COURT OF APPEALS OF VIRGINIA
Present: Judges Benton, Coleman and Fitzpatrick
Argued at Richmond, Virginia
VAUGHAN MONROE CUNNINGHAM
MEMORANDUM OPINION * BY
v. Record No. 0663-95-2 JUDGE SAM W. COLEMAN III
JULY 23, 1996
NOVELLA CUNNINGHAM
FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY
William R. Shelton, Judge
Sharon A. Baptiste (Sylvia Cosby Jones;
Sharon A. Baptiste, P.C.; Sylvia Cosby Jones,
P.C., on briefs), for appellant.
(John E. Dodson; Gordon, Dodson & Gordon, on
brief), for appellee.
Vaughan Monroe Cunningham (husband) appeals the final
divorce decree in which the trial court equitably distributed the
parties' marital property, awarded Novella Cunningham (wife) $500
per month in spousal support and $2,000 in attorney's fees, and
held husband in contempt for wilfully failing to pay $13,050 in
pendente lite spousal support arrears. For the following
reasons, the decree is affirmed in part and reversed in part, and
the case is remanded to the trial court for further proceedings.
EQUITABLE DISTRIBUTION
(1) The trial court erred by failing to correctly calculate
the marital share of husband's military retirement, and by
awarding wife forty-five percent of husband's gross retirement
*
Pursuant to Code § 17-116.010 this opinion is not
designated for publication.
benefits.
When equitably distributing retirement benefits, the trial
court shall classify the "marital share" of retirement or pension
benefits as "marital property." Code § 20-107.3(A)(3)(b).
"'Marital share' means that portion of the total interest, the
right to which was earned during the marriage and before the last
separation of the parties, if at such time or thereafter at least
one of the parties intended that the separation be permanent."
Code § 20-107.3(G)(1); see Gamer v. Gamer, 16 Va. App. 335, 342,
429 S.E.2d 618, 624 (1993).
In this case, the evidence showed that the parties were
married for eighteen of the twenty-one years that husband served
in the military. At the time of the divorce, he had retired and
was receiving monthly retirement benefits. Based on the eighteen
of twenty-one years ratio, the marital share of husband's $1,056
monthly retirement payment is $905.14, of which wife is entitled
to no more than fifty percent or $452.57. Code § 20-107.3(G)(1).
However, rather than calculate the marital share, the trial
court awarded wife forty-five percent of husband's "gross
military retired pay," which amounts to $475.20 per month.
(Emphasis added).
The wife contends the error is insignificant and harmless.
Because the error deprived the husband of the monthly retirement
funds to which he is entitled, the error is not harmless.
Therefore, we reverse the equitable distribution award and remand
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the case for the trial court to determine the marital share of
husband's military retirement benefits in accordance with Code
§§ 20-107.3(A)(3)(b) and 20-107.3(G)(1), and to adjust the
equitable distribution award accordingly.
(2) The trial court erred by awarding wife fifty percent of
the $13,000 in retirement benefits husband earned during his
employment with the Commonwealth of Virginia because the portion
of the retirement proceeds that were earned after the parties
separated are the husband's separate property.
Retirement benefits earned after spouses have last
separated, with the intent to remain permanently separated, are
not marital property and, therefore, not subject to equitable
distribution. Code § 20-107.3(G)(1); Price v. Price, 4 Va. App.
224, 231-32, 355 S.E.2d 905, 909 (1987). Consequently, the trial
court erred by awarding wife fifty percent of the entire $13,000
of husband's state retirement contributions. The parties
separated permanently in July 1989, but the husband continued to
contribute his separate property to the retirement plan after
July 1989 until 1992. Therefore, the equitable distribution
decree awarded wife more than fifty percent of the marital share
of the husband's state retirement proceeds. We reverse this
aspect of the equitable distribution award and remand the case
for the trial court to determine the marital share of the
husband's contributions to the state retirement plan in
accordance with Code § 20-107.3(G)(1), and to adjust the
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equitable distribution award accordingly.
(3) The trial court did not err by awarding wife fifty
percent of the personal injury settlement that husband received
for a back injury he sustained prior to July 1989 when the
parties last separated.
The portion of a personal injury settlement "attributable to
lost wages or medical expenses to the extent not covered by
health insurance accruing during the marriage and before the last
separation of the parties" is marital property and is subject to
equitable distribution. Code § 20-107.3(H). However, the owner
of the settlement has the burden of proving the amount of the
settlement that is attributable to lost wages and medical
expenses. See Thomas v. Thomas, 13 Va. App. 92, 95, 408 S.E.2d
596, 598 (1991).
