Opinion
Nos. 1D21-1711 1D21-2346.
12-30-2022
Henry SAKOW, Appellant/Cross-Appellee, v. Linda BLAYLOCK f/k/a Linda Sakow, Appellee/Cross-Appellant.
M.K. Thomas, J.
This appeal arose from two final orders granting Ms. Blaylock, the former wife's, motion and amended motion to enforce the final judgment of dissolution of marriage and for contempt, relief, clarification, and attorney's fees and costs. Dr. Sakow, the former husband, appealed both final orders which required him to pay Ms. Blaylock approximately $1,000,000.00 he has owed her for over twelve years pursuant to a Marital Settlement Agreement (MSA) and Final Judgment of Dissolution of Marriage entered March 24, 2010. Ms. Blaylock cross-appealed the order denying her motion for rehearing and for reconsideration.
Dr. Sakow did not pay the amounts contained in the orders, did not seek a stay pending appeal, nor did he post a bond for the money judgment entered against him. In a prior order citing McLemore v. McLemore, 567 So.2d 23 (Fla. 1st DCA 1990), this Court dismissed Dr. Sakow's direct appeal for his failure to abide by the trial court's orders. Yet the cross-appeal of Ms. Blaylock remains viable. Ms. Blaylock argues the trial court erred by not awarding her a lump sum representing 50% of Dr. Sakow's Georgia state retirement benefits. We find merit in Ms. Blaylock's argument and reverse.
I. Facts
The parties divorced in 2010, and the Final Judgment of Dissolution of Marriage incorporated the terms of an MSA entered by the parties. The MSA states, in part, that Ms. Blaylock shall receive 50% of Dr. Sakow's retirement benefits from the State of Georgia and required that "[a]ny marital property not addressed in [the] Agreement, or inadvertently omitted shall be addressed between the parties or placed before the court if necessary." A Qualified Domestic Relations Order was completed to implement the award of retirement benefits, but Georgia would not honor it.
In 2020, Ms. Blaylock filed the subject motions seeking to enforce the terms of the final judgment of dissolution of marriage and asking that Dr. Sakow be held in contempt. Ms. Blaylock alleged that despite the passage of ten years since the final judgment, Dr. Sakow had failed to abide by many of the terms set forth in the MSA, including the award of Georgia state retirement benefits, survivor benefits, and payment of a lump sum.
A hearing occurred on the enforcement motion in August 2020, at which time the trial court became aware that Dr. Sakow had recently applied for his retirement pension through the State of Georgia. Noting that in Georgia once the first pension check is issued the beneficiary cannot be changed, the trial judge ordered Dr. Sakow to immediately contact the Employment Retirement System of Georgia and terminate his application requesting payments directly to him. At the hearing, counsel for Dr. Sakow further instructed Dr. Sakow not to "do a darn thing until Judge Caloca-Johnson tells you you can do it."
The hearing was continued, and Dr. Sakow was scheduled to testify when the hearing was reconvened. However, upon reconvening the hearing, Dr. Sakow was a no show. Ultimately, the trial court determined that the survivor benefit associated with Dr. Sakow's Georgia retirement was a marital asset not addressed in the MSA. The trial court granted Ms. Blaylock's request for Option 2 of the pension—100% Joint & Survivor—with her listed as 100% beneficiary. However, these awards could not be effectuated because Dr. Sakow did not terminate his pension application (as directed by the trial judge and his counsel at the prior hearing) and his pension benefits were initiated under the maximum plan option with payments made directly to him.
As a result, Ms. Blaylock filed a motion for reconsideration or rehearing. She asserted that Dr. Sakow had ignored the trial court's oral and written orders regarding the Georgia retirement benefits and had willfully started his pension, failing to list her as survivor beneficiary. Thus, because the pension plan does not allow for modification, a prior order granting her Option 2 of the pension could not be executed. In the alternative, she requested a lump sum money judgment in lieu of the original award.
A hearing was conducted on the motion for reconsideration or rehearing. Despite being subpoenaed, Dr. Sakow was again a no-show. Ms. Blaylock's counsel called a manager with the Employee's Retirement System of Georgia to testify. She stated that on September 18, 2020 (weeks after the enforcement hearing in which Dr. Sakow was ordered to immediately terminate his application for pension benefits with payments made directly to him), Dr. Sakow sent an email requesting to resume his retirement application process with no changes made and selecting the maximum plan with an October 1, 2020, effective date for retirement. There is no survivor benefit associated with the maximum plan. The pension was initiated. The manager confirmed that once the plan is initiated, it cannot be changed.
Ms. Blaylock also presented expert testimony on the estimated value of the retirement and survivor benefits. Barbara Pople, a certified public accountant, certified divorce financial analyst, and certified financial planner, opined that based on the monthly retirement payments, the age of the parties, the social security life expectancy calculator, and a 4.31% interest rate, the estimated total for Ms. Blaylock's portion of the Georgia pension plus the survivor benefit is $328,007.10. The trial court asked Ms. Pople if her estimate included future payments, and she confirmed that they did. The trial court then asked if the calculations would be incorrect if Dr. Sakow died tomorrow. She explained that the figure provided was indeed an estimate of the present value because exact life spans cannot be known, so estimates are based on the most appropriate inputs available, such as social security life expectancies and Florida judgment interest rates.
The trial judge entered the May 18, 2021 orders finding that Dr. Sakow had violated the court's prior order by commencing the pension process and selecting a pension option that did not permit a survivor beneficiary. The orders also noted that the pension option Dr. Sakow selected cannot now be changed, making its prior order impossible to implement. Yet, the trial judge denied Ms. Blaylock's motion for rehearing and her request for a lump sum award, finding that her expert's valuation of the pension value at $328,007.00, although likely accurate, was speculative.
