Armendariz v. Armendariz ( 2018 )

2018 UT App 175THE UTAH COURT OF APPEALS
GARY LYNN ARMENDARIZ,
Appellant,
v.
PIXIE MARIE ARMENDARIZ,
Appellee.
Opinion
No. 20160997-CA
Filed September 7, 2018
Second District Court, Farmington Department
The Honorable John R. Morris
No. 044700632
Matthew G. Koyle, Attorney for Appellant
Robert L. Neeley, Attorney for Appellee
JUDGE KATE A. TOOMEY authored this Opinion, in which
JUDGE GREGORY K. ORME concurred. JUDGE RYAN M. HARRIS
concurred, with opinion.
TOOMEY, Judge:
¶1 Gary Lynn Armendariz and Pixie Marie Armendariz
divorced in 2005 after almost twenty-nine years of marriage.
Gary 1 entered early retirement in 2015, claiming that physical
pain prevented him from working in a position similar to his
employment during the marriage. As a result, Gary’s income
decreased after he retired, and he petitioned the district court to
modify the divorce decree by terminating Pixie’s award of
1. “As is our practice in cases where both parties share a last
name, we refer to the parties by their first name with no
disrespect intended by the apparent informality.” Smith v. Smith,
2017 UT App 40, ¶ 2 n.1, 392 P.3d 985.
Armendariz v. Armendariz
alimony (the Petition to Modify). The district court denied the
Petition to Modify, concluding that Gary’s retirement was
foreseeable at the time of divorce and that his early retirement
was voluntary and therefore did not constitute a material and
substantial change of circumstances. Gary appeals, and we
affirm.
¶2 Gary and Pixie’s 2005 divorce decree identified three
events that would terminate Gary’s alimony obligation:
(1) Pixie’s remarriage, (2) “her creation of a cohabitation
relationship with a person of either sex,” or (3) “her death.” It
also provided that Pixie would receive a “50% distributive share
of [Gary’s] federal civilian employment civil service retirement
account as of and not beyond the entry date of the decree of
divorce.” Gary had worked as an aircraft mechanic at Hill Air
Force Base for thirty-five years before retiring at the age of
sixty-one.
¶3 Near the end of 2014, Gary filed the Petition to Modify,
asking the court to modify the divorce decree and terminate his
alimony obligation, based on his planned retirement the next
year. According to the Petition to Modify, he wanted to retire
early because he was “simply unable to continue [working].”
Because of his retirement, Gary asserted that, “[f]or some reason,
[Pixie] believes she is entitled to her alimony, and her
appropriate share of [Gary’s] retirement accounts, which would
obviously be inappropriate and inequitable.”
¶4 During the bench trial, Gary testified that he suffered an
injury in a car accident in 1998 that broke all of the metatarsal
bones in his foot. Then, in 2011 and 2012, Gary underwent
shoulder surgeries to repair torn rotator cuffs in each shoulder.
As a result of these injuries, Gary claimed it was too painful to
continue working and therefore sought early retirement.
¶5 After the bench trial, the court entered an order with
supporting findings of facts and conclusions of law. The court
concluded that it “[did] not have jurisdiction to terminate
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alimony” because Gary’s retirement was foreseeable at the time
of divorce and nothing in the divorce decree provided that
retirement would terminate his alimony obligations. It found
that the divorce decree allocated half of Gary’s retirement
account accrued during the time of the marriage to Pixie, but the
decree did not provide that receipt of the retirement funds
would “modify, terminate, or amend the award of alimony to
[Pixie].” In its oral ruling, the court also found that there was no
evidence, other than Gary’s anecdotal statements, that his
injuries rendered him disabled and unable to continue working.
It further found that Gary “admitted under cross-examination
that he didn’t even seek alternative employment or
reassignment,” and he did not provide any information that his
employer had “talked to him about the quality of his work” or
his ability to continue working. Without additional evidence to
support his inability to continue working, the court concluded
that his early retirement was voluntary. For these reasons, the
court denied the Petition to Modify. Gary appeals.
¶6 Gary contends the district court erred in determining that
his retirement was foreseeable at the time the divorce decree was
entered. “In a divorce action, the district court is permitted
considerable discretion in adjusting the financial and property
interests of the parties, and its actions are entitled to a
presumption of validity.” Anderson v. Anderson, 2018 UT App 19,
¶ 19, 414 P.3d 1069 (quotation simplified). We review a district
court’s determination regarding a petition to modify a divorce
decree for an abuse of discretion. MacDonald v. MacDonald, 2017
UT App 136, ¶ 7, 402 P.3d 178, aff’d, 2018 UT 48; see also Earhart v.
