Michael Horgan v. Kelly DePaolo Horgan ( 2021 )

NOTICE: This opinion is subject to motions for reargument under V.R.A.P. 40 as well as formal
revision before publication in the Vermont Reports. Readers are requested to notify the Reporter
of Decisions by email at: JUD.Reporter@vermont.gov or by mail at: Vermont Supreme Court, 109
State Street, Montpelier, Vermont 05609-0801, of any errors in order that corrections may be made
before this opinion goes to press.
2021 VT 84No. 2021-121
Michael Horgan Supreme Court
On Appeal from
v. Superior Court, Chittenden Unit,
Family Division
Kelly DePaolo Horgan September Term, 2021
Barry D. Peterson, J., Specially Assigned
Amanda M. Hemley and Hillary A. Borcherding of Gravel & Shea PC, Burlington, for
Plaintiff-Appellee.
Jacob Oblak of Bergeron, Paradis & Fitzpatrick, LLP, Essex Junction, for Defendant-Appellant.
PRESENT: Reiber, C.J., Robinson, Eaton, Carroll and Cohen, JJ.
¶ 1. COHEN, J. Wife appeals the family division’s May 2021 order granting
husband’s motion to permit him to purchase the marital home. Wife argues that this was an
impermissible modification of the stipulated property division incorporated into the 2017 final
divorce order. We agree, and reverse.
¶ 2. Wife and husband were divorced in February 2017 through a final order and decree
that incorporated their Marital Settlement Agreement (“MSA”). One term of the MSA provided
that the parties’ marital residence would be sold, that the net proceeds after listed expenses would
be split with sixty percent going to husband and forty percent going to wife, and “that neither
[husband] nor members of his immediate family [would] purchase the property or any portion
thereof, including the two potential building lots.” Since February 2017, husband has been
responsible for maintaining the marital residence, which he believes reaches a cost of
approximately $13,400 each month due to the mortgage and other expenses.
¶ 3. In October 2017, husband filed a motion to vacate the MSA pursuant to Vermont
Rule of Civil Procedure 60(b)(3) and (6). His motion challenged the MSA as a whole and argued
that his lack of legal representation and severe depression at the time of signing the MSA rendered
it legally void. There was a lengthy process in which both parties filed multiple motions and the
family division held hearings on the issues. Ultimately, the family division denied the motion to
vacate in April 2020 after hearing testimony from several medical professionals who treated and/or
assessed husband, finding that husband failed to establish grounds for relief under either Rule
60(b)(3) or (6). The court found that husband did not prove the elements of fraud, duress by
improper threat, or duress by undue influence, and did not show that the MSA was procedurally
or substantively unconscionable, or that he lacked the legal capacity to sign the MSA. Husband
did not appeal the decision to this Court.
¶ 4. In June 2020, husband filed a verified emergency motion to permit his father to
purchase the marital home. Husband alleged several facts in his motion, including that the only
offer for the marital residence was received in September 2015 for over one million dollars below
the asking price, that wife did not agree to reduce the asking price, that wife has not signed the
most recent listing agreements for the residence, and that husband and his father have invested
significant money—approximately four million dollars—in the marital residence. In the motion,
husband’s father offered wife $140,000 for her interest in the marital residence. The motion did
not rely on any law to support husband’s request. Wife responded in opposition, challenging
husband’s father’s right to intervene under Vermont Rule of Civil Procedure 24 and disagreeing
with several of the alleged facts, including husband’s allegations about her unwillingness to sign
the listing agreements, and noting that she was willing to accept the September 2015 offer.
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¶ 5. The court issued an entry order in July 2020 stating that it would set a hearing when
the court’s schedule permitted and that “[t]he Court will permit [husband] to purchase the property
once the Court determines the property[’]s current fair market value and what obligations need to
be paid prior to the parties splitting the equity pursuant to the Marital Settlement Agreement.” A
hearing was subsequently set for August 2020. Wife moved to continue the hearing. The court
issued an entry order granting her motion and stating that it anticipated setting a hearing “on all
outstanding issues including to establish the fair market value for the marital residence; and giving
[husband] and/or [husband]’s father an opportunity to purchase the property.” In December 2020,
wife filed a motion to enforce the MSA, asking the court to prohibit husband and his family from
buying the marital residence.
