Denmark v. Denmark

[Cite as Denmark v. Denmark, 2015-Ohio-4292.]

IN THE COURT OF APPEALS OF OHIO
SECOND APPELLATE DISTRICT
MONTGOMERY COUNTY

SCOT DENMARK :
:
Plaintiff-Appellee : Appellate Case No. 26438
:
v. : Trial Court Case No. 2010-DR-259
:
BARRIE DENMARK : (Appeal from Domestic Relations
: Court)
Defendant-Appellant :
:

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OPINION

Rendered on the 16th day of October, 2015.

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L. ANTHONY LUSH, Atty. Reg. No. 46565, 2160 Kettering Tower, Dayton, Ohio 45423-
1001
Attorney for Plaintiff-Appellee

THOMAS R. SCHIFF, Atty. Reg. No. 39881, 500 Lincoln Park Boulevard, Suite 216,
Kettering, Ohio 45429-6412
Attorney for Defendant-Appellant

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WELBAUM, J.

{¶ 1} In this case, Defendant-Appellant, Barrie Denmark, appeals from an entry

and order granting the motion of Plaintiff-Appellee, Scot Denmark, for clarification of a

divorce decree between the parties and reducing the spousal support paid to Barrie for a

period of 39 months.1 In support of her appeal, Barrie contends that the language of the

divorce decree is not ambiguous or unclear, and the trial court, therefore, did not have

the ability to modify or clarify the decree.

{¶ 2} We conclude that the trial court did not err in clarifying the decree and

modifying Barrie’s spousal support. Accordingly, the judgment of the trial court will be

affirmed.

I. Facts and Course of Proceedings

{¶ 3} As background leading to the filing of the motion before the trial court, we

note the following facts in the record. On March 12, 2010, Scot filed a complaint seeking

a divorce from Barrie. Both parties were represented by counsel during the proceedings,

and a final judgment and decree of divorce was filed on February 7, 2011. In the decree,

the court noted that the parties had entered into an agreement resolving most questions

as to spousal support, the division of property, the division of indebtedness, and other

matters, and the court approved their agreement. Only one matter – the marital

residence – was the subject of some disagreement.

{¶ 4} Previously, in February 2009, Fifth Third Bank (“Fifth Third”) had filed a

foreclosure complaint against Scot and Barrie in connection with a home they owned at

1 For purposes of clarity, we will refer to the parties by their first names.
 -3-

528 Misty Morning, Dayton, Ohio. Fifth Third held two notes and mortgages on the

property. Both parties had signed the first note, which was entered into in 2003, for an

original principal amount of $367,500. Both parties were jointly and severally liable on

the note, and Fifth Third had placed a first mortgage on the residence to ensure payment

of the note.

{¶ 5} Both parties had also signed what was called a Consumer Note in the amount

of $300,400 in September 2007, and Fifth Third obtained a second mortgage on the

property to ensure payment of the note. Both parties again were jointly and severally

liable on the Consumer Note. The February 2009 foreclosure proceeding involved only

the Consumer Note.

{¶ 6} In July 2009, Scot and Barrie signed a forbearance agreement, as a result of

which Fifth Third agreed not to enforce its rights or take judgment on the Consumer Note

so long as Scot and Barrie complied with the terms of the agreement, which required

them to pay $2,000 per month beginning July 1, 2009, and continuing on the first of the

month thereafter. The agreement was set to expire on January 1, 2010.

{¶ 7} On August 28, 2009, Fifth Third Bank dismissed its foreclosure action against

the Denmarks, without prejudice. As was noted, the divorce action was filed on March

12, 2010. On March 31, 2010, Scot and Barrie signed a first amended forbearance

agreement, which extended the term of forbearance until October 31, 2010. The

Denmarks again agreed to pay $2,000 per month on the obligation, which at that time

was $290,817.72.

{¶ 8} On November 22, 2010, Scot and Barrie signed a second amended

forbearance agreement, which extended the term of forbearance until April 30, 2011,
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again contingent on the payment of $2,000 per month toward the debt, which at that point

was $282,369.01. During the divorce proceedings, Barrie continued to live in the Misty

Morning home.

