Opinion
No. C9-95-2379
Filed May 14, 1996.
Appeal from the District Court, Wright County, File No. F2-93-1696.
Stephen L. Madsen, (for Appellant)
James V. Gerharter, (for Respondent)
Considered and decided by Davies, Presiding Judge, Harten, Judge, and Willis, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1994).
Unpublished Opinion
Appellant challenges the district court denial of her motion to reopen and amend the parties' stipulated dissolution judgment. We affirm.
Facts
In 1994, the parties dissolved their seventeen-year marriage. After extensive negotiations, completed on the scheduled date of their dissolution trial, the parties agreed to a stipulation, which was read into the district court record and resulted in a dissolution judgment.
The stipulation awarded appellant mother physical custody of the parties' two minor daughters and respondent father custody of the parties' minor son. The district court findings indicated that respondent's net monthly income was "no less than $3,680," from which respondent agreed to pay $1,104 per month child support. Appellant was awarded $700 per month maintenance, to be reduced to $550 per month in 1997 and $400 in 2000.
Finally, as reflected in Paragraph 12 of the ensuing judgment, respondent's maintenance obligation would be reduced by one-half of any social security disability benefits subsequently received by appellant.
In 1995, nearly one year after entry of the stipulated judgment, appellant moved to reopen and amend the judgment to increase respondent's maintenance and child support obligations and vacate Paragraph 12. Appellant claimed that respondent had fraudulently withheld information concerning his actual income and that her attorney had been incompetent and pressured her into accepting the stipulation. Respondent filed a cross-motion for, among other things, judgment reimbursing, pursuant to Paragraph 12, his overpayment of maintenance. The district court denied appellant's motion and entered judgment for respondent in the amount of $1,456.
The district court also denied respondent's cross-motions for child support from appellant and to reduce his own child support obligation.
Decision
"Courts favor stipulations, particularly in dissolution cases." Steffan v. Steffan, 423 N.W.2d 729, 731 (Minn.App. 1988). Such stipulations cannot be set aside without the consent of the other party "except by leave of court for cause shown." Id. A court may set aside a stipulation for fraud, duress, or mistake. Id. "On appeal, a trial court's determination whether or not to vacate a stipulation will not be disturbed in absence of an abuse of discretion." Maranda v. Maranda, 449 N.W.2d 158, 164 (Minn. 1989).
Appellant claims that respondent fraudulently failed to disclose during negotiations his actual income, resulting in inadequate child support and maintenance awards. To establish fraud on the court sufficient to reopen a stipulated judgment, the moving party must show
an intentional course of material misrepresentation or non-disclosure, having the result of misleading the court and opposing counsel and making the property settlement grossly unfair.
Id. at 165.
We agree with the district court that respondent did not commit fraud.
Respondent's 1992 net monthly income was $3,680, and his temporary child support obligation was derived from that figure. The parties agreed to use that figure to determine respondent's permanent support obligations. In correspondence to respondent's attorney, appellant's attorney proposed that child support be based on an income of $3,680 per month, which represented "the minimum net income of [respondent] based upon his annual tax statements for approximately the last five years." The letter continued:
I believe your pre-trial statement actually reflects a net income in excess of $4,000 per month. However, for settlement purposes we would accept a net income at the amount agreed to in the temporary order.
Moreover, respondent disclosed an actual income in excess of $3,680 in his pre-hearing informational statement. The findings incorporated into the judgment confirm that the stipulated child support was not intended to be based on respondent's actual current income: "Respondent's net monthly income is no less than $3,680.00 per month." (Emphasis added.)
Appellant has not shown that respondent intentionally withheld information concerning his actual income.
Appellant nonetheless asserts that even if her attorney had notice of respondent's actual income, her attorney did not communicate such information to her, and that her assent to the stipulation was therefore ineffective. The joint tax return signed by appellant in March 1994, however, indicates that appellant had knowledge that $3,680 did not represent respondent's actual income. Furthermore, because respondent's temporary support obligation was also based on respondent's 1992 income of $3,680 per month, appellant herself had notice that respondent's permanent obligation was not calculated from his income at the time of the stipulation.
Appellant also suggests that the stipulation should be vacated on the basis of mistake. The following factors guide district court acceptance of a stipulation:
(1) whether the party was represented by competent counsel;
(2) whether extensive and detailed negotiations occurred;
(3) whether the party agreed to the stipulation in open court; and
(4) whether when questioned by the judge the party acknowledged understanding the terms and considering them fair and equitable.
