NO. 91-200
IN THE SUPREME COURT OF THE STATE OF MONTANA
1991
IN RE THE MARRIAGE OF
GAVIN DUANE CASTOR,
Petitioner and Appellant,
and
SHIRLEY MAE CASTOR,
Respondent and Respondent.
APPEAL FROM: District Court of the Eighth Judicial District,
In and for the County of Cascade,
The Honorable Joel G. Roth, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
James D. Elshoff, Attorney at Law, Great Falls,
Montana
For Respondent:
Marcia Birkenbuel, Attorney at Law, Great Falls,
Montana
Submitted on Briefs: June 13, 1991
Decided: August 29, 1 9 9 1
Filed:
I "
Clerk
Justice John Conway Harrison delivered the Opinion of the Court.
Gavin Castor appeals from a February 20, 1990, order of the
District Court of the Eighth Judicial District, Cascade County,
Montana, denying his motion for modification of spousal maintenance
payments and ordering him to pay Shirley Castor $6,066 in past-
due maintenance payments, $4,000 representing Mrs. Castor's
remaining share of his civil service retirement fund, $300 per
month spousal support, and $250 in attorney's fees. We affirm.
We frame the issues as follows:
1. Should the District Court have set aside the February 20,
1991, order under Rule 60(b), M.R.Civ.P. because of mistake,
inadvertence, excusable neglect, or any other reason justifying
relief?
2. Does a State District Court have the authority in a
dissolution action to order the United States Office of Personnel
Management to pay directly to a former spouse a share of a civil
servant's monthly disability retirement annuity payments?
3. Did the District Court abuse its discretion by ordering
Mrs. Castor to deliver all personal property in her possession
awarded to Mr. Castor by the dissolution decree, after she had
received in full her share of retirement benefits, past-due
maintenance payments, and attorney's fees?
4. Did the District Court abuse its discretion by awarding
$250 in attorney's fees to Mrs. Castor?
After 28 years of marriage, on April 1, 1988, Gavin D. Castor
2
and Shirley M. Castor were granted a dissolution of marriage. Mr.
Castor was required to pay $675 per month spousal maintenance until
the couple's home in Utah was sold. Maintenance would then be
reduced to $300 per month until Mrs. Castor became eligible for
Social Security retirement benefits. Mr. Castor was ordered to pay
$4,000 to Mrs. Castor as her share of his civil service retirement
pension. The parties were allowed to keep certain personal
property then in their possession, and Mrs. Castor was ordered to
turn over certain personal property to Mr. Castor.
On October 15, 1990, Mr. Castor moved to modify the
dissolution decree by reducing the amount of spousal maintenance
payments and moved to require Mrs. Castor to turn over titles to
vehicles and other personal property awarded to Mr. Castor,
On December 6, 1990, Mrs. Castor requested a continuance of
the hearing on the motion for modification of the dissolution
decree because notice of the hearing scheduled for that date was
not received until November 30, 1990. The motion was granted, and
the hearing was reset for January 23, 1991.
On January 22, 1991, the District Court ordered the January
23 date for the hearing to be vacated because of a conflict in the
court's calendar and rescheduledthe hearing for February 14, 1991.
Both parties received written notice of the continuance. Although
Mr. Castor's counsel received the notice, he failed to see the new
date of the hearing. A s a consequence, neither Mr. Castor nor his
attorney appeared at the hearing on February 14. After waiting for
forty minutes, the District Court heard testimony from Mrs. Castor
3
and entered judgment in her favor.
In its February 20, 1991 order, the District Court required
the United States Office of Personnel Management to continue to pay
Mrs. Castor $582 per month from Mr. Castor's monthly retirement
benefits until March 1991. At that time, the Office of Personnel
Management was ordered to withhold $500 per month for Mrs. Castor.
Of the $500 withheld, $300 was for spousal maintenance and $200 was
to be applied to the balance of Mrs. Castor's $4,000 share of
retirement benefits, $6,066 in past-due spousal maintenance, and
$250 in attorney's fees. In approximately three years when these
obligations to Mrs. Castor had been paid in full, the Office of
Personnel Management was ordered to withhold $300 per month for
spousal maintenance.
In addition, after Mrs. Castor's share of retirement benefits,
past-due maintenance, and attorney's fees were paid in full, Mrs.
Castor was required to deliver to Mr. Castor the personal property
and title to vehicles awarded to him by the dissolution decree.
On March 13, 1991, the District Court denied Mr. Castor's
motion to set aside the order modifying the dissolution decree.
