claimed, or whether it does not exist at all, as Husband argues.

      Wife offered the following testimony at the hearing.         She testified

about a “demand note to [Husband]” for money he owes to her for “several

credit cards that he was trying to pay on and the interest was more than he

was actually paying.” N.T., 8/10/2015, at 108-09.     According to Wife, she

paid off Husband’s credit cards prior to marriage in the amount of $13,200.

She testified that Husband owes her that principal, plus approximately

$17,000 in interest. Wife further testified that this $13,200 was a separate

note from the “$10,200 in cash [she] gave [Husband] for different items.”

Id. at 112.    Wife also stated that she did not put the $13,200 in the

Agreement because she already had a promissory note. Id. Based on the

foregoing, we hold that the trial court did not err by including the $13,200

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amount as being owed from Husband to Wife in the equitable distribution

award.8 Thus, Husband is not entitled to relief.

        Husband also contends the trial court erred by not giving him credit for

“$22,000 worth of guns that he owned prior to the parties’ marriage.”9 See

Husband’s Brief at 12. With respect to this issue, the trial court opined as

follows.

        [Husband] failed to adduce any credible proof as to which
        specific guns and ammunition were nonmarital property. It is
        especially noteworthy that [Husband] did not specifically list any
        guns or ammunition as separate property in the [Agreement].
        In contrast, [Wife] testified that the guns and ammunition were
        purchased during the marriage. The master and [the trial court]
        found that [Wife] was credible and [Husband] was not.

Trial Court Opinion, 1/6/2017, at 1-2.

        “[I]t is within the province of the trial court to weigh the evidence and

decide credibility and this Court will not reverse those determinations so long

as they are supported by the evidence.” Morgante v. Morgante, 119 A.3d

382, 387 (Pa. Super. 2015).            Instantly, Wife testified that Husband

purchased guns and ammunition during the marriage. See N.T., 8/10/2015,

at 123-24.      Husband even acknowledged that “[s]ome of the rifles and

pistols are” marital property. Id. at 195. Thus, we discern no error or abuse

of discretion by the trial court and conclude that Husband is not entitled to

relief on this basis.

8
    The trial court did not award Wife any interest on this note.
9
    Wife does not respond to this argument.

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III. Counsel Fees

      Finally, both Husband and Wife complain about the trial court’s award

with respect to the amount of counsel fees payable from Husband to Wife.

See Wife’s Brief at 20-27 (complaining that the trial court erred by not

awarding her the full amount of counsel fees for Husband’s breach of the

Agreement as the master did); Husband’s Brief at 8-10 (complaining that

the trial court erred by requiring him to pay any part of Wife’s counsel fees).

      We review an award of counsel fees mindful of the following.

      Our standard of review of the award of counsel fees pursuant to
      the Domestic Relations Code is for an abuse of discretion. An
      abuse of discretion is [n]ot merely an error of judgment, but if in
      reaching a conclusion[,] the law is overridden or misapplied, or
      the judgment exercised is manifestly unreasonable, or the result
      of partiality, prejudice, bias or ill-will, as shown by the evidence
      of record. [R]eview of the grant of counsel fees is limited ... and
      we will reverse only upon a showing of plain error.

Habjan v. Habjan, 73 A.3d 630, 642 (Pa. Super. 2013) (citing Kraisinger

v. Kraisinger, 34 A.3d 168, 175 (Pa. Super. 2011)) (internal citations and

quotation marks omitted).

      In this case, we also evaluate the award of counsel fees in light of the

Agreement, which provides the following:

      Article XI. Waiver of Alimony, Alimony Pendente Lite
      and/or Spousal Support

      A. [] [Wife] and [Husband] agree as follows: that neither will be
      required to pay any spousal support, alimony pendente lite or
      alimony, counsel fees, costs or expenses to the other.

