No. 93-424
IN THE SUPREME COURT OF THE STATE OF MONTANA
1994
IN RE THE MARRIAGE OF
WILLIAM RICHARD CARAS,
Petitioner, Respondent,
and Cross-Appellant,
and
LAURI CHRISTINE CARAS,
Respondent, Appellant,
and Cross-Respondent.
APPEAL FROM: District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable Ed McLean, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Noel K. Larrivee, Larrivee Law Offices,
Missoula, Montana
Richard Ranney, Williams & Ranney,
Missoula, Montana
For Respondent:
Richard A. Reep, Reep, Spoon & Gordon,
Missoula, Montana
, Submitted on Briefs: December 22, 1993
Decided: February 11, 1994
Filed: FEB f 1 9994
Justice Terry N. Trieweiler delivered the opinion of the Court.
In In re Marriage of Caras (l992), 254 Mont. 169, 835 P.2d 715
(Caras I, we vacated that portion of the parties' dissolution decree
)
which incorporated a marital and property settlement agreement and
remanded with instructions that the District Court make findings
regarding the conscionability of the agreement. The District Court
for the Fourth Judicial District in Missoula County found that the
agreement was conscionable. Lauri now appeals the findings,
conclusions, and order of the District Court regarding that
agreement. Bill cross-appeals the District Court's order regarding
attorney fees and costs. We affirm in part and reverse in part.
The parties have raised the following issues:
1. Did the District Court err when it concluded that the
marital and property settlement agreement was conscionable?
2. Did the District Court abuse its discretion when it
failed to grant a continuance to allow further investigation of the
marital estate?
3. Did the District Court abuse its discretion when it
failed to rule on motions filed during trial?
4. Did the District Court err when it ordered each party to
pay his and her own attorney fees and costs?
William Richard Caras and Lauri Christine Caras signed a
property and marital settlement agreement in August 1990 which was
later incorporated in their petition for legal separation. The
District Court granted their separation and approved their
settlement agreement on October 11, 1990.
On May 21, 1991, the District Court granted Bill's motion to
convert the legal separation to a final decree of dissolution.
Lauri was successful in her effort to have that decree set aside,
however, she did not respond when Bill filed a motion to convert
the decree of legal separation to a final decree of dissolution for
a second time. On November 22, 1991, the District Court entered
the final dissolution decree which incorporated the parties'
marital and property settlement agreement from August 1990. Lauri
appealed with new counsel of record and we remanded to the District
Court.
After this Court's decision and denial of Bill's petition for
rehearing Caras1 on August 25, 1992, the parties began a course of
written discovery which included the exchange of interrogatories
and Bill's deposition. On January 25, 1993, the District Court, at
Bill's request, set the matter for a nonjury hearing on its March
calendar. Three days before trial, Lauri moved the District Court
to continue the trial based on a delay in transcribing Bill's
deposition and the need for further information from Bill regarding
his real estate holdings. The District Court denied Lauri's motion
and the trial was held on March 11 and 25, 1993.
At trial, the attorney who had represented Lauri in the
preparation of the marital and property settlement agreement was
called by Bill to testify regarding his role as Lauri's attorney at
the beginning of the dissolution. The only other witnesses who
were called to testify were Lauri and Bill.
During the court's recess, Lauri moved the District Court to
compel Bill to provide more complete information regarding certain
investment property. In response to this motion, Bill filed a
motion to protect him from further discovery pursuant to
Rule 26(c), M.R.Civ.P. The District Court did not rule on these
motions and the trial proceeded to its conclusion.
The District Court issued its findings of fact, conclusions of
law, and order on May 19, 1993, in which it held that the marital
and property settlement agreement executed on August 17, 1990, was
not unconscionable and should be adopted by the court and
incorporated in the final decree of dissolution.
ISSUE 1
Did the District Court err when it concluded that the marital
and property settlement agreement was conscionable?
When it determines the conscionability of a marital and
property settlement agreement, a district court
engage[s] in discretionary action which cannot be
accurately categorized as either a finding of fact or a
conclusion of law. These discretionary judgments made by
the trial court are presumed to be correct and will not
be disturbed by this Court absent an abuse of discretion
by the lower court.
InreMam'ageofHamilton (1992), 254 Mont. 31, 36, 835 P.2d 702, 704-05
(quoting InreMam'ageofDanelson (1992), 253 Mont. 310, 317, 833 P.2d
Bill contends that where the parties have agreed to a property
distribution pursuant to a separation agreement, the controlling
statute is 5 40-4-201(2), MCA, and not, as Lauri suggests, the
"equitable apportionment" statute at 5 40-4-202, MCA. Section
40-4-201(2), MCA, provides that:
In a proceeding for dissolution of marriage or for
legal separation, the terms of the separation agreement,
except those providing for the support, custody, and
visitation of children, are bindins upon the court unless
it finds, after considering the economic circumstances of
the parties and any other relevant evidence produced by
the parties . . . that the se~aration aareement is
unconscionable. [Emphasis added].
