Marriage of MacMillan v. Schwartz, 226 Ariz. 584

Background

Wife and Husband divorced in March 2005; PSA incorporated into decree provisions for spousal maintenance of $6,666.67/month for eight years.
PSA provides modification trigger under A.R.S. § 25-327 if Wife earns $50,000 or more from employment or business endeavors; earnings under that threshold are not grounds for modification.
During marriage Wife held SCI interests; she sold them to Husband and accepted severance, later working part-time then full-time at Company Nurse with rising and later contested salary.
From 2007 onward Wife’s salary and a deferred compensation plan produced aggregate earnings around $60,000 per year, surpassing the modification threshold when combined.
In 2009 Husband sought to reduce maintenance; Wife petitioned to modify to increase maintenance; trial court reduced to $4,250/month after considering income and needs.
Arizona Court of Appeals reviews whether deferred compensation counts as income, and whether investment income and 401(k) contributions affect the modification and award amount.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does deferred compensation constitute income triggering modification?	MacMillan argues deferred comp is not income since not under her exclusive control.	Schwartz contends all earnings over $50,000, including deferred comp, count as earnings capable of modifying maintenance.	Yes; earnings from the deferred compensation plan count toward the $50,000 trigger and can be considered for modification.
Were interest, dividends, and 401(k) contributions properly considered in calculating the modification and needs?	Wife argues investment income and 401(k) contributions should not affect modification if known at PSA execution.	Husband contends such income may be considered for determining sufficiency to meet needs after modification, though not to trigger change.	Investment income can be used to assess means for needs; 401(k) matching may be considered but not given a fixed value in this record.
Did the trial court correctly apply the PSA’s standard of living in setting the modified amount?	Wife contends standard of living should reflect pre-divorce level, not PSA-estimated level.	Husband maintains the PSA-fixed standard and contract controls; modification should reflect the agreed standard.	Court affirmed, concluding the PSA standard governs and Wife’s total income supports a reduced maintenance amount.
Did the trial court abuse its discretion regarding protective order for SCI documents?	Wife claims protective order was improper abuse of discretion and motive-based.	Husband asserts need to protect confidential SCI materials and proper discovery safeguards.	No abuse of discretion; protective order justified and record supports confidentiality concerns.

Key Cases Cited

Richards v. Richards, 137 Ariz. 225 (App. 1983) (changed circumstances for modification must be proven by comparison with dissolution)
LaPrade v. LaPrade, 189 Ariz. 243 (1997) (incorporation vs merger; contractual status of PSA after dissolution)
Lopez v. Lopez, 125 Ariz. 309 (App. 1980) (actual income vs anticipated future income for modification)
Chaney v. Chaney, 145 Ariz. 23 (App. 1985) (avoid predicting future income; modification based on actual changes)
Wineinger v. Wineinger, 137 Ariz. 194 (App. 1983) (retirement earnings and entitlement to maintenance)
Sheeley v. Sheeley, 10 Ariz. App. 318 (1969) (increase in husband's earnings after divorce not automatically shared)
Linton v. Linton, 17 Ariz. App. 560 (1972) (change in income must be a change in circumstances at dissolution)
Graville v. Dodge, 195 Ariz. 119 (App. 1999) (attorneys' fees expressly within discretion; weighing positions)
John C. Lincoln Hosp. and Health Corp. v. Maricopa County, 208 Ariz. 532 (2004) (obligation to address insufficient or inadequate trial findings; waiver rules)
Ruhsam v. Ruhsam, 110 Ariz. 426 (Ariz. 1974) (incorporation of agreement; res judicata implications)
LaPrade v. LaPrade, 189 Ariz. 243 (1997) (see above; included once for emphasis)