180 A.3d 855
Vt.2017Background
- Parties cohabited from 2004, married in 2007, separated in Feb 2014; no children of the marriage. Wife brought ~ $1.8M into the marriage; husband brought $4.4–$5.4M and later substantial compensation from finance jobs (Citibank).
- The superior court found the marital estate to be roughly $5.6M in assets and divided property so wife received ~40% (including a $1.1625M payment for real property) and husband received the Winhall home.
- The court awarded wife an undifferentiated $970,000 lump sum described partly as property division and partly as property in lieu of spousal maintenance; the court did not specify how much represented maintenance.
- Deferred compensation (deferred stock and cash) paid or expected from Citibank during and after the marriage was disputed: the superior court both treated some deferred awards as marital assets and also described parts as not subject to distribution.
- Wife appealed, arguing the court erred by (1) excluding premarital cohabitation years from the marriage length analysis, (2) failing to specify the split between property division and maintenance in the $970,000 award, and (3) misvaluing and inconsistently allocating husband’s deferred compensation and certain debts.
- The Supreme Court affirmed the divorce decree generally but reversed and remanded limited issues for clarification and additional findings regarding deferred compensation allocation, some debt allocation, and a mathematical valuation discrepancy.
Issues
| Issue | Plaintiff's Argument (Wife) | Defendant's Argument (Husband) | Held |
|---|---|---|---|
| Whether court should count premarital cohabitation years in marriage-length analysis for property/maintenance | Cohabitation and joint purchases from 2004 mean longer functional marriage; court should factor premarital years into §751/§752 analysis | Court reasonably declined because parties kept finances separate, wife preserved prior spousal support, and wife was not dependent pre-marriage | Affirmed: court did not abuse discretion in excluding premarital cohabitation years |
| Whether lump-sum $970,000 award violated requirement to separate property division from maintenance | Award is undifferentiated; court failed to make findings showing how much was maintenance and whether maintenance needs are met | Court made §751 and §752 findings, considered husband's income and wife's needs, and husband sought but court denied more findings; wife previously opposed more detail | Affirmed (in part): court’s award permissible; wife waived some challenge by opposing further findings; overall award not shown inequitable |
| Treatment and valuation of husband’s deferred compensation (unvested/vested, pre- and post-separation) | Deferred compensation earned during marriage (including unvested amounts) must be treated and distributed as marital property; court was inconsistent and omitted distribution of some unvested awards | Husband urged that post-separation and speculative/unvested portions are not marital or should be allocated to him; asked for clarification of what was awarded | Reversed and remanded: court must identify, value (as of final hearing), and expressly allocate deferred compensation earned during marriage (including unvested sums), explain basis for apportionment, and may consider vesting contingencies and functional end date when allocating |
| Allocation of legal fees/debts and mathematical valuation error | Court said legal/expert fees not marital liabilities but then allocated $125,000 (legal fees) to husband; also misstated total marital asset math | Husband says any inconsistency harmless because debts allocated to original owner | Reversed and remanded for clarification/correction: court must address debt allocation inconsistency and correct asset valuation if needed |
Key Cases Cited
- Wall v. Moore, 167 Vt. 580, 704 A.2d 775 (court may consider premarital relationship length when equitable)
- Jenike v. Jenike, 177 Vt. 502, 857 A.2d 798 (property division should be considered before maintenance; court must consider property when deciding maintenance)
- Golden v. Cooper-Ellis, 181 Vt. 359, 924 A.2d 19 (deferred compensation for past/present performance can be marital property even if vesting occurs after divorce)
- Hayden v. Hayden, 176 Vt. 52, 838 A.2d 59 (assets valued for distribution as of final hearing date regardless of when acquired)
- McDermott v. McDermott, 150 Vt. 258, 552 A.2d 786 (principles for apportioning retirement/pension benefits; courts may use coverture fraction and functional end date considerations)