II. Analysis
A trial court has the discretion to fashion a remedy, including ordering a lump sum payment, to effectuate the equitable distribution of marital property, such as retirement and survivor benefits. See Kvinta v. Kvinta, 277 So.3d 1070, 1072-73 (Fla. 5th DCA 2019); Janovic v. Janovic, 814 So.2d 1096, 1101 (Fla. 1st DCA 2002). A lump sum award is appropriate here to effectuate the award of retirement and survivor benefits given that the original award is impossible to execute. See Heldmyer v. Heldmyer, 555 So.2d 1324 (Fla. 5th DCA 1990) (holding that because the former husband was deceased, it was impossible for the trial court to enter an order requiring former husband to designate former wife as survivor beneficiary and remanded the case for determination of valuation of the former wife's portion of the military pension).
Dr. Sakow ignored the trial court's order and selected a pension plan that does not allow a survivor benefit. That selection cannot now be changed. Further, Dr. Sakow has repeatedly refused to provide Ms. Blaylock with the assets she is entitled to, making it unlikely that he would willingly provide her a monthly payment representing the awarded amount. Indeed, the trial court did not deny Ms. Blaylock's request for a lump sum payment because it believed the award improper. Rather, the trial court denied the request because it found the expert's testimony speculative. We do not agree.
First, the expert's use of the social security life expectancy calculator did not render her estimation of the present value of the benefit as speculative. A trial court may award a lump-sum payment for pension benefits rather than a monthly payment of the pension itself. See Kvinta, 277 So. 3d at 1072 (affirming award of lump-sum payment for half of the former husband's pension plan); Rogers v. Rogers, 622 So.2d 96, 98 (Fla. 2d DCA 1993) (noting that a trial court may, when dividing a marital asset pension, reduce the pension benefits to present value and order a lump-sum distribution). Additionally, when reducing a marital interest in a pension to a lump-sum payment, courts may consider use of an assumed life expectancy. See Van Den Berg v. Van Den Berg, 49 So.3d 283, 285 (Fla. 5th DCA 2010) ("[T]he trial court, having found the ... pension contract to be entirely marital, employed the immediate offset method and converted the Wife's half interest into a lump sum distribution based on a discounted present value applying an assumed life expectancy which recognized a reduction in benefits occurring at age 80. This approach is considered the preferred approach.").
Additionally, the expert meticulously explained the basis for her calculations. She applied the $1,524, which Ms. Blaylock would receive while Dr. Sakow was living, and $4,187.96, which she would receive after his death, referenced in original order as the survivor benefit payment in her calculations. Using the social security life expectancy calculator, she estimated Dr. Sakow's life expectancy to be 15.4 years and Ms. Blaylock's life expectancy to be 22.8 years. She then applied the State of Florida judgment interest rate in effect at the time (4.31%) to determine the present value of the survivor benefit. Accordingly, the present value total for Ms. Blaylock's portion of the joint benefit plus her survivor benefit was $328.007.10. A spreadsheet of her calculations was admitted as evidence without objection.
Dr. Sakow's attorney did not challenge the expert's calculations and he did not present any witnesses. No objection was raised to the trial court entering the order awarding a lump sum or any objection to the amount. The trial court recognized that ordering Dr. Sakow to pay Ms. Blaylock a monthly benefit would be a useless gesture, because, "Dr. Sakow is not interested in providing the former wife her share of equitable distribution." Nonetheless, the trial court denied Ms. Blaylock's motion for reconsideration in its entirety finding the expert's testimony speculative. Thus, the trial court failed to determine that she was entitled to any amount at all. We agree with Ms. Blaylock that as it now stands, she is left in the position of receiving none of Dr. Sakow's retirement benefit, in direct conflict with the MSA and the trial court's previous orders. The trial court could have remedied the situation by awarding a lump sum payment which is the only logical remaining option for recovery given Dr. Sakow's defiance of the trial court's order which prohibited him from initiating his Georgia pension.
We recognize that another option exists—for Ms. Blaylock to go to court each and every month for the next 26 years to obtain a money judgment on her share of the pension benefits. On point, the trial judge advised Ms. Blaylock's counsel at the hearing, "I understand your frustration. I understand your client's frustration. Dr. Sakow is not participating.... He is under subpoena and he is not participating.... I am at a loss.... The Court, quite frankly, is frustrated in trying to think of ways to enforce the equitable distribution." Given the history of this case and Dr. Sakow's failure to pay what is owed according to the terms of the initial judgment in the twelve years since its issuance, any consideration of a monthly payment option to Ms. Blaylock regarding the retirement benefits is pointless and unjust.
It is undisputed that Ms. Blaylock is entitled to half of Dr. Sakow's retirement benefit, which was earned during the parties 24-year marriage, and that the survivor benefit is a marital asset to which Ms. Blaylock is entitled. Dr. Sakow purposefully and deceptively took the entire benefit for himself and his current wife and has flouted multiple trial court orders, his own attorney's instructions, and the MSA.
Because, under these facts, a lump sum award is appropriate, and because the expert's testimony was not speculative, the trial court erred in denying Ms. Blaylock's motion for rehearing. Accordingly, we reverse the final order and remand the case so that the trial court may enter an order consistent with this opinion, nunc pro tunc to the date of the order on appeal.
REVERSED and REMANDED.
Kelsey and Jay, JJ., concur.