Court Opinion

ID: 9362923
Source: CourtListenerOpinion
Date Created: 2023-01-13 15:09:06.512209+00
Date Added: 2024-06-11T17:15:26.460352
License: Public Domain

RENDERED: JANUARY 6, 2023; 10:00 A.M.
                         NOT TO BE PUBLISHED

                  Commonwealth of Kentucky
                             Court of Appeals

                                NO. 2020-CA-1507-MR

JULIE WERNER (FKA JULIE CROWE)                                            APPELLANT

                   APPEAL FROM DAVIESS FAMILY COURT
v.                 HONORABLE JOHN M. MCCARTY, JUDGE
                          ACTION NO. 17-CI-00039

MICHAEL JAMES CROWE                                                          APPELLEE

                                       OPINION
                                      AFFIRMING

                                     ** ** ** ** **

BEFORE: ACREE, DIXON, AND K. THOMPSON,1 JUDGES.

THOMPSON, K., JUDGE: Julie Werner (FKA Julie Crowe) appeals two orders of

the Daviess Family Court. The first order, entered March 26, 2020, denied her

Kentucky Rules of Civil Procedure (CR) 60.02 motion to set aside the family

court’s decree regarding Werner’s division of marital property with her now ex-

1
 Judge Kelly Thompson authored this Opinion before his tenure with the Kentucky Court of
Appeals expired on December 31, 2022. Release of this Opinion was delayed by administrative
handling.
husband, appellee Michael James Crowe. The second order, entered October 23,

2020, denied Werner’s additional motion for a declaration of rights regarding two

Merrill Lynch accounts which were not divided in the decree. We affirm because

it was not unconscionable for the family court to rely on the parties’ waiver of their

rights in agreeing to the property settlement without more judicial oversight,

Werner has not alleged fraud but rather appears to “second-guess” the wisdom of

entering into a property settlement agreement and waiving her additional rights to

judicial oversight, and the parties consented to Merrill Lynch accounts being

awarded to Crowe.

             On January 11, 2017, Werner filed a verified petition in family court

to dissolve her marriage with Crowe. Crowe answered shortly afterward, and

nothing more was filed over the course of roughly the next sixteen months. At all

relevant times, both parties were represented by counsel.

             On July 11, 2018, Werner and Crowe then filed of record: (1) sworn

answers to one another’s discovery interrogatories; (2) a verified property

settlement agreement (PSA); (3) a joint motion for the entry of a decree dissolving

their marriage and incorporating their PSA; and (4) a joint, verified

acknowledgement and motion for waiver indicating that they “waived exchanging

signed and notarized Verified Disclosure Statements,” “the filing of verified

disclosures with the record,” and “the right to a final hearing and further

                                         -2-
proceedings.” Later that month, the family court granted their motions; it also

entered a dissolution decree incorporating their PSA, finding it to be “not

unconscionable.”

             Roughly a year later, Werner filed a CR 60.02 motion arguing the

PSA was unconscionable and that the family court erred in failing to so rule. She

sought to have the PSA and the decree incorporating it either set aside or modified.

             The family court denied Werner’s motion. Werner now appeals,

arguing: (1) the family court should have set aside the decree pursuant to CR

60.02 because (a) the family court failed to follow its statutory mandate to

determine the conscionability of the PSA; and (b) Crowe’s out of court conduct

amounted to “fraud affecting the proceedings”; or, alternatively, (2) that the family

court had no jurisdiction to effect a post-decree modification of her property

division with Crowe that encompassed two Merrill Lynch accounts that were not

addressed in the PSA.

             The reopening of a judgment under Kentucky law is governed by CR

60.02. Relief under CR 60.02 is exceptional and is to be granted cautiously and

available “only under the most unusual and compelling circumstances.” Age v.

Age, 340 S.W.3d 88, 94 (Ky. App. 2011). The decision to grant or to deny a CR

60.02 motion lies within the sound discretion of the family court and we will not

disturb its decision absent an abuse of that discretion. Age, 340 S.W.3d at 94.

                                         -3-
Only a decision that is “arbitrary, unreasonable, unfair, or unsupported by sound

legal principles” constitutes an abuse of discretion. Id. (quoting Commonwealth v.

English, 993 S.W.2d 941, 945 (Ky. 1999)).