¶ 6. In May 2021, the court held a hearing on all pending motions, including husband’s
motion to purchase the marital home and wife’s motion to enforce. It subsequently issued an order
denying wife’s request to prohibit husband or his father from purchasing the property. It stated:
Pursuant to the Court’s Entry Regarding motion dated 7-7-20, and
Entry Regarding Motion dated 8-13-20 the Court notified the parties
of its decision to permit [husband] or [husband]’s father to purchase
the property once the Court determines the property’s fair market
value and what obligations were to be paid prior to the parties
splitting the equity pursuant to the Marital Settlement Agreement.
Neither party requested reconsideration or appealed the Court’s 7-
7-20 or 8-13-20 decisions.
The May 2021 order awarded husband the sole title, use, and possession of the marital residence,
subject to husband paying wife $338,171.25 for her share of the equity and removing her name
from any associated debts.
¶ 7. Wife appeals to this Court, arguing that Vermont precedent prohibits modifying a
final divorce property division and therefore the May 2021 order was inconsistent with the law.
Husband counters that wife failed to appeal from the July 2020 and August 2020 entry orders and
therefore this appeal is untimely. He further argues that the order was an enforcement rather than
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a modification of the divorce decree, and wife is estopped from pursuing this appeal because she
created obstacles to selling or renting the marital residence.
¶ 8. We review questions of law de novo. Louko v. McDonald, 2011 VT 33, ¶ 7, 189
Vt. 426, 22 A.3d 433. Before addressing the merits of wife’s arguments regarding the modification
of the divorce decree, we first dispose of husband’s assertion that wife’s appeal is untimely.
¶ 9. Husband’s argument that wife’s appeal is untimely rests on his assertion that the
July and August 2020 entry orders were final appealable orders. We disagree. As this Court has
repeatedly held, “the test of whether a decree or judgment is final . . . is whether it makes a final
disposition of the subject matter before the court.” In re Webster’s Est., 117 Vt. 550, 552, 96 A.2d
816, 817 (1953); see also Morissette v. Morissette, 143 Vt. 52, 58, 463 A.2d 1384, 1388 (1983)
(same); Woodard v. Porter Hosp., Inc., 125 Vt. 264, 265, 214 A.2d 67, 69 (1965) (same). Although
the entry orders issued in July and August 2020 expressed the family division’s intent to allow
husband or his father to purchase the marital residence, they were not final appealable orders. The
intent expressed in both orders was conditioned on the occurrence of a hearing and findings of fact
related to the fair market value of the marital residence; it is conceivable that the family division
could have ultimately reversed course after the hearing and denied husband’s request. It was not
until the May 2021 order that the family division officially “awarded sole title, use, and possession
of the marital residence” to husband. Therefore, it was in the May entry order that the family
division made a final disposition of the subject matter—that is, the ownership and fair market value
of the marital residence—before the court. It would be inappropriate and contrary to judicial
efficiency to require wife to engage in a piecemeal appeal from the earlier entry orders when the
matter was not finally disposed and the record not fully developed. See In re Pyramid Co. of
Burlington, 141 Vt. 294, 300, 449 A.2d 915, 918 (1982) (“Piecemeal appellate review causes
unnecessary delay and expense, and wastes scarce judicial resources.”).
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¶ 10. Having concluded that wife’s appeal is timely, we turn to her argument that the
court improperly modified the final property division by transferring title of the marital residence
to husband. Vermont law prohibits the modification of property divisions resulting from a divorce
decree “absent circumstances, such as fraud or coercion, that would warrant relief from a judgment
generally.” Boisselle v. Boisselle, 162 Vt. 240, 242, 648 A.2d 388, 389 (1994). Under Vermont
Rule of Civil Procedure 60(b) Relief from a Judgment or Order, these circumstances include six
potential justifications such as fraud, misconduct, and mistake. V.R.C.P. 60(b).
¶ 11. Wife is correct that transferring ownership of the marital residence to husband is a
modification because it contravenes the express language and intent of the divorce decree’s
prohibition on selling the property to husband or his family. Husband argues that the superior
court enforced rather than modified the divorce decree because the marital residence was on the
market for six years with only one offer for below market value and the May 2021 order provided
wife with her allotted forty percent of the proceeds from the sale. He asserts that paying wife forty
percent of the fair market value of the marital residence ultimately benefits wife and does not alter
the intended asset division. In addressing the issue of the express provision prohibiting him and
his family from purchasing the marital residence, husband alleges that enforcement orders may
contradict an agreement’s plain language to effectuate the agreement’s intent.
¶ 12. It is true that Vermont courts may issue supplemental orders to enforce final
property divisions resulting from a divorce decree. Mason v. Mason, 2006 VT 58, ¶ 15, 180 Vt.