{¶ 9} The final divorce decree was filed on February 7, 2011, prior to the time that

the second forbearance agreement expired. On February 5, 2011, Barrie sent an email

to Scot, indicating that she hoped to know no later than June 1 whether she would be

leaving Dayton for a new job or for training for a new career. She also said that she

could leave town as early as July 1, 2011. Barrie then made a proposal that she

indicated had never been presented to Scot. First, she proposed that she would receive

half of his income in spousal support. The second condition involved the house, which

had been for sale during the divorce proceedings. In this regard, the email stated:

We will reduce the price of the house immediately and ask Lois to

reposition it as: MUST SELL.

With the narrow upturn in the market and the spring selling season

upcoming, I think we can sell it by summer’s end. Scot, even though both

of our attorneys are too lazy to check it out, I have copies of articles in recent

ABA journals, under the legal ethics section, showing that the Ohio, NY and

Florida bars, among others are, in practice, not theory, permanently

preventing new applicants from being able to sit for the bar exam due to

foreclosure, bankruptcy and other credit issues. I will have copies of these

articles with me in court on Monday. By agreeing to allow the bank to take

over the house, I will create a situation where I cannot ever sit for the bar -

-- and I would like to become an attorney. You certainly understand that I
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cannot sign anything to that effect. I am not just being arbitrary. If at the

end of the summer selling season the court orders me to allow the house to

be returned, I will have to do that with a statement that it is against my

wishes and ethical views. As it is now, I am able to explain that the

situation was handled without my knowledge, that we hired counsel to work

on our behalf to get the banks to allow us to pay and that we would

eventually pay the shortfall when the house is sold at a loss.

Plaintiff’s Ex. 6, p. 2.

{¶ 10} The email also included a proposed real estate provision which indicated,

among other things, that the property was currently listed for sale with a realtor, and that

if the property were sold within 7 months, the parties would be equally entitled to the net

equity, or would be equally liable for a shortfall if a deficit existed at closing. This

provision also stated that “[a]t the end of the 7 months, if there is no sale and no

agreement to extend the sale window, the property will be allowed to go into foreclosure,

and the parties will share equally in any and all resulting damages or judgments related

thereto.” Id. at p. 3.

{¶ 11} According to Barrie’s testimony, her attorney had probably written the real

estate provision that was included in the email. As was previously noted, most of the

decree was entered pursuant to the agreement of the parties. Regarding the real estate,

the decree contained the following provision:

3. REAL ESTATE: The parties are owners of the real estate

located at 528 Misty Morning, Dayton, Ohio 45429. The parties have two

debts to Fifth Third Bank associated with this property, with balances
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totaling in excess of $600,000.00. As a result of an existing default on the

note, Fifth Third Bank filed a foreclosure action against the property, which

is still pending. The parties have entered into a forbearance agreement

with Fifth Third Bank which has been extended and currently expires in May

2011. The property has been listed for sale for an extensive period and

has not sold. On February 6, 2011, the parties instructed the realtor to

lower the price to $450,000.

While the court is aware that this is the only issue the parties could

not agree upon, and the court having heard the stipulations of the parties,

and the concern of the Defendant regarding her desire to sit for the Bar

Exam in the future, all these points having been considered, the terms and

conditions of this provision are an ORDER of this court not an agreement

of the parties.

If the property is sold by July 31, 2011, or before the note extension

has ended, the parties shall be equally entitled to the net equity proceeds

from the sale, or if there is a deficit at the time of sale or disposition, the

parties shall be equally liable for any shortfall at the time of closing or

judgment. The parties can agree to extend or shorten the sale period from

the July 31st date set out above. The Defendant can try to buy out the

property just as a third party on or before the note extension fails or by July

31, 2011, from the current creditors, and the Plaintiff shall reasonably

cooperate to allow the purchase. However, any deficit for the Defendant’s

purchase will be split equally between the parties as if it were a third party
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sale. On July 31, 2011, or the expiration of the note extension, whichever

shall first occur, if there is no sale and no agreement to extend the sale

window, the property will proceed to foreclosure in accordance with the

pending foreclosure, and the parties will share equally in any and all related

damages or judgments related thereto. Neither party will be required to

pay any further monies toward said property after July 31, 2011, except as

same may be ordered in any foreclosure proceeding.