Lauri asserts that she is not advocating a strict application
of 5 40-4-202, MCA; she advocates its application only to the
extent that its various factors would aid the court in making a
determination of conscionability. In particular, she argues that
without determining the net value of the marital estate, it was
impossible for the District Court to make a finding of
conscionability. She argues that the District Court failed to find
a specific value for the marital estate and merely "outlinedM the
testimony of three witnesses who gave three different valuations.
In Caras I, Lauri successfully persuaded this Court that her
misunderstanding of the final nature of the separation agreement,
her hope of reconciliation of the marriage, and the length of time
between the execution of the agreement and its incorporation in a
decree of dissolution suggested that the agreement may have been
unconscionable. CarasI, 835 P.2d at 716-17. However, the language
in that opinion should not be construed to mean that a district
court commits reversible error by failing to make findings pursuant
to 3 40-4-202, MCA, when it has before it a separation agreement
which distributes marital property. To the extent that language in
that decision suggests a contrary conclusion, it is overruled. The
factors set forth in 9 40-4-202, MCA, must be considered by the
district court when dividing the marital estate absent a marital
and property settlement agreement between the parties. See In re
Mam'age of Sirucek (l985), 219 Mont. 334, 341-42, 712 P.2d 769, 773.
Where the parties have reached a separation agreement, a
determination of net worth of the marital estate is not required.
InreMam'ageofMiller (1980), 189 Mont. 356, 616 P.2d 313; seealso,Znre
Mam'ageofEvert (1982), 198 Mont. 191, 645 P.2d 417. In Miller, we
stated that:
[Tlhe net worth of the parties is a necessary
consideration; however, if there is a signed and executed
separation agreement, we must conclude that the parties
themselves have already made a determination of their net
worth as a basis for their decision.
Miller, 616 P.2d at 318. nl[W]ewill not substitute our conclusions
for those of the District Court in the absence of clear and
reversible error. In Miller 616 P.2d at 318.
At trial, the District Court received various estimates of the
net value of the Caras estate. Laurins first attorney valued the
marital estate at $530,000. Bill offered an exhibit valuing the
estate as of August 1990 at $290,508. Laurins estimate of the
estate as of August 1990 was $939,502. A financial statement
signed by Bill in October 1991, which was introduced by both
parties, indicated that Bill's net worth was $1,075,200. Bill
introduced testimony that this amount had been overstated.
Apparently, there were no professional appraisals conducted on
any component of the marital estate. Presented with these various
opinions, the District Court concludedthat the parties* agreement,
when taken in its entirety, including the distribution of
property, the payment of maintenance in lieu of property,
the waiver of obligations for child support and medical
care, the associated provisions for support of both
[Lauri] and the parties1 children, and after considering
the economic circumstances of the parties at the time of
execution of the parties1 marital and property settlement
agreement, as well as their current circumstances, is not
unconscionable and should be adopted by this court.
After a review of the record, we conclude that the District
Court's findings in support of its decision are supported by
substantial evidence, are not clearly erroneous, and that the
District Court did not abuse its discretion when it held that the
parties' marital and property settlement agreement was
conscionable.
ISSUE 2
Did the District Court abuse its discretion when it failed to
grant a continuance to allow further investigation of the marital
estate?
We will review a district court's decision to grant or deny a
motion for a continuance for abuse of discretion.
[Alny motion for a continuance of trial is within the
sound discretion of the District Court . .. [and we]
will not overrule a District Court's decision to deny a
motion for a continuance of trial unless there is "an
affirmative showing that the complaining party has
suffered prejudice."
M-County Plumbing & Heating, Znc. v. Levee Restorations ( 1986) , 2 2 1 Mont . 403 ,
408, 720 P.2d 247, 250.
Lauri further argues that Bill's failure to disclose the
existence and value of property he held in JKW Investments, a
partnership with his brother and sister, contributedto the court's
failure to accurately determine the value of tne marital estate.
At trial, Laurilscounsel requested a continuance to allow time to
transcribe Bill's deposition taken February 22, 1993, and to allow
Lauri additional time to investigate JKW property. However, the
District Court denied the continuance and noted that Bill's
deposition had not been scheduled until the trial had been placed
on the calendar, that more than eight months had passed since
remand, and that if the case were continued, it could not be
rescheduled for another six months.
Bill asserts that in his answers to Lauri's interrogatories
dated October 23, 1992, he identified JKW Investments as a
partnership. Lauri's former attorney testified that the parties
had indicated that there was full and accurate disclosure of all
the marital assets at the time the settlement agreement was signed.
Additionally, we note Laurils testimony that during the marriage
she had knowledge of the partnership's existence.
