E.K. v. C.T., Personal Representative. ( 2023 )

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).
COMMONWEALTH OF MASSACHUSETTS
APPEALS COURT
21-P-1019
E.K.
vs.
C.T., 1 personal representative. 2
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
This contempt matter arises from a divorce judgment that
entered in 2008 (divorce judgment). The plaintiff in contempt
is the special personal representative (SPR) of the estate of
the husband, who died in 2017. The SPR initiated this
proceeding in 2019, alleging that the wife had failed to
transfer shares of DuPont stock to the husband in 2008, as
required by the divorce judgment, and that the wife also had
improperly continued to receive and retain DuPont dividends
since that date. After an evidentiary hearing, the judge found
the wife "not guilty" of contempt, because the SPR failed to
show both (1) "a clear and unequivocal order," and (2) "clear
1 As successor special personal representative, appointed after
the death of M.R., special personal representative of the estate
of J.K., who died on October 24, 2022.
2 Of the estate of J.K.
disobedience" by the wife. Smith v. Smith, 93 Mass. App. Ct.
361, 363 (2018). Among other things, the judge found that the
wife had complied with an order requiring delivery of the DuPont
stock certificates to the husband's attorney in 2008, but that
thereafter, the husband "never took steps to transfer the
stock." The judge further declined to order the wife to pay the
estate the dividends she had received and retained.
For the reasons that follow, we affirm the finding of no
contempt. However, we conclude that the divorce judgment was
sufficiently clear that once it entered, the DuPont stock and
any dividends thereon would be the property of the husband. We
accordingly remand this matter for further consideration of the
estate's claim to reimbursement of the amount of the dividends
received by the wife.
Background. 1. The divorce judgment. Husband and wife
were married in 1968 and divorced in 2008 after contentious
litigation and a trial. The 2008 divorce judgment divided the
marital assets and stated among other things that "Husband shall
retain as his individual property" "2340 shares of DuPont." The
judge's rationale, which accompanied the divorce judgment,
further stated:
"[The parties] . . . jointly acquired DuPont stock in 1968
. . . The Wife has received all of the dividend income
from this stock since the parties['] separation. The
Husband shall receive this stock in the division of assets
in order to equalize the parties['] assets so this income
2
shall no longer be included in the Wife's income stream and
$66.53 per week shall be added to his income."
One month after the divorce judgment entered, in April of
2008, the parties agreed to an amendment to the divorce judgment
(April 2008 amendment), as follows:
"Husband and Wife hereby stipulate that Wife shall deliver
to Husband's counsel by Friday, April 18, 2008 by 4:00 P.M.
the [DuPont] stock certificates. . ."
The wife delivered the DuPont certificates to husband's
counsel, as directed by the April 2008 amendment. The DuPont
shares, however, were never transferred into the husband's name
prior to his death in 2017. 3 The wife accordingly continued to
receive dividends from the shares by "direct deposit," as she
had during the marriage.
2. The contempt proceeding. In the contempt complaint,
the SPR claimed that the wife had violated the 2008 divorce
judgment by "never transferring" the DuPont stock, and by
continuing to receive and to deposit the dividend checks. The
judge held a hearing on the contempt complaint in 2020, at which
the wife and the family's investment advisor testified. The
judge found that the wife had delivered the stock certificates
to the husband's attorney, as directed by the April 2008
amendment to the judgment. The judge further found that the
3 The DuPont shares were apparently transferred to the estate
after the husband's death, although this fact is not
specifically included in the judge's findings.
3
wife "made efforts to perfect the [stock] transaction to the
best of her ability," in particular by conferring with the
husband's counsel and with a special master assigned to the
matter, both of whom advised her to "wait until the [husband]
transferred the stock."
The judge concluded (1) that the divorce judgment did not
clearly state that the wife could "not collect the dividends"
(emphasis in original), and (2) that in any event, the wife's
actions did not constitute clear disobedience. Having found no
contempt, the judge went on to consider whether the wife should
pay to the husband's estate any dividends she had received after
the husband's death; the judge concluded, however, that she did
not have sufficient evidence to fashion such an order.
Discussion. To prove civil contempt a plaintiff must show
two separate elements -- "(1) clear disobedience of (2) a clear
and unequivocal command." Smith, 93 Mass. App. Ct. at 363.
Here the judge ruled that the divorce judgment did not contain a
"clear and unequivocal command" as to what the wife must do to
effect a transfer of the DuPont shares, but we do not rest our
affirmance on that ground. While it is true that neither the
divorce judgment nor the April 2008 amendment directed the wife
to do more than deliver over the stock certificates (which the
wife did), we nevertheless conclude that when read together with
the rationale (as is reasonable), the judgment plainly directed
4
that the DuPont shares were to be the husband's property, and
that all dividends would belong to him. The rationale made this
clear: "The Wife has received all of the dividend income from
this stock since the parties['] separation. The Husband shall
receive this stock in the division of assets . . . so this
income shall no longer be included in the Wife's income"
(emphasis added). Under the divorce judgment, the husband was
entitled to receive the dividends. 4
That is not the end of the matter, however, because to
demonstrate contempt, the plaintiff also was required to show
"clear disobedience" by the wife. "The case law demonstrates
that not every violation of a clear order will constitute
contempt, and thus that the requirement to prove 'clear
disobedience' has teeth." Smith, 93 Mass. App. Ct. at 363-364.
