Campitelli v. Johnston

EYLER, Judge. This is an appeal from an order of the Circuit Court for Montgomery County denying the petition of Anthony Campi-telli, appellant, to terminate or reduce spousal support payable ⁶⁹² to Vivian Johnston, appellee. Finding no error, we shall affirm. Factual Background On June 15, 1953, appellant and appellee were married.

On August 22, 1972, the parties entered into a Separation and Property Settlement Agreement (“Agreement”), in which they resolved all monetary issues relating to the end of their marriage. As part of the Agreement, appellant agreed to pay appellee spousal support in the amount of $1,500 per month, non-tax deductible to appellant, subject to an annual cost of living increase. The support was to continue until the death of appellee, regardless of any remarriage by appellee or appellant and/or the death of appellant. In addition to the support provision, the parties mutually released each other from all obligations; appellee conveyed her right, title, and interest with respect to several properties to appellant, and appellant agreed to hold appellee harmless with respect to those properties.

At the time, appellee had approximately $20,000 in cash, a condominium worth $50,000, and miscellaneous assets. On September 15, 1972, the parties were divorced. The Agreement was not incorporated or merged into the judgment of absolute divorce. On October 4, 1990, the parties entered into an amendment to the Agreement.

In that amendment, the support was increased to $40,000 annually and made tax deductible to appellant, but as before, the support continued until the death of appellee. There was no provision in the Agreement, or the amendment, that specifically dealt with modification, i.e., it was neither prohibited nor permitted. Appellee remarried in 1991. Subsequent to remarriage, appellee paid none of her living expenses, purchased two vacation homes, and generally lived quite comfortably.

At the time of trial, appellee’s net worth was approximately $615,000, and appellant’s net worth was nine to ten million dollars. Appellant stopped paying support at the end of 1998. Ap-pellee filed a petition to enforce the support provision in the ⁶⁹³ amendment to the Agreement, and appellant filed a petition to terminate or reduce spousal support. The latter petition asserted as grounds appellee’s remarriage and the absence of any need for money by appellee.

On July 6, 1999, the matters were heard by a master, who on July 29, 1999, issued a report and recommendation. The master recommended denial of appellant’s motion, reduced the support in arrears to a judgment, and awarded attorney’s fees to appellee. Appellant filed exceptions, which were overruled by the circuit court. Questions Presented 1.

Whether the Trial Court’s determination that Title 11 of the Family Law Article of the Maryland Code Annotated was inapplicable to this proceeding was clearly erroneous. 2. Whether an alimony provision within a Property Settlement Agreement requiring the payment of alimony to a former spouse who has remarried is void as against public policy. 8. Whether the finding that the obligation of a payor spouse to continue to pay alimony to a remarried former spouse, where that spouse is worth over $615,000 and has little or no necessary expenses, is not harsh or inequitable constituted an abuse of discretion. 4. Whether the Court was clearly erroneous in awarding attorney’s fees to the Appellee.

Discussion 1. Appellant contends that the circuit court was “clearly erroneous” in finding that Title 11 of the Family Law Article, entitled “Alimony,” was inapposite. Appellant relies on Maryland Code (1984, 1999 Rep. Vol.), § 8-103 of the Family Law Article, Mendelson v. Mendelson, 75 Md.App. 486 , 541 A.2d 1331 (1988), and Langley v. Langley, 88 Md.App. 535 , 596 A.2d 89 (1991), overruled by Shapiro v. Shapiro, 346 Md. 648 , 697 ⁶⁹⁴ A.2d 1342 (1997).

Based on the nature of those authorities and guided by oral argument, we discern appellant’s point to be that the support obligation in the 1990 amendment is subject to modification because of the absence of an express statement that it is not subject to modification. Section 8-103(b) provides that a court may modify a provision in an agreement with respect to spousal support executed after January 1, 1976, unless there is a provision that specifically states that it is not subject to court modification. Section 8-103(e) provides that a court may modify a provision in an agreement with respect to alimony or spousal support executed on or after April 13, 1976, unless there is an express waiver of alimony or spousal support or a provision that specifically states that it is not subject to court modification. In Mendelson , we considered § 8-103 and held that the trial court did not have the power to modify a provision for spousal support in a separation agreement because, while incorporated into the divorce decree, the agreement had not been merged into the divorce decree.

