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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
EILEEN M. CULLISON : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
DONOVAN C. CULLISON :
:
Appellant : No. 991 WDA 2018
Appeal from the Order Dated June 18, 2018
In the Court of Common Pleas of Allegheny County Family Court at
No(s): FD 05-000104-004
BEFORE: BOWES, J., SHOGAN, J., and STRASSBURGER*, J.
MEMORANDUM BY SHOGAN, J.: FILED SEPTEMBER 1, 2020
Donovan C. Cullison (“Husband”) appeals the June 18, 2018 order
denying his exceptions to the Master’s post-remand report and
recommendation and awarding Eileen M. Cullison (“Wife”) fifty percent of
Husband’s retirement fund as of May 2015, and counsel fees. The June 18,
2018 order made final a July 14, 2016 order finding Husband in contempt,
sustaining two of Wife’s exceptions to the Master’s recommendations
regarding the equitable distribution of Husband’s retirement fund, and
remanding to the Master for a calculation of Wife’s interest in Husband’s
retirement fund and her counsel fees. After careful review, we affirm.
Husband and Wife were married in September 1985, separated in
January 2005, and divorced in December 2008. N.T., 12/9/15, at 84.
Husband worked as a pilot for US Airways/American Airways (“US Air”) from
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* Retired Senior Judge assigned to the Superior Court.
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April 1983, during the marriage and after the separation and divorce, until his
retirement in May 2015. Id. at 47. US Air entered bankruptcy in August
2002, which adversely affected its pilots’ retirement plan. N.T., 1/23/07, at
103, 105–106; N.T., 3/1/07, at 119, 153–154. As part of its restructuring,
US Air negotiated and entered multiple agreements with its pilots.
Specifically, Letter of Agreement (“LOA”) 85, known as Pilots’ Defined
Contribution Plan, terminated the existing US Air retirement benefits plan as
of March 31, 2003, and created a defined contribution plan (“DC Plan”), which
had an effective date of April 1, 2003, and was funded entirely by US Airways.
LOA 85 at 2; Summary Plan Description, 1/1/05, at 1; N.T., 12/9/15, at 84–
85, 90–94. The previous plan was a defined benefit plan known as the “Target
Plan for Pilots of US Airways, Inc.” (“Target Plan”) and was discontinued during
the US Airways bankruptcy. N.T., 12/9/15, at 94–95. If a pilot participated
in the Target Plan, his or her prior account balance was maintained in a
separate retirement account known as the “Target Benefit Account.”
Summary Plan Description, 1/1/05, at 1.
Subsequently, US Air and its pilots executed LOA 93, known as
Transformation Plan, which addressed myriad issues, including changes to the
DC Plan. LOA 93, Transformation Plan Term Sheet at 5; N.T., 3/1/07, at 158–
159. The effective date of revisions contained in LOA 93 appears to be
January 1, 2005, ten days before the parties’ separation on January 11, 2005.
Summary Plan Description, 1/1/05, at 1. Although the Target Plan was
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weighted in favor of more experienced pilots, LOA 93 revised the DC Plan to
provide contributions by US Air based on a pilot’s monthly compensation,
multiplied by a fixed contribution percentage of ten percent. Summary Plan
Description, 1/1/05, at 5; N.T., 3/1/07, at 157; N.T., 3/20/09, at 84.
In March 2006, US Air provided pilots with a Summary Plan Description;
it explained that the Target Plan was amended and revised, becoming the DC
Plan, also known as the “Retirement Savings Plan for Pilots of US Airways,
Inc.” (“RS Plan”). Summary Plan Description, 1/1/05, at 1; N.T., 12/9/05, at
141–142. The Summary Plan Description summarized “the main provisions
of the [RS Plan] as of January 1, 2005.” Summary Plan Description, 1/1/05,
at 1. Pursuant to the Summary Plan Description, US Air would make
contributions on behalf of a pilot to a tax-deferred savings account, and the
pilot would decide how to invest his or her account balance. Id. at 2; N.T.,
12/16/05, at 63; N.T., 3/20/09, at 83. Fidelity Investments was custodian of
the RS Plan. N.T., 3/1/07, at 81.
In January 2007, the parties entered stipulations regarding, inter alia,
distribution of Husband’s RS Plan benefits (“Stipulations”). Pursuant to the
Stipulations, the parties agreed that:
(3) Wife is entitled to receive whatever percentage the court
determines to be equitable of any and all benefits Husband
receives pursuant to the Transformation Plan of October 2004
(Letter of Agreement 93)[,] including but not limited to payments
Husband receives from the lump sum payments on January 1,
2010 and January 1, 2011 and the profit sharing benefits. The
parties agree that all of the benefits Husband shall receive or
has received under the Transformation Plan are marital. . .
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* * *
(5) … the marital value of Husband’s interest in the U.S. Airways
Retirement Savings Plan . . . is $97,089 pretax as of 11/27/06.
The total value of the [P]lan is [$]131,998 as of January 21, 2007.
The parties agree that the Court will decide how to distribute this
asset with the provisions as stated. The parties agree that if the
contribution formula is enhanced to account for prior service
or if the benefit is enhanced that reflects prior service, that a
QDRO[1] or DRO[2] will be entered to pay ___ % (as the court
determines for equitable distribution[)] of the marital value to
Wife. . . .
The parties agree also to QDRO or DRO any other U.S. Air
benefit created after the date of separation that is based in any
part on service during the marriage. Coverture to be calculated
using the appropriate number of years of marriage during the
credited years of service, divided by the credited years of service
under the new plan.