Husband received approximately $13,000 from a settlement for
a back injury that he suffered in the course of his employment
with the state. He testified that a portion of the settlement
represented pain and suffering, but he could not recall and did
not prove the specific amount allocated for his non-economic
injury. He stated that it was "very little." The evidence is
not sufficient to prove that a specific amount of the settlement
was attributable to husband's damages for other than lost wages
and medical expenses. Accordingly, the trial court did not err
and we affirm the equitable distribution award to the wife of
fifty percent of the husband's personal injury settlement.
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(4) The trial court found that husband and wife incurred
federal and state tax liabilities during certain years of the
marriage during which wife did not work, and that it was
husband's obligation to file income tax returns for those years.
The trial court did not err by refusing to credit husband for
the delinquent tax payments that he made to satisfy their tax
liabilities after they were separated.
Although income tax debts incurred during the marriage are
generally classified as marital debt, a trial court does not
abuse its discretion by holding that a spouse who did not have
earnings and who did not create the liability should not be held
liable for a late filing penalty. See Brett R. Turner, Equitable
Distribution of Property § 6.29, at 457 (2d. ed. 1994). The
trial court did not err by refusing to give husband credit for a
portion of the tax debt when the entire tax obligation was
incurred by the husband.
SPOUSAL SUPPORT
Code § 20-107.1(8) provides that when determining spousal
support a trial court shall consider the "provisions made with
regard to the marital property under Code § 20-107.3."
Accordingly, because we are reversing and remanding "provisions
made with regard to the [equitable distribution of] marital
property," we necessarily must remand the issue of spousal
support for reconsideration. See Brinkley v. Brinkley, 5 Va.
App. 132, 141-42, 361 S.E.2d 139, 143-44 (1987).
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Notwithstanding, because the trial court will necessarily
confront on remand certain spousal support issues that the
parties raise on appeal, we address those issues:
(1) We hold that the trial court erred to the extent that it
based the wife's $500 per month spousal support award, in whole
or in part, on the husband's portion of the marital share of his
military retirement pension.
"Whether spousal support should be paid is largely a matter
committed to the sound discretion of the trial court, subject to
the provisions of Code § 20-107.1." McGuire v. McGuire, 10 Va.
App. 248, 251, 391 S.E.2d 344, 347 (1990). Code § 20-107.1(1)
expressly provides that in setting spousal support the trial
court shall consider a party's financial resources, including
income from "all pension, profit sharing or retirement plans, of
whatever nature." However, the trial court must apply the
provisions of Code § 20-107.1(1) in conjunction with the
provisions and limitation imposed by Code § 20-107.3(G)(1), which
prohibits awarding a spouse in excess of "fifty percent of the
marital share of cash [retirement] benefits actually received by
the party against whom such award is made."
The court may direct payment of a percentage
of the marital share of any . . . retirement
benefits, whether vested or nonvested, which
constitutes marital property and whether
payable in a lump sum or over a period of
time. . . . No such payment shall exceed
fifty percent of the marital share of cash
benefits actually received by the party
against whom such award is made.
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Id. Although Code § 20-107.3(G)(1) by its terms applies to
equitable distribution, and not to spousal support, the clear
purpose of the provision is to ensure that a person who has
contributed to a retirement or pension plan shall be guaranteed
at least fifty percent of the marital share of retirement
benefits actually received in a divorce proceeding. The trial
court cannot indirectly exceed the fifty percent limitation on
the equitable division of the marital share of retirement
benefits by basing the spousal support award, in part, upon the
husband's marital share of his pension.
As previously noted, when the trial court awarded wife
forty-five percent of the husband's "gross military retired pay,"
the court already exceeded the limitation imposed by Code
§ 20-107.3(G)(1). The trial court further exceeds the fifty
percent limitation to the extent that it based the spousal
support award, in whole or in part, upon the husband's remaining
portion of the marital share of his military retirement.
The evidence proved that the husband had monthly income of
$724 as a minister. He also had $1,056 per month in military
retirement benefits, of which he was ordered to pay $475.20 to
wife under the equitable distribution award. His assets
consisted of his equitable distribution award of $8,500 for
one-half the equity from the marital residence, his $6,500 for
one-half of his contributions in Virginia retirement benefits,
and his $6,500 for one-half of his personal injury award.
