Baran v. Jaskulski

CATHELL, Judge. Once again, we are faced with a case in which a party to a contract, perceiving with hindsight that it is not advantageous to him, asks the courts to relieve him of the bargain he made. Judge Hinkel left him with his bargain and so shall we. Bruno Louis Baran, appellant, appeals from a judgment rendered against him in the Circuit Court for Baltimore County in an action sounding in contract, i.e., to enforce an agreement incorporated but not merged in an order of divorce filed by Janice Joann Jaskulski, appellee, in which Judge Hinkel directed that the proceeds of the sale of the former marital property be distributed with $43,953.00 plus interest to appellee and $7,580.95 plus interest to appellant.

Appellant challenges the correctness of the trial judge’s action, presenting two issues on appeal: I. Whether Judge Hinkel erred in enforcing the separation agreement so as to result in gross injustice and inequality to Mr. Baran[.] II. Whether Judge Hinkel erred in his interpretation of the vague and ambiguous term “Crawford credits’’^] We answer both questions in the negative and shall affirm. We shall later address the two issues in reverse order. ³²⁵ The Facts Prior to their divorce, the parties entered into a Separation and Property Settlement Agreement. That agreement was subsequently “incorporated by reference into the Order of Divorce, but not merged.” (There was a modification not pertinent to the issues present on appeal.) That agreement, as relevant to the issues here presented, provided: WHEREAS, it is the desire of the parties hereto to make a full and complete settlement of their property now owned by them and which may be hereafter acquired by them without waiving any ground for divorce which either of them may now or hereafter have against the other, the parties deem it in their best interest to enter into this Agreement to formalize said voluntary separation, to settle their respective property rights, the right of the Wife to support, maintenance and counsel fees and all other matters growing out of their marital relationship. 13.

The parties agree that the Wife shall have a Use and Possession of the family home at 900 Tammy Road, Baltimore, Maryland 21236, for a three (3) year period. At the end of that time (or previously if agreed to by both parties) either party may purchase the interest of the other, or in the event that neither party wishes to purchase the home, the house will be listed for immediate sale. At the time the home is sold, a sum of $10,000.00 will be placed in a joint trust fund for the educational use of the parties’ one (1) minor child. During the Use and Possession, all major repairs on the house are to be split in terms of payment, and if one party is forced to pay more than his or her share of said major repairs, that party will receive a credit at the time the house is sold.

Crawford Credits will also be available to the party paying the mortgage during the Use and Possession period. 21. No modification or waiver by the parties of any of the terms of this Agreement shall be valid unless in writing ³²⁶ and executed with the same formality as this Agreement. No waiver of any breach or default hereunder shall be deemed a waiver of any subsequent breach or default. 22. This Agreement contains the entire understanding of the parties. [T]here are no representations, warranties, promises, covenants, or undertakings other than those expressly set forth herein. 26.

Each party hereto declares that he or she has read the foregoing Separation and Property Settlement Agreement, and that he or she has the right to independent legal advice by counsel of his or her selection, that each fully understands the facts and has been fully informed of his or her rights and liabilities, and that after such advice and knowledge, each believes the Agreement to be fair, just and reasonable, and that each signs the Agreement freely and voluntarily. Wife has been represented in the review, negotiations and execution of this Agreement by Nancy M. Levin. Husband has been represented in the review, negotiations and execution of this Agreement by J. David Ash. [Emphasis added.] It was stipulated at trial that during the use and possession period, appellee paid the mortgage payments, taxes, and other carrying charges on the property at issue. Her mortgage payments totaled $28,874.44, and her payments for repairs totaled $2,363.62.

