Holyoak v. Holyoak ( 2016 )

IN THE SUPREME COURT OF THE STATE OF NEVADA
ERIC HOLYOAK, No. 67490
Appellant,
vs. FILED
TONI HOLYOAK, MAY 1 9 2016
Respondent.
ORDER OF AFFIRMANCE
This is an appeal from a post-divorce decree order regarding
the distribution of retirement benefits. Eighth Judicial District Court,
Clark County; Vincent Ochoa, Judge.
In 1982, appellant Eric Holyoak and respondent Toni Holyoak
married. In 2008, they divorced. Appellant was a police officer employed
by the Las Vegas Metropolitan Police Department and a participant in the
Public Employees Retirement System (PERS). During the divorce
proceedings, he was not yet eligible for retirement.
Neither party was represented by an attorney during the
divorce proceedings. Further, both parties executed a joint petition for
summary decree of divorce, which they amended twice. The petition
divided their community property through a memorandum of
understanding (MOU), which they mediated with the assistance of a
former family court judge. With regard to appellant's PERS retirement
account, the MOU stated: "The parties agree to split the costs of the
preparation of a [qualified domestic relations order (QDRO)]. The QDRO
will direct the trustee of PERS to pay to each party their proportionate
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share of the account at the time [appellant] retires." Ultimately, the
parties disputed the meaning of this clause before the district court.
Appellant filed a brief detailing his position on several issues
relevant to the division of community property, including when he was
required to pay respondent's share of the PERS benefits. 1 According to
appellant, pursuant to the applicable clause in the MOU, both parties
agreed that respondent will receive her share starting from the time of
appellant's official retirement. In support of his argument, appellant filed
a declaration stating that both parties agreed at the time of the mediation
that respondent would not receive her share until appellant officially
retired. However, appellant's counsel also acknowledged in an earlier
proceeding that the clause in the MOU was simply "a one-sentence
agreement" and that "what the two parties agreed to may have been
completely different between the two of them in their minds as to what
they were agreeing to." Respondent asserted that appellant's
interpretation of the clause was incorrect and that Nevada caselaw
supported her position that she can receive her share when appellant is
eligible to retire. Before the district court, she also noted that one reason
1 We note that, in general, a district court lacks jurisdiction to modify
property rights, as established by a divorce decree, beyond six months.
See NRCP 60(b); Kramer v. Kramer, 96 Nev. 759, 762, 616 P.2d 395, 397
(1980). However, because the district court in this case merely interpreted
the decree and enforced its terms, rather than modifying the parties'
interests, the time requirements of NRCP 60(b) do not apply. See Walsh v.
Walsh, 103 Nev. 287, 288, 738 P.2d 117, 117-18 (1987) (interpreting rather
than modifying pension plan provision of divorce decree outside NRCP
60(b)'s six-month period). Further, the MOU was incorporated into the
divorce decree, and the district court has inherent authority to construe its
decrees in order to remove an ambiguity. See Kishner v. Kishner, 93 Nev.
220, 225, 562 P.2d 493, 496 (1977).
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for accepting a low amount in spousal support "was her understanding
that she would receive her portion of the PERS retirement for the rest of
her life." In addition, respondent claimed that she was "under the
impression that [appellant] would be retiring sooner than later."
With regard to this issue, the district court ruled in favor of
respondent. The district court determined that nothing in the MOU or the
divorce decree "indicates any intention on the part of any person involved
to do anything other than what the law provides and divide the
community portion of all assets equally." Further, the court noted that
according to the MOU, respondent "is to receive a 'proportionate share' of
[appellant's] Nevada PERS pension benefits" and that this language "was
intended to comply with Nevada law." Applying Nevada precedent
concerning election of retirement benefits, the court concluded that
respondent had an interest in appellant's retirement pension starting from
the date of his eligibility. However, the district court noted that
respondent must first file a motion "requesting to begin receiving payment
of her portion" of the PERS pension benefits.
