APPEAL FROM: District Court of the Thirteenth Judicial District, In and For the County of Yellowstone, Cause No. DR 06-1018 Honorable In-grid Gustafson, Presiding Judge
The opinion of the court was delivered by: Justice Michael E Wheat
Submitted on Briefs: October 30, 2012 Decided: January 31, 2013
Justice Michael E Wheat delivered the Opinion of the Court.
¶1 Dennis Simpson ("Dennis") appeals the denial of his motion to modify child support by the Thirteenth Judicial District Court, Yellowstone County. Larissa Simpson ("Larissa") cross-appeals the District Court's denial of her motion to invalidate the parties' stipulation amending the final decree. We affirm both issues.
FACTUAL AND PROCEDURAL BACKGROUND
¶2 Dennis and Larissa were married on December 17, 1988, in Twin Bridges, Montana. Larissa filed a petition for dissolution of the marriage on October 13, 2006, citing serious marital discord. At the time of the dissolution, Dennis and Larissa had three minor children. Dennis's primary source of income was from Simpson's Hot Springs, Inc., d/b/a Bozeman Hot Springs ("the Hot Springs"), of which he is an owner. The Hot Springs afforded Dennis an income of roughly $1,500,000.00 a year. Larissa worked as a homemaker.
¶3 As part of the dissolution, Dennis and Larissa entered into a Property Settlement Agreement ("the Agreement") and a Stipulated Final Parenting Plan ("the Plan") in October of 2006. The Agreement distributed Dennis's and Larissa's property and allocated their debts and liabilities. Under the Agreement, Dennis retained the marital residence, the retirement and investment accounts in his name, vehicles titled in his name, accounts held in his name, and all real and personal property in his possession. He also assumed sole responsibility for all bills that existed at the time of the dissolution. Larissa was to receive several forms of payment from Dennis. These payments consisted of a $10,000.00 per month payment "for life" and a $500,000.00 payment to be rendered in total by January 7, 2009. Dennis's monthly payment obligation was set to begin "in the month following the parties' youngest child's graduation from high school or one month following his 19th birthday." Dennis was also required to make the payments on Larissa's vehicle and give Larissa a lifetime membership to a fitness center. The Agreement finally provided that it "shall not be modified in any future legal proceeding under the authority of § 40-4-201(6), MCA."
¶4 The Plan directed Dennis to pay Larissa $10,000.00 per month in child support until "terminated by emancipation of each child or each child's graduation from high school," but in no event later than each child's 19th birthday. Thus, the combined operation of the Plan and the Agreement entitled Larissa to a $10,000.00 per month payment from Dennis for the rest of her life, first in child support, and later, after the youngest child reached 19 years of age, in the form of a property settlement. The District Court found that the Agreement was not unconscionable and found that the Plan was in the best interests of the children, adopting and incorporating both into the court's Final Decree of Dissolution of Marriage, filed November 3, 2006.
¶5 Dennis eventually began to fall behind in paying the $10,000.00 per month in child support. In response, Larissa filed a motion for contempt on August 29, 2008, alleging Dennis owed $77,412.05 in child support through July 2008, and $47,510.41 in an outstanding tax bill he accepted responsibility for under the Agreement. Shortly thereafter, a fire at the Hot Springs resulted in significant damage, and Dennis claimed this fire impaired both his ability to pay his obligations and his ability to appear for a show cause hearing. Dennis accordingly sought a series of continuations and the parties finally agreed to participate in mediation regarding Dennis's alleged arrearage in May of 2009. In light of the pending mediation, the District Court continued the show cause hearing on Larissa's motion for contempt, ordering that it could be re-set upon the request of either party following the completion of mediation.
