In re the Marriage of Ronald L. Thorstad, Appellee, and Randie J. Thorstad, n/k/a Randie J. Randell, Appellant.
No. 17CA2293
COLORADO COURT OF APPEALS
January 24, 2019
2019COA13
Opinion by CHIEF JUDGE BERNARD; Hawthorne and Tow, JJ., concur
Jefferson County District Court No. 01DR2710; Honorable Dennis J. Hall, Judge
SUMMARY
January 24, 2019
2019COA13
No. 17CA2293, Marriage of Thorstad — Family Law — Uniform Dissolution of Marriage Act — Post-dissolution — Modification and Termination of Provisions for Maintenance, Support, and Property Disposition
A division of the court of appeals addresses the issue of how trial courts should apply
The division then concludes that, absent a court‘s decision to reserve jurisdiction, the parties’ stipulation in a separation agreement to apply a different standard, or a statute enunciating a different standard, a court must apply
In other words, the payor‘s good faith decision to retire is a factor in the analysis, but it does not automatically require the court to grant the motion to modify or to terminate a maintenance obligation.
So, the division reverses the trial court‘s order because it misapplied
ORDER REVERSED AND CASE REMANDED WITH DIRECTIONS
Division IV
Opinion by CHIEF JUDGE BERNARD
Hawthorne and Tow, JJ., concur
Announced January 24, 2019
Elizabeth Henson, Attorney Mediator P.C., Elizabeth Henson, Greenwood Village, Colorado, for Appellee
Schaffner Law LLC, Jennifer A. Schaffner,
I. Introduction
¶ 1 Colorado statutes establish how courts set, modify, and terminate maintenance orders. The decision to modify or to terminate a maintenance order is often governed by the effect of changed circumstances on the payor spouse‘s ability to pay.
¶ 2 More specifically,
¶ 3 This case examines the statutory structure that courts apply when dealing with the effect of one potential substantial and continuing changed circumstance upon a maintenance order: a payor‘s decision to retire. We recognize that, in some cases, there could be an ulterior motive behind this decision: to reduce or to eliminate the obligation to pay maintenance by reducing or eliminating the payor‘s income. The law gives a name to such an ulterior motive: “voluntary underemployment or unemployment.”
¶ 4 Courts frown on voluntary underemployment and unemployment because these stratagems constitute an attempt to avoid paying maintenance. They may counter such stratagems by, for example, considering “whether [a payor] spouse is voluntarily underemployed in determining whether reduced income is a substantial and continuing circumstance that would justify modification or termination of his [or her] maintenance obligation.” In re Marriage of Swing, 194 P.3d 498, 500 (Colo. App. 2008); see also In re Marriage of Barnthouse, 765 P.2d 610, 613 (Colo. App. 1988) (“[W]e find no error in the court‘s [finding] that the father . . . was voluntarily earning less than he was capable of earning. Therefore, there is no merit to the father‘s contention that the . . . maintenance award[] [was] erroneous.“).
¶ 5 There is also the prospect that a payor‘s decision to retire was not the product of an ulterior motive, but was, instead, a product of good faith. See
¶ 6 Swing addressed this concern. The division first recognized the payor‘s dilemma: “Unless the effect of retirement on maintenance has been addressed in the parties’ separation agreement, a spouse contemplating retirement who is either paying or receiving maintenance faces considerable uncertainty.” Swing, 194 P.3d at 500. The uncertainty is generated, on the one hand, by the reduction in income that almost “irrevocably” accompanies retirement, and, on the other hand, by the lack of Colorado law “assur[ing] that maintenance will be modified based on the retiree‘s lower wage income.” Id.
¶ 7 To ameliorate the payor‘s dilemma, the division surveyed decisions from other states, and it discovered a majority rule: “[R]educed income due to a spouse‘s objectively reasonable decision to retire, made in good faith and not with the intention of depriving the other spouse of support, should be recognized as a basis for modifying maintenance.” Id. at 501. The division then concluded that a court should not find a payor to be voluntarily underemployed if the payor‘s decision to retire (1) “was made in good faith, meaning not primarily motivated by a desire to decrease or eliminate maintenance,” id.; and (2) “was objectively reasonable based on factors such as the [spouse‘s] age . . . [and] health, and the practice of the industry in which the [spouse] was employed,” id.
¶ 8 Apparently following the division‘s lead, the legislature took a similar approach to solving the payor‘s dilemma when, in 2013, it amended
¶ 9 As a result of the amendments,
[u]nless otherwise agreed in writing or expressly provided in the decree, the obligation to pay future maintenance is terminated upon the earlier of:
(I) The death of either party;
(II) The end of the maintenance term, unless a motion for modification is filed prior to the expiration of the term;
(III) The remarriage of or the establishment of a civil union by the party receiving maintenance; or
(IV) A court order terminating maintenance.