During the pendency of the sale, the parties shall equally split the

mortgage and commercial loan obligations, the homeowners insurance and

the real estate taxes, in addition to the community/homeowner fee

assessments. All utilities and other expenses shall be the sole

responsibility of the Defendant and she shall hold the Plaintiff harmless and

blameless thereon until any closing or the occurrence of the loss of the

forbearance extension or July 31, 2011 whichever shall first occur. To the

extent she hasn’t already done so, the Defendant shall immediately place

all utilities or services for the home in her sole name. However, any realtor

recommended repairs shall be split equally by the parties at the time they

are incurred. In addition, any property maintenance related to preparing

the house for sale shall be limited to $1,500.00 per person per year to be

the equal responsibility of the parties.

Any taxes associated with a sale or foreclosure shall be shared

equally by the parties. The parties shall split the tax deductions associated

with the property equally.
 -8-

Final Judgment and Decree of Divorce, Doc.# 17, pp. 2-3.

{¶ 12} Under the divorce decree, Barrie was also given spousal support of $17,500

per month from March 1, 2011 through July 31, 2011 or until she was employed,

whichever occurred first. Spousal support after that time was to be $16,200 per month

until the death of either party or Barrie’s remarriage. The court also retained continuing

jurisdiction over the issue of spousal support.

{¶ 13} After the divorce decree was filed, Barrie lived in the house until July 31,

2011. She then moved to Pittsburgh to attend law school. On April 27, 2011, the parties

signed a third amended forbearance agreement with Fifth Third, which extended the term

of forbearance until October 30, 2011. The Denmarks again agreed to pay $2,000 per

month on the obligation, which at that time was $274,161.92. On July 25, 2011, Scot

wrote an email to Barrie regarding his potential purchase of the house as a “short sale”

and his attempts to refinance the loans to remove Barrie’s name. At that time, Barrie

responded that “I will pay my half of the short sale to the bank on a monthly basis or to

you based on the rate deal you work out.” Plaintiff’s Ex. 12, p. 1.

{¶ 14} After Barrie moved out of the house, Scot moved in and continued to

negotiate with Fifth Third regarding the restructuring of the loans on the property. In

December 2011, both Barrie and Scot signed a fourth amended forbearance agreement,

which extended the term of forbearance until October 30, 2012. The Denmarks again

agreed to pay $2,000 per month on the obligation, which at that time was $265,383.42.

{¶ 15} In June 2012, Scot authorized his attorney to send a letter to Barrie’s

attorney, indicating that negotiations with the bank had been unsuccessful and that Scot

would be making no further payments on the mortgage. At the time, Barrie was studying
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abroad and was not apparently communicating with anyone in the United States. When

Barrie returned, she learned that Scot was no longer making payments on the mortgages.

On August 1, 2012, Barrie’s attorney sent a letter to Scot’s attorney stating as follows:

It has come to my attention that Mr. Denmark has stopped paying

the mortgage on the residence at 528 Misty Morning, Dayton, Ohio 45429

which will in essence allow the house to go into foreclosure.

As you are also aware, there is going to be a shortfall of some

amount that the parties will be required to split with respect to one or both

mortgages if the house proceeds to foreclosure.

Plaintiff’s Ex. 18, p. 1.

{¶ 16} The letter proposed that a realtor be obtained so that the house could be

rented until a foreclosure action reached its conclusion. Id. On September 17, 2012,

Scot’s attorney sent Barrie’s attorney a notice from Fifth Third, which indicated the bank’s

intent to proceed with foreclosure regarding the property. Scot’s attorney asked for a

meeting between the attorneys to discuss how to proceed with Fifth Third. Neither Barrie

nor her attorney responded to this letter.

{¶ 17} According to Barrie, Fifth Third called and asked her to come in to talk about

the loans. Barrie and her attorney met with the bank on September 20, 2012. The bank

wanted her to bring the Consumer Note loan (which had been subject to the forbearance

agreements) current so that it appeared current on their books for that quarter. In

exchange, Fifth Third would release Barrie from any liability on the Consumer Note.