             In relevant part, CR 60.02 sets forth six grounds upon which relief

from a final judgment may be granted. Werner does not connect what she alleges

were procedural errors with any specific ground identified in CR 60.02. In her

appellate brief, she summarizes her argument as follows:

             The Trial Court failed to follow its statutory mandate
             under [Kentucky Revised Statutes] KRS 403.180 to
             determine the conscionability of the parties’ PSA as it
             was legally and factually impossible to do so given the
             failure of the parties to neither exchange and file
             mandatory preliminary verified disclosure statements nor
             final verified disclosure statements.

             However, Werner’s arguments that the family court “failed to follow

its statutory mandate” and did something “legally and factually impossible”

involved facts that should have been known to her prior to when she asked the

family court to approve her PSA with Crowe and enter its decree. Accordingly,

these are issues she could have raised in a direct appeal; and it is well-established

that CR 60.02 relief is only available for issues that could not be raised in a direct

appeal. McQueen v. Commonwealth, 948 S.W.2d 415 (Ky. 1997). Indeed, Werner

devotes much of her brief to the premise that the family court’s assessment of

“conscionability” was indicative of “clear error,” which is not a ground for relief

                                          -4-
under CR 60.02, but rather a standard that would have applied to direct appellate

review of the family court’s decree. See CR 52.01.

             To the extent Werner’s argument in this vein could involve any of the

CR 60.02 grounds, it at most appears to implicate subsection (e), which permits a

trial court to vacate a “void” judgment. However, Werner cites no authority – and

we have found none – favoring the proposition that insufficiency of evidence

supporting an unconscionability determination or the failure to file or exchange

verified disclosure statements can render a property division decree void.

             Kentucky encourages the amicable resolution of a divorce action by

settlement agreement. KRS 403.250(1) provides that such agreements

incorporated into a decree of dissolution of marriage “may not be revoked or

modified, unless the court finds the existence of conditions that justify the

reopening of a judgment under the laws of this state.”

             Pursuant to KRS 403.180, a family court must determine whether a

property settlement agreement “is unconscionable prior to approval of that

agreement.” Peterson v. Peterson, 583 S.W.2d 707, 711 (Ky. App. 1979).

However, making such a determination in the context of an uncontested divorce

proceeding can lead to an issue:

             In such cases, the trial court is presented with an
             agreement which, on its face at least, appears to be
             reasonable. Since the dissolution proceeding is
             “uncontested,” the parties offer no proof of economic

                                         -5-
             circumstances. Although the trial court could request
             such proof on its own motion, KRS 403.180 does not
             require it to do so. Such a request is apparently rare,
             perhaps because the court views the case as agreed. The
             trial court then approves the agreement as conscionable
             without really knowing the underlying facts. Sometime
             thereafter, the silent party appeals to this Court for relief
             contending that the agreement is unconscionable and that
             the trial court erred in failing to so rule.

Id.

             When the family court assessed the conscionability of the parties’

PSA, nothing in KRS 403.180 prohibited it from simply relying upon the parties’

sworn interrogatory answers and statements set forth in the PSA, all of which

supported their joint assertion that their division of property was not

unconscionable. The dissolution proceeding was uncontested, and the parties

offered all required necessary proof regarding their respective economic

circumstances.

             Likewise, regarding Werner’s point about “the failure of the parties to

neither exchange and file mandatory preliminary verified disclosure statements nor

final verified disclosure statements,” Werner explicitly waived exchanging verified

disclosure statements with Crowe, and the family court was authorized to grant her

motion to further waive the filing of verified disclosures with the record. See

Kentucky Family Court Rules of Procedure and Practice (FCRPP) 2(1)(e)

(permitting the family court to enter an order permitting the parties to not file a

                                          -6-
Final Verified Disclosure Statement); see also FCRPP 2(3) (providing that

Preliminary Mandatory Disclosures “shall not be filed in the record unless ordered

by the court or required by local rule.”).2 In short, Werner presents nothing in this

respect indicating the family court committed error that would subject its final

decree to collateral attack through a CR 60.02 motion.