¶ 10
¶ 11 We must next make a point about the statutes that we consider in this appeal. In 2013,
¶ 12 The petition for dissolution of marriage in this case was filed on September 17, 2001, so the new version of
¶ 13
¶ 14 Turning to this case, a former husband, Ronald L. Thorstad, suffered from some health problems, which contributed to his decision to retire from his job. He therefore asked a magistrate to terminate his maintenance obligation to his former wife, Randie J. Thorstad, who is now known as Randie J. Randell. (For readability purposes, we shall dispense with the adjective “former” and simply call the parties to this appeal “husband” and “wife.“) The magistrate granted husband‘s request; wife sought the district court‘s review; and the district court denied her petition. (Because the district court denied wife‘s petition, essentially affirming the magistrate‘s decision, we will refer to the district court and the magistrate cumulatively as “the trial court” unless we need to make a specific point about either one.)
¶ 15 Wife filed this appeal.
¶ 16 We conclude that the magistrate‘s order, as affirmed by the district court, partially misapplied
II. Background
¶ 17 The decree in this case dissolved the marriage between husband and wife in May 2002. Their separation agreement included a “step down” schedule for husband‘s maintenance obligation to wife, meaning that the amount husband paid decreased over time. He was paying wife $3000 per month when he asked the trial court to terminate his maintenance obligation.
¶ 18 In the separation agreement, husband and wife agreed that the trial court would have jurisdiction to modify the amount of maintenance if wife‘s medical condition worsened or if her medical costs substantially increased. The agreement contained the following succession of sentences:
- “Maintenance shall be subject to review and modification by the [c]ourt under
[section 14-10-114] , without the requirement of proving a substantial and continuing change of circumstances making the existing [o]rder unfair.”
- Husband and wife “have assumed . . . that wife will be able to work full-time without disability from her [medical condition], and that husband will retire completely from paid employment on or before he reaches age sixty.”
- Husband and wife “understand that a worsening of . . . wife‘s [medical condition] which interferes with her ability to work full time, or a substantial increase in the wife‘s medical costs, will require a re-evaluation of maintenance in connection to . . . wife‘s needs.”
¶ 19 These sentences do not include any reference to the termination of maintenance, and they do not refer to
¶ 20 In May 2017, relying on
¶ 21 Unbeknownst to the magistrate, wife had filed a response to husband‘s motion to terminate maintenance after the time for responding had lapsed. She did not ask for the magistrate‘s permission to do so. The response asked the court to deny husband‘s request to terminate his maintenance obligation and that the court take a “wider view” of
¶ 22 The magistrate granted husband‘s motion without a hearing before wife‘s response reached the court‘s electronic filing system.
¶ 23 Employing
¶ 24 Wife contended that
¶ 25 Although the magistrate did not have wife‘s response prior to ruling on husband‘s motion, the district court noted in its order that it had taken her response into account when ruling on her
III. Standard of Review
¶ 26 A district court‘s review of a magistrate‘s order is like appellate review, and the magistrate‘s findings of fact cannot be altered unless clearly erroneous.
¶ 27 We review a district court‘s order modifying maintenance for an abuse of discretion. In re Marriage of Ward, 740 P.2d 18, 21 (Colo. 1987). However, we review de novo whether the district court applied the correct legal standard. In re Marriage of Atencio, 47 P.3d 718, 720 (Colo. App. 2002).
IV. Wife‘s Contentions and Our Conclusions
¶ 28 Wife raises three contentions. She asserts that the trial court erred when it
- relied on
section 14-10-122 instead ofsection 14-10-114 in the course of granting husband‘s motion to terminate his maintenance obligation; - terminated husband‘s maintenance obligation without making sufficient factual findings; and
- treated husband‘s motion as confessed even though wife had submitted an untimely response.
¶ 29 Addressing these contentions, we reach the following conclusions, which we will explain below in detail.
- The question of what statute applies to resolve husband‘s motion is one of law, which we review de novo. See Atencio, 47 P.3d at 720.
Section 14-10-122 was the right statute for the trial court to use when deciding whether to grant husband‘s motion. But a court cannot automatically terminate a maintenance obligation undersubsection 122(2)(a)(IV) if a payor satisfies the retirement provisions found insubsections 122(2)(b) and(c) . Rather, a payor‘s good faith retirement simply becomes a factor for the court to consider in the analysis of whether, undersubsection 122(1)(a) , the payor can show that there has been a substantial and continuing change of circumstances that makes the existing maintenance order unfair.- A court can, in specified circumstances, reserve jurisdiction over a maintenance order. But husband and wife‘s separation agreement in this case, which the court had approved, did not reserve jurisdiction over the question of what effect husband‘s retirement would have on his maintenance obligation. So the separation agreement did not require the trial court to use
section 14-10-114 to resolve husband‘s motion instead ofsubsections 122(1)(a) ,(2)(a) ,(2)(b) , and(2)(c) . - We do not need to address wife‘s assertion that the trial court erred when it decided that wife had confessed husband‘s motion.
