Tag Archives: Required good faith efforts to rehabilitate and find employment

Court Reverses Trial Court Permanent Spousal Maintenance Award And Directs Rehabilitative Maintenance and Also Directs Smaller Monthly Sum

In Spolum v. D’Amato, A14-1335, A14-1720 (Minn. App. August 17, 2015)  the Court of Appeals reversed a Ramsey County  trial court decision awarding Permanent Spousal Maintenance and remanded to the trial court to recalculate Spolum’s  monthly expenses, D’Amato’s income, and to reduce the monthly maintenance award of $14,072 and further held only Rehabilitative Spousal Maintenance was appropriate.

D’Amato, an orthopedic surgeon, and Spolum, a flight attendant, were married in 2001 and had one son, born in 2003. The parties separated in July 2010.  A legal separation action was started and then the parties attempted reconciliation but continued to live separately. A divorce trial began in August 2013. At that time, Spolum was age 49 and D’Amato was age 45.

To plan for the wedding, Spolum took a leave of absence as a flight attendant and extended it after the 911 attack and returned to work 5 years later. She quit in 2006 because her commute was stressful. She is high school educated with some college and art school classes.

Spolum worked at a clothing boutique and as a yoga instructor. When the parties reconciled she opened a chocolate shop, but the business failed. Trial evidence reflected she was “brilliant and creative”.  She was interested in animal-welfare and was on the board of directors for an animal-welfare organization. Spolum desired to establish a career as an animal welfare advocate. A vocational rehabilitation evaluation was completed concluding without additional training she could work in a position earning between $10-$12 an hour, but could attend a two year vocational program.

During the marriage D’Amato was let go in a physician practice. He applied to Health Partners. He was initially rejected, but Spolum testified she invited the head of HealthPartners to their home to advocate for reconsideration and D’Amato was then hired.  D’Amato also began a second job as an independent medical-legal consultant, working approximately 20 hours a week. Near the end of 2011 D’Amato quit the second job as it was time-consuming and stressful causing him anxiety and to be unhealthy. He testified he was already working 50 hours a week at HealthPartners.

D’Amato testified his earning in 2013 would be $800,000 and that he was seeing fewer patients as they were being diverted to other doctors. The Director of HealthPartners testified there has been a decrease in patient volume and surgeries. D’Amato’s income has been decreasing since 2011 and he predicted this trend would continue. He could earn additional income based on his production, but patients were decreasing. D’Amato testified he projected his salary in 2014 to be $750,000. D’Amato proposed the court use his 2013 income of $800,000 and that he pay spousal maintenance for 4 years to allow Spolum to acquire employment and training.

In the Judgment the trial court set D’Amato’s income at $950,538 using a 3 year average and despite finding he had quit his second job to create a more balanced life. The  judge stated that in the event the court overestimated his income D’Amato was in a better position to correct the error by pursuing additional options.

The trial court found Spolum’s discretionary spending at $9,943 per month and then modified that to $8,383 based on D’Amato’s claim this was even higher than she requested. In the original decision the court ordered $18,225 per month in spousal maintenance which was subsequently amended to $14,072 after post-trial motions. Apparently the trial court made findings concerning Spolum’s earning capacity and ability to re-enter the job market, but ignored those facts in making it a permanent maintenance award. The court found she was in good physical and emotional health and found no reason why she could not pursue a successful career because she was healthy, intelligent, articulate, creative, and capable.

The court found permanent spousal maintenance was appropriate based on: (1) the high marital standard of living, (2) the length of the marriage, (3) Spolum will never be able to support herself in the manner close to the marital standard of living, and (4) the fact D’Amato’s income would not decrease. Spolum was awarded $1.2 million dollars in assets, including the Caribbean home “Seacliff” which D’Amato requested be sold and artwork of $110,000, but found the assets were not available until retirement.

The court of appeals reversed the amount and duration of the award and stated Permanent Spousal Maintenance was not warranted and that the award should be Rehabilitative. The court explained a court may award spousal maintenance (1) if a spouse lacks sufficient property, including allocated property to provide for reasonable needs considering the standard of living, or (2) is unable to provide self-support through appropriate employment, in light of the standard of living. Minn Stat. 518.552, subd.1.  In determining an award the court should evaluate (1) the financial resources of the requesting party, including marital property awarded to the party, and the party’s ability to meet needs independently, (2) time necessary to become self-supporting, (3) marital standard of living, (4) duration of marriage, (5) loss of employment benefits and opportunities foregone by requesting party, (6) age, physical condition, and emotional condition of the requesting party, (7) ability of the obligor to meet the needs of both parties, and (8) contribution of each party in the acquisition, preservation, and depreciation of marital property. Minn. Stat. 518.552, subd. 2.

