Opinion
23A-DR-2722
08-08-2024
Kay Beam, Appellant-Petitioner v. Philipe Beam, Marshall County Sheriff's Department, and Marshall County Sheriff's Merit Board, Appellees-Respondents
ATTORNEY FOR APPELLANT Alexander L. Hoover Alexander L. Hoover & Associates, LLC Plymouth, Indiana ATTORNEY FOR APPELLEE PHILIPE BEAM Rachelle N. Ponist Harshman Ponist Smith & Rayl, LLC Indianapolis, Indiana ATTORNEY FOR APPELLEES MARSHALL COUNTY SHERIFF'S DEPARTMENT AND MARSHALL COUNTY SHERIFF'S MERIT BOARD Sean M. Surrisi Wyland, Humphrey, Clevenger &Surrisi, LLP Plymouth, Indiana
Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision is not binding precedent for any court and may be cited only for persuasive value or to establish res judicata, collateral estoppel, or law of the case.
Appeal from the Marshall Circuit Court Trial Court Cause No. 50C01-0111-DR-64 The Honorable Matthew E. Sarber, Special Judge
ATTORNEY FOR APPELLANT Alexander L. Hoover Alexander L. Hoover & Associates, LLC Plymouth, Indiana
ATTORNEY FOR APPELLEE PHILIPE BEAM Rachelle N. Ponist Harshman Ponist Smith & Rayl, LLC Indianapolis, Indiana
ATTORNEY FOR APPELLEES MARSHALL COUNTY SHERIFF'S DEPARTMENT AND MARSHALL COUNTY SHERIFF'S MERIT BOARD Sean M. Surrisi Wyland, Humphrey, Clevenger &Surrisi, LLP Plymouth, Indiana
MEMORANDUM DECISION
Mathias, Judge
[¶1] Kay Beam ("Wife") appeals the Marshall Circuit Court's order modifying its decree issued in her divorce from Philipe Beam ("Husband"). Wife presents a single dispositive issue for our review, namely, whether the trial court erred when it modified the 2002 dissolution decree to address tax implications to Husband.
[¶2] We affirm.
Facts and Procedural History
[¶3] Wife and Husband's marriage was dissolved in 2002. Husband was employed by the Marshall County Sheriff's Department and had a vested interest in a pension plan. The dissolution decree provided in relevant part as follows:
[Husband] has a pension through the Marshall County Sheriff's Department with a total sum of One Hundred Forty-one Thousand Eight Hundred Seventy-four Dollars and Forty-seven Cents ($141,874.47) as of June 1, 2001. [Wife] is entitled to fifty percent (50%) of the pension as of June l, 2001. [Wife] will prepare a [QDRO] to be sent to the company regarding her pension percentage, however, it has been stated by the company that the Marshall County Sheriff's Department pension does not fall under the guidelines of the federal government [QDRO] pension statute and that they do not have to honor a pension [sic] from the Court. Therefore, all of [Wife's] rights regarding the pension shall be preserved as of the June l, 2001[,] date and that upon [Husband's] retirement he shall be ordered to pay [Wife] a monthly sum that would be equal to her fifty percent (50%) of the interest in the pension as of June l, 2001. Furthermore,
[Husband] is unable to bankrupt [Wife's] interest in this pension plan.
Appellant's App. Vol. 2, p. 29. Other than the reference to a QDRO, the decree was silent regarding any tax implications of Husband's obligation to pay Wife half of his pension distributions upon his future retirement.
[¶4] In October 2019, Husband retired and began receiving monthly pension distributions, but he did not send Wife fifty percent of those distributions per the decree. Accordingly, Wife filed a motion for rule to show cause. Following a hearing, the trial court issued an order that Husband's "pension plan administrator shall issue separate checks to [Wife] and [Husband]" in the amount of $468.24. Id. at 68.