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Although Code § 20-107.1(1), (7), and (8) expressly provide that
the trial court shall consider the parties' incomes from
pensions; their real and personal property interests; and the
provisions from the equitable distribution award in determining
spousal support, the limitation of Code § 20-107.1(G)(1)
prohibits an award that, to the extent it is based on a party's
cash retirement benefits actually being received, will exceed
fifty percent of the husband's marital share of "cash benefits
actually received by the party against whom such award is made."
Although we cannot say with assurance from this record that
the spousal support award of $500 per month was based upon the
remaining fifty percent of the husband's cash retirement
benefits, on remand the court must take Code § 20-107.1(G)(1)
into consideration. It does not appear that the trial court
based the monthly spousal support award upon husband's equitable
distribution award from his equity in the marital residence, his
share of his state pension contributions, or his share of the
personal injury award. The court had equally divided those
assets and no evidence proved the husband's share generated
income sufficient to pay the monthly award or that the court
intended that husband would be required to liquidate his
resources for that purpose. See Code § 20-107.1(7); L.C.S. v.
S.A.S., 19 Va. App. 709, 715-17, 453 S.E.2d 580, 583-84 (1995).
Furthermore, the court did not base the spousal support award, in
any degree, upon husband's separate property because, as
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previously noted, the court did not determine his separate
interest in either his military retirement or his post-separation
contributions to his state pension. Because the $724 per month
received as a minister would not have supported a spousal support
award of $500, 1 the record indicates that the award may have been
based, at least in part, upon husband's monthly cash retirement
benefits, and to that extent would exceed the fifty percent
limitation of Code § 20-107.1(G)(1). In reconsidering spousal
support on remand, the trial court shall consider the limitation
imposed by Code § 20-107.1(G)(1).
(2) The trial court did not err by finding husband in
contempt for failing to pay the court ordered pendente lite
spousal support, which appellant concedes is in arrears.
A party is in contempt of a court's order to pay spousal
support only when the party fails or refuses to pay the
obligation "in bad faith or [in] willful disobedience of [the
court's] order." Alexander v. Alexander, 12 Va. App. 691, 696,
406 S.E.2d 666, 669 (1991) (quoting Carswell v. Masterson, 224
Va. 329, 332, 295 S.E.2d 899, 901 (1982)). Where the evidence
shows a party's failure to pay spousal support, the offending
party "has the burden of proving justification for his or her
1
Assuming that the trial court relied solely on husband's
income from his church activities in determining spousal support,
ordering husband to pay $500 per month when his income was $724
per month, without explanation, constitutes a clear abuse of
discretion on this record. See Gamble v. Gamble, 14 Va. App.
558, 574, 421 S.E.2d 635, 644 (1992).
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failure to comply." Id.
Here, the pendente lite support order required husband to
pay wife $900 per month. Husband concedes that he did not comply
with the court's order and that the accumulated arrearage is
$13,050. Husband contends, however, that he was unable to pay
the support obligation because his wages were subject to a tax
levy beginning in April 1992, and he left his job with the state
in 1992 for medical reasons. During the period between 1989 and
1992 that the pendente lite support order was in effect, husband
was receiving the full monthly benefits from his military
retirement, his income from his pastoral activities, the state
retirement proceeds, and the personal injury settlement. On
these facts, he had funds available to pay the support
obligation. The trial court did not err by finding that the
defendant wilfully failed to pay support as ordered. The
contempt citation was "not plainly wrong [or] without evidence to
support it." Id. Furthermore, the court did not abuse its
discretion by requiring husband to immediately pay the arrearage
in order to purge the contempt; the order was remedial in nature.
See Rainey v. City of Norfolk, 14 Va. App. 968, 974, 421 S.E.2d
210, 214 (1992).
ATTORNEY'S FEES
The trial court has discretion to award attorney's fees that
are reasonable "under all of the circumstances revealed by the
record." Gamer, 16 Va. App. at 346, 429 S.E.2d at 626 (quoting
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Ellington v. Ellington, 8 Va. App. 48, 58, 378 S.E.2d 626, 631
(1989)). Here, the record shows that wife incurred attorney's
fees of at least $3,281.50. Therefore, the trial court did not
abuse its discretion by awarding wife $2,000 in attorney's fees.
For these reasons, the decree appealed from is affirmed in
part and reversed in part, and the case is remanded for further
proceedings consistent with this opinion.
Affirmed in part,
reversed in part,
and remanded.
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