The court stated the trial court put an overriding emphasis on the standard of living, which was merely one factor to be considered. The court did not agree the assets awarded to Spolum were not available until retirement. The court held the evidence and findings support an award of rehabilitative maintenance, not permanent spousal maintenance. The court noted the standard of living was over emphasized because Spolum also testified the standard of living was excessive and unnecessary and was a mistake and was based on D’Amato previously working two jobs and that it was unfair to consider a lifestyle based on income from a prior second job that contributed an average of additional income of $200,00 per year. The court also stated the parties had only lived together as husband and wife for 9 years. It noted prior to the marriage Spolum made $46,000 annually as a flight attendant. The court stated the evidence only supported a rehabilitative award.

The court also stated the trial court failed to consider Spolum’s dubious use of assets during the separation where she transferred $125,000 from the parties’ joint account and only had $40,000 left.

The  court stated the trial court’s finding of the need for discretionary spending of $8,343 per month was excessive. The court also found the trial court clearly erred in finding D’Amato’s income was $950,838 and that spousal maintenance should be based on the obligor’s income at the time of trial. The court noted it was unreasonable for a court to require D’Amato to work a second job in order to satisfy a maintenance award when Spolum is not required to work even one job.

The issue of spousal maintenance is a very difficult matter and requires careful evaluation of numerous factors and often the assistance of experts, including an experienced family law attorney. It is critical to promptly retain an experienced divorce lawyer if spousal maintenance is a potential issue.

Change in Circumstances Needed to Modify Awards of Spousal Maintenance

Change in Circumstances Needed to Modify Awards of Spousal Maintenance

Under Minnesota law, Minn. Stat. 518A, Section 39, subd. 2., a court may order a modification in a spousal maintenance order if there has been a change in circumstances that makes the order now unreasonable. The court may do this because of any of the following:

  1. Increased or decreased gross income of the obligor or obligee;
  2. Substantially increased or decreased need of the obligor or obligee;
  3. Receipt of welfare benefits;
  4. Change in the cost of living, based on the Bureau of Labor Statistics;
  5. A child’s extraordinary medical costs;
  6. A change in the availability of health insurance coverage or a substantial increase in its cost;
  7. The addition or an increase or decrease in work-related or education-related child care expenses; or
  8. Emancipation of a child.

It is important to note that an ex-spouse’s refusal to obtain employment is not a change in circumstances that requires making a temporary award of spousal maintenance permanent.  

In Van Steenburgh v. Clyma, A13-1318 (Minn. Ct. App. Mar. 3, 2014), the Court of Appeals rejected an ex-spouse’s motion to make a temporary spousal award of $10,000 per month permanent. The court noted the dissolution court had determined that his reasonable monthly budget was substantially less at $7691.35.

The court also found that evidence showing that the ex-husband had refused to rehabilitate himself and find employment was sufficient to support the denial of the motion. An ex-spouse who receives temporary maintenance is required to make a good faith effort to rehabilitate and find employment. Here, an employment expert had opined that the ex-spouse could be earning a salary of $80,000 or more after three or five years of employment. Also, he had received $138,000 more than his expenses as temporary maintenance, and, with the assets that had been distributed following the divorce, he had the resources to support himself.

The evidence that he had not sufficiently tried to rehabilitate himself included: (1) a long time period when he did not apply for any jobs; (2) taking just one community college course during the period of temporary spousal support; (3) only focusing on a narrow set of jobs and refusing retraining and not considering employment opportunities outside his area of expertise.

An ex-spouse’s decrease in housing expenses, based on the sale of the former marital home and purchase of a less expensive home, is not a substantial change in circumstances that requires modification of a spousal maintenance order.

In Thomas v. Thomas, A13-905 (Minn. Ct. App. Mar. 3, 2014), the original divorce decree provided that the ex-husband, a self-employed dentist, would pay his ex-wife permanent spousal maintenance of $7,440 per month, which was to be lowered to $5,200 when the parties’ youngest child was emancipated. After the youngest child was emancipated in June 2012, the ex-wife sold the former marital residence (which had become her property) and relocated to a condominium in Florida.

After losing in the district court, the ex-husband appealed, arguing that the substantial decrease in housing expenses and increase in voluntary expenses, such as vacations and a car payment, made the spousal-maintenance agreement unfair because it made him support her in a lifestyle that was higher than the marital standard of living. The Minnesota Court of Appeals found his argument that the expenses did not reflect the marital standard of living lacked merit, as the parties lived very well on his income during the marriage, driving nice cars and taking vacations. Furthermore, the court emphasized that the parties had agreed on the permanent spousal maintenance obligation, and that agreement is given great weight in motions to modify maintenance. The court emphasized that the ex-husband receives a tax benefit from paying spousal-maintenance. Even though the wife was relatively young and cohabitating with a significant other, the court found that there was no change in circumstances that required modification of spousal maintenance.

If you believe that a change in spousal maintenance is needed, whether an increase or a decrease, you should consult Jeffrey R. Arrigoni Attorney at Law immediately.