Stipulations, 1/24/07, at ¶¶ 3, 5 (emphases supplied).
Following a three-day trial, the trial court disposed of the parties’
equitable distribution claims on March 16, 2007. Incorporating paragraphs
three and five of the Stipulations in its equitable distribution order (“ED
Order”), the trial court awarded Wife fifty percent of the RS Plan. ED Order,
3/19/07, at ¶¶ 15, 16(a); see also Order, 7/14/16 (affirming that nature of
the RS Plan as marital property subject to equal division was settled matter).
Also, the trial court ordered that, “if the contribution formula is enhanced to
account for prior service or if the benefit is enhanced that reflected prior
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1 Qualified domestic relations order
2 Domestic relations order
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service,” the parties were to enter a QDRO or DRO to be paid at fifty percent
to Husband and fifty percent to Wife. ED Order, 3/19/07, at ¶ 15. “Any other
US Air benefit created after the date of separation that is based in any part on
service during the marriage,” would also be subject to a QDRO or DRO and
based on the stipulated coverture fraction. Id. at ¶ 16(b).
The parties executed an amended RS Plan QDRO3 in December 2008,
identifying Wife as the alternate payee of the RS Plan with a fifty percent
interest in the total vested balance of the RS Plan as of September 15, 2008.
Amended Stipulated Qualified Domestic Relations Order—Retirement Savings
Plan for Pilots of US Airways, Inc., 12/12/08, at ¶¶ 1b, 4. Through the
amended RS Plan QDRO, Wife received a payment of $39,763.92, which
represented half of the RS Plan’s September 15, 2008 value of $79,527.84.
N.T., 12/9/15, at 56–58, 139, Exhibits A, B.
Six years after executing the QDRO, Wife filed a petition to enforce the
ED Order, claiming that she had not received all of the RS Plan benefits owed
to her pursuant to that order; she also requested counsel fees. Petition for
Enforcement, Contempt, Special Relief and Counsel Fees, 4/8/15, at ¶¶ 4, 10.
Following a December 9, 2015 hearing, the Master agreed with Husband that
Wife was not entitled to any more of the RS Plan benefits; nor was she entitled
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3 The parties executed multiple QDROs regarding various benefits earned by
Husband: LOA 85 QDRO, 7/8/08; LOA 93 QDRO, 7/18/08; and Plan QDRO,
8/18/08. Docket Entries 194, 195, 197, and 212.
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to counsel fees. Master’s Report and Recommendation, 1/13/16, at 2, 4. Wife
filed exceptions, and Husband filed a brief in opposition. Exceptions, 2/2/16;
Brief in Opposition, 4/9/16. The trial court granted two of Wife’s exceptions,
finding the Master erred in denying Wife additional RS Plan benefits and
counsel fees. Order, 7/14/16, at 1; Trial Court Opinion, 10/7/16, at 1. The
trial court also found Husband in contempt of the ED Order and remanded to
the Master for review of Wife’s two exceptions. Order, 7/14/16, at 2; Trial
Court Opinion, 10/7/16, at 1.
Following a January 22, 2018 remand hearing, the Master found that
Husband “knowingly allowed the wasting of [the RS Plan] so as to defeat Wife’s
interest therein” and recommended that Wife receive fifty percent of the May
2015 balance of $448,799.22, rather than the July 2017 balance of
$72,682.63, as well as $5,000 in counsel fees. Master’s Report and
Recommendation, 2/16/18, at 3–4. Husband filed exceptions, which the trial
court denied. Exceptions, 3/9/18; Order, 6/21/18. This appeal followed.
Husband and the trial court complied with Pa.R.A.P. 1925.
On appeal, Husband presents the following questions for our
consideration:
1. Did the trial court err by finding that Husband waived certain
exceptions by failing to set forth separate and specific
objections?
2. Did the trial court err by failing to apply the coverture
fraction to a retirement benefit earned after the parties’
separation as specified in its March 16, 2007 order?
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3. Did the trial court err by relying upon the January 2007
stipulations, the testimony taken at the 2007 equitable
distribution trial, and its September 12, 2007 opinion, all of
which pre-dated the March 16, 2007 order . . . of which
[Husband] was found in contempt?
4. Did the trial court err by finding [Husband] in contempt of
the March 16, 2007 order and awarding Wife counsel fees?
5. Did the trial court err by finding that [Husband] “knowingly”
allowed the wasting of the retirement savings plan for pilots
as to defeat [Wife’s] interest therein?
6. Did the trial court err by awarding Wife fifty percent of the
value of [Husband’s] retirement savings plan for pilots as of
May 2015 as opposed to the current value, plus or minus
gains or losses?
Husband’s Brief at 7–8 (full capitalization omitted).
In the context of Husband’s first question, we address which issues he
has properly preserved for review. According to the trial court, Husband has
preserved only one issue: Whether the trial court erred in awarding Wife a
fifty percent share of the May 2015 RS Plan balance. Trial Court Opinion,
9/5/18, at 6–7. The trial court found that Husband waived all other issues by
simply referring to arguments he raised in his Brief in Opposition to Wife’s
Exceptions in lieu of setting forth separate, individual exceptions. Id. at 7.
