The Appeals Court decision in DeMarco v. DeMarco reminds us that a deal is a deal, even when it’s entered into based upon advice from a trial judge who misinterprets the law.
In this case, the husband and wife were divorced in May 2010. At that time they signed a separation agreement calling for the husband to pay alimony to his wife of until the death of either party, the wife’s remarriage, or such time as the husband had no gross earned income after reaching age 68. After the Alimony Reform Act was passed into law in 2012, the husband filed a complaint for modification seeking to terminate his alimony obligation based upon his having reached full retirement age.
M.G.L. c. 208 sec. 49(f) provides:
Once issued, general term alimony orders shall terminate upon the payor attaining the full retirement age. The payor’s ability to work beyond the full retirement age shall not be a reason to extend alimony, provided that:
(1) When the court enters an initial alimony judgment, the court may set a different alimony termination date for good cause shown; provided, however, that in granting deviation, the court shall enter written findings of the reasons for deviation.
(2) The court may grant a recipient an extension of an existing alimony order for good cause shown; provided, however, that in granting an extension, the court shall enter written findings of:
(i) a material change of circumstance that occurred after entry of the alimony judgment; and
(ii) reasons for the extension that are supported by clear and convincing evidence.
The DeMarco modification case – husband’s request to terminate his alimony based upon reaching retirement age – was set for trial in February 2014. On the morning of the first day of trial, the trial Judge spoke to the parties about the benefits of settling their case. While acknowledging that interpretation of the alimony reform act was subject to significant debate, the trial judge expressed his concern that the results after trial could be harsh to the wife. She could potentially be left with no alimony as a result of termination based upon retirement age.
Heeding the trial judge’s advice, the husband and wife settled the modification case, agreeing that the husband would make a lump sum cash payment to the wife in exchange for termination of his obligation to continue to pay alimony. The agreement the parties signed survived the judgment of modification as a binding contract, meaning for all intents and purposes it was not subject to future modification.
In January 2015, the Supreme Judicial Court issued three decisions holding that G.L. C. 208, Sec. 49(f) (the retirement provision) does not apply retroactively to alimony orders in divorce judgments or separation agreements that entered before March 1, 2012. This meant that alimony would not have terminated under the law in the DeMarco matter.
Based on what she deemed to be a mistake of law in crafting the 2014 agreement, the wife filed a motion and a complaint in equity seeking to reinstate the husband’s alimony obligation. The trial judge ruled that the “wife’s reliance on the Court’s incorrect interpretation of the Alimony Reform Act to her serious detriment” constituted extraordinary circumstances warranting relief from the terms of the 2014 agreement. The Appeals Court, however, disagreed.
Changes in decisional law alone aren’t extraordinary circumstances and don’t justify reopening a final judgment. Here, the wife chose to settle her case so she is bound by that settlement. The wife had the option to have a trial and then seek an appeal. She also had the option to ask the trial judge to send the issue up to the Appeals Court before hearing the evidence through a procedure called “reserve and report.” The wife chose not to pursue those avenues. Additionally, the wife entered into a surviving agreement. In the absence of fraud, coercion or countervailing equities, someone who enters into a surviving settlement agreement freely and voluntarily is bound by its terms. The wife in DeMarco is bound by the settlement agreement she agreed to, regardless of the fact that it was based on the trial judge’s interpretation of the law which differed from that of the Appeals Court.
Until next time,