Opinions, Dec. 29, 2016: You Say Tomato, I Say Contractual Alimony

Happy new year from the Houston Family Law Appeals Blog!

The First District Court of Appeals released its memorandum opinion in Barger v. Barger, No. 01-15-00659-CV this morning which concerns the interpretation of multiple contractual alimony agreements.

Cari and Keith Barger divorced in 2007. At the time they had two minor children. Their agreed decree included provisions for Keith to pay contractual alimony. The contractual alimony provisions also provided for the termination of alimony if Cari remarried or cohabitated with somone “in a conjugal relationship.” In 2009, the parties renegotiated the contractual alimony and signed a Binding Informal Settlement Agreement which included a schedule by which Keith would pay Cari $815,000 over time. This amount would represent the total amount of child support, college payments for their children, and contractual alimony. On March 3, 2010, the trial court entered a reformed order which was based on the settlement agreement. The reformed order did not include a remarriage or cohabitation clause.

In April 2010, Cari remarried, though Keith claimed he learned of the remarriage a year later.

Keith made payments of $3,000 per month from May 2010 until May 2014. In July 2014, Cari filed an enforcement action against him. In March 2015, the trial court heard Cari’s enforcement, and, after comparing the original decree to the reformed order, found the contractual alimony provisions of the reformed order were ambiguous. The trial court then held an evidentiary hearing to determine what the parties’ intention was in omitting the marriage or cohabitation provision from the reformed order.

At issue is the marriage or cohabitation clause (which provided for the termination of the contractual alimony) which was in the original decree but was not in the reformed order. Keith argued that the provision was still valid because the reformed order stated “All other terms of the prior orders not specifically modified in this order shall remain in full force and effect” and the reformed order did not mention the marriage/cohabitation clause. Cari argued that the marriage or cohabitation clause was a terminating event in the original decree specifically modified by the reformed order.

The trial court found that the parties did not intend for the marriage or cohabitation clause to be of continued validity in the reformed order and clarified the reformed order. The reformed order had stated that its intent was to “restructure the contractual alimony provisions set forth in the Agreed Final Decree of Divorce dated October 19, 2007; which shall be reformed as set forth herein.” The trial court revised the reformed order to clarify that “these modifications shall reform and restructure all the provisions contained in the Agreed Final Decree of Divorce dated October 19, 2007, as relates to contractual alimony.” In other words, the marriage/cohabitation clause was no longer in effect because it was not in the reformed order.

Keith appealed, alleging three issues.

First, he argued the trial court erred by not issuing findings of fact and conclusions of law. The Court of Appeals held that the trial court did err by not issuing FF/CL, but the error was harmless because the lack of FF/CL did not prevent Keith from presenting his legal challenge alleging a lack of ambiguity in the reformed order or the propriety of the trial court’s clarification of that order.

In his second issue, Keith argued the trial court erred by concluding the reformed order was ambiguous. The test for ambiguity, the Court of Appeals noted, is whether there is more than one reasonable interpretation of the contract. The Court of Appeals observed that Cari’s interpretation of the reformed order was reasonable but pointedly did not reach whether or not Keith’s interpretation was reasonable because the result was the same either way: 1) If Keith’s interpretation was unreasonable, then the trial court did not err by applying the unambiguous reformed order in Cari’s favor. 2) If Keith’s interpretation was reasonable, then the trial court did not err in finding after an evidentiary hearing that the parties intended to remove the marriage or cohabitation clause.

In his third issue, Keith argued the trial court erred by substantively changing the parties’ agreement because, according to Keith, the parties agreed the reformed order would not supersede the marriage/cohabitation clause. The Court of Appeals held that because the trial court found that the parties intended to remove the marriage or cohabitation clause, it did not err in clarifying the order.

The trial court was affirmed.

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