In other words, we held that § 8-103 applied only to merged agreements. As a result, absent merger, based on general contract principles, we observed that a spousal support provision in an agreement was not modifiable unless the agreement itself provided for modification. Mendelson has been superseded, in part, by statute. Section 8 — 105(b), enacted in response to Mendelson , provides that a court may modify any provision in an agreement that is incorporated, whether or not merged, into a divorce decree and subject to modification under § 8-103.

See Shapiro v. Shapiro, 346 Md. 648, 662 , 697 A.2d 1342 (1997) (stating that the purpose of § 8-105(b) was to change the rule enunciated in Mendelson); 1 Horsey v. Horsey, 329 Md. 392 , 417 n. 9, 620 ⁶⁹⁵ A.2d 305 (1993) (stating that the “Mendelson interpretation of [§ 8-103(b) and (c)] was largely abrogated by the General Assembly in Ch. 589 of the Acts of 1989 and Ch. 443 of the Acts of 1990, Code (1984, 1991 Kepl.Vol.), § 8-105 of the Family Law Article. Thus Mendelson furnishes little authority with regard to separation agreements entered into after January 1,1976.”). Appellant references Family Law §§ 11-108 and 11-107 as providing a standard for determining whether modification should in fact occur. Section 11-108 provides that alimony terminates on the death of either party, on the marriage of the recipient, or if the court finds the termination necessary to avoid a harsh and inequitable result.

Section 11-107 provides that, on petition of either party and subject to § 8-103, a court may modify the amount of alimony awarded as circumstances and justice require. Appellee contends that Title 11 is applicable only to awards of alimony and not to contractual agreements with respect to alimony or spousal support, when as here, the agreement was neither incorporated nor merged into a decree. We note that § 8-105(b) appears to have changed the holding in Mendelson only with respect to incorporated but not merged agreements. We further note that Mendelson, Langley, and Shapiro all involved agreements that had been incorporated but not merged.

We need not decide this interesting issue, however, and thus its determination will have to await another day. The circuit court, in fact, treated the spousal support provision as modifiable and considered whether modification or termination of support was indicated, based on principles of equity. Consequently, regardless of whether it was or was not modifiable by Title 11, appellant was treated as if the provision was modifiable and as if the equitable factors in Title 11 were applicable. ⁶⁹⁶ 2. Appellant contends that the support provision in question is void as against public policy for requiring the payment of support after the remarriage of appellee.

Appellant relies on (1) the present law which limits alimony with respect to amount and duration as being reflective of public policy and (2) a view expressed by courts in a few states consistent with appellant’s argument. We And it unnecessary to analyze the statutes and decisions in those few states supportive of appellant’s position. Maryland has long recognized and enforced spousal support agreements. Gordon v. Gordon, 342 Md. 294, 300 , 675 A.2d 540 (1996) (citations omitted).

As stated by the Gordon Court: “The prevailing view is now that ‘separation agreements ... are generally favored by the courts as a peaceful means of terminating marital strife and discord so long as they are not contrary to public policy.’ ” Id. at 300-01 , 675 A.2d 540 (quoting 5 S. WILLISTON, A TREATISE ON THE LAW OF CONTRACTS § 11:7, at 396-99 (R. Lord ed., 4th ed.1993)). A separation agreement is subject to the general rules governing other contracts. See Heinmuller v. Heinmuller, 257 Md. 672, 676 , 264 A.2d 847 (1970); Fultz v. Shaffer, 111 Md.App. 278, 298 , 681 A.2d 568 (1996). The Court of Appeals has been consistently reluctant to strike down voluntary contractual arrangements on public policy grounds.

See Anne Arundel County v. Hartford Accident and Indem. Co., 329 Md. 677, 688 , 621 A.2d 427 (1993) (stating that the “recognition of an otherwise undeclared public policy as a basis for a judicial decision involves the application of a very nebulous concept to the facts of a given case, and that declaration of public policy is normally the function of the legislative branch ....”) (quoting Adler v. American Standard Corp., 291 Md. 31, 45 , 432 A.2d 464 (1981)). Maryland courts will strike down voluntary bargains on public policy grounds “only in those cases where the challenged agreement is patently offensive to the public good, that is, where ‘the ⁶⁹⁷ common sense