Following the district court's order, respondent filed a motion
for immediate election of her share of appellant's PERS benefits.
Ultimately, the court granted the motion, reiterating its previous decision
that respondent is entitled to receive her share starting from the date of
appellant's eligibility. This appeal follows. 2
2 We note that in her answering brief, respondent raises issues
concerning alleged errors in this court's precedent on survivorship rights.
However, respondent did not file a cross-appeal, and thus lacks the ability
to challenge the district court's ruling on these issues.
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Generally, this court reviews the district court's division of
community property for an abuse of discretion. Wolff v. Wolff, 112 Nev.
1355, 1359, 929 P.2d 916, 918-19 (1996). Further, this court reviews a
district court's factual findings for an abuse of discretion, and will not set
aside those findings unless they are clearly erroneous or not supported by
substantial evidence. Ogawa v. Ogawa, 125 Nev. 660, 668, 221 P.3d 699,
704 (2009). When a district court's interpretation of a divorce decree
involves a question of law, however, this court reviews the interpretation
de novo. Henson v. Henson, 130 Nev., Adv. Op. 79, 334 P.3d 933, 936
(2014).
An agreement to settle pending divorce litigation constitutes a
contract and is governed by the general principles of contract law.
Grisham v. Grisham, 128 Nev., Adv. Op. 60, 289 P.3d 230, 234 (2012). In
the context of family law, parties are permitted to contract in any lawful
manner. See Rivero v. Rivera, 125 Nev. 410, 429, 216 P.3d 213, 226 (2009).
"Parties are free to contract, and the courts will enforce their contracts if
they are not unconscionable, illegal, or in violation of public policy." Id.
An enforceable contract requires 'an offer and acceptance, meeting of the
minds, and consideration." May v. Anderson, 121 Nev. 668, 672, 119 P.3d
1254, 1257 (2005).
Further, this court views a contract as "ambiguous if it is
reasonably susceptible to more than one interpretation." Shelton v.
Shelton, 119 Nev. 492, 497, 78 P.3d 507, 510 (2003) (internal quotation
and footnote omitted). When interpreting an ambiguous contract, this
court looks beyond the express terms and analyzes the circumstances
surrounding the contract to determine the true mutual intentions of both
parties. Id. (footnote omitted). Finally, this court has recognized that an
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interpretation that "results in a fair and reasonable contract is preferable
to one that results in a harsh and unreasonable contract." Id. (internal
quotation and footnote omitted).
With regard to retirement benefits, those earned during a
marriage qualify as community property, even if they are not vested.
Gemma v. Gemma, 105 Nev. 458, 460-61, 778 P.2d 429, 430 (1989). While
the effect of a contract on the timing of a nonemployee spouse's receipt of
benefits has not yet been explored, this court has discussed the issue of
when a nonemployee spouse is entitled to request his or her share of
benefits. In particular, we have held that the nonemployee spouse has a
right to his or her share of the employee spouse's benefits starting from
the date of eligibility for retirement. Id. at 464, 778 P.2d at 432.
Moreover, NRS 125.155 gives the court discretion to consider directing the
employee spouse to pay the nonemployee spouse his or her share of PERS
benefits at the first eligible retirement date or to order that the
nonemployee spouse wait until the employee spouse actually retires. See
NRS 125.155(2).
Here, while part of the district court's analysis is mistaken,
the outcome of its order is correct. The clause in the MOU provides that
"[t]he QDRO will direct the trustee of PERS to pay to each party their
proportionate share of the account at the time [appellant] retires." The
district court did not expressly acknowledge the ambiguity of this clause,
but we conclude that it is ambiguous because it is reasonably susceptible
to more than one interpretation. Appellant interprets the phrase "at the
time [appellant] retires" as an agreed-upon determination of the time
when respondent is eligible to receive her share. In contrast, respondent
contends that the phrase, within the context of the entire clause, pertains
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to the time of disbursement of the payments; the clause is merely a
procedural instruction to the trustee of PERS to pay the proportionate
share after appellant retires. Respondent asserts that the clause does not
prohibit her from directly seeking her share from appellant, which is how
pre-retirement payments are standardly made. Accordingly, the
calculation of the proportionate share is based on the employee spouse's
eligibility for retirement, and if the employee spouse does not retire when
he is eligible, he must pay the nonemployee spouse the amount that the
nonemployee spouse would have received if the employee spouse had
retired at that time.