Appellant’s counsel argued to the trial court (much as he does here) that the “critical issue ... is the definition of the word[s] ‘Crawford credit.’ ” Appellant’s counsel, after a discussion with the trial judge, stated: I’m not sure that you can even go beyond what was in the four corners of the document, that being a vague, most respectfully, Your Honor, a vague definition at best of what’s going to happen when the house gets sold. I think this Court really is in a position where you have to determine what you think is fair. ³²⁷ But just to say a Crawford credit, Your Honor, is not a definitive statement. And I don’t think the Court can really determine what is meant by that statement, which is the contract that counsel is using as the basis for claiming the credit. In respect to the argument made below and on appeal relative to appellant’s tax consequences, appellant’s counsel informed the trial court: He wasn’t really aware of the capital gains situation until I had it researched for him and provided him with a definitive answer that he could not roll that over into another residence.[ 1 ] Judge Hinkel, during a well-reasoned discussion, opined: The agreement in paragraph 13, at the top of page 7, talks not only about the Crawford credits, but does talk about the repairs, major repairs, and how they will be handled.

They’ll be split evenly by the parties. The party will receive a credit at the time the house is sold. The very last sentence is the one that causes the dispute here. That is, that Crawford credits will also be available to the party paying the mortgage during the use and possession period.

Now, in the Crawford case, if my recollection serves me correctly, it states what is the general policy or what it generally involves. And that includes not only the principal, it includes the interest, the taxes on the property. It even includes insurance on the property at times. If the parties had intended it to mean other than that generally accepted term, they should have said so.

And it could easily have been further defined rather than rely on the generally accepted understanding of the Crawford case and Crawford credits. ³²⁸ ... Judge DeWaters didn’t make any determination. He merely accepted the agreement of the parties, which I trust was negotiated and was reduced to this writing.[ 2 ] So I have no reason but to believe that the intention of the parties was to abide by the general accepted definition of Crawford credits. That being the case, the Court finds that calculations based on the stipulated figures are correct.

Discussion In 1982, the Court of Appeals rendered its decision in Crawford v. Crawford, 293 Md. 307 , 443 A.2d 599 (1982). In that case, the Court of Appeals abolished the presumption of gift between separated spouses and permitted a spouse to seek contribution in those instances when married parties were not residing together and one of them, or the other, had paid a disproportionate amount of the carrying costs of property. The Court began its analysis by noting the general law of contribution applicable to cotenants: “Generally, one co-tenant who pays the mortgage, taxes, and other carrying charges of jointly owned property is entitled to contribution from the other.” Id. at 309 , 443 A.2d 599 . The Court then held: Therefore, a co-tenant in a tenancy by the entireties is entitled, to the same extent as a co-tenant in a tenancy in common or joint tenancy is entitled, to contribution for that spouse’s payment of the carrying charges which preserve the property.

Thus, Mrs. Crawford would be entitled to deduct these expenses from the proceeds of sale before splitting them between the parties. Id. at 311 , 443 A.2d 599 . “Crawford credits,” i.e., the contribution contemplated by the holding in Crawford , apply in appropriate circum ³²⁹ stances even in the absence of an agreement that they apply. From our reading of Crawford , its holding would generally apply under facts such as these unless there was an agreement that they would not apply. Here, the parties specifically agreed that Crawford credits applied.

In Crawford , the trial court had refused to apply contribution principles because of the presumption of a gift between a husband and a wife. Because of that presumption, the trial court did not address an issue before it — that there was a specific agreement as to the responsibility for mortgage payments and other carrying charges. The Court of Appeals remanded the case for the trial court to consider that issue. In Keys v. Keys, 93 Md.App. 677 , 614 A.2d 975 (1992), an en banc majority decision, the property settlement agreement, unlike the instant case, did not expressly provide for Crawford credits, i.e., contribution.

Keys was decided on the basis of general, not specific, contribution grounds. The majority held that because the right to contribution is an equitable remedy, other factors such as ouster or — in the case of Keys — the spouse seeking contribution having refused to cooperate in selling the property, could be considered in fashioning an equitable result. In a vigorous dissent, two of the five judges argued that cotenants were “entitled to contribution” except in the case of “ouster.” 3 In this case, we do not have to revisit Keys with a view to either overruling or sustaining the majority holding. In the case sub judice, there was no claim