From these judgments, Mr. Castor appeals.
Should the District Court have set aside the February 20,
1991, order under Rule 60(b), M.R.Civ.P. for mistake, inadvertence,
excusable neglect, or other reason justifying relief?
Sections (1) and (6) of Rule 60(b), M.R.Civ.P. provide that
the court may relieve a party from a final judgment for "mistake,
4
inadvertence, surprise, or excusable neglect" or "any other reason
justifying relief from the operation of the judgment."
Mr. Castor's counsel argues that he is "only human" and that
his mistake in failing to notice the rescheduled date of the
hearing on Mr. Castor's motion should not have been imputed to his
client. Mr. Castor's counsel maintains that medical evidence of
his client's disability would have changed the outcome of the
court's ruling.
If the district court exercises its discretion in appraising
or weighing facts of a particular case, on review this Court
determines whether the district court, in varying degrees, has
abused or misused its discretion. See Steer, Inc. v. Department
of Revenue (Mont. 1990), 803 P.2d 601, 603-04, 47 St.Rep. 2199,
2200. If the district court's decision does not involve the public
policy that cases should be tried and decided on their merits, then
the scope of review is the standard abuse of discretion test.
When the district court sets aside a default judgment pursuant
to Rule 60(b), allowing the case to be tried on its merits, a
showing of great abuse of discretion is necessary to reverse the
district court's decision. Graham v. Mack (1985), 216 Mont. 165,
172, 699 P.2d 590, 594. But when the district court has refused
to set aside a default judgment, "no great abuse of discretion need
be shown to warrant reversal." Lords v. Newman (1984), 212 Mont.
359, 364, 688 P.2d 290, 293.
Generally, "mistake,I' "inadvertence,'I and "excusable neglect"
5
require some justification for an error beyond mere carelessness
or ignorance of the law on the part of the litigant or his
attorney. Lomas and Nettleton Co, v. Wiseley (7th Cir. 1989), 884
F.2d 965, 967. Mr. Castor's counsel has not offered an explanation
other than his failure to note the rescheduled date of the hearing.
Such a mistake is not enough to require setting aside a judgment
under Rule 60(b), M.R.Civ.P. See Watson v. Fultz (1989), 239 Mont.
364, 369, 782 P.2d 361, 364 (no relief from judgment when attorney
failed to notice hearing date in opponent's motion to amend
findings): Griffin v. Scott (19851, 218 Mont. 410, 710 P.2d 1337
(no relief from judgment when attorney failed to read mail for five
weeks because of work accumulated during his absence).
The general rule is that neglect of an attorney is
attributable to the client. Mvers, 235 Mont. at 236, 766 P.2d at
866. Mr. Castor's counsel relies on Lords v. Newman (1984), 212
Mont. 359, 688 P.2d 290, in which we held that attorney neglect can
be excusable on the part of the client upon the proper showing.
The attorney in Lords, after making a general court appearance,
"totally abandoned his clients and disappeared from sight." Lords,
212 Mont. at 367, 688 P.2d at 295.
In Paxson v. Rice (1985), 217 Mont. 521, 706 P.2d 123, we
distinguished LordS because, although the attorney in Paxson failed
to act in response to numerous requests by opposing counsel, he had
not abandoned his client and left the state. We held that the
attorney's procrastination in filing answers and other documents
was "a type of neglect which is properly attributable to a client,
6
and which we distinguish from the abandonment in Lords.Ir Paxson,
217 Mont. at 525, 706 P.2d at 126. Similarly, the neglect in this
case is properly attributable to the client.
In addition, the judgment of a district court can be set aside
for "any other reason justifying relief from the operation of the
judgment." Rule 60(b) (6), M.R.Civ.P. Generally, relief is
afforded under subsection (6) of Rule 60(b) in extraordinary
situations when circumstances go beyond those covered by the first
five subsections or when a party in whose favor judgment was
entered has acted improperly. Fuller v. Quire (6th Cir. 1990),
916 F.2d 358, 360; In re Marriage of Tesch (1982), 199 Mont. 240,
245, 648 P.2d 293, 296. We hold that Mr. Castor has not shown that
the District Court abused its discretion in refusing to set aside
the order of February 20, 1991 under Rule 60(b), M.R.Civ.P.
Does a State District Court have the authority in a
dissolution action to order the United States Office of Personnel
Management to pay directly to a former spouse a share of a civil
servant's monthly disability retirement annuities?