98, 904 A.2d 1164. However, the cases husband cites in his brief do not support his assertion that
the family division enforced rather than modified the divorce decree in the present case.
¶ 13. In Mason, this Court upheld the family division’s enforcement of the final divorce
decree by requiring wife to transfer husband an additional 8033 shares of stock despite a stipulation
in the decree that required a specific number transfer not including the additional 8033 shares. Id.
¶ 1. The Court’s decision rested on the fact that wife knew about and hid knowledge of an
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impending stock split before the parties signed the stipulation. Id. ¶ 3-5. As a result of her failure
to disclose the information, the division of stock shifted from one-third to husband and two-thirds
to wife as intended in the stipulation to one-fifth to husband and four-fifths to wife after the stock
split. Id. ¶ 5. In prioritizing the designated proportions rather than the specifically enumerated
number of shares, the family division did not modify the divorce decree but rather enforced the
intended division of marital property. Id. ¶ 16.
¶ 14. Similarly, in Schwartz v. Haas, this Court upheld the family division’s enforcement
of the final divorce decree by offsetting $50,000, the amount wife owed husband for her share of
the marital estate, from husband’s monthly maintenance obligation. 169 Vt. 612, 613, 739 A.2d
1188, 1189 (1999) (mem.). As we explicitly noted in the entry order, “We view this situation as
one in which the family court was not modifying its property division or maintenance award but,
rather, was seeking to enforce the terms of the decree as originally entered in the face of
intransigence by one of the parties.” Id. at 614, 739 A.2d at 1190. The enforcement used setoff
as an equitable remedy rather than a permanent modification of the divorce decree, and it was
through this remedy that the Court was able to “reduce the multiplicity of actions” and expedite
distribution. Id. at 614, 739 A.2d at 1191.
¶ 15. The present case is distinguishable. Although the difference between what may be
considered enforcement compared to a modification of property division is not an exact science, a
court cannot enforce the parties’ divorce decree by simply ordering a transfer of money to
effectuate the decree’s original intention where it is contrary to the stipulated final order and
objected-to by a party. Allowing husband or his family to purchase the marital residence would
directly violate a specific provision in the agreed-upon order, which expressly prohibited husband
or his family from purchasing the marital residence. By effectively asking the court to strike an
explicit term of the agreement, husband was seeking a modification rather than enforcement of the
divorce decree.
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¶ 16. Because husband was seeking to modify the divorce decree, his primary avenue for
relief was a motion for relief from judgment under Rule 60. The superior court’s May 18, 2021
order was a modification of the property division in violation of Vermont law asserting the finality
of property divisions in divorce proceedings. Boisselle, 162 Vt. at 242, 648 A.2d at 389. Rule
60(b) provides that the court, on motion, may relieve a party from a final judgment for six
enumerated reasons. The order on appeal was not the result of husband’s request for relief under
Rule 60(b) to vacate the specific provision prohibiting him or his family from purchasing the
marital residence, and the superior court’s orders do not indicate that any of the criteria for relief
under that rule are met. Modifying the divorce decree by allowing husband or his family to
purchase the marital residence would contravene Vermont’s long-standing prohibition of
modifying property divisions in divorce decrees and is inappropriate here. If husband were truly
attempting to enforce rather than modify the MSA, he could have filed a motion to enforce seeking
other available remedies related to the pricing or marketing of the property to expedite the sale.
See, e.g., Mansfield v. Mansfield, 167 Vt. 606, 608, 708 A.2d 579, 582 (1998) (mem.) (upholding
family court’s order placing marital home at fair market value, to be reduced by $10,000 every
ninety days it remained unsold).
¶ 17. Finally, we reject husband’s argument that wife was estopped from enforcing the
MSA because she created obstacles to renting or selling the marital residence to a third party. The
family division did not make any findings of fact related to wife’s alleged interference, and did not
address this argument in the first instance. In general, issues not presented to the trial court cannot
then be raised on appeal. O’Rourke v. Lunde, 2014 VT 88 ¶ 17, 197 Vt. 360, 104 A.3d 92.
Husband is therefore prevented from arguing estoppel or clean hands on appeal. Even if wife’s
actions did reach the level of interference with selling the property, the family division has other
 Husband’s 60(b) motion to vacate from October 2017 sought to vacate the entire MSA
and was denied as detailed above.
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avenues as described above to prevent further interference and promote the sale of the marital
residence without improperly modifying an explicit provision in the divorce decree.
Reversed.
FOR THE COURT:
Associate Justice
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