                                      ***

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      Article XIV. Default

            If either party defaults in the due performance of any of
      the terms or conditions of this [Agreement], the non-defaulting
      party shall recover his or her entire legal fees, costs and
      expenses incurred to cure any such default. It is the intention of
      the parties hereto that the non-defaulting party should not be
      required to pay legal fees, costs and expenses to enforce or
      defend this [Agreement].

Petition for Special Relief, 11/22/2011, at Exhibit A.

      In considering the Agreement, the divorce code provides that

      [a] party to an agreement regarding matters within the
      jurisdiction of the court under this part, whether or not the
      agreement has been merged or incorporated into the decree,
      may utilize a remedy or sanction set forth in this part to enforce
      the agreement to the same extent as though the agreement had
      been an order of the court except as provided to the contrary in
      the agreement.

23 Pa.C.S. § 3105(a). In addition, the divorce code provides specifically for

the award of counsel fees:     “If, at any time, a party has failed to comply

with … the terms of an agreement as entered into between the parties, after

hearing, the court may, in addition to any other remedy available under this

part, in order to effect compliance with its order … award counsel fees and

costs.” 23 Pa.C.S. § 3502(e)(7).

      The trial court offered the following in support of its conclusion that

Husband was required to pay counsel fees to Wife.

           In September 2011, [Wife] returned to her own home from
      a vacation trip with her parents. [Husband] had remained at
      home. [Wife] found the home stripped of most of its contents.
      These contents included 30 to 40 totes (lidded plastic containers
      about the size of a laundry basket). The totes contained [Wife’s]
      meticulously kept personal and business records, financial and

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     otherwise, including patient records. This Court made a finding
     in a contempt hearing several years ago that [Husband]
     removed these records in order to make it difficult for [Wife] to
     establish that most of the assets were purchased with her
     separate property.     [Husband] took the records with full
     knowledge of their importance under the terms of the prenuptial
     agreement.
                                    ***

     The docket of this divorce proceeding indicates that [Wife],
     through counsel, filed petitions for special relief or petitions for
     contempt on November 22, 2011; January 24, 2012; July 10,
     2012; August 9, 2012; and February 24, 20[13]. Counsel for
     [Wife] appeared for the sundry hearings well prepared. These
     hearings were caused by [Husband’s] “heist” of personalty in
     September 2011 and his refusals to surrender the important
     records to [Wife].

           The [m]aster awarded counsel fees to [Wife] in the
     amount of $44,941.76.        ([Wife’s] total legal fees were
     $49,941.76, but [Husband] had already paid $5,000 toward
     them to purge himself of a prior finding of civil contempt.)
     [Wife’s] lead counsel charged at a rate of $275.00 per [hour].
     Associate counsel’s hourly rate was $175.00 per hour. [Wife]
     concedes that some fees would have been incurred even if the
     divorce proceedings had been less contentious.

            [Husband] argues that the total fees are unreasonable
     because [Wife’s] lawyers were “high-priced” and “from a
     different county.” There is no evidence in the record to support
     the assertion of unreasonableness.

           The [c]ourt recognizes that there were some very real
     issues in the instant case, over and above those that resulted in
     the filings mentioned above.       For this reason, the [c]ourt
     concludes that $15,000 better reflects the legal fees incurred as
     a result of [Husband’s] vexatious behavior early in the case,
     $5,000 of which had already been paid.

Trial Court Opinion, 9/28/2016, at 9-11.

     Based upon the foregoing, and contrary to Husband’s assertions, the

Agreement does not prevent the trial court from awarding any counsel fees

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to Wife. Moreover, we agree with the trial court that it was proper to hold

Husband responsible for the portion of Wife’s counsel fees that were due to

his contemptuous behavior. Additionally, contrary to Wife’s assertions, the

default provision, Article XIV of the Agreement, does not require Husband to

pay all of Wife’s counsel fees under these circumstances. Instead, we hold

that the trial court did not err or abuse its discretion by requiring Husband to

pay that portion of counsel fees that resulted from his actions. Therefore,

neither Husband nor Wife is entitled to relief.

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 9/12/2017

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