Barrie did not inform Scot of either her meeting or the proposed agreement with the bank,

because the bank wanted the transaction to be confidential.
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{¶ 18} On September 27, 2012, Barrie signed a settlement agreement with Fifth

Third. In exchange for paying $6,000 immediately, and paying an additional $2,000 on

or before October 15, 2012, Fifth Third released Barrie only from liability on the Consumer

Note. The agreement also contained a confidentiality clause, which prohibited both

parties from disclosing the terms of the agreement to anyone other than their attorneys,

financial advisors and employees “on a need to know basis, unless ordered to disclose

such terms and conditions by a court of valid jurisdiction.” Plaintiff’s Ex. 20, p. 2. Barrie

never notified Scot or his attorney of this agreement. Fifth Third also never filed the

release with the county recorder.

{¶ 19} In September 2012, Barrie contacted a realtor to put the house on the

market. On October 15, 2012, Fifth Third filed a complaint for foreclosure against Scot

and Barrie, but only with respect to the first note and mortgage, not the Consumer Loan

that was the subject of the forbearance agreements, and for which Barrie had been

released.

{¶ 20} The house was subsequently sold. According to a closing statement dated

January 18, 2013, the selling price was $403,000. The closing statement indicates a

payoff of the first mortgage to Fifth Third in the amount of $335,392.55, and a payoff of

the second mortgage (on the Consumer Note) to Fifth Third in the amount of $60,000.

Plaintiff’s Ex. 22. Fifth Third’s first and second mortgages on the property were released

in early February 2013. See Plaintiff’s Exs. 23 and 24.

{¶ 21} About a week after the mortgage releases were filed, Scot’s attorney

notified Barrie’s attorney that Fifth Third was demanding payment on the Consumer Note

in the amount of $256,836, including $800 in fees. See Plaintiff’s Ex. 25. Barrie did not
 -11-

respond to this letter. On February 25, 2013, Scot’s attorney sent another letter to

Barrie’s attorney, asking that they work together to resolve the debt to Fifth Third. No

response was received to this letter, either.

{¶ 22} Thereafter, Scot negotiated with Fifth Third to resolve the matter. On July

29, 2013, Scot’s attorney sent another letter to Barrie’s attorney, indicating that Fifth Third

had agreed to a reduction of the outstanding Consumer Note amount, and that the first

installment of out-of-house attorney fees of $1,813.98 had been paid. Scot’s attorney

asked for reimbursement of half of this amount. The letter further noted that effective

September 1, 2013, monthly payments of $4,000 per month would be required for 41

months. Plaintiff’s Ex. 29, p. 1. Scot’s attorney proposed that the spousal support order

be changed to allow for direct payment to Fifth Third of one-half this amount, and he

attached an Agreed Order to that effect. Id.

{¶ 23} On August 6, 2013, Scot filed a verified motion with the trial court, asking

the court to modify the spousal support order to allow direct payments of $2,000 to be

made to Fifth Third for Barrie’s share of the $4,000 loan repayment. A copy of the motion

was sent to Barrie’s attorney, again with a request that she contribute.

{¶ 24} At a pretrial held on September 4, 2013, Scot learned about the confidential

agreement between Barrie and Fifth Third. Scot then filed an amended verified motion

on October 22, 2014. The amended motion contained five branches. The first branch

asked the court to allow Scot to make direct payments of $2,000 per month to Fifth Third

from Barrie’s spousal support; the second asked the court to reduce Barrie’s spousal

support by $2,000 per month; the third asked for clarification of the divorce decree; the

fourth asked for Civ.R. 60(B)(5) relief; and the final branch asked for attorney fees and
 -12-

any other relief to which Scot was entitled.

{¶ 25} On October 28, 2013, Fifth Third filed a complaint against Scot in

connection with the Consumer Note, contending that he owed the principal sum of

$208,784.25, plus accrued but unpaid interest through September 17, 2013, and interest

after October 30, 2012 at a different rate. After receiving summary judgment in its favor

for those amounts, Fifth Third filed a certificate of judgment against Scot with the

Montgomery County Recorder. See Plaintiff’s Exs. 33, 34 and 35.