Mr. Castor claims that under § 25-13-608, MCA, his retirement
benefits, as "disability benefits," are exempt from execution;
therefore, the District Court did not have jurisdiction to order
the United States Office of Personnel Management to pay a share of
his disability retirement benefits directly to Mrs. Castor. Mrs.
Castor counters that according to an Arizona case, Villasenor v.
Villasenor (Ariz. App. 1982), 657 P.2d 889, the civil service
7
retirement annuities Mr. Castor receives do not constitute
"disability benefits. 'I
The issue of apportionment of civil service pensions between
civil service "retirement" benefits under 5 U.S.C. 5 8336 or 5 8338
and civil service "disability" benefits under 5 U.S.C. 5 8337 has
been addressed in cases relating to division of property between
spouses in community property states. See Levy v. Office of
Personnel Management (Fed. Cir. 1990), 902 F.2d 1550; Villasenor
v. Villasenor (Ariz. App. 1982), 657 P.2d 889. Although Mr. Castor
asserts that these cases do not apply because Montana is not a
community property state, the cases are instructive regarding
apportionment of retirement and disability benefits as part of
disability retirement annuities. Under 5 25-13-608, MCA, although
veterans' and social security benefits are subject to execution if
they are levied for child support or spousal maintenance,
"disability or illness benefits" are exempt. Section 25-13-
608(1) (d), MCA. If the monthly benefits Mr. Castor is currently
receiving qualify as "disability" benefits, such payments are
exempt from execution.
The California Supreme Court addressed apportionment of
military retirement and disability pay in In re Marriage of
Sternquist (Cal. 1978), 582 P.2d 96. The husband became disabled,
but remained in military service for twenty-six years. His regular
'Tlongevitylt
retirement annuity consisted of 65 per cent of his base
pay: his "disability1rretirement annuity was 75 per cent of his
base pay. Consequently, the husband elected to receive disability
8
retirement. The court recognized that the husband's disability pay
not only compensated him for loss of earnings because of compelled
early retirement and personal suffering, but "also serves the
objective of providing support for the serviceman and his spouse
after he leaves the service." Sternquist, 582 P.2d at 101. The
court awarded half of the annuity which was construed as the
"retirement" component of the husband's retirement disability
annuity to the wife and ruled that the "disability" component was
the husband's separate property. 1
In Levy v. Office of Personnel Management (Fed. Cir. 1990),
902 F.2d 1550, the court applied the principles set forth in
Sterncluist to civil service pensions. The court recognized that
retirement pay based on disability has two components: (1)
compensation to the civil servant for loss of earning power and
personal suffering: and (2) retirement support. m,902 F.2d at
1553. Accordingly, the rule for apportionment of retirement
benefits is that the amount the civil servant receives each month
as disability over and above what would have been received as
longevity retirement benefits is the civil servant's separate
property; the remainder is divisible community property. a.
The formula applicable to civil service retirement benefits
was detailed in Villasenor. A civil service employee can receive
retirement and disability benefits under Chapter 83, 5 U.S.C. §§
In Montana disability benefits may be included in the
marital estate. In re Marriage of Cooper (1990), 243 Mont. 175,
179, 793 P.2d 810, 812.
9
8301-8351 (1986), of the Civil Service Code. Villasenor, 657 P.2d
at 891. A civil servant can qualify for Chapter 83 benefits in
several ways. When a civil service employee meets the criteria for
age and length of service, he or she is entitled to "immediate
retirement" benefits. 5 U.S.C. 5 8336. One who is separated after
completing at least five years of civil service also qualifies for
an annuity, but payments do not begin until the employee is 62
years old, referred to as "deferred retirement." 5 U.S.C. 5 8338.
Finally, an employee with at least five years of civil service who
becomes disabled is eligible for ;;disability retirement," with
benefits payable immediately. 5 U.S.C. 5 8337. Mr. Castor is
receiving the third type of benefits, "disability retirement,"
under 5 U.S.C. 5 8337.
Annuities for immediate, deferred, and disability retirement
are all paid from the same fund, consisting primarily of
contributions in the form of deductions from employees' pay. The
annuity amounts for all three forms of retirement are calculated
by use of the same basic formula, based upon the employee's average
annual pay for the three highest-earning years and years of
service. 5 U.S.C. 5 8339; Villasenor, 657 P.2d at 891. Disability
retirement is earned during years of service just as any other
retirement pension, and disability is but one of several conditions
causing rights in the plan to vest. Villasenor, 657 P.2d at 892.