[¶5] On November 28, 2022, OneAmerica wrote a letter to the trial court stating that "the Sheriff's Plan Committee . . . has not Authorized OneAmerica to comply with the Court's Order" to issue separate checks to the parties. Id. at 136. The letter stated that "OneAmerica cannot act except in accordance with the instructions of the Committee, in its capacity as Plan Administrator." Id. In addition, the Marshall County Sheriff wrote a letter to the trial court stating that the pension plan "is not subject to domestic relations orders" and that he was not authorizing OneAmerica to review the court's order. Id. at 134. Accordingly, Husband received monthly checks in the amount of $936.48, but state and federal taxes were withheld from each check, and the net amount was $793.85. Out of that amount, pursuant to the decree, Husband was obligated to pay Wife $468.24.
[¶6] In May 2023, Husband filed a "Petition for Order on Distribution of Pension Proceeds" with the trial court. Id. at 143. In that petition, Husband asked the trial court "for an Order allowing him to deduct [Wife's] taxes from the payment she is entitled to[.]" Id. Wife objected to that proposed resolution. Instead, Wife filed a petition for joinder of necessary parties, namely, the Marshall County Sheriff's Department ("the Sheriff") and Marshall County Sheriff's Merit Board ("the Board"). After the trial court granted that petition, the Sheriff and the Board jointly moved the court to remove them as parties.
[¶7] Following a hearing on Husband's petition and the Sheriff and Board's petition for removal, the trial court "order[ed] a reduction in the amount paid by [Husband] with an annual reconciliation based on [Wife's] income information." Id. at 192. The trial court rejected Wife's argument that Husband had waived this issue because he had not presented evidence of the potential tax implications to him prior to the issuance of the decree in 2002. The trial court did not rule on the Sheriff and Board's petition for removal, and they do not participate in this appeal. This appeal ensued.
The Sheriff and the Board filed a joint motion to appear on appeal as non-parties, a motion to allow briefing if necessary, and a request to remand to the trial court, if necessary, to resolve the issue of alleged misjoinder. We granted that motion in part and denied it in part. We granted the Sheriff and the Board permission to file a brief, which they declined to do, but we stated that remand to the trial court was not necessary because the trial court retained jurisdiction over the joinder issue under Indiana Appellate Rule 32.
Discussion and Decision
[¶8] The parties agree that Husband's petition was, in essence, a Trial Rule 60(B) motion for relief from the 2002 dissolution decree. Accordingly, we use that standard of review on appeal. Our standard of review is well settled:
A grant of equitable relief under Ind. Trial Rule 60 is within the discretion of the trial court. An abuse of discretion occurs when the trial court's judgment is clearly against the logic and effect of the facts and inferences supporting the judgment for relief. When reviewing the trial court's determination, we will not reweigh the evidence.KWD Industrias SA DE CV v. IPM LLC, 129 N.E.3d 276, 280 (Ind.Ct.App. 2019) (internal citations omitted).
[¶9] Initially, we note that Husband made no argument to the trial court under a specific subsection of Trial Rule 60(B), and he repeats that omission here. Given the twenty-plus years that have passed since the trial court issued the dissolution decree, Husband's petition must have fallen under the catchall provision in Trial Rule 60(B)(8). See Parham v. Parham, 855 N.E.2d 722, 728 (Ind.Ct.App. 2006), trans. denied. As we have explained,
T.R. 60(B)(8) allows the trial court to set aside a judgment within a reasonable time for any reason justifying relief "other than those reasons set forth in sub-paragraphs (1), (2), (3), and (4)." [T.R. 60(B).] The trial court's residual powers under subsection (8) may only be invoked upon a showing of exceptional circumstances justifying extraordinary relief. Indiana Ins. Co. v. Ins. Co. of N. Am., 734 N.E.2d 276[ (Ind.Ct.App. 2000)]. Among
other things, exceptional circumstances do not include mistake, surprise, or excusable neglect, which are set out in T.R. 60(B)(1). In this respect, we have explained:
"T.R. 60(B)(8) is an omnibus provision which gives broad equitable power to the trial court in the exercise of its discretion and imposes a time limit based only on reasonableness. Nevertheless, under T.R. 60(B)(8), the party seeking relief from the judgment must show that its failure to act was not merely due to an omission involving the mistake, surprise or excusable neglect. Rather some extraordinary circumstances must be demonstrated affirmatively. This circumstance must be other than those circumstances enumerated in the preceding subsections of T.R. 60(B)."