Earhart, 2015 UT App 308, ¶ 5, 365 P.3d 719 (“A district court’s
determination regarding whether a substantial change of
circumstances has occurred is presumptively valid, and our
review is therefore limited to considering whether the district
court abused its discretion.”).
¶7 The district court “has continuing jurisdiction to make
substantive changes and new orders regarding alimony based on
a substantial material change in circumstances not foreseeable at
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the time of the divorce.” Utah Code Ann. § 30-3-5(8)(i)(i)
(LexisNexis Supp. 2017) (emphasis added). In MacDonald, this
court addressed the “foreseeability standard” and determined
that, rather than use “the verb ‘foresee’ in its past tense,
‘foreseen,’” the “legislature employed the adjective ‘foreseeable,’
which includes not only those circumstances which the parties
or the court actually had in mind, but also circumstances that
could ‘reasonably be anticipated’ at the time of the decree.” 2017
UT App 136, ¶ 11. Our supreme court has affirmed our
interpretation of section 30-3-5-(8)(i)(i) and clarified that “the
foreseeability inquiry requires a threshold determination of the
relevant scope of information to be considered” and that “it is
not enough to simply note that something is foreseeable if it can
be reasonably anticipated.” See MacDonald v. MacDonald, 2018
UT 48, ¶ 31. The inquiry of foreseeability is therefore limited to
the universe of information that was presented in the record at
the time the district court entered the divorce decree.” Id. ¶ 5.
¶8 Here, the fact of Gary’s retirement was a foreseeable event
at the time of the divorce. Gary contributed to a retirement
account during the marriage, and a provision of the divorce
decree provided that Pixie was entitled to half of that account
accrued during their marriage. The fact of Gary’s retirement was
therefore “foreseeable under the express terms of the decree.”
See id. ¶¶ 5, 44. And Gary admitted at the bench trial that
“[w]hen [he] divorced [Pixie] in 2005 . . . [he had] anticipated to
work until [he] was 65.” The divorce decree also identified three
specific events that would terminate Pixie’s alimony, but nothing
in the decree “specifically call[ed] out retirement as an event
which would terminate the alimony obligation.” None of these
provisions included language that Gary’s retirement or the
distribution of half of his retirement fund to Pixie would
terminate Gary’s alimony obligation. 2 We therefore conclude the
2. Similar to the appellant in MacDonald, Gary argues that
Bolliger v. Bolliger, 2000 UT App 47, 997 P.2d 903, is controlling
and that this court should apply the standard from a prior
(continued…)
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district court did not abuse its discretion in determining Gary’s
retirement was a foreseeable event at the time the divorce decree
was entered 3 and that nothing in the decree supports the
conclusion that retirement was a triggering event for termination
of his alimony obligation. 4
(…continued)
version of Utah Code section 30-3-5(8)(i)(i). But MacDonald
explicitly stated that, although the Bolliger court “did not address
whether the 1995 amendment [to this statute] altered the
applicable standard . . . the standard did change and we apply
that standard today.” 2017 UT App 136, ¶ 16; see also MacDonald
2018 UT 48, ¶¶27–29. As a result, any reliance on cases that do
not apply the current foreseeability standard for a petition to
modify alimony is misplaced.
3. Because we conclude Gary’s retirement was a foreseeable
event at the time of divorce and nothing in the divorce decree
provided that retirement would terminate Gary’s alimony
obligation, we decline to address the remainder of Gary’s
arguments that relate to whether his early retirement was
voluntary.
4. This latter proposition is not surprising as a legal matter,
although it is perhaps counterintuitive at first blush. Alimony is
a form of support, terminable on remarriage and other specific
occurrences, limited to the duration of the marriage, and subject
to adjustment in the event of a material change of circumstances.
See generally Utah Code Ann. § 30-3-5(8)–(10) (LexisNexis Supp.