Depending on how many years of service the civil servant has,
disability retirement can have both a "retirement" component and
a "disability11component. The lldisability'lcomponent becomes
10
proportionately smaller as the years of service increase and
"disappears altogether for those who 'fall through the cracks' by,
for example, having served more than 21.9 years but being too young
to take immediate retirement, or being over 60 years but having too
few years of service to take immediate retirement." -
Id. Mr.
Castor, age 58 with 28 years of civil service employment, is one
for whom the t*disabilityts
component disappears.
From the analysis presented in Villasenor, we conclude that
Mr. Castor's monthly annuity is accurately characterized as
"retirement" benefits, rather than "disability" benefits. Hence,
the District Court is not precluded by 5 25-13-608, MCA, from
ordering the United States Office of Personnel Management to pay
Mrs. Castor a share of Mr. Castor's monthly disability retirement
annuity. We note that 5 U.S.C. 5 R345(j)(l) allows civil service
retirement benefits to be paid directly to a former spouse as
provided by a court decree of dissolution. We hold that the
District Court did not err in ordering the United States Office of
Personnel Management to pay directly to Mrs. Castor a share of Mr.
Castor's monthly disability retirement annuity.
I11
Did the District Court abuse .its discretion by ordering Mrs.
Castor to deliver all personal property in her possession awarded
to Mr. Castor by the dissolution decree, after she had received in
full her share of retirement benefits, past-due maintenance
payments, and attorney's fees?
Mr. Castor alleges that the District Court should have ordered
11
Mrs. Castor to turn over personal property awarded to him by the
dissolution decree because no Montana statute allows the court to
order the items to be held until his obligations are paid.
Section 40- 4- 209, MCA, allows the court to order a person
obligated to pay maintenance who is delinquent in an amount equal
to the total of six months of support payments to "post bond, give
a mortgage, or provide security or guaranty for so long as there
is a support delinquency.'' Section 40-4-209(2), MCA.
Mr. Castor's support obligation for six months was $4,040; the
court found that he owed $6,066 in past-due maintenance payments.
Allowing Mrs. Castor to keep personal property awarded to Mr.
Castor in the dissolution decree until support obligations have
been paid can serve as "security or other guaranty" as provided for
by g 40- 4- 209, MCA. We hold that the District Court stayed within
the guidelines of 5 40- 4- 209, MCA, and did not abuse its discretion
in ordering Mrs. Castor to deliver personal property belonging to
Mr. Castor after the delinquent support obligation had been paid.
IV
Did the District Court abuse its discretion by awarding $250
in attorney's fees to Mrs. Castor?
Mr. Castor contends that the District Court abused its
discretion by awarding attorney's fees without an evidentiary
hearing.
The court may award attorney's fees in dissolution cases:
The court from time to time, after considering the
financial resources of both parties, may order a party
to pay a reasonable amount for the cost to the other
party of maintaining or defending any proceeding under
chapters 1 and 4 of this title and for attorney's fees
....
Section 40-4-110, MCA. Mr. Castor asserts that the District Court
did not properly consider the "financial resources of both
parties.
Since the statute is permissive, the appropriate standard of
review is whether the court abused its discretion. In re Marriage
of Sullivan (1990), 243 Mont. 292, 299-300, 794 P.2d 6 8 7 , 691-692.
We have previously stated that because an award of $400 in
attorney's fees approaches & minimis, were we to reverse, the
costs on remand could easily exceed the amount originally awarded.
We thus upheld the court's award of attorney's fees. In re
Marriage of Chapin (1982), 202 Mont. 153, 156, 655 P.2d 991, 992.
The same principle applies in this case. We hold that the District
Court did not abuse its discretion by awarding $250 in attorney's
fees to Mrs. Castor.
Affirmed.
We concur:
Justices
13
Justice Fred J. Weber dissents as follows:
On October 15, 1990, Mr. Castor moved to modify the
dissolution decree. The petition was set for hearing on December
6, 1990. On the date of that hearing, Mrs. Castor requested a
continuance of the hearing because notice of hearing was not
received until November 30, 1990. The motion was granted and the
hearing was reset for January 23, 1991. On January 22, 1991, the
District Court, on its own order, vacated the hearing of January
23, 1991, and rescheduled the hearing for February 14, 1991. A5
pointed out in the majority opinion, both parties received written
notice of the continuance. The counsel for Mr. Castor who had
initiated the proceeding failed to note the new date of the
hearing. As a result neither Mr. Castor nor his attorney were
present at the hearing: and after waiting 40 minutes, testimony was
taken from Mrs. Castor, and judgment was entered in her favor.