And as to her finding of no "clear disobedience," the judge's
4 At one point, the judge's order on the complaint for contempt
suggests that the rationale may not be important in evaluating
whether there has been a contempt; the judge states that "[a]
rationale is an explanation of an order or judgment; it is not a
court order." The judge's comment came in the context of
evaluating whether the divorce judgment was "clear and
unequivocal," but we do not understand the judge to be saying
that the rationale is not relevant. To the contrary, although
the rationale may not itself be an order, the rationale can be
highly relevant in construing the meaning of a court order, to
the extent the order is less than clear. See, e.g., Poras v.
Pauling, 70 Mass. App. Ct. 535, 543, 546 (2007) (looking to
judge's contemporaneous and subsequent statements in construing
contempt judgment). We consult the rationale for that purpose
here.
5
ruling is on very solid ground. As noted, the wife complied
with the specific direction in the April 2008 amendment.
Nothing in that amendment said anything about the dividends, and
one can infer that the parties were satisfied that once the wife
delivered the certificates, the husband would take the
appropriate steps to place the stock in his name and thereby
receive the dividends. The husband, however, did not take any
additional steps to place the stock certificates in his name.
Moreover, the judge found that the wife -- knowing that she was
still receiving the dividends -- took steps to determine what to
do, by consulting with both the husband's lawyer and the special
master. The judge found that the wife then followed the advice
that she received, which was to wait until the husband effected
the transfer. As the judge found, none of this conduct amounted
to clear disobedience. 5
The SPR argues, however, that the wife failed to take the
necessary steps to actually effect the transfer, because there
was additional paperwork that the wife needed to fill out, as
the stock certificates were held jointly. The SPR further
argues that the wife knew that she needed to fill out this
5 We acknowledge that the wife could have, and likely should
have, held the dividends separately while awaiting further
instruction. There was no evidence that she was ordered (or
even advised) to do so, however, and her actions may have been
influenced because, apparently, the husband was not paying
alimony for at least some of the time in question.
6
additional paperwork to complete the transfer, pointing to
actions that the wife took in 2017, after the husband died.
We are not persuaded. As of 2008, the stock certificates
were physically with the husband's lawyer. There was no
evidence presented that the husband or his agents ever requested
any additional actions by the wife after she delivered the
certificates. The husband did not request that the wife fill
out additional paperwork, and he did not ask the wife to forward
the dividends even though the wife told husband's counsel she
was still receiving them. Moreover, and tellingly, the
husband's financial advisor testified that he repeatedly asked
the husband for the DuPont certificates so that the financial
advisor could complete the transfer, but the husband did not
provide them. The judge credited this testimony as well. We
review the judge's finding of no contempt for abuse of
discretion or other error of law. Department of Revenue Child
Support Enforcement v. Grullon, 485 Mass. 129, 134 (2020).
There was no abuse of discretion here.
2. The request for repayment. Finally, we must address
the SPR's request for an order that the wife repay the dividends
she received. We think a claim for those dividends is fairly
subsumed in the estate's contempt complaint, even where the wife
was found not guilty of contempt. See Smith, 93 Mass. App. Ct.
at 362, 364-365; Wooters v. Wooters, 74 Mass. App. Ct. 839, 840,
7
844 (2009). As discussed above, any dividends the wife received
after the divorce judgment entered should have been paid to the
husband. The fact that the wife was found not guilty of
contempt does not alter this underlying legal obligation, as we
explained in Wooters, 74 Mass. App. Ct. at 844, and Smith, 93
Mass. App. Ct. at 364, 366-367. Here we have no doubt that had
the husband timely requested the dividends (or brought a lawsuit
or contempt proceeding), the husband would have been entitled to
those dividends. Moreover, at the contempt hearing, the SPR
entered into evidence various documents regarding the dividends
the wife received, as shown on her tax returns from 2008 through
2017.
The judge addressed the estate's claim for dividends the
wife received after the husband's death in 2017, finding that
the estate's proof as to those dividends was not sufficient.
The judge's order does not, however, address whether the estate
is entitled to recover dividends that the wife received between
2008 and the husband's death.
On appeal the wife raises potential defenses of waiver and
unclean hands. The SPR responds that neither of those defenses
were previously pleaded or raised during the contempt hearing.
The wife also suggests that the husband's estate owes her
substantial unpaid amounts of, among other things, alimony,
which might be an offset against any claim for the dividends.
8
While we rule today that the husband was entitled to the
dividends under the divorce judgment, in the circumstances a
remand is appropriate so that the judge may address the estate's
claim in the first instance. On remand the judge may consider
whatever defenses he or she determines are properly raised to
the estate's claim in this case. We accordingly affirm the
portion of the judgment finding the wife not in contempt, but
vacate the remainder of the judgment insofar as it addresses
whether the wife should pay money to the husband's estate, and
remand that issue for further consideration in light of this
decision. 6
So ordered.
By the Court (Vuono, Singh &
Englander, JJ. 7),
Clerk
Entered: October 27, 2023.
6 The parties' requests for appellate attorney's fees and costs
are denied.
7 The panelists are listed in order of seniority.
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