Steffan, 423 N.W.2d at 731.
Deferring for the moment consideration of the first factor, we find that the last three factors are satisfied. The transcript from the dissolution hearing, at which the stipulation was read into the record, indicates that the parties' attorneys had spent the entire day negotiating the terms of the agreement. It reflects that the district court cautioned the parties as follows:
I'm going to ask that both the parties please listen carefully to the agreement as it's recited into the record because you won't have a chance to sign a written agreement. This is it. If you decide that you want to change your mind the day after tomorrow in connection with this agreement, you won't be allowed to do so. So this will substitute for a written agreement * * *, but you've had a chance throughout the whole day to discuss the matter with your respective attorneys and I'm sure they're both very competent attorneys who have a lot of experience in this area and I'm sure they both have explained all of the ramifications of this agreement to you.
After the agreement was recited, appellant testified that settlement discussions had been held throughout the day; that she had heard the agreement read into the record; that her attorney had explained the terms to her satisfaction; and that she agreed to the terms, knowing that they were final.
Appellant argues that her attorney did not competently advise her about the stipulated terms. She claims that the attorney misstated the law in telling her that respondent would have a claim for a portion of any personal injury award received by appellant as a result of a recent accident. The stipulation provided that respondent receive 15 percent of any such award in satisfaction of all claims thereto, including any claim for loss of consortium. In her motion, however, appellant did not request that this provision be amended or vacated; rather, she only sought relief from the child support and maintenance provisions and from Paragraph 12.
Moreover, appellant has not shown that her attorney misstated the law. At the motion hearing, appellant pointed out that no personal injury action had even been commenced. Moreover, appellant states in her brief that personal injury awards "are generally described as non-marital property." (Emphasis added.) Appellant has not established that respondent had no viable claim to a portion of a future award; thus, appellant has not established that her attorney was incompetent in recommending that she agree to the provision.
Appellant also contends that her attorney misstated the law by telling her that she was legally required to give respondent one-half of all social security disability benefits. At the motion hearing, appellant's new attorney told the court that the law does not necessarily require a maintenance reduction to account for disability benefits, but that the issue is normally one for trial. It is likely, therefore, that appellant's original attorney recommended agreement to Paragraph 12 because he recognized that a court could decide the issue adversely to appellant. We conclude that appellant has not provided sufficient evidence of her attorney's alleged incompetence, and we hold that the district court did not abuse its discretion in refusing to vacate the stipulation on that basis.
Finally, appellant contends that her attorney pressured her into accepting the terms by telling her that the judge would be angry and hold it against her if she refused to accept the stipulation. Appellant asserts that her anxiety disorder, which causes her to fear authority figures, led to her to accept it in open court.
We reject appellant's claim of duress stemming from a psychological condition.
As evidence of her condition, appellant submitted a letter from a psychologist stating that appellant suffers from an anxiety disorder. The letter, which was not in affidavit form, did not speak of an inordinate fear of authority figures. In Lindsey v. Lindsey, 388 N.W.2d 713 (Minn. 1986), the supreme court ruled that a stipulated dissolution judgment could be reopened where the consenting party lacked sufficient capacity:
[Respondent] clearly lacked the capacity to validly enter into a stipulated dissolution decree. Her mental and emotional condition at the time of the dissolution precluded her from being able to fairly and reasonably understand the matters under consideration.
Id. at 716 (citation omitted). As the district court concluded here, appellant has not met the Lindsey threshold — she did not show that her condition prevented her from being able to understand the terms of the agreement.
The cases cited by appellant are distinguishable. See John v. John, 322 N.W.2d 347, 348 (Minn. 1982) (stipulated dissolution judgment set aside where term was omitted and party was not adequately informed of the consequences of the stipulation); Steel v. Steel, 305 Minn. 504, 504-05, 232 N.W.2d 104, 105 (1975) (district court did not err in opening stipulated property division because of duress and material mistake of fact). As discussed, no material mistake of fact was present here. Nor has appellant established duress sufficient to justify vacating the stipulation. See Kroeplin v. Haugen, 390 N.W.2d 872, 875 (Minn.App. 1986) (pressure on party to reach dissolution agreement did not amount to duress in light of lengthy period of negotiations), review denied (Minn. Sept. 25, 1986).
In summary, appellant has not established fraud, duress, or mistake sufficient to support her motion to reopen and amend the stipulated dissolution judgment. We hold that the district court did not abuse its discretion in denying appellant's motion.