Counsel for Mr. Castor admits that it was his own failure to
note the February 14 hearing which caused Mr. Castor, his client,
and himself to miss the hearing. He does not in any way attempt
to cover this up. He points out that his practice was to maintain
two calendars with notes of scheduled court appearances and filing
deadlines and to notify clients promptly when they must attend a
hearing. He failed to follow that practice in this instance.
The majority points out that it will not review a decision to
grant or deny a Rule 60(b) motion absent abuse of discretion. That
is only a partial statement of the rule as we have most recently
applied it. Using a federal Seventh Circuit Court case as
14
authority, the majority further states that generally mistake,
inadvertence and excusable neglect require some justification
beyond an error, mere carelessness or ignorance of the law.
This Court's 1990 authority on the same issue is set forth in
Blume v. Metropolitan Life Ins. Co. (1990), 242 Mont. 465, 791 P.2d
784. In Blume the plaintiff filed a complaint against Metropolitan
Life Insurance Co. (Metropolitan) and service was made on the State
Auditor and Commissioner of Insurance. The complaint, summons and
discovery documents were mailed by certified mail and were received
by Metropolitan. Apparently the same were lost. Metropolitan
failed to file an answer and a default judgment was eventually
entered in the amount of $185,986.43. In Blume we cited the
following as the controlling standard to be applied in considering
the District Court's refusal to set aside the default judgment
entered against Metropolitan. The unanimous Court stated:
Where a trial court denies a motion to set aside a
default judgment the standard of review is that no sreat
abuse of discretion need be shown to warrant reversal,
or, alternatively, 'slisht abuse' is sufficient to
reverse an order refusins to set aside a default. The
Lords court, which drew a distinction between the
standards of review applied to cases where motions to set
aside default judgments had been granted and those that
had been denied based its holding on two basic tenets:
(1) every litigated case should be tried on its merits
and default judgments are not favored and (2) trial
courts have a certain amount of discretion when
considering a motion to set aside a default judgment. .
.. (Citations omitted.) (Emphasis added.)
Blume, 791 P.2d at 785. The Court then set forth a great deal of
the evidence submitted by Metropolitan to support its motion to set
aside the default judgment, including the entry from the
Metropolitan log which showed that the mail was received from the
15
Commissioner on February 9, 1989; and affidavits of various other
persons who normally would have received information and acted in
connection with litigation, but all failed to do so. The Court
concluded that the evidence produced by Metropolitan demonstrated
that its failure to appear was not due to any inexcusable neglect
or disrespect for court or judicial process. They pointed out that
it was a mystery what happened to the summons and complaint after
it arrived at Metropolitan--although there is no argument that it
did arrive at Metropolitan. The majority in Blume then quoted from
a 1905 Montana case which stated:
Nesliqence or inadvertence directlv traceable to a vartv
litisant or his attorney, no less excusable than that
disclosed by this record, has many times been held
sufficient to warrant the ovenins of a default, and trial
courts have not infrequently been reversed for their
refusal to set aside defaults under such circumstances.
(Emphasis added.)
Blume, 791 P.2d at 787. then concluded that the neglect in
the 1905 case, where an inexperienced stenographer signed an
acceptance of service and then misplaced a complaint and summons,
was comparable to the loss of summons and complaint in Blume.
Blume then pointed out that the judgment would adversely effect
Metropolitan because the amount of the judgment exceeded $185,000.
In 1990, we concluded in Blume that an unexplained loss of a
summons and complaint and subsequent failure to appear was
excusable neglect. Under the present majority opinion, we are
concluding that the unexplained failure to appear for a continued
hearing was somehow more reprehensible than the loss of a summons
and complaint. I find no basis for such a distinction.
16
I conclude that the neglect on the part of counsel for Mr.
Castor was excusable in the same manner that the neglect on the
part of Metropolitan and its various personnel was excusable. As
in Blume, the judgment here adversely effected Mr. Castor. A s in
Blume Mr. Castor's counsel moved promptly to set aside the default.
In addition, we point out that Mr. Castor in this case was the
party who originally petitioned for the modification and who has
been denied his opportunity to present any evidence.
Based upon Blume I would conclude that the District Court
abused its discretion and vacate the default judgment.
Y
Wtlice
17
August 29, 1991
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the
following named:
James D. Elshoff
Attorney at Law
P.O. Box 2323
Great Falls, MT 59403
Marcia Birkenbuel
Attorney at Law
613 Strain Bldg.
Great Falls, MT 59401
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTAN
BY:
Deputy