               Werner’s second argument relative to CR 60.02 is that the decree

regarding her division of property with Crowe should be set aside due to Crowe’s

out-of-court conduct, which she contends amounted to “fraud affecting the

proceedings” – a ground CR 60.02(d) encompasses. Regarding this aspect of the

CR 60.02 motion she filed below, Werner asserted that several months after the

family court entered its decree incorporating her PSA with Crowe, she came to

2
  In her brief, Werner notes that the local rules of at least one judicial circuit in Kentucky
specifically require parties to file verified disclosure statements with the record. She emphasizes
that the 14th Family Court Rules of Procedure (14th FCR) 701 of the Bourbon, Scott, and
Woodford Family Court provides, in relevant part, that:

       A Preliminary Verified Disclosure Statement, Form AOC-238, shall never be
       waived. If the parties enter into a settlement agreement, each shall attach to the
       agreement a copy of a completed Preliminary Verified Disclosure Statement,
       Form AOC-238 for consideration by the Court assessing the conscionability of
       the terms of the agreement.

Her point is irrelevant. This action was resolved in Daviess Family Court, and the only local rule
relating to FCRPP 2, Rules of the Daviess Circuit Court (RDCC) 506, provides in relevant part:

       If the parties reach an agreement on all issues, a decree of dissolution may be
       obtained without a hearing by filing a motion or agreed order to submit for decree
       of dissolution of marriage. Counsel shall comply with FCRPP 2 and 3 and file the
       documents with the Clerk for entry[.]

It does not require the filing of any verified disclosure statement before an agreed decree
of dissolution may be obtained.

                                                -7-
believe Crowe had concealed or undervalued marital assets. She argued that if

Crowe had in fact done so, then he had fraudulently induced her to enter the PSA.

The word “if” is emphasized for a reason: because the parties conducted no formal

discovery prior to settling their division of marital property, Werner remained

uncertain whether Crowe had undervalued or concealed any assets. Instead, as

Werner set forth in her CR 60.02 motion, she had “grave suspicions.” In the

relevant part of her motion, she argued:

                    The parties’ PSA appears to be unconscionable,
             but this Court cannot be certain without knowing the
             extent of the parties’ marital and nonmarital estate.

             ...

             At a minimum, this Court must require these parties to
             submit verified financial disclosures, which set values on
             the numerous business entities and the assets held within
             each. Without this information, the Court cannot
             possibly decide whether the parties’ PSA is conscionable.

                    On its face, the PSA may appear as a conscionable
             agreement because Ms. Werner received a multimillion
             dollar share of the marital estate. However, without
             verified disclosure statements before it, the court still
             could not determine whether the agreement was
             conscionable. Ms. Werner has grave suspicions that the
             agreement was unconscionable since Dr. Crowe retained
             100% of Owensboro Dermatology Associates, P.S.C.;
             Dermatology Property Management, LLC; and Microcap
             Insurance Company, Inc., and none of those businesses
             were ever valued by Dr. Crowe under oath for this
             Court’s review. Vicky Lang, a certified public
             accountant who is accredited in Business Valuation by
             the American Institute of Certified Accountants was

                                           -8-
recently retained by Ms. Werner. Exhibit B – Vicky
Lange’s Resume. Having reviewed the 2016 income tax
return for Owensboro Dermatology Associates, P.S.C.,
Vicky Lange found as follows:

             Given that the revenues of the
      dermatology practice approximated $9.7
      million and wages to staff exceeded $3.1
      million, this is a very large practice with
      multiple non-physician owner services
      providers, such as nurse practitioners
      providing direct patient care and procedures.
      In dermatology practices, procedures such as
      BOTOX are often performed by nurse
      practitioners and other mid-level providers.

             The large practice revenues and
      salaries suggest that a portion of Owensboro
      Dermatology PSC’s goodwill is enterprise
      goodwill.

             Another indication of value pertains
      to fact [sic] that the practice owns
      depreciable assets (equipment, fixtures,
      improvements, etc.) with a cost (or other
      depreciable basis) of $4,226,477) (Schedule
      L, line 10a). This is an indication that the
      practice likely has a tangible value in
      addition to the goodwill value.

       Exhibit C – Vicky Lange’s Affidavit. Further,
Dr. Crowe was allotted $253,672 of income from
Dermatology Property Management in 2016, alone,
which suggests this asset also has value. In addition,
numerous businesses [sic] entities were not discussed in
the parties’ PSA, and Dr. Crowe has effectively retained
the entire marital interest in same. Vicky Lange’s
affidavit identifies at least six (6) additional businesses
owned by the parties per their 2016 tax return that went

                            -9-
unaddressed in the PSA. Mrs. Lange concluded that the
parties owned the following businesses in 2016:

      a. EXECUTIVE BENEFIT
      INVESTMENTS (Supporting schedule –
      Line 28 of Sch. E)

      b. CROWES NEST CAPTIVE LLC
      (Supporting schedule – Line 28 of Sch. E)

      c. CROWES NESTS INVESTMENTS LLC
      (Ky Form 725)

      d. ADVANCED AESTHETICS LLC (KY
      Form 725)

      e. HENDERSON DEMATOLOGY [sic]
      PLLC (KY Form 725)

      f. ADVANCED AESTHETICS LLC (KY
      Form 725).