In support of her argument that the District Court abused its
discretion when it denied a continuance, Lauri cites our prior
decision in in re Mam'age of Hill (1982), 197 Mont. 451, 643 P.2d 582,
where this Court allowed the wife to pursue examination of a
disputed piece of property since it had reversed and remanded the
case for further proceedings to reconsider the marital estate
assets. However, reference to Hl mere1y underscores the
il If second
chancel1 this Court gave Lauri in Caras I.
Section 25-4-501, MCA, states that "[a] motion to postpone a
trial on grounds of the absence of evidence shall only be made upon
affidavit showing the materiality of the evidence expected to be
obtained and that due diligence has been used to procure it."
Lauri did not file any affidavit or brief when she requested the
continuance. Nor has Lauri asserted how she was prejudiced by the
failure of the court to continue the trial.
It is not an abuse of discretion for a district court to deny
postponing a trial where no affidavit has been filed as required by
5 25-4-501, MCA. In re T.M.M. (1988), 234 Mont. 283, 289, 762 P.2d
866, 869-70; Statev. P ~ c g 0 (l977), 173 Mont. 121, 566 P.2d 802. We
conclude that Lauri had ample opportunity to formally pursue
discovery or to undertake her own independent investigation of the
extent of and value of property held by Bill and JKW Investments
and that the District Court did not abuse its discretion when it
denied her motion to postpone the trial.
ISSUE 3
Did the District Court abuse its discretion when it failed to
rule on motions filed during trial?
Our standard of review from orders granting or denying
discovery and imposing sanctions for failure to comply with
discovery rules is abuse of discretion. "The District Court has
inherent discretionary power to control discovery and that power is
based upon the District Court's authority to control trial
administration. " State ex rel. Guarantee Znswance Co. v. Dkm'ct Court of the Eighth
JudicialDist. (l98l), 194 Mont. 64, 67, 68, 634 P.2d 648, 650. Seeako,
Marriage ofJacobson (1987), 228 Mont. 458, 743 P.2d 1025; Massaro v
.
Dunham (l979), 184 Mont. 400, 603 P.2d 249.
After the trial commenced, Laurils counsel filed a motion to
compel Bill to list all JKW Investment properties, their value, and
indebtedness; a motion for the District Court to reconsider
sanctions; and a motion for determination of attorney fees. Bill's
counsel filed a motion for a protective order in response to
Lauri's motion to compel. The District Court did not rule on any
of these motions. Therefore, they are deemed denied.
In this case, Lauri had eight months from the date of remand
to the date of trial. Yet, her discovery-related motions were not
filed until after trial began. She explains that because discovery
was completed so close to trial that her motions were timely.
However, parties have an obligation to complete discovery far
enough in advance of trial that discovery issues can be resolved by
the district court before trial begins. Where they have not done
so, and absent aggravating circumstances (which are not shown in
this case) we will not find an abuse of discretion from the
district court's failure to consider discovery related motions
after trial has begun.
The District Court's denial of Lauri's motions is affirmed.
ISSUE 4
Did the District Court err when it ordered each party to pay
his and her own attorney fees and costs?
Bill argues that the language of the marital and property
settlement agreement forecloses the District Court's exercise of
discretion on this issue and that, as the prevailing party, he is
entitled to reasonable attorney fees and costs. The agreement
provided that, "[s]hould any action be commenced to enforce, modify
or interpret any provision contained herein, the court, as a cost
of suit, shall award a reasonable attorney's fee to the successful
party. " The District Court found that '[elach party should bear
I
their [sic] own costs and attorney's fees in this matter as the
waters were so muddy that further court action was necessary to
examine the conscionability of the agreement."
Generally, it is within the district court's discretion to
award attorney fees. Such awards are subject to an abuse of
discretion standard of review. I re Mam'age 0fBuni.s (1993), 258 Mont.
n
265, 272, 852 P.2d 616, 620. Here, however, the language of the
marital and property settlement agreement is clear, and the
District Court, having found it to be conscionable, is bound by its
terms. Lauri's appeal to the Supreme Court was an nractionto
enforce, modify, or interpret" the agreement. We, therefore,
reverse the District Court's conclusion that each party should bear
his and her own costs and remand for a determination of reasonable
attorney fees to be awarded Bill.
11
The judgment of the District Court is affirmed in part,
reversed in part, and remanded for further proceedings consistent
with this opinion.
We concur:
February 11, 1994
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by U i e States mail, prepaid, to the following
ntd
named:
Noel K. Larrivee
LARRIVEE LAW OFFICES
334 East Broadway
Missoula, MT 59802
Richard Ranney
WILLIAMS & RANNEY, P.C.
P. 0. Box 9440
Missoula. MT 59807
Richard A. Reep
REEP, SPOON & GORDON, P.C.
P.O. Box 9019
Missoula, MT 59807-9019
ED SMITH
CLERK OF THE SUPREME COURT
STATEOF MONTANA