¶6 Dennis has claimed that prior to the mediation both he and Larissa disputed the amount of arrearage and whether child support should continue. At the mediation, Dennis and Larissa stipulated to several modifications of Dennis's original payment obligations and agreed upon the arrearage. Specifically, Dennis and Larissa agreed to amend the court's November 3, 2008 final decree to: (1) indefinitely extend the January 7, 2009 deadline for the $500,000.00 lump-sum payment, agreeing that the obligation would accrue simple interest at the rate of five percent per year until paid in full; (2) agree that Dennis owed $55,000.00 in child support through June 2009, and that this arrearage would accrue five percent annual interest beginning January 7, 2009, until paid in full; (3) agree that Dennis would pay $6,000.00 per month in "child support" beginning July 1, 2009, to be paid by automatic deposit; (4) agree that the remaining $4,000.00 in child support owing each month would accrue five percent annual interest until paid in full; (5) agree that until the obligations are paid in full, any net proceeds greater than $500.00 from the sale of Dennis's real or personal property would be paid towards his obligations; and (6) agree that Dennis had roughly six months to either satisfy his outstanding tax obligation or remove Larissa's liability. These agreements were memorialized in a document entitled "Stipulation and Order Amending Final Decree," ("the Stipulation") and it was signed by Larissa, but not Dennis. Notably, the Stipulation did not decrease Dennis's total monthly child support obligation in light of Larissa's diminished parental responsibilities. Instead, the Stipulation provided for a delayed child support payment schedule and set the interest rate to be applied to any arrearage.
¶7 After the mediation, Dennis and Larissa engaged in protracted wrangling over Larissa's discovery requests. In response to Dennis's recalcitrance and failure to pay the mediated child support obligation, Larissa requested that the court set a hearing on her motion for contempt, which the court scheduled for November 17, 2010. Following the hearing, the Court ordered Dennis to begin paying child support per the Stipulation on December 1, 2010, and to pay the outstanding tax obligation.
¶8 Dennis filed a Motion to Modify Child Support ("the Motion") on November 17, 2010. The Motion alleged that the $10,000.00 per month in child support was unconscionable in light of changed circumstances. Specifically, Dennis alleged that Larissa was no longer supporting any children, as two of his three children had reached the age of majority and the youngest was residing with him, and argued that Larissa's income had changed. Larissa opposed the Motion, arguing that circumstances had not changed and that the child support was part of a "greater agreement" dividing the marital estate and could therefore not be modified without reforming "the entire agreement."
¶9 At a March 16, 2011 show cause hearing concerning Larissa's motion to hold Dennis in contempt for failing to abide by the court's November 17, 2010 order, Larissa challenged the validity of the Stipulation. There, Larissa somewhat incongruously claimed that the Stipulation was invalid while also asking the court to hold Dennis in contempt for failing to follow its terms regarding the payment of child support. In a subsequent motion, Larissa claimed the Stipulation lacked either sufficient consideration or mutual consent and argued the Plan and Settlement were not modifiable.
¶10 The District Court addressed Dennis's motion to modify child support and Larissa's motion to invalidate the Stipulation in its September 23, 2011 order. The court denied Dennis's motion to modify child support payments by concluding that the parties intended to provide Larissa a $10,000 per month income regardless of her parental responsibilities. In support, the court cited Dennis's statement that characterizing payments as child support was a "misnomer" in light of Larissa's lack of parenting responsibilities. The court reasoned its conclusion was bolstered by the fact that the Stipulation did not reduce child support payments even though "Larissa [had] no children residing with her." Because Dennis's "child support" obligation seemed to exist independent of Larissa's actual child support needs, the court concluded that it was "the obvious intention" of the parties to provide Larissa $10,000 per month for life, regardless of labels.
¶11 The court similarly denied Larissa's motion to invalidate the stipulation, finding that because the parties had "significant disputes" concerning the amounts Dennis owed Larissa, "there clearly was consideration for the stipulation." More importantly, the court found that Larissa was estopped from asserting the Stipulation was invalid in light of her prior representations that the Stipulation embodied the parties' mediated agreement and because of her various efforts to enforce its terms.
¶12 Dennis and Larissa's appeals followed the District Court's September 23, 2011 order ...