2017). In contrast, retirement benefits are a property interest,
allocable to the named beneficiary if separate property or
distributed as marital property if part of the marital estate. See
Johnson v. Johnson, 2012 UT App 22, ¶¶ 11–13, 270 P.3d 556, aff’d
in part and rev’d in part on other grounds by 2014 UT 21, 330 P.3d
704. Entitlement to retirement benefits is not a function of need,
and that entitlement does not end with remarriage or
(continued…)
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¶9 We conclude that Gary’s retirement was foreseeable at the
time the divorce decree was entered and the decree did not
provide that Gary’s alimony obligation would terminate upon
his retirement. Accordingly, we affirm.
HARRIS, Judge (concurring):
¶10 I concur in full with the majority opinion, because in my
view the result in this case is compelled by the plain language of
Utah Code section 30-3-5(8)(i)(i), which allows district courts to
(…continued)
cohabitation. See id. ¶ 11 (providing that “an employee spouse’s
retirement benefits are subject to equitable distribution in a
divorce proceeding, provided that the benefits accrued in whole
or in part during the marriage” (quotation simplified)). But there
is an indirect connection between the two. Alimony is a function
of need and ability to pay. See Utah Code Ann. § 30-3-5(8)(a)(i)–
(iii). To the extent that a spouse otherwise entitled to alimony
becomes eligible for retirement benefits, her actual need may
well be reduced. And by the same token, if the spouse obligated
to pay alimony receives less in retirement than he earned while
working, his ability to pay may likewise be reduced. Seen from
this perspective, Judge Harris makes an excellent point: where a
payor spouse experiences a drop in income at retirement, or
where a payee spouse receives significant benefits associated
with either spouse’s retirement, such changes may well make
alimony unnecessary or at least suggest that the amount of
alimony be reduced. Thus, anticipating such changes and
adjusting alimony accordingly, either prospectively or at the
time they occur, makes a great deal of sense. See infra ¶¶ 10–12.
But the majority does not see any need for amendment of the
applicable statute. Family law practitioners need only recognize
that in all but a handful of divorce cases, retirement is inevitable,
and thus a foreseeable, event. As such, it should routinely be
dealt with explicitly in the divorce decree.
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modify alimony orders only where there exists a change in
circumstances that is both (a) substantial and material, and (b)
“not foreseeable at the time of the divorce.” (LexisNexis Supp.
2017); see also MacDonald v. MacDonald, 2017 UT App 136, ¶ 12,
402 P.3d 178 (interpreting the statute to require that “a change in
circumstances, even a substantial one, can only form the basis for
the modification of alimony if that circumstance was not
foreseeable—as opposed to actually foreseen—at the time of the
divorce” (quotation simplified)), aff’d, 2018 UT 48. As the
majority opinion recognizes, retirement will usually be
foreseeable, and clearly was in this case. See supra ¶ 7.
Accordingly, I agree that the district court did not abuse its
discretion in determining that the requirements of the statute
were not met, and therefore did not err in declining to consider a
modification to the applicable alimony order.
¶11 I write separately for two reasons. First, I wonder whether
this result—especially as applied to retirement—is truly what
our legislature intended. While it is of course the legislature’s
task—and not ours—to weigh competing policy considerations
and craft legislation, it seems to me that there are compelling
policy reasons to prefer the rule discussed in our previous
decision in Bolliger v. Bolliger, 2000 UT App 47, 997 P.2d 903,
interpreting the statutory language in effect prior to the 1995
statutory amendment discussed in MacDonald, 2017 UT App 136,
¶ 12 n.4. Under the previous rule, “a party’s retirement or receipt
of social security, unless expressly foreseen at the time of the
divorce, may amount to a substantial material change of
circumstances entitling the petitioner to a determination of
whether the alimony [order] should be modified.” Bolliger, 2000
UT App 47, ¶ 20. The language of the current statute, by
contrast, could give rise to situations in which payor spouses are
saddled with alimony obligations that were computed based on
pre-retirement income but that, subsequent to their retirement,
they may not realistically be able to meet. If that result is not
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what the legislature intended, then it should consider amending
the statute.
¶12 Second, assuming that the current statutory scheme
remains in place, I urge family law practitioners and district
judges, when negotiating and drafting alimony provisions in
decrees of divorce, to make a practice of taking into account the
parties’ likely future retirement, and making appropriate ex ante
adjustments to the payor spouse’s future payment obligations to
account for significant foreseeable post-retirement changes in the
parties’ financial situation, including the extent to which the
payee spouse will receive significant retirement benefits, and
including any changes in the payor spouse’s income.
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