Husband argues that, given the procedural history of this case, he did
preserve the substantive issues raised on appeal. According to Husband, he
“could not have filed Exceptions to the initial Master’s Report and
Recommendation issued in February of 2016 because the Master ruled in favor
of Husband.” Husband’s Brief at 38. Husband explains that, when Wife filed
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exceptions on February 2, 2016, to the Master’s January 13, 2016 report and
recommendation, he filed a brief in opposition, in which he preserved the first
five substantive issues raised in this appeal. Id. at 36 (citing Brief in
Opposition, 4/9/16). Husband further explains that, after the trial court
granted two of Wife’s exceptions and remanded for consideration by the
Master, he “attempted to appeal the case[,]” but withdrew it because the trial
court deemed it interlocutory. Id. at 38–39. Therefore, Husband submits
that his “arguments had already been considered by the [t]rial [c]ourt in the
first round of Exceptions[, i.e., Wife’s February 2, 2016 exceptions,] and were
not before the [t]rial [c]ourt in the second round of Exceptions, which only
pertained to the remand of the first round of Exceptions.” Id. at 37. Relying
on the trial court’s pre-remand opinion of October 7, 2016, Husband argues
that the trial court:
was aware of the issues that Husband intended to raise as it
specifically listed those issues in its Opinion. The parties
proceeded to the remand hearing and Husband subsequently filed
Exceptions to that remand, preserving his arguments until a final
Order was entered on June 18, 2018.
Id. at 39.
To preserve an issue for appeal, a party must file a timely exception to
the Master’s Report pursuant to Pa.R.C.P. 1920.55–2(b). The rule provides:
Within twenty days of the date of receipt or the date of mailing of
the master’s report and recommendation, whichever occurs first,
any party may file exceptions to the report or any part thereof,
to rulings on objections to evidence, to statements or
findings of fact, to conclusions of law, or to any other
matters occurring during the hearing. Each exception shall
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set forth a separate objection precisely and without discussion.
Matters not covered by exceptions are deemed waived unless,
prior to entry of the final decree, leave is granted to file exceptions
raising those matters.
Pa.R.C.P. 1920.55–2(b) (emphasis supplied). The purpose of exceptions in a
judicial proceeding is to point out mistakes of fact or law so that the trial judge
has an opportunity to correct them before an appeal is lodged. In re Borough
of Churchill, 575 A.2d 550, 555 (Pa. 1990).
Here, after Wife filed exceptions to the Master’s first report and
recommendation, Husband filed an opposing brief. Therein, he stated his
position on whether: (1) Wife was entitled to receive retirement benefits
Husband acquired after separation; (2) Wife was entitled to a portion of
Husband’s profit sharing distributions; (3) Husband was in contempt; (4) Wife
was required to pay a portion of the parties’ 2004 taxes; (5) Wife was required
to reimburse Husband for taxes due from 2004; and (6) Wife was entitled to
counsel fees. Brief in Opposition, 4/9/16, at unnumbered 9–16. After the
trial court granted Wife’s first and sixth exceptions, Husband filed an appeal.
In response, the trial court filed an opinion, addressing all of Husband’s
arguments. Opinion, 10/7/16, at 4–10. The trial court opined, however, that
the appeal was interlocutory. Id. at 5–6. Husband agreed, withdrew his
appeal, and his issues did not reach this Court. The trial court remanded
Wife’s two exceptions to the Master for review. Order, 5/30/17. The Master
found Husband liable to Wife for additional RS Plan benefits. Report and
Recommendation, 2/16/18, at 3–4. Husband filed exceptions to the Master’s
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post-remand recommendation, and raised his earlier issues by incorporation,
without listing them specifically. Exceptions, 3/9/18, at ¶¶ 1, 2.
Based on the foregoing, we conclude that the trial court had the
opportunity to address Husband’s allegations of error and filed an opinion
addressing the issues Husband now raises on appeal. Trial Court Opinion,
10/7/16, at 4–10; Borough of Churchill, 575 A.2d at 555. Because the
purpose of exceptions has been met, we choose to overlook Husband’s
technical error in not spelling out the exceptions a second time. Thus, we
reject the trial court’s finding of waiver, and we will address the remaining
questions presented.
Husband’s second issue challenges the trial court’s equitable distribution
of Husband’s RS Plan benefits. We review a challenge to the trial court’s
equitable distribution scheme for an abuse of discretion. Brubaker v.
Brubaker, 201 A.3d 180, 184 (Pa. Super. 2018) (citation omitted).
Moreover:
“[w]e do not lightly find an abuse of discretion, which requires a
showing of clear and convincing evidence.” Id. We will not find
an abuse of discretion “unless the law has been overridden or
misapplied or the judgment exercised was manifestly
unreasonable, or the result of partiality, prejudice, bias, or ill will,
as shown by the evidence in the certified record.” Carney v.
Carney, 167 A.3d 127, 131 (Pa. Super. 2017). When reviewing
an award of equitable distribution, “we measure the
circumstances of the case against the objective of effectuating
economic justice between the parties and achieving a just
determination of their property rights.” Hayward v. Hayward,
868 A.2d 554, 558 (Pa. Super. 2005).
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When determining the propriety of an equitable distribution
award, this Court must consider the distribution scheme as a
whole. Mundy v. Mundy, 151 A.3d 230, 236 (Pa. Super. 2016).
“We do not evaluate the propriety of the distribution order upon
our agreement with the court’s actions nor do we find a basis for
reversal in the court’s application of a single factor. Rather, we
look at the distribution as a whole in light of the court’s overall
application of the 23 Pa.C.S. § 3502(a) factors for consideration
in awarding equitable distribution. If we fail to find an abuse of
discretion, the order must stand.” Harvey v. Harvey, 167 A.3d
6, 17 (Pa. Super. 2017) (citation and internal brackets omitted).