In this case, appellant's interpretation ultimately lacks merit
because it results in a harsh and unreasonable contract. The record does
not sufficiently show that respondent intended to wait until appellant
officially retired to collect her share, and this court has repeatedly held
that the nonemployee spouse has a right to her share as soon as the
employee spouse is eligible to retire. Upon consideration of the
circumstances surrounding the MOU and in light of precedent from this
court, we conclude that respondent's interpretation results in a fair and
reasonable contract. Even though the district court dismissed the
ambiguous nature of the clause in the MOU, its decision was nevertheless
correct. See Rosenstein v. Steele, 103 Nev. 571, 575, 747 P.2d 230, 233
(1987) ("[T]his court will affirm the order of the district court if it reached
the correct result, albeit for different reasons"). Thus, the district court
properly ruled that respondent was entitled to receive her share starting
from the time that appellant was eligible to retire. Accordingly, we
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ORDER the judgment of the district court AFFIRMED.
CU/LA a_c? cr , C.J.
Parraguirre
Hardesty
.AD°0-01 , J.
Douglas
J.
J.
J.
cc: Hon. Vincent Ochoa, District Judge
Carolyn Worrell, Settlement Judge
Neil J. Beller, Ltd.
Willick Law Group
Eighth District Court Clerk
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PICKERING, J., dissenting:
The parties mediated the issues regarding dissolution of their
marriage before Robert E. Gaston, who served for eight years as a district
court judge, family court division, before establishing an alternative
dispute resolution service dedicated to civil and domestic court cases. 1
Their mediation culminated in a written settlement agreement, prepared
under the supervision of Judge Gaston, which they signed on May 20,
2008. Addressing retirement/investment accounts, specifically, Eric's
retirement account with PERS, the settlement agreement states that the
parties will split the costs of preparing a QDRO, and that the QDRO "will
'See Settlement Judge Biographies: Robert E. Gaston, Nev. Cts.,
http://nvcourts. gov/Settlement_Program/Biographies/Gaston,_Robert_E_/
(last visited May 12, 2016). I thus do not agree that the parties did not
know what they were signing Right above their signatures, in fact, the
following paragraph appears:
The above Memorandum of Understanding
reflects agreements formulated in mediation on
the 20th day of May, 2008. By signing this
document each party stipulates and agrees that
they have carefully read this document, and the
document accurately reflects the agreement that
each party has entered into on this day, and that
each party voluntarily signs this agreement
without undue influence, coercion or threat. Both
parties represent that they are of sufficient
capacity to understand and enter into this
agreement. The parties agree that this
Memorandum of Understanding represents what
each believes to be a fair and reasonable
resolution of the issues. Both parties acknowledge
the fact that they had the right to have legal
counsel, but have waived that right.
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direct the trustee of PERS to pay each party their proportionate share of
the account at the time Eric retires." A straightforward reading of this
clause suggests that the payments occur "at the time Eric retires," not, as
the majority would have it, at the time Eric becomes eligible to retire.
"A settlement agreement is a contract governed by general
principles of contract law"; when a settlement agreement's "language is
unambiguous, this court will construe and enforce it according to that
language." The Power Co. v. Henry, 130 Nev., Adv. Op. 21, 321 P.3d 858,
863 (2014). As I do not see the settlement agreement as ambiguous, I
would enforce it as written. I therefore respectfully dissent.
CJICht, J.
Pickering
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