V. Analysis
A. The Decision to Award Maintenance
¶ 30 In 2001, before a court could award maintenance,
B. Incorporating a Payor‘s Retirement into the Decision to Modify Maintenance
¶ 31 Based upon the relevant facts and law, we ask and answer three questions concerning how the 2001 version of
¶ 32 Do Subsections 122(2)(a), (b), and (c) Create a Reason — Good Faith Retirement — That Automatically Terminates a Payor‘s Duty to Pay Maintenance?
¶ 33 We answer this question “no.”
¶ 34 To remind the reader, when discussing retirement,
¶ 35 “[W]e ‘must read and consider the statutory scheme as a whole to give consistent, harmonious[,] and sensible effect to all its parts.‘” People v. Stellabotte, 2018 CO 66, ¶ 32 (quoting Martin v. People, 27 P.3d 846, 851 (Colo. 2001)). When we look at the entirety of
¶ 36 But it is also clear from the statutory language that this rebuttable presumption is not conclusive on the question of whether the court should terminate the payor‘s maintenance obligation.
¶ 37 Because the presumption is rebuttable, the spouse who is receiving maintenance must have the opportunity to rebut the presumption. “Rebuttable presumptions have a limited purpose.” Krueger v. Ary, 205 P.3d 1150, 1154 (Colo. 2009). They “(1) shift[] the burden of going forward to the party against whom it is raised, and (2) if that burden is not met, establish[] the presumed facts as a matter of law.” Id.
¶ 38 Once the payor satisfies the rebuttable presumption created by
¶ 39 Do Subsections 122(2)(a), (b), and (c) Merely Set Out a Factor — Good Faith Retirement — That a Court Must Consider When Deciding, Under Subsection 122(1)(a), Whether Circumstances Have Changed in Such a Substantial and Continuing Way as to Make the Terms of the Existing Maintenance Order Unfair?
¶ 40 Looking at the language of these subsections together, we conclude that the answer to this second question is generally “yes.”
¶ 42 To determine if the parties’ changed circumstances warrant modification, the court must examine them as if it were awarding maintenance for the first time under
¶ 43 In other words, if a payor asks a court to modify or to terminate a maintenance obligation because he or she intends to retire, then the court should follow a general rule. First, applying
¶ 44 We therefore conclude that the trial court erred because it did not apply the general rule in this case. Its order treated husband‘s good faith decision to retire as conclusive in resolving his motion to terminate maintenance. The order did not address the
¶ 45 We reverse the trial court‘s order and remand this case to the court because of this error. On remand, the court shall consider husband‘s good faith retirement as a factor in deciding whether, under
¶ 46 What Happens to This General Rule If a Separation Agreement Reserves Jurisdiction?
¶ 47 We conclude that such language might establish an exception to the general rule. But the boundaries of the exception are established by the specific language of the separation agreement. And, in this case, the separation agreement did not reserve jurisdiction for the trial court to consider husband‘s decision to retire or his declining health.
¶ 48 If, at the time of permanent orders, an important future contingency exists that a court can resolve in a reasonable and specific time, the court may reserve jurisdiction to modify maintenance under
¶ 49 If the court does not properly reserve jurisdiction, it can only modify maintenance under the parameters set out under
¶ 50 In this case, although the separation agreement mentioned husband‘s retirement, its language did not reserve jurisdiction to the court concerning husband‘s decision to retire or his declining health, or state that husband‘s good faith retirement or declining health would automatically terminate his obligation to pay future maintenance to wife. Rather, the agreement identified two events — a worsening of wife‘s medical condition that interfered with her ability to work full time or a substantial increase in her medical costs — as the basis for the court‘s reserved jurisdiction.
¶ 51 But husband did not ask the court to terminate his maintenance obligation on the basis of either of these events; he relied, instead, on his own health complications and on his anticipated retirement.
VI. Magistrate‘s Ruling Deeming Husband‘s Motion Confessed
¶ 52 Wife also contends that the magistrate erred when he found that wife had confessed husband‘s motion to terminate maintenance. Because the district court considered wife‘s response before ruling on her
VII. Wife‘s Request for Appellate Attorney Fees
¶ 53 Wife asks that we award her appellate attorney fees under
¶ 54 We reverse the trial court‘s order terminating husband‘s maintenance obligation, and we remand the case to the trial court to determine (1) whether husband‘s circumstances have changed in such a substantial and continuing way as to make the existing terms of husband‘s maintenance obligation unfair; and (2) wife‘s request for appellate attorney fees under
JUDGE HAWTHORNE and JUDGE TOW concur.
CHIEF JUDGE BERNARD
COLORADO COURT OF APPEALS