Finally, “it is within the province of the trial court to weigh the
evidence and decide credibility and this Court will not reverse
those determinations so long as they are supported by the
evidence.” Brubaker, 201 A.3d at 184 (citation omitted).
Hess v. Hess, 212 A.3d 520, 523 (Pa. Super. 2019).
Specifically, Husband argues that the trial court erred in awarding Wife
fifty percent of his RS Plan benefits. According to Husband, the RS Plan
benefits were post-separation, non-marital retirement assets to which the
coverture fraction should have been applied as specified in the ED Order.
Husband’s Brief at 40–41. In Husband’s view, the trial court mischaracterized
the RS Plan benefits as “a ‘chunk’ of retirement benefits that [Husband]
earned during the marriage, but US Airways could not properly give him . . .
on the account of the bankruptcy.” Id. at 42 (citing Trial Court Opinion,
10/7/16, at 7). Husband argues, “The true error in the trial court’s finding is
in its determination that the retirement benefits Husband earned post-
separation were entirely attributable to work performed during the marriage
and marital property.” Id. at 46.
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Wife counters that division of the RS Plan was addressed in paragraph
16(a) of the ED Order. Wife’s Brief at 13. That paragraph, Wife argues,
entitled her to one-half of any funds attributable to the RS Plan, including the
benefits at issue, which the trial court identified as marital. Id. at 14, 16–17.
According to Wife, the “coverture fraction was only to be applied to any other
benefits, those benefits anticipated under Paragraph 16(b)” of the ED Order.
Id. at 14.
Upon thorough review of the entire testimonial and documentary record,
we conclude that Husband’s coverture-based position is not sustainable. The
ED Order arose out of the Stipulations, wherein Husband agreed that:
(3) Wife is entitled to receive whatever percentage the court
determines to be equitable of any and all benefits Husband
receives pursuant to the Transformation Plan of October
2004 (Letter of Agreement 93). . . . The parties agree that all
of the benefits Husband shall receive or has received under
the Transformation Plan are marital.
Stipulations, 1/24/07, at ¶ 3 (emphases supplied). Pursuant to the
Stipulations and the ED Order, the coverture fraction would apply in the event
US Air created any other benefit after the date of separation that was based
in any part on Husband’s service during the marriage. Stipulations, 1/24/07,
at 5; ED Order, 3/29/07, at ¶ 16(b). The record contains no evidence that US
Air created such a benefit, and the RS Plan was not a benefit created after the
date of separation; rather, it was the revised continuation on the DC Plan.
LOA 85, LOA 93, Summary Plan Description, 1/1/05, at 1.
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Moreover, the ED Order language is clear and unambiguous: Wife is
entitled to fifty percent of the RS Plan benefits, and the coverture fraction
applies to any other benefits. ED Order, 3/19/07, at ¶¶ 15, 16(a), and 16(b).
Significantly, on multiple occasions during this protracted litigation, Husband
affirmed—or, at least, he did not object—that Wife was entitled to fifty percent
of the RS Plan benefits. N.T., 6/4/08, at 187, 205; N.T., 9/26/11, at 319–
320; N.T., 1/22/07, at 4–7, 8, 34–35; N.T., 3/1/07, at 43, 82, 84, 87; N.T.,
12/9/15, at 52–53, Exhibit 2; see also Consent Order, 6/18/08, at ¶ 1
(Husband consents to Wife receiving fifty percent of “his retirement accounts
. . . and benefits he received and will receive through his . . . Retirement
Savings Plan, the Transformation Plan [LOA] 93 and the Transformation Plan
[LOA] 85 until such time as he retires.”). Moreover, although Husband filed a
notice of appeal from the ED Order, challenging, inter alia, the award of fifty
percent of the RS Plan to Wife, he withdrew the appeal. Pa.R.A.P. 1925(b)
Statement of Errors, 5/24/07; Superior Court Order, 12/29/07. Thus, he
cannot be heard now to challenge the award of fifty percent of the RS Plan
benefits to Wife.
Because the ED Order demonstrates that the coverture fraction did not
apply to the RS Plan benefits at issue, we discern no abuse of the trial court’s
discretion in refusing to apply it. Husband’s contrary claim fails.
Husband’s third issue challenges the trial court’s reliance on documents
and testimony outside the scope of the ED Order “to expand the scope of the
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assets to which Wife was entitled.” Husband’s Brief at 52. Specifically,
Husband argues that the trial court “abused its discretion by relying upon the
January 24, 2007 Stipulations, trial testimony heard at the equitable
distribution hearing, . . . and its September 12, 2007 Opinion . . . .” Id. at
50.
According to Husband, the trial court should not have relied on the
Stipulations because their application was limited to the QDRO provision of
the ED Order; the QDRO pertained only to “any other US Air benefit created
after the date of separation that is based in any part on service during the
marriage.” Husband’s Brief at 52. Husband asserts that the trial court relied
on the challenged documents and testimony in an attempt to obtain the result
it desired rather than the result that followed the plain language of the [ED]
Order.” Id. at 53. Husband concludes that the trial court’s use of the
challenged documents and testimony to interpret its unambiguous ED Order
violates Pennsylvania law “in that assets earned after the parties’ separation
are not deemed marital property.” Id. at 55.
In response, Wife argues that, although the trial court mentioned the
Stipulations “and other information in its [ED] Order, the court did not rely on
[them] in order to rule in favor of Wife.” Wife’s Brief at 17 (emphasis in
original). According to Wife, the trial court “did not need the [Stipulations] or
trial testimony in order to reach the conclusion it did, it simply referred to that
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information to remind Husband of all that led to the [ED Order.]” Id. at 18–
19 (emphasis in original).