      As Ms. Werner’s attached affidavit attests (Exhibit
D), she has had nothing to do with and does not know
what has been done with these assets post-decree. It is
indisputable that she has received nothing from them.

...

By all accounts, Dr. Crowe has retained and controlled
each of these businesses and its assets post decree. It is
unknown both to Ms. Werner and this Court whether
these businesses have any value. As such, on its face, it
appears that this Court likely would not have found the
agreement to be conscionable had it known the true value
of all the marital assets because Dr. Crowe has walked
away with a grossly inequitable share of the marital
estate. Until this Court requires Dr. Crowe to submit a
Final Verified Disclosure, Ms. Werner will not be able to

                           -10-
             adequately and specifically address full [sic] extent of the
             inequitable nature of the PSA.

             To allay her “grave suspicions,” Werner also filed what she styled as a

“motion to permit discovery while 60.02 motion is pending.” There, after largely

restating the substance of her CR 60.02 motion set forth above, she asked the

family court:

             [T]o permit her to conduct discovery and to obtain
             appraisals so that this court can ascertain the values and
             relevant facts of each business entity owned by the
             parties, under oath, at the time of dissolution that either
             were undervalued or undisclosed. Without same, this
             Court could not possibly determine the conscionability of
             the parties’ PSA.

             At a February 17, 2020 hearing, the family court questioned Werner’s

counsel about Werner’s “motion to permit discovery while [a] 60.02 motion is

pending.” It asked whether the goal of her motion was, paradoxically, to reopen

the underlying proceedings for the purpose of allowing Werner to conduct open-

ended discovery that might lead to evidence of fraud which, in turn, might justify

reopening the underlying proceedings based upon fraud. The relevant part of their

exchange was as follows:

             COURT: In essence, what you’re asking me is saying,
             “Please set it aside,” then we’re going to look at it again,
             then – to decide whether or not it should be set aside or
             not.

             COUNSEL: Well, I look at it a little differently. I mean,
             my – and I thought if I were a judge trying to look at this

                                         -11-
             case, I’d say, well, tell me what I – you keep telling me
             what I should have had when the decision of
             conscionability was made, and so if we took a little
             discovery, we could tell the court. This is what you
             would have had or should have had when the decision
             was made, although I understand, of course, you were not
             part of that. But you at least have a list of assets under
             oath so we know that there’s not a million dollars in a
             foreign country, for example. I don’t think there is. I
             don’t want to imply that there is, but you at least have a
             list of assets with people swearing to a complete
             disclosure, and then you would have some discovery that
             would – through documentation, would provide the
             numbers so that you could do a comparison and say,
             “Yes, this was conscionable,” or “This was not
             conscionable at the time.” “Yes, there was
             misrepresentation” or “there wasn’t a misrepresentation.”
             I think that would be helpful.

             In summary, Werner acknowledged that during her roughly sixteen

months of pre-settlement negotiations with Crowe, while she was represented by

counsel, Crowe had provided her documentation regarding the extent of their

marital estate, and that she had never questioned it or otherwise sought formal

discovery. Werner also recognized that in the interrogatories and verified

acknowledgement she filed with the family court prior to its final decree, she had

sworn under oath that she and Crowe had fully disclosed to one another all

information relevant to their marital assets and debts. Nevertheless, approximately

one year after the family court had resolved the division of their marital estate

through a final decree, Werner then represented to the family court that, contrary to

her pre-decree sworn statement, she had no way of knowing the value of any

                                         -12-
marital assets associated with Crowe’s businesses. Further, Werner represented

that she had hired an accountant to review the documents Crowe had provided her

during their negotiations, as well as the tax return that she had jointly filed with

Crowe in 2016; and the accountant’s resulting opinion had caused her to suspect

Crowe may not have divulged the full extent or proper value of their marital estate

during their pre-settlement negotiations. Therefore, Werner was invoking CR

60.02 to reopen discovery and garner evidence to ascertain, in the words of her

counsel, whether “there was a misrepresentation or there wasn’t a

misrepresentation.”