{¶ 26} On May 21, 2014, the trial court heard testimony from Barrie and Scot, and

admitted Plaintiff’s Ex. 1-35. After hearing the testimony, the court filed an Entry and

Order on September 26, 2014, concluding that two sentences in Section 3 of the divorce

decree created an ambiguity with regard to the division of the debt on the martial

residence. The court further concluded that reading the decree as a whole, the intended

meaning of the order was to subject the debt on the marital residence to equal division.

The court found each party liable for $86,000 on the debt for the martial residence,

credited Barrie with $8,000 that she had paid, and reduced her spousal support in the

amount of $2,000 per month for 39 months, effective October 1, 2014. Based on its

findings, the court also concluded that the Civ.R. 60(B) motion was moot. Barrie timely

appealed from the judgment of the trial court.

II. Clarification of Divorce Decree

{¶ 27} Before addressing the merits of this case, we note that Barrie’s brief fails to

comply with App.R.16(A)(1),(2),(3), and (4), in that it does not contain a table of contents

with page references; a tables of cases; “a statement of the assignments of error
 -13-

presented for review with reference to the place in the record where each error is

reflected”; or “a statement of the issues presented for review, with references to the

assignments of error to which each issue relates.” In such situations, App.R. 12(A)(2)

provides that an appellate court “may disregard an assignment of error presented for

review if the party raising it fails to identify in the record the error on which the assignment

of error is based or fails to argue the assignment separately in the brief, as required under

App.R. 16(A).”

{¶ 28} Nonetheless, where the issue an appellant is raising is clear, we have

elected to consider the issue. (Citations omitted.) JP Morgan Chase Bank, N.A. v.

Johnson, 2d Dist. Champaign No. 2014-CA-27, 2015-Ohio-1939, ¶ 8. In the case before

us, Barrie appears to contend that the trial court could not modify the property division

provision in the divorce decree because the provision was not ambiguous. Therefore,

that is the alleged error we will consider.

{¶ 29} Concerning property divisions, R.C. 3105.171(I) provides that:

A division or disbursement of property or a distributive award made

under this section is not subject to future modification by the court except

upon the express written consent or agreement to the modification by both

spouses.

{¶ 30} However, both parties agree that trial courts may clarify ambiguous terms

in divorce decrees without violating this statute. We also agree. See, e.g., McKinney

v. McKinney, 142 Ohio App.3d 604, 608, 756 N.E.2d 694 (2d Dist.2001); McConnell v.

McConnell, 2d Dist. Champaign No. 09-CA-43, 2010-Ohio-4757, ¶ 24. “An ambiguity

exists when a provision in an order or decree is reasonably susceptible of more than one
 -14-

meaning.” McKinney at 609.

{¶ 31} In this regard, we have stressed that:

“ ‘If there is good faith confusion over the interpretation to be given to a

particular clause of a divorce decree, the trial court in enforcing that decree

has the power to hear the matter, clarify the confusion, and resolve the

dispute.’ ” (Citation omitted.) Browne v. Browne, 2d Dist. Greene No.

02CA117, 2003-Ohio-2853, ¶ 12, quoting Quisenberry v. Quisenberry, 91

Ohio App.3d 341, 348, 632 N.E.2d 916 (2d Dist.1993). For a reviewing

court, the issue is whether the trial court, in clarifying the confusion, abused

its discretion – that is, whether the trial court made the decision with an

“ ‘unreasonable, arbitrary, or unconscionable’ ” attitude. Browne at ¶ 13,

quoting Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140

(1983).

Printz v. Printz, 2d Dist. Darke No. 2013-CA-2, 2013-Ohio-5344, ¶ 8.

{¶ 32} After reviewing the divorce decree, we conclude that the trial court did not

abuse its discretion by finding the decree ambiguous. As an initial point, the foreclosure

proceeding was not pending during the divorce proceedings or when the decree was filed.

This is contrary to the statement in the first paragraph of Section 3 of the divorce decree.

Thus, confusion was introduced into the decree at the very beginning of Section 3,

through reference to an event that did not exist.