The trial court addressed Husband’s challenge to its record references
as follows:
This [c]ourt essentially divided equally the parties’ assets. See
generally ED Order, dated March 16, [2007]. Thus, in order to
effectuate the 50-50 scheme, the [c]ourt, and per the parties[’]
stipulation, also equally divided [the RS Plan] benefits (i.e.
Paragraph 16(a) benefits).
* * *
Husband contends that the [c]ourt’s reliance on part of the
case’s record amounts to an error. Husband requested this
[c]ourt deny Wife’s enforcement action but argues that this
[c]ourt must forget the case history, specifically the rationale
behind it own order and trial court opinion.
* * *
[I]t is worth noting that the Family Division of the Court of
Common Pleas in Allegheny County operates on a “One Judge/One
Family” system, wherein only one judge hears a family’s case.
The judge of record in this [case] has been the only judge of
record for over a decade, after the previous judge of record
transferred to Civil Division. The current judge of record presided
over the equitable distribution, its stipulations, its trial and
authored the ED order and corresponding opinion. . . .
In this case, Husband would have this [c]ourt proceed
blindly, forbidden from looking to the history. The [c]ourt does
not find use for irrelevant or even tangentially relevant docket
entries, nor is interested in revisiting those rulings cited in Wife’s
Exceptions brief that are particularly unfavorable to Husband.
Rather, this [c]ourt, in the interest of promoting stability and
continuity within the case merely revised that specific point in the
case’s previous litigation that has seemingly [been] the source of
the present conflict. Husband would have this [c]ourt pretend it
did not previously address these matters.
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Trial Court Opinion, 10/7/16, at 2–3, 9–10 (internal citations omitted).
Upon review, we discern no abuse of discretion or error of law. The
Stipulations and equitable distribution hearing testimony resulted in the ED
Order. The trial court’s September 12, 2007 opinion addressed Husband’s
thirty-five allegations of error related to the ED Order, including a challenge
to the trial court’s conclusion that Wife was entitled to fifty percent of the RS
Plan benefits:
Husband also contends that the [c]ourt erred in dividing the
retirement plan and any benefits under the so-called
transformation plan equally between the parties. However,
Husband agreed to this division, and cannot now be heard to
dispute it. See T.T., Vol. III, at 83–84 (where Husband’s counsel
stated: “the parties agree to share it, in proportion to what you
create as an equitable distribution scheme.”).
Trial Court Opinion, 9/12/07, at 19. As stated earlier, Husband filed a notice
of appeal from the ED Order then discontinued it; thus, the award to Wife is
unassailable at this point. Finally, we would question the reasoning of any
trial court that did not consider the history of the case in formulating its
current decision. Husband’s third issue does not warrant relief.
In his fourth issue, Husband complains that the trial court erred by
finding him in contempt of the ED Order and awarding Wife counsel fees
“because he had failed to provide Wife [with one-]half of all of the retirement
benefits he had received based on his post-separation work.” Husband’s Brief
at 56. Regarding contempt orders, our scope of review is very narrow, and
we place great reliance on the court’s discretion. Thomas v. Thomas, 194
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A.3d 220, 225 (Pa. Super. 2018) (citation omitted). The trial court abuses its
discretion if it misapplies the law or exercises its discretion in a manner lacking
reason. Harcar v. Harcar, 982 A.2d 1230, 1234 (Pa. Super. 2009). Each
court is the exclusive judge of contempts against its process. The contempt
power is essential to the preservation of the court’s authority and prevents
the administration of justice from falling into disrepute. Habjan v. Habjan,
73 A.3d 630, 637 (Pa. Super. 2013). Absent an error of law or an abuse of
discretion, we will not disrupt a finding of civil contempt if the record supports
the court’s findings. Thomas, 194 A.3d at 225 (citation omitted).
Generally, in a civil contempt proceeding, the burden of proof rests with
the complaining party to demonstrate that the defendant is noncompliant with
a court order. MacDougall v. MacDougall, 49 A.3d 890, 892 (Pa. Super.
2012).
To sustain a finding of civil contempt, the complainant must
prove, by a preponderance of the evidence, that: (1) the
contemnor had notice of the specific order or decree which he is
alleged to have disobeyed; (2) the act constituting the
contemnor’s violation was volitional; and (3) the contemnor acted
with wrongful intent.
Id. Nevertheless, “a mere showing of noncompliance with a court order, or
even misconduct, is never sufficient alone to prove civil contempt.” Habjan,
73 A.3d at 637. “If the alleged contemnor is unable to perform and has, in
good faith, attempted to comply with the court order, then contempt is not
proven.” Cunningham v. Cunningham, 182 A.3d 464, 471 (Pa. Super.
2018).
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According to Husband, because he provided Wife with her share of the
retirement benefits based on “work performed during the marriage” via the
QDRO, he “justifiably believed he had complied with the [ED] Order.”
Husband’s Brief at 56–57. In support of his position, Husband submits the
Master’s report and recommendation following the contempt hearing on
December 9, 2015:
The [M]aster finds that Husband has not been in contempt. Both
his attorney and he have repeatedly attempted to address all of
Wife’s concerns in a timely fashion but did not receive reciprocal
cooperation from Wife or her counsel. Wife’s counsel represented
her at the time the [QDROs] were prepared and submitted and
the docket clearly [reflects] that. Why this remains a problem for
Wife appears to be that she has the unrealistic expectation that
she is entitled to a share of Husband’s post-separation
contributions to his pension. This is not the law in Pennsylvania.