              Upon consideration, the family court denied Werner’s motion. Before

discussing the substance of its reasoning, however, it is important to revisit what

Werner was required to demonstrate below, and the limitations upon granting this

type of relief:

              A party alleging fraud under CR 60.02(d) has the burden
              of proving, by clear and convincing evidence, that the
              opposing party’s procurement of the court’s prior order
              was achieved by fraud or deceit. See Rice v. Dowell, 322
              S.W.2d 468 (Ky. 1959). The moving party must
              essentially prove that the opposing party’s conduct
              outside of the trial itself somehow prevented the moving
              party from appearing or presenting fully and fairly its
              side of the case. See 7 Ky. Prac. R. Civ. Proc. Ann. Rule
              60.02 (6th ed. 2012).

Ipock v. Ipock, 403 S.W.3d 580, 585 (Ky.App. 2013). Additionally, relief under

CR 60.02:

                                         -13-
             is an extraordinary and residual remedy to correct or
             vacate a judgment upon facts or grounds, not appearing
             on the face of the record and not available by appeal or
             otherwise, which were discovered after the rendition of
             the judgment without fault of the party seeking relief.

Harris v. Commonwealth, 296 S.W.2d 700, 701 (Ky. 1956). The Kentucky

Supreme Court has further stated that:

             The purpose of CR 60.02 is to bring before a court errors
             which (1) had not been put into issue or passed on, and
             (2) were unknown and could not have been known to the
             moving party by the exercise of reasonable diligence and
             in time to have been otherwise presented to the court.

Young v. Edward Technology Group, Inc., 918 S.W.2d 229, 231 (Ky.App. 1995).

If the party pursuing relief under CR 60.02 could have raised the issue prior to

judgment or could have followed the appropriate channels for a direct appeal but

neglected to do so, relief from judgment under CR 60.02 is not available. Board of

Trustees of Policemen’s and Firemen’s Retirement Fund of City of Lexington v.

Nuckolls, 507 S.W.2d 183, 186 (Ky. 1974).

             With that said, the substance of the family court’s ruling, as set forth

in its March 26, 2020 dispositive order, focused upon several points. First,

Werner’s post-decree claim of ignorance about the extent and value of the marital

estate she shared with Crowe conflicted with her pre-decree sworn statements of

record to the contrary. Second, Werner’s complaints about the omissions or

                                         -14-
valuations of the various business entities were matters that could and should have

been raised prior to the entry of the decree. The family court explained:

              [Werner] claimed only three (3) businesses were
              addressed in the PSA, but that she hired an expert CPA
              who found six additional businesses based on the 2016
              tax returns that were not addressed by the PSA and that
              [Crowe] retained 100% of these businesses. However,
              both [Werner] and her attorney had copies of the 2016
              tax returns so they had constructive, if not actual,
              knowledge of these businesses and never said anything
              about them not being listed all during the months of
              negotiations. In addition, [Werner] even made
              corrections and notes on drafts of the PSA and never
              made a note or asked why those other businesses were
              not included or asked that they BE included.

              In her motion, [Werner] also argued that there were no
              values listed for the three businesses that were included
              in the PSA and now claims they were deliberately
              undervalued. However, the Court notes that [Werner’s]
              own expert CPA affidavit cites documents between the
              parties’ attorneys that discuss the value of the
              businesses.[3] Again, she never mentioned this lack of
              valuation in her notes or corrections or additions to the
              PSA drafts and never asked that values be included.

              Third, the family court found Werner failed to carry her burden to

demonstrate Crowe had prevented her from appearing or presenting fully and fairly

her side of the case. In that respect, its analysis addressed Werner’s additional

3
  As indicated, in support of her opinion, Lange (Werner’s expert accountant) examined the
parties’ joint 2016 income tax return, as well as the 2016 income tax return of Owensboro
Dermatology PSC. There is no contention that Werner was not provided these documents prior
to when the family court entered its decree.