{¶ 33} The trial court also found two sentences in Section 3 ambiguous. These

sentences, which are contained in the third full paragraph of Section 3, state that:

On July 31, 2011, or the expiration of the note extension, whichever shall
 -15-

first occur, if there is no sale and no agreement to extend the sale window,

the property will proceed to foreclosure in accordance with the pending

foreclosure, and the parties will share equally in any and all related

damages or judgments related thereto. Neither party will be required to

pay any further monies toward said property after July 31, 2011, except as

same may be ordered in any foreclosure proceeding.

{¶ 34} The parties contemplated that by July 31, 2011, a sale extension would be

granted, or the property would be sold (which was unlikely since it had been for sale for

an extended period of time), or the property would proceed to the pending foreclosure.

While this latter alternative was most likely, there was no pending foreclosure.

{¶ 35} A reasonable interpretation of the statement about paying further monies

“toward” the property is that in the event of foreclosure, neither party would have to

continue making payments for the property, including mortgage payments, taxes,

homeowner association fees, utilities, and pool maintenance and upkeep – all of which

Scot testified were involved. This interpretation is consistent with the fact that the

paragraph of Section 3 following immediately thereafter outlines the parties’ obligations

to equally split the homeowners’ insurance, mortgage payments, real estate taxes, and

commercial loan obligations during the pendency of a sale.

{¶ 36} Another interpretation, advanced by Barrie, is that unless she was ordered

to pay money pursuant to a foreclosure proceeding, she had no liability for anything after

July 31, 2011. This is inconsistent with statements that the parties were to equally share

in the net profit or the deficits resulting from the sale or foreclosure of the property. In

view of this lack of clarity in the property division provision, the trial court was entitled to
 -16-

interpret the provision, as it did, in view of the entire decree, and to conclude that “the

debt on the marital residence was subject to equal division, just as the proceeds of the

property were to be shared equally.” Doc. #44, p. 4.

{¶ 37} As a further matter, we note that the trial court reserved continuing

jurisdiction over the spousal support order. “A trial court has the authority to modify the

amount of spousal support if the court determines that ‘the circumstances of either party

have changed’ and the decree (as it did here) contains a provision authorizing the court

to modify the amount or terms of spousal support.” Allread v. Allread, 2d Dist. Darke No.

2010 CA 6, 2011-Ohio-1271, ¶ 19, quoting R.C. 3105.18(E). “A change of

circumstances ‘includes, but is not limited to, any increase or involuntary decrease in the

party's wages, salary, bonuses, living expenses, or medical expenses.’ The burden of

showing that a reduction of spousal support is warranted is on the party who seeks the

reduction.” (Emphasis added.) Id., quoting R.C. 3105.18(F). (Other citation omitted.)

Again, in this situation, we review the trial court’s decision for abuse of discretion. Id.

{¶ 38} The fact that Barrie would obtain a release from Fifth Third Bank on a debt

of close to $300,000, prior to the sale of the house and by paying only $8,000, was clearly

not contemplated at the time of the divorce. Her failure to disclose her actions prior to

the sale of the property was also not contemplated at the time of the decree. By

concealing her actions, she deprived Scot of the ability to fully protect his interest in their

jointly-held property. Furthermore, Barrie’s actions constituted a substantial change in

circumstances, since Barrie was jointly and severally liable for the debt, and the decree,

as noted, contemplated that the parties would equally share in the net profit or in any

liability pertaining to the house and the notes and mortgages on the house.
 -17-

{¶ 39} Accordingly, even if the decree had been clear, the trial court could have

modified the spousal support based on a change in circumstances. We note that Scot’s

motion asked the trial court to reduce Barrie’s spousal support, and the trial court’s entry

and order found the motion for reduction of spousal support to be well-taken. Doc. #44,

p. 6. We find no abuse of discretion in the trial court’s decision.

{¶ 40} Accordingly, Barrie’s assignment of error is overruled.

III. Conclusion

{¶ 41} Barrie’s sole assignment of error having been overruled, the judgment of

the trial court is affirmed.

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FAIN, J. and HALL, J., concur.

Copies mailed to:

L. Anthony Lush
Thomas R. Schiff
Hon. Timothy D. Wood