Wife has incurred counsel fees of over $34,000 in pursuing
matters which were resolved in 2008. She has received her
401(k) award, is receiving her share of the US Airways pension
. . . and knew that the Target benefit Plan had replaced the
Savings Plan. . . .
Husband’s Brief at 58–59 (citing Master’s Report and Recommendation,
1/13/16, at 3–4). See also N.T., 9/26/11, at 427 (Husband did not split lump
sum payment with Wife because he believed QDRO covered her fifty percent
share). The trial court rejected the Master’s finding of no contempt. Order,
7/15/16, at 1; Trial Court Opinion, 10/7/16, at 3–4.
Wife counters that Husband had notice of his obligation to divide the RS
Plan benefits equally with Wife under the ED Order; his failure to comply with
the ED Order was volitional because his belief that he had complied with the
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ED Order was not justified; the ED Order was definite, clear, and specific.
Wife’s Brief at 19–20. Thus, Wife asserts, the trial court appropriately held
Husband in contempt. Id. at 20.
The trial court justified its contempt finding with the following analysis:
This [c]ourt departed from the Master’s recommendation and
found Husband to be in contempt for failing to comply with the
2007 ED Order. Litigation on this narrow question of benefits has
lasted unnecessarily for well over a year. Had this been a
contention of first impression, so as to speak, the [c]ourt would
not characterize Husband’s noncompliance with such disapproval,
but the [c]ourt previously ruled (and wrote) on this matter. The
benefits question was not as complex an issue as Husband would
make it out to be. The [c]ourt opines that this issue was not one
of ambiguity, ripe for putting forth a creative argument. Rather,
Husband’s inaction simply meant he failed to comply with this
[c]ourt’s ED Order. “If, at any time, a party has failed to comply
with an order of equitable distribution. . . the court may. . .in order
to effectuate compliance with its order: award counsel fees and/or
. . . find the party in contempt.” 23 Pa.C.S.A. § 3502(e)(7);(9).
Trial Court Opinion, 10/7/16, at 6.
Here, Wife has demonstrated all three elements for contempt. The
relevant provisions of the ED Order, directing Husband to divide the RS Plan
benefits equally with Wife, were clear, definite, and specific. ED Order,
3/24/07, at ¶¶ 15, 16(a), and 16(b). Husband does not argue otherwise, and
he does not deny that he had notice of the ED Order. Moreover, Husband
stipulated to Wife’s receipt of whatever percentage of the RS Plan benefits the
trial court awarded—ultimately, fifty percent—and did not appeal the ED
Order. Stipulations, 1/24/07, at ¶¶ 3, 5; Consent Order, 6/18/08, at ¶ 1. If
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Husband was confused about the retirement provisions of the ED Order, he
could have sought clarification from the trial court.
As for Husband’s intent, the record reveals that within two months of
the trial court’s April 17, 2015 order enjoining Husband from transferring any
portions of his various retirement accounts, Husband “transferred the entire
balance of the [RS Plan] of just over $440,000 into a rollover IRA account.”
Trial Court Opinion, 9/5/18, at 3; N.T., 12/09/05, at 82–83, 136, 240-241.
From the time of the rollover until the remand hearing, the RS Plan account
“had lost more than [one-]half its value, dropping more than $200,000
without any action by Husband.” Trial Court Opinion, 9/5/18, at 4; N.T.,
12/9/15, at 155. Husband admitted that the account, which was “self-
directed,” “tanked” and that he did nothing about it. N.T., 12/9/15, at 155–
156. Thus, Husband’s failure to pay one-half of his RS Plan benefits to Wife
was volitional, and he acted with wrongful intent. Accordingly, we reject
Husband’s request for relief on the finding of contempt.
In his fifth issue, Husband challenges the Master’s recommendation and
the trial court’s finding that he knowingly allowed the wasting of the RS Plan.
Husband’s Brief at 60–65. We repeat: “[I]t is within the province of the [fact
finder] to weigh the evidence and decide credibility and this Court will not
reverse those determinations so long as they are supported by the evidence.”
Hess, 212 A.3d at 523 *2 (citation omitted).
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Here, the trial court accepted the Master’s factual findings regarding
Husband’s handling of the RS Plan investments:
As of May 7, 2015, not long after the filing of Wife’s contempt
petition, the account had a value of $448,799.22. Most of the
account was invested in stock with a company called Sino Agro.
[N.T., 1/22/18,] at 78. Once the contempt litigation was
underway, the account, which was exclusively under Husband’s
control, began a steady and substantial decline—without any
action by Husband to change the investment strategy—such that,
two years later and with the same litigation still ongoing, the
balance was down to only $72,682.63 as of June 30, 2017.
Master’s Report[, 2/16/18,] at 3; [N.T., 1/22/18,] at 33.
In more detail, the Master noted that, on May 7, 2015, the
value was $448,799.22. Master’s Report at 3. . . . [On June 30,
2015, the value was reduced to $423,373.47, a loss of
$25,425.75. Additional losses occurred in July, August and
September]. Id. . . . By the end of 2015, the balance dropped by
an additional $108,464.12, for a loss of more than $200,000. Id.
Throughout 2016, Husband continued to do nothing while the
account lost another $181,411.42, until ultimately, by June 30,
2017, the account was down to $72,682.63. Id.
Trial Court Opinion, 9/5/18, at 4–5 (citing Master’s Report and
Recommendation, 2/16/18, at 3).