                                           -15-
contention, as set forth in her CR 60.02 motion and an accompanying self-serving

affidavit, that she had executed the PSA due to Crowe’s “coercion,” explaining:

            [Werner] does say that she was the victim of undue
            influence and overreaching when it came to her
            agreement to the PSA. She claims [Crowe] pressured her
            into signing, that he would e-mail her directly and tell her
            not agreeing to the PSA would mean “chronic litigation”
            that would hurt her in the long run, and that there would
            be no “large check to buy a house” and that she would
            end up living in a small apartment. She claims he also
            told her that she would never see a “significant payout”
            of their assets for one to two years, and that he copied
            their adult children on these e-mails to try to pressure her
            to agree. She also claims that he tried to cause a rift
            between her and her attorney so that she would disregard
            advice of counsel, that he threatened to withdraw the
            payment check if she did not agree, and said they would
            be forced into “a public, court mandated divorce.”
            [Werner] further claimed in an affidavit that she suffered
            from PTSD and depression, that [Crowe] had always
            been verbally abusive to her, and that he typically used
            their children to manipulate her into doing what he
            wanted.

                   In his Response to [Werner’s] Motion to Vacate,
            [Crowe] makes the point that she was represented by “an
            experienced and very competent family law attorney”
            and received a lump sum of $1,000,000 plus five annual
            payments of $100,000 via a promissory note and no
            marital debt. He argued that neither a preliminary or
            final Verified Disclosure Statement was required to be
            filed in the record and that at any rate, they had both
            agreed to waive the filing. He stated that he had
            provided her with documents relating to all assets,
            including the 2016 tax returns, and he was aided by his
            accountant in this.

            ...

                                       -16-
                   [Crowe] goes on in his Response to cite text
             messages from [Werner] that show she knew about all
             marital assets and even had a copy of a rough draft of the
             PSA where she had made notes and corrections and even
             added in things she wanted included. He notes that
             [Werner] did this herself and sent it to him directly and
             bypassed both attorneys. He argues that they exchanged
             documents and negotiated for sixteen (16) months and
             she had all the information she needed during that time.

             Now on appeal, Werner argues the family court abused its discretion

by refusing to reopen the decree based upon CR 60.02(d) and what she asserted in

her motion in that respect. Werner argues the facts of this case are analogous to

those presented in Terwilliger v. Terwilliger, 64 S.W.3d 816 (Ky. 2002). There,

the Kentucky Supreme Court determined that a decree was properly reopened on

the basis of CR 60.02(d) where, during dissolution proceedings, a husband had

persuaded his wife to (1) proceed without counsel; (2) enter a settlement agreement

that he had drafted; and (3) enter the agreement less than three months after he had

filed the dissolution petition after representing to her that she needed to do so

immediately or risk losing her home to creditors. Id. at 817-18. A decree was

entered consistently with their agreement, and the wife’s share of the marital

property consequently consisted of the marital residence, valued at $67,000 and

subject to a $51,000 mortgage; a vehicle valued at $1,800; $2,550 in other cash and

assets; some stock valued by her husband at $11,000; and $6,000 in credit card

debt. Id. at 817. The husband received ninety percent of the stock of several

                                         -17-
corporations, which he valued at $100,000. Thereafter, in her post-judgment

motion to set aside the decree based upon CR 60.02(d), the wife presented

evidence demonstrating that her husband had knowingly undervalued marital

assets. Specifically, within two weeks of the signing of the settlement agreement

and before the divorce decree was entered, the husband told a potential buyer that

one of the corporations was worth $1.7 million dollars, and after the dissolution

was final, he sold it for $1.6 million. Terwilliger, 64 S.W.3d at 817.

             We disagree, and we find no abuse of the family court’s discretion.

Terwilliger is distinguishable from this case for several reasons. Here, for

example, Werner initiated the underlying divorce proceedings. She was

represented by separate counsel at all relevant times. The evidence of record

demonstrates, as the family court noted, that the PSA Werner entered was a

collaborative endeavor in which she participated. Werner’s decision to enter the

PSA was also not immediate, nor the product of what evidence – as opposed to

speculation or belief – demonstrates was a false threat of insolvency. Indeed, what

Werner presents as evidence of “coercion” or undue influence – namely, Crowe’s

alleged threats of delays, disappointments, or embarrassments that might result

from “chronic litigation” or “a public, court mandated divorce” – cannot be

considered legally sufficient to warrant setting aside a judgment. All parties

considering settlement do so based upon a consideration of the adverse

                                        -18-
consequences that might result if the action proceeds and they do not prevail on the

merits.

