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In re Marriage of Simpson

Supreme Court of Montana

November 27, 2018

IN RE THE MARRIAGE OF: LARISSA L. SIMPSON, Petitioner and Appellant, and DENNIS D. SIMPSON, Respondent and Appellee.

          Submitted on Briefs: July 11, 2018

          APPEAL FROM: District Court of the Thirteenth Judicial District, In and For the County of Yellowstone, Cause No. DR 06-1018 Honorable Ingrid G. Gustafson, Presiding Judge

          For Appellant: John M. Kauffman, Kasting, Kauffman & Mersen, P.C., Bozeman, Montana

          For Appellee: Dennis D. Simpson Self-Represented, Scottsdale, Arizona


          Mike McGrath Chief Justice

         ¶1 This is an appeal from a Thirteenth Judicial District Court order modifying Dennis Simpson's (Dennis) and Larissa Simpson's (Larissa) Property Settlement Agreement and subsequent order awarding attorney fees. We affirm.

         ¶ 2 We restate the issues on appeal as follows:

1. Whether the District Court abused its discretion when it modified the Agreement, terminating monthly payments to Larissa.
2. Whether the District Court abused its discretion when it limited the amount of Larissa's attorney fees to those incurred during the contempt proceedings.


         ¶3 Dennis and Larissa were married in 1988 and divorced in 2006. In early November 2006, the District Court entered a Final Decree of Dissolution of Marriage which incorporated both a Property Settlement Agreement (Agreement) and a Stipulated Final Parenting Plan. Between 2006 and 2009, the parties were engaged in ongoing disputes and litigation, mainly involving the parenting plan. In 2013, this Court affirmed the District Court's decision to deny Dennis's motion to modify child support and Larissa's motion to invalidate a stipulation concerning delayed child support payments. Simpson v. Simpson, 2013 MT 22, 368 Mont. 315, 294 P.3d 1212 (Simpson I).

         ¶ 4 Pursuant to the Agreement, Dennis retained the bulk of the marital assets and assumed responsibility for the marital debts. Larissa was to receive a $10, 000 monthly payment from Dennis each month for life, secured by a life insurance policy on Dennis's life with Larissa as the sole beneficiary. The Agreement also required Dennis to pay Larissa a lump sum of $500, 000 and provide her with a lifetime gym membership. The Agreement included a non-modification clause, which stated that "Both parties agree that this Agreement and any Decree of Dissolution of their marriage incorporating this Agreement shall not be modified in any future legal proceeding under the authority of § 40-4-201(6), MCA." The parties also included a provision that the prevailing party in any future dispute will be entitled to attorney fees.

         ¶5 At or near the time of dissolution, the parties prepared financial statements, which indicated their net worth to be approximately $13, 000, 000. However, the District Court found the "assets were not worth anywhere near $13, 000, 000," noting that these "statements exaggerated the parties' net worth and, in further complication, much of the value of these assets was completely lost with the economic disaster occurring in 2008-09." These assets included (1) a note receivable for $500, 000; (2) a certificate of deposit with Mountain West Bank for $385, 000; (3) Arrow Construction Inc. valued at $600, 000; (4) Rainbow Subdivision valued at $4, 000, 000; (5) lots in Northstar Subdivision valued at $750, 000; (6) eighty acres of property at Triple Creek Meadows valued at $1, 900, 000; (7) two lots at the Bozeman Hot Springs valued at $1, 200, 000; (8) the Bozeman Hot Springs valued at $5, 000, 000; (9) personal belongings valued at $600, 000; and (10) $62, 000 in cash. Dennis also noted multiple debts in his financial statement, including loans with Mountain West Bank and Yellowstone Bank and various tax obligations.

         ¶6 In May 2015, Dennis continued to fall behind on the monthly $10, 000 payments to Larissa. On May 7, 2015, Larissa filed a motion to hold Dennis in contempt for failure to make payments. Larissa also moved the District Court to find Dennis in breach of the Agreement for his failure to maintain life insurance. After a hearing, the District Court issued an order for an accounting and held the contempt in abeyance after Dennis advised that he was filing for bankruptcy in Arizona. Following bankruptcy proceedings in Arizona and several continuances, Dennis filed his accounting on May 4, 2017. The District Court held another hearing on July 25, 2017. Following that hearing, Dennis filed a motion to modify the Agreement, arguing that changed circumstances made the Agreement unconscionable.

         ¶7 On October 31, 2017, the District Court found Dennis in contempt, ordered him to pay Larissa $253, 475, and awarded Larissa court costs and reasonable attorney fees associated with her contempt motions. The District Court also modified the Agreement by terminating Dennis's obligation to pay Larissa $10, 000 a month.[1] The District Court concluded that the Agreement was unconscionable under the current circumstances because the valuation of the marital assets was "grossly inflated," a fire damaged the Bozeman Hot Springs, and an economic collapse in 2008 virtually halted development projects in Gallatin County. The modification order stated that Dennis could purge his contempt if he made monthly installments of $2, 000 on or before the tenth day of each month until Larissa was paid in ...

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