On appeal, Husband maintains that “Fidelity prohibited [him] from
making changes and[,] therefore, Husband did not knowingly waste the [RS]
Plan.” Husband’s Brief at 60. Additionally, Husband blames the trial court’s
April 17, 2015 order, filed in response to Wife’s request to prevent Husband
from withdrawing funds from the RS Plan as he was turning sixty-five, for his
not making changes to the RS Plan. Id. at 61. As further justification for his
position, Husband asserts that he “attempted to submit an [o]rder to the
[t]rial [c]ourt at the oral argument on the first round of [e]xceptions that
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would ‘unfreeze’ the [RS Plan] and permit Husband to trade the depleting
stock. However, the [t]rial [c]ourt declined to execute said [o]rder.” Id. at
63. Moreover, Husband claims that he “had no incentive to cause the decrease
in value of the account because he believed that all of the money in the RS
Plan belonged to him alone.” Id.
The Master did not believe Husband’s explanations regarding
devaluation of the RS Plan account:
According to the 4/17/15 Order of Court:
Defendant Husband was enjoined from withdrawing,
liquidating, transferring, gifting, encumbering, or
otherwise disposing of any portion of his various
accounts through US Airways, including but not
limited to his US Airways Savings Plan Account, his
401(k) Plan, as well as any other retirement or other
benefits of any kind that Husband has received from
US Airways.
There was no language in that Order restricting Husband’s ability
to sell or trade stocks within that Plan. Even if he misunderstood
it, when he saw the value of this Plan dropping precipitously
quarter after quarter, neither he, nor his counsel, if she was so
informed, had sought permission for the Court via a simple Motion
or Petition to take such action as necessary to stem the
floodgates.
* * *
The Master is forced to conclude that for over 2 years Husband
intentionally did nothing. That he knowingly allowed the wasting
of this valuable asset [the RS Plan] so as to defeat Wife’s interest
therein. In fact, according to the statements contained in Exhibit
5, Husband knew he could buy and sell shares. He had bought
the Sino Agro Food Inc. shares on 6/12/15, almost 2 months after
the “freeze order” went into effect. He continued to buy Sino Agro
Food stock in July and August 2015. In the September 2015
statement it clearly shows that Sino Argo Food shares LOST
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$43,816.90 in just that month, but Husband, who was not a
newcomer to the stock market, again took no action to diversify
his portfolio.
Master’s Report and Recommendation, 2/16/18, at 2–3 (emphases omitted).
The trial court agreed with the Master’s credibility assessment and
finding that Husband disposed of the contents of the RS Plan account by
wasting them:
Contrary to Husband’s position, nothing in the plain language of
the [April 15, 2015] Order prevented Husband from engaging in
trading within the account, and . . . Husband testified that his
purpose in rolling the money into this account was to avoid a
blackout and expand his investment options. See [N.T., 1/22/18,
at 85–86.] Moreover, given the extensive [c]ourt action in this
case, if Husband believed that he was prevented from trading or
taking action to preserve the account by selling a clearly failing
stock in an otherwise positive market, he certainly knew how to
come to [c]ourt to explain his predicament and seek an order
explicitly permitting trading. Similarly, if as Husband claims,
Fidelity refused to allow him to trade, Husband once again could
have come to [c]ourt for an Order to the contrary for Fidelity. He
did not. Husband’s position that his hands were inalterably tied
even as the fund plummeted and plummeted is simply not
credible.8
8 In his argument, Husband argues that his action in
obtaining a consent order back in August of 2015 to
withdraw some funds from the Fidelity account, which
he then did not do, shows that he did not intend to
waste the asset. However, there is nothing in the
record about the reason for the request or his
subsequent inaction. To this [c]ourt, the consent
order demonstrates Husband’[s] knowledge of how to
approach the [c]ourt if changes needed to be made
regarding this account. See Consent Order of Court,
entered Aug. 6, 2015.
Finally, Husband argues that he would have had no
incentive—such as the acrimony that has infused this decade of
litigation—to allow the wasting of the [RS] Plan to spite Wife
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because he believed that the [RS] Plan’s contents were non-
marital and, therefore, all for him. See Husband’s Exceptions Br.
at 4–5. On credibility, this contention fares equally poorly in light
of the [Stipulations] filed with this [c]ourt many years ago, in
which Husband put his own handwritten signature to the following
statement: “The parties agree that all of the benefits Husband
shall receive or has received under the [RS] Plan are marital.”
Stipulations, Jan. 22, 2007, filed Jan. 24, 2007. The factfinder
was within its discretion to reject Husband’s evidence and
credibility on this matter. In any event, Husband’s arguments on
whether the [RS] Plan was a marital asset have been previously
and extensively litigated, rejected, and settled.
Trial Court Opinion, 9/5/18, at 10–11 (footnote and some citations omitted).
Upon review, we discern no basis for disturbing the trial court’s
determination that Husband knowingly wasted the RS Plan account. The trial
court found, and the record confirms, that:
[a]s of May 7, 2015, not long after the filing of Wife’s contempt
petition, the [Plan] had a value of $448,799.22. Most of the
account was invested in stock with a company called Sino Agro.
[N.T., 1/22/18, at 78.] Once the contempt litigation was
underway, the [Plan], which was exclusively under Husband’s
control, began a steady and substantial decline—without any
action by Husband to change the investment strategy—such that,
two years later and with the same litigation still ongoing, the
balance was down to only $72,682.63 as of June 30, 2017.
Master’s Report at 3; [N.T., 1/22/18,] at 33.
* * *
On the current matter, it also appeared that Husband
possessed but did not turn over to Wife communication from
Fidelity regarding Husband’s ability to interact with the account
absent Court permission. See [N.T., 1/22/18,] at 80, 84.