             The most critical difference, however, is that in support of her CR

60.02 motion, the wife in Terwilliger presented evidence that her husband had

knowingly undervalued a marital asset during their divorce proceedings to induce

her to enter their property settlement agreement. Werner, on the other hand,

presents only her “grave suspicions” stemming from an expert opinion which

reexamined evidence that had been available to her prior to the family court’s

decree. That is not enough to warrant reopening a decree – or to warrant reopening

discovery to determine whether a decree should be reopened – because fraud is not

presumed, speculation and conjecture are insufficient to warrant CR 60.02 relief,

and a new opinion reexamining previously available evidence is not itself new

evidence capable of invoking the rule. See United Parcel Service Co. v. Rickert,

996 S.W.2d 464 (Ky. 1999) (regarding fraud); Foley v. Commonwealth, 425

S.W.3d 880, 887-88 (Ky. 2014) (explaining “mere speculation or conjecture”

cannot be the basis of CR 60.02 relief).

             Largely illustrating this point is a case the Terwilliger Court discussed

in the context of its analysis, McMurry v. McMurry, 957 S.W.2d 731 (Ky.App.

1997). See Terwilliger, 64 S.W.3d at 819. There, Mrs. McMurry’s CR 60.02(d)

motion to reopen was found to have been properly denied by the trial court. Mrs.

                                           -19-
McMurry alleged that she had relied to her detriment upon her husband’s

misrepresentations concerning the true value of the couple’s marital assets.

Roughly analogous to what Werner asserts relative to Crowe, Mrs. McMurry

contended that her husband, Gordon,

              misrepresented to her that his medical practice had no
              value, that the couple’s marital residence and real estate
              had a negative value, and that his income in 1991 was
              substantially lower than it had been in previous years.
              She claim[ed] that Gordon took advantage of her
              emotional state and led her to believe that they were on
              the verge of bankruptcy. She maintain[ed] that she relied
              on his misrepresentations in assenting to the property
              settlement agreement.

McMurry, 957 S.W.2d at 732. Despite Mrs. McMurry’s claims about her

“emotional state,” however, this Court affirmed the circuit court’s denial of Mrs.

McMurry’s motion to reopen because, as we explained:

              The record does not support her contention that Gordon
              attempted to or concealed and misrepresented any
              information relating to the medical practice or the
              couple’s finances. This information was discoverable
              and could have been obtained through formal discovery
              if Mary had elected to do so in lieu of entering into the
              property settlement agreement without conducting an
              independent inquiry of her own. There is no evidence in
              the record—nor is any offered by the appellant—to
              indicate that Gordon acted in a fraudulent manner. Bare
              allegations will not suffice to establish “fraud affecting
              the proceedings.” In the case sub judice, Mary has not
              met her burden of proving that Gordon’s actions rise to
              the level of fraud.

Id. at 733.

                                         -20-
                Here, as indicated, the crux of the family court’s ruling was that if

Werner had exercised reasonable diligence, the issues she raised in her CR 60.02

motion could and should have been raised prior to the entry of its decree or in a

direct appeal. Specifically, Werner knew or should have known, prior to the entry

of the decree, that: (1) Crowe had not provided her a sworn valuation of his

interests in Owensboro Dermatology Associates, P.S.C., Dermatology Property

Management, LLC, and Microcap Insurance Company, Inc.; and (2) the “marital

assets” allegedly omitted from the PSA existed (i.e., the six “additional businesses

owned by the parties per their 2016 tax return” that accountant Vicky Lange

identified in her affidavit, which Werner acknowledged possibly had no value), as

they were listed in the 2016 tax return Werner filed jointly with Crowe that had

been in her attorney’s possession during their months of pre-settlement

negotiations.

                Accordingly, Werner had the same reasons to conduct formal

discovery, insist upon verified disclosures, and litigate the conscionability of the

PSA before the family court entered its decree as she did after the family court

entered its decree. Werner produces no evidence indicating Crowe prevented her

from conducting formal discovery, or that he otherwise denied any request she

made to him for relevant documentation. By electing not to conduct formal

discovery, Werner placed herself in the position she now finds herself post-

                                            -21-
judgment in which she is entertaining “grave suspicions” that Crowe

misrepresented or concealed assets and asking the family court to reopen discovery

to allow her to find proof in service of her theory. As McMurry illustrates, this

does not justify CR 60.02 relief.