Indiana Ins. Co. v. Ins. Co. of N. Am., 734 N.E.2d at 279-80 (quoting Blichert v. Brososky, 436 N.E.2d at 1167).Brimhall v. Brewster, 864 N.E.2d 1148, 1153 (Ind.Ct.App. 2007), trans. denied.
[¶10] It is well settled that, "[i]n general, 'when a deferred-distribution award is implemented through a QDRO, the plan administrator gives a separate benefit check to each spouse, and each spouse is responsible for his or her own tax consequences.'" Smith v. Smith, 194 N.E.3d 63, 67 n.1 (Ind.Ct.App. 2022) (quoting Eads v. Eads, 114 N.E.3d 868, 878 (Ind.Ct.App. 2018)). Here, in the 2002 decree, the trial court ordered Wife to prepare a QDRO, but the court also observed that Husband's public pension plan is exempt from ERISA and did not have to honor a QDRO. Thus, while the decree did not explicitly address the tax consequences of Husband's future payments to Wife under his public pension plan, the trial court's reference to a QDRO implies that it had contemplated each party paying his/her own taxes.
[¶11] Indeed, Wife conceded to the trial court that she should be responsible for paying taxes on her share of the distributions. Tr. p. 5. And both parties anticipated and sought separate checks to be issued by the bank handling Husband's pension plan. Only when that bank refused to honor the trial court's order to issue separate checks did the problem of tax consequences to Husband come to light. And the parties disagreed on a solution to that problem.
[¶12] In her brief on appeal, Wife argues that this Court's vacated opinion in Cooley v. Cooley precludes relief to Husband. 209 N.E.3d 11 (Ind.Ct.App. 2023), vacated by 229 N.E.3d 561 (Ind. 2024). While our Supreme Court vacated our opinion, it agreed with our resolution of the issue relevant to Wife's argument on appeal. The Court held that the husband had waived for appellate review the issue of the tax consequences stemming from the division of his public pension payments because he "did not provide the [trial] court with any definitive evidence of what his actual or potential tax consequences" would be when he ultimately retired. 229 N.E.3d at 566. Wife urges us to apply that analysis here, where, she claims, Husband did not make any argument to the trial court, prior to the 2002 decree, that he would incur tax consequences upon his retirement.
[¶13] But the procedural posture in Cooley was different from that here. This is not a direct appeal from the entry of the dissolution decree. Rather, the parties agree that Husband's petition should be treated as a motion to set aside under Trial Rule 60(B). Accordingly, Cooley is inapposite here.
[¶14] Rather, we consider whether Husband demonstrated "extraordinary circumstances" to entitle him to relief under Trial Rule 60(B)(8) and whether the trial court abused its discretion in granting that relief. See Brimhall, 864 N.E.2d at 1153. Under the facts before us, both parties anticipated that they would receive separate checks and deal with tax consequences individually. Only after the bank refused to honor the trial court's order to issue separate checks did the problem of the tax consequences to Husband arise. Indeed, the decree initially called for a QDRO, which would have resulted in separate checks, so the decree impliedly addressed the issue of taxes. And Wife makes no argument on appeal that Husband did not file his petition within a reasonable time. See T.R. 60(B). Finally, the only prejudice Wife alleged to the trial court is the inconvenience of having to share her income with Husband at tax time each year.
Wife argues that Husband's petition could only be treated as a motion under Trial Rule 60(B)(2), which has a one-year deadline. Wife states that "there would be no basis otherwise for what [Husband] was requesting from the trial court." Appellant's Br. at 8. Wife is incorrect, and we treat his motion as a Trial Rule 60(B)(8) motion. See, e.g., Parham, 855 N.E.2d at 728.
[¶15] For all these reasons, we hold that the trial court did not abuse its discretion when it granted Husband's motion and clarified the 2002 decree to account for the tax consequences to Husband due to the bank's refusal to issue separate checks.
Because we hold that the trial court did not abuse its discretion when it granted Husband relief under Trial Rule 60(B), we need not address Wife's argument that the decree cannot be modified under Indiana Code section 31-15-7-9.1.
[¶16] Affirmed.
May, J., and Brown, J., concur.