Monday, January 25, 2010

Spousal Support Termination Upon Remarriage

How does a practitioner negotiate and draft an order that provides for spousal support to continue beyond the remarriage of the supported spouse? What language, if any, is needed in the judgment to insure that the intentions of the parties are followed?

In re Marriage of Cesnalis (2003) 106 Cal.App.4th 1267; 131 Cal.Rptr.2d 436, the court addresses these concerns.

The Cesnalis’s were marred November 30, 1992. They separated in 1999. The stipulated judgment, prepared by husband’s attorney (after much negotiation), provided in pertinent part as follows:

“Husband shall pay spousal support in the amount of $4,000.00 per month for a period of three years…beginning November 1, 2000 and continuing until either parties’ death or October 20, 2003, whichever occurs first, at which point, spousal support will terminate absolutely. The duration of spousal support will not be modifiable under any circumstances and the termination dates stated herein are absolute, and no court shall have jurisdiction over the issue of spousal support, regardless of whether any motion is made on, before or after October 30, 2003. The parties stipulate that the marriage was one of short duration, and otherwise have bargained carefully for the termination of support contained herein.”

The stipulated judgment for dissolution of marriage was entered on October 25, 2000. The wife remarried on August 6, 2001. The husband, upon learning of wife’s remarriage, moved to terminate spousal support. The trial court, after allowing extrinsic evidence regarding the settlement negotiations, denied husband’s request. Husband appealed.

The Appellate Court confirmed the Trial Court’s decision. First, the Appellate Court cited the relevant Family Code section regarding waiver of the provision for a termination of spousal support obligation upon the remarriage of the supported ex-spouse The Court quoted Family Code Section 4337 which states:

“Except as otherwise agreed by the parties in writing, the obligation of a party under an order for the support of the other party terminates upon the death of either party, or the remarriage of either party.”

The court stated that although no particular or unique language was required to make spousal support continue after the remarriage of the supported spouse, silence on the subject would be insufficient to establish a waiver of the rule that continuing spousal support terminate.

Citing In re Marriage of Thorton (2002) 95 Cal.App.4th 251; 115 Cal.Rptr. 2d 380, the court stated, on page 439, that:

“…remarriage termination is not waived simply because the written agreement fails to include remarriage among the terminating events that are expressly mentioned … (and) the party seeking to overcome a remarriage termination bears the burden of proving, by clear and convincing evidence the requisite written agreement.”

In determining whether or not a waiver occurred in Cesnalis the court indicated that there were two lines of cases. One line followed the analysis in In re Marriage of Glasser, (1986) 181 Cal.App.3d 149; 226 Cal.Rptr. 229, and In re Marriage of Thorton (previously cited). Those cases found that the language used did not waive the remarriage provision for termination of spousal support.

On the other hand, the court cited a line of cases following In re Marriage of Sherman (1984) 162 Cal.App.3d 1132; 208 Cal.Rptr. 832 and Steele v. Langermuir (1976) 65 Cal.App.3d 459; 135 Cal.Rptr. 426, in which the language did constitute a waiver of the spousal support termination provision and therefor susceptible to the admission of extrinsic evidence to determine actual intent. Steele dealt with an agreement that provided for termination upon “death or remarriage” but failed to specify whose death terminated support. Absent more specificity it held that the death language only refered to the death of the supported spouse. The Cesnalis court stated, on Page 439, that the Steele/Sherman line of cases was:

” … more tailored in critical ways. In Steele the agreement provided that spousal support would continue until death, remarriage or the expiration of 20 years and was “‘to be deemed non-modifiable, regardless of any change of circumstances, except for the contingencies contained herein’ … In Sherman, the agreement stated that ‘the amount of support, the method of payment and the terms and conditions of termination of support, all as (previously specified) shall not be modified by the parties or by any court on any grounds.’”

The court found that the language use in the Cesnalis judgment fell more within the lines of the Sherman/Steele cases.

The relevant provision in the stipulated judgment in the Cesnalis judgment spoke of a specified termination date (October 20, 2003) and a specific duration for support that would not be modifiable during that duration. The court stated on Page 440:

“In applying the previously stated principle, how a written agreement may waive Section 4337, … the paragraph does not specifically mention remarriage. But it does say that the only way that the spousal support can end before the three year period elapsed is when one of the parties dies. … (the judgment) reiterates that the three year duration cannot be changed under any other circumstances; it is no stretch to say that a supported spouse’s remarriage would generally be considered the most prominent of such circumstances. Viewed in this light, … (the judgment) cannot be said to be altogether silent on remarriage as a terminating event.”

With regard to the admission of extrinsic evidence the court also found that the Trial Court was correct in admitting same. The court stated on Page 440:

“On the issue of extrinsic evidence, the preceding analysis of paragraph 4 language demonstrates that the paragraph is reasonably susceptible to interpretation as a declaration of intent that support continues beyond remarriage. Because of this reasonable susceptibility, the trial court properly admitted extrinsic evidence on the meaning of paragraph 4 regarding the remarriage.”

The Appellate Court went on to discuss the extrinsic evidence that was admitted at the Trial Court. It was undisputed that the judgment originally drafted by husband’s counsel included the termination of spousal support upon remarriage. Husband contended in a declaration that his then-counsel advised him that taking the provision out regarding the termination of marriage would have no legal effect. Husband also contended in his declaration that at the time of the negotiation, wife’s attorney had stated that although removing same may have no legal effect, that was what wife wanted.

The Appellate Court sustained the Trial Court’s decision in discounting these assertions. The Appellate Court stated on Page 441, that the Trial Court had been correct in finding that if wife and her counsel “…believed that removing the remarriage language from Paragraph 4 would have no legal effect, it would have been nonsensical to bargain for it.”

The Appellate court sustained the finding in the Trial Court that there in fact had been a written waiver of the remarriage termination provision for spousal support.

In dicta, the court indicated its disagreement with the Thorton court’s requirement of language specifically serving as a waiver of the remarriage termination provision for spousal support. Quoting the Thorton case in discussing Family Code Section 4337, the Thorton case states:

“If the parties wish to make a written agreement to waive the remarriage provisions of Section 4337, they must, at a minimum, expressly state that the spouse’s remarriage will not terminate spousal support.”

The Cesnalis court significantly disagrees with Thorton. As the Cesnalis court stated on Page 441:

“We believe this statement goes beyond the requirement of Family Code Section 4337. Taken liberally, this statement would mean that particular words are required to waive Section 4337, and that extrinsic evidence has no relevance in resolving whether a written agreement has waived the Section 4337 remarriage provision. Section 4337 does not go so far as to require a written agreement expressly stating that the support spouse’s remarriage will not terminate spousal support.”

Counsel needs to be vigilant in drafting and negotiating such clauses. Records of the negotiations should be preserved. Cesnalis would suggest that if during the course of negotiations clauses are deleted from such agreements regarding certain issues, particularly termination of spousal support, counsel should not necessarily rely on the un-stated assumption that the ‘current law’ reflects the parties intentions. If there appears to be any hint of language which is “reasonably susceptible to interpretation” of a contrary intent, extrinsic evidence may be allowed to assist the court in determining what the agreement of the parties actually was.
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