             Over the course of the CR 60.02 proceedings, Werner also raised two

points that the family court did not specifically address in any order. In Werner’s

“motion to permit discovery while 60.02 motion is pending,” she questioned the

validity of a $1.6 million debt that the PSA recited Crowe owed to the Crowe

Dynasty Trust – a debt that factored into their division of assets. In her subsequent

CR 59.05 motion, she also represented:

             Dr. Crowe’s businesses are the subject of IRS lawsuits
             wherein the IRS has found that Dr. Crowe has
             underreported income by reason of captive insurance
             premium deductions disallowed to the tune of hundreds
             of thousands of dollars resulting in an increase in tax of
             $210,147 for the tax year 2015, which means the values
             of the businesses Owensboro Dermatology Associates,
             PSC and Dermatology Property Management, LLC are
             even greater than Dr. Crowe suggests.

             That said, Werner was aware of the $1.6 million debt in question prior

to the entry of the decree, passed on the opportunity to contest it at that time, and

presents no evidence – new or otherwise – disputing its legitimacy. As for the

“IRS lawsuits” concerning Crowe’s business interests, she likewise indicates those

lawsuits remain pending and offers nothing with respect to whether or how they

                                         -22-
may have concluded. In short, these are more examples of speculation and

conjecture that have no bearing upon our analysis. We find no error or abuse in the

family court’s decision to deny Werner’s CR 60.02 motion.

             The final issue Werner raises on appeal concerns two Merrill Lynch

accounts that were titled in her name and Crowe’s as tenants in common. They

were not specifically disposed of in the PSA or the decree, but the family court

subsequently awarded them to Crowe pursuant to an October 23, 2020 order. As

Werner represents in her appellate brief:

             [T]hese accounts were the Merrill Lynch Joint Checking
             #XXX-31266 titled “Michael J. Crowe MD AND Ms.
             Werner W. Crowe TIC” (tenants in common) valued at
             $5,909.96 on July 18, 2020, and Merrill Lynch Joint
             Long-Term Growth #XXX-31267 titled “Michael J.
             Crowe MD and Ms. Werner W. Crowe TIC” (tenants in
             common) valued $227,639.87 as of July 18, 2018.

             Werner argues that because the PSA and decree did not specifically

address these accounts, they remained marital property; and that because neither

she nor Crowe directly appealed the non-inclusion of these accounts in the decree,

“the Trial Court lost jurisdiction to enter a subsequent order to award these assets

to Dr. Crowe.”

             We disagree. To be sure, Werner correctly notes that the PSA and

decree did not address these accounts. However, the remainder of her argument

                                         -23-
lacks merit. When the family court “awarded” these accounts to Crowe, its

explanation was as follows:

             The Court finds that the parties, in open Court at the
             January 28, 2019 hearing, agreed that two (2) Merrill-
             Lynch cash management accounts were included in
             Paragraph 3.1 of the July 5, 2018 Property Settlement
             Agreement, and were awarded to [Crowe] and considered
             when calculating the money paid and to be paid to
             [Werner] as an equalization of marital assets. The Court
             further finds that it inadvertently omitted mentioning
             these accounts in its February 18, 2019 Order following
             the January 28, 2019 hearing. [Werner’s] Motion for
             Declaration of Ownership and Equal Distribution of Two
             Merrill Lynch Accounts not Divided in PSA and Motion
             for Account Division of these accounts is DENIED.

             Again, Werner’s argument is only that the family court lacked

jurisdiction to amend its decree consistently with their open-court settlement.

However, her argument is misguided. Utilizing CR 60.02 is not the only means of

reopening or modifying a decree; Werner and Crowe were also permitted to reopen

or modify it “by a voluntary, arms-length settlement;” and the family court had

continuing, equitable jurisdiction to effectuate their settlement so long as “such a

settlement is proved to the satisfaction of the trial court with reasonable certainty.”

Brown v. Brown, 796 S.W.2d 5, 8 (Ky. 1990). Werner does not contest the

substance of what the family court related in its order, i.e., that in open court,

during the January 28, 2019 hearing, she and Crowe settled this issue. Therefore,

                                          -24-
she provides this Court no reason to disturb the family court’s decision in this

regard.

             Accordingly, we affirm the Daviess Family Court’s denial of

Werner’s motion for CR 60.02 relief to set aside the decree dividing Crowe’s and

Werner’s marital property.

             ALL CONCUR.

BRIEFS FOR APPELLANT:                     BRIEF FOR APPELLEE:

Allen P. Dodd III                         Christopher G. Safreed
Allen McKee Dodd                          Owensboro, Kentucky
Louisville, Kentucky

                                        -25-