However, in a separate document from May 26, 2015, which was
sent to both parties directly, Fidelity indicated its unwillingness to
allow withdrawals without court intervention, but significantly, did
allow that Husband would “remain eligible to direct the investment
of future contributions and existing balances.” Id. at 83. From its
face, this document gives the understanding that Wife plainly had:
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that Husband could direct investments within the account if there
were a need. Indeed, Husband also testified that the very reason
he rolled the account over with Fidelity was because there was a
so-called blackout period coming due to an airline merger that
would have shut out all account activity. Id. at 85–86. Therefore,
Husband explained on the stand, the account was rolled over so
that “I wouldn’t be restricted to not doing anything during the
blackout period, plus the investment choices would be broadened.
I wouldn’t be restricted to what the investment choices were.” Id.
at 86. Nonetheless, Husband admitted to a long lapse in any
communication with Fidelity: “I just let it be while I’ve waited for
this litigation to finish up.” Id. As both parties are aware,
litigation in this divorce is contentious and does not tend to finish
up promptly, as evidenced by the fact that the issue now before
the [trial c]ourt has been in litigation for three years.
Trial Court Opinion, 9/5/18, at 4–6 (internal brackets and footnotes omitted).
Moreover, as stated above, Husband admitted that the account, which was
“self-directed,” “tanked” and that he did nothing about it. N.T., 12/9/15, at
155–156. In light of Husband’s own testimony, his self-serving arguments
did not persuade the trial court, and they do not persuade us. Accordingly,
we decline to grant relief on this issue.
Lastly, Husband challenges the trial court’s ruling that, because
Husband wasted the RS Plan account, Wife was entitled to one-half the value
of the RS Plan as of May 2015, which was $448,799.22, rather than one-half
the value of the RS Plan as of June 2017, which was $72,682.63. Husband’s
Brief at 65–66. Husband argues that Pennsylvania law favors using the date
of distribution for the valuing of an asset because “volatile market conditions
[have] an effect on valuing assets and therefore, it is more just to value the
asset as of the date of distribution.” Husband’s Brief at 67 (citing Sutliff v.
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Sutliff, 543 A.2d 534, 537 (Pa. 1988)). As a result of the trial court’s ruling,
Husband submits, he will be left with zero retirement funds at the age of sixty-
five, and he will have “to obtain a loan in order to secure the funds to pay
Wife the difference owed.” Id. at 68. Husband considers this result “unjust”
and “not supported by Pennsylvania law.” Id. at 70.
“In determining the value of marital assets, a court must choose a date
of valuation which best works economic justice between the parties. The same
date need not be used for all assets.” Smith v. Smith, 904 A.2d 15, 18 (Pa.
Super. 2006) (citations omitted). We observed in Smith our Supreme Court’s
recognition in Sutliff v. Sutliff, 543 A.2d 534 (Pa. 1988), that the date of
distribution should generally be utilized for determining the value of a marital
asset as that date is the one that will most likely achieve economic justice.
The Smith Court further observed, however, that there are limited
circumstances when a different valuation date may be utilized to achieve
economic justice. Smith, 904 A.2d at 19. Those circumstances include when
one spouse has consumed or disposed of the asset in question or if conditions
render it difficult to ascertain the date-of-distribution value. Id.
Because Husband wasted the RS Plan account, the Master agreed with
Wife that a non-distribution valuation date was appropriate:
Wife’s position is that if Husband had transferred her 50%
of the [RS] Plan in May 2015, she would have received almost
$224,400 which she would have been able to invest as she saw
fit. The Master agrees that Wife should have received her share,
if not in May 2015, by no later than September 2015 when it was
clear that Sino Agro Food was not a good investment.
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Master’s Report and Recommendation, 2/16/18, at 2–3 (emphases omitted).
Affirming the Master’s credibility assessment that Husband disposed of
the RS Plan assets by wasting them, the trial court supported the Master’s
valuation date: “[T]he circumstances of this case remove it from the ‘usual
case’ described in Sutliff, 543 A.2d 534, 536, and that valuation at an earlier
date is permissible and just.” Trial Court Opinion, 9/5/18, at 10.
Consequently, the trial court rejected Husband’s reliance on case law utilizing
the date-of-distribution valuation method. Id. at 9–10 (distinguishing Sutliff
and Fexa v. Fexa, 578 A.2d 1314 (Pa. Super. 1990)).
Upon review of the record, we find support therein for the trial court’s
factual finding that, despite the ability to do so, Husband did nothing to protect
the RS Plan assets and allowed its value to plummet over the course of two
years. N.T., 12/9/15, at 155–156; N.T., 1/22/18, at 47. Husband’s claim
that he attempted to obtain a court order “unfreezing” the RS Plan during oral
argument of Wife’s exceptions is belied by the record. N.T., 1/22/18, at 101–
104. Husband’s reliance on Sutliff and Fexa is misplaced. The former case
focused on market volatility, which was not a contributing factor in this case.
Sutliff, 543 A.2d 534. The latter involved investment advice from a plan
administrator, which resulted in devaluation of the account. Fexa, 578 A.2d
1314. In contrast, Husband was in control of the RS Plan account, and his
management decision caused its devaluation. Thus, we discern no error in
the trial court’s conclusion that the circumstances of this case warrant
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valuation at an earlier date in order to best work economic justice between
the parties. Smith, 904 A.2d at 18.
Order affirmed.
Judge Bowes joins this Memorandum.
Judge Strassburger files a Concurring & Dissenting Memorandum.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 9/1/2020
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