247 So. 3d 604
Fla. Dist. Ct. App.2018Background
- Parties divorced after a 27-year marriage and executed a marital settlement agreement (MSA) allocating specified percentages of any "inheritance funds received" by the Former Husband to the Former Wife as part of equitable distribution.
- The MSA anticipated the Former Husband would receive inheritance as a lump sum and required life insurance as security until the Wife received the inheritance.
- After the MSA, the Former Husband’s father funded a revocable trust and created a spendthrift subtrust that paid the Former Husband periodic distributions rather than a lump sum.
- The Former Husband received distributions from the subtrust but refused to pay the Former Wife her contractually specified percentage of those distributions.
- The Former Wife moved to enforce the MSA, claiming the distributions were "inheritance funds received." The Former Husband argued the distributed trust funds were not "inherited" and relied on bankruptcy/statutory-construction cases.
- The trial court denied enforcement based on statutory construction authorities; the Second DCA reversed, holding the dispute presents a latent ambiguity requiring parol evidence and factual findings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether periodic trust distributions to Former Husband constitute "inheritance funds received" under the MSA | Morrison (Former Wife): distributions from the subtrust are "inheritance funds received" and she is entitled to the contract percentage of amounts actually paid to Husband | Morrison (Former Husband): payments from the spendthrift trust are not "inherited" as a matter of contract interpretation; cited bankruptcy/statutory cases to construe "inherit" | Court: The contract contains a latent ambiguity about how inherited funds would be received; parties’ intent must be resolved with parol evidence and factual findings; trial court erred by applying statutory construction authorities instead of latent-ambiguity/contract principles |
| Proper interpretive standard: statutory construction vs. latent ambiguity/parol evidence | Former Wife: interpret MSA under contract law; consider extrinsic evidence of parties’ intent because MSA did not specify trust distributions | Former Husband: plain-language/statutory construction approach (relied on bankruptcy cases interpreting "inherit") | Court: Statutory-construction precedent (bankruptcy cases) is inapposite; latent-ambiguity doctrine controls and requires the trial court to consider extrinsic evidence of parties’ intent |
| Whether appellate court may resolve interpretation without factual development | Former Wife: factual hearing occurred (she testified) supporting her position | Former Husband: relied on trial court’s plain-language ruling; did not present evidence | Court: When latent ambiguity exists, interpretation is a factual question; appellate court will not make factual findings; remand for trial court fact-finding or further hearings |
| Whether an interpretation that nullifies equitable-distribution provisions should be adopted | Former Wife: adopting Husband’s view would negate a core portion of the MSA and be inequitable | Former Husband: argued narrow reading of "inheritance" | Court: Prefer reasonable interpretations that avoid absurd or inequitable results; reject interpretations negating large portions of the agreement |
Key Cases Cited
- GE Fanuc Intelligent Platforms Embedded v. Brijot Imaging Sys., Inc., 51 So. 3d 1243 (Fla. 5th DCA 2011) (defines latent ambiguity and need for extrinsic evidence)
- Deni Assocs. of Fla., Inc. v. State Farm Fire & Cas. Ins. Co., 711 So. 2d 1135 (Fla. 1998) (latent ambiguity principles)
- Luciano v. Franchino, 730 So. 2d 410 (Fla. 2d DCA 1999) (latent ambiguity and parol evidence in contract interpretation)
- Mac-Gray Servs., Inc. v. Savannah Assocs. of Sarasota, LLC, 915 So. 2d 657 (Fla. 2d DCA 2005) (latent ambiguity makes interpretation a question of fact requiring parol evidence)
- Hunt v. First Nat'l Bank, 381 So. 2d 1194 (Fla. 2d DCA 1980) (extrinsic evidence should reflect what parties would have included had they anticipated the omitted event)
- RX Sols., Inc. v. Express Pharmacy Servs., Inc., 746 So. 2d 475 (Fla. 2d DCA 1999) (parol evidence required for latent ambiguity)
- Emergency Assocs. of Tampa, P.A. v. Sassano, 664 So. 2d 1000 (Fla. 2d DCA 1995) (latent ambiguity doctrine)
- Raymond James Fin. Servs., Inc. v. Phillips, 126 So. 3d 186 (Fla. 2013) (explaining purpose of statutory-construction analysis and legislative intent)
- Hobus v. Crandall, 972 So. 2d 867 (Fla. 2d DCA 2007) (general rule that interpretation of MSA is a question of law)
- Muir v. Muir, 925 So. 2d 356 (Fla. 5th DCA 2006) (MSA interpretation typically reviewed as a matter of law)