Riley v. Riley

WILNER, Judge. George B. Riley appeals from an order of the Circuit Court for Montgomery County denying his petition to terminate or reduce alimony and directing him to pay $5,000 toward his ex-wife’s counsel fee. The parties were divorced in August, 1983. The decree, among other things, (1) awarded custody of the minor child of the parties to Ms. Riley, (2) gave her use and possession of the family home until December 30, 1984, when the child would turn 18, (3) required Dr. Riley to make the mortgage payments during the use and possession period, (4) awarded child support of $750/month, (5) directed Dr. Riley to pay alimony, and (6) gave Ms. Riley a monetary award based on marital property.

The two aspects of that decree of interest here are those dealing with alimony and the monetary award. The parties had been married for 32 years. At the time of the 1983 decree, Dr. Riley was 56 years old and was employed by the National Institutes of Health at an annual salary of approximately $52,000. In addition to his salary, he also was receiving disability benefits from the Veterans ⁴⁰³ Administration in the amount of $14,500.

His aggregate monthly net income was $3,808. Ms. Riley was 55 years old and had not been employed outside the home since early in the marriage. Aside from support payments by Dr. Riley, her sole income was $100/month received from renting a room in the marital home. The court found that, due to her age and lengthy absence from any employment, her “additional approximate potential earning capacity” was limited to $500/month.

Initially, the court decided to award Ms. Riley indefinite alimony, structured as follows: from July 1, 1983 to December 31, 1984 (when the child support and use and possession order would end), $800/month; thereafter, $l,200/month. Before signing the decree, however, it reconsidered that decision and, applying the then-recently enacted changes in the alimony law, decided to terminate the alimony on June 30, 1991. This was based on the court’s inability to find that Ms. Riley could not “reasonably be expected to make substantial progress toward becoming self-supporting” or that, after making such progress, “the respective standards of living of the two parties will be unconscionably disparate ____” The monetary award was premised on total marital property of $305,000, of which Dr. Riley owned $176,000 and Ms. Riley owned $129,000. Part of that property was Dr. Riley’s civil service pension which, based entirely on his periodic contributions to the plan, the court valued at $37,-364 and in which it held Ms. Riley should have a 25% interest.

The court ultimately made a monetary award to Ms. Riley of $11,500, of which about $9,300 represented her interest in the pension. Neither party was entirely happy with the decree and so each appealed. In November, 1983, while the appeal was pending, Dr. Riley moved to reduce or extinguish Ms. Riley’s alimony. That motion was denied on February 23, 1984. ⁴⁰⁴ In a per curiam Opinion filed July 3, 1984, we rejected most of the challenges made to the decree but did find merit in some of them.

Principally, we concluded that the court erred in terminating Ms. Riley’s alimony effective June 30, 1991. Noting that Dr. Riley’s income amounted to about $67,000/year whereas Ms. Riley’s maximum potential income was found to be only $6,000/year, we held that, “[i]n the case at bar there is no suggestion that the wife may reasonably expect to be self-supporting in the future.” Based on Holston v. Holston, 58 Md.App. 308 , 473 A.2d 459 (1984), we also implicitly found that a termination of alimony would leave Ms. Riley with a standard of living uncon- " scionably disparate from that of Dr. Riley. We therefore found the termination to be an abuse of discretion and vacated that aspect of the decree. See Riley v. Riley, S.T. 1983, No. 1326, Opinion filed 7/3/84.

We also found some minor fault with the valuation of Dr. Riley’s pension, namely that the court did not take into account accrued interest on his contributions. At some point, it appears, Dr. Riley paid the monetary award to Ms. Riley, including, of course, the $9,300 representing her interest in his civil service pension. In September, 1987, Dr. Riley retired from government service. The next month, he unilaterally reduced Ms. Riley’s alimony from $1,200 to $210 and filed a motion to reduce or terminate the alimony.

Ms. Riley responded, in part, with a request for an earnings withholding order, which was granted. As a result of that order, Ms. Riley began receiving $l,109/month directly from Dr. Riley’s pension plan administrator. This appeal arises from the ultimate disposition of Dr. Riley’s motion to terminate or reduce alimony. By order dated August 10, 1989, the court denied that motion and, as we indicated, directed that Dr. Riley contribute $5,000 to Ms. Riley’s counsel fees.

Dr. Riley complains that the court erred in three respects — failing to terminate the alimony, failing to reduce it, and awarding counsel fees. ⁴⁰⁵ (1) Alimony Dr. Riley mounts two challenges to the rejection of his motion to reduce or terminate the alimony — one essentially legal and the other mostly factual. The factual challenge is based on the assertion that, being a retiree, he is in substantially reduced circumstances whereas Ms. Riley has managed to find a job paying her a net monthly income of $907. Together with the rental income from the room in her home ($250/month), her net income since February, 1984 (when Dr. Riley’s earlier motion to reduce or extinguish alimony was denied) had risen to $l,157/month. We may quickly dispose of that challenge.

There was substantial evidence from which the master and the court could reasonably find that (1) coupling his pension and disability benefits with his post-retirement business income, Dr. Riley’s monthly net income actually increased by nearly $l,000/month to $4,784, and that he could well afford the $l,200/month alimony, and (2) notwithstanding that Ms. Riley was earning more than the court expected in 1983, her expenses had also increased and the need for the $1,200 alimony was still present. The legal challenge is itself in two parts, but the essence of it is that the court erred in considering Dr. Riley’s pension and disability benefits as sources of income for the purpose of determining his ability to pay alimony. He urges that his pension benefits cannot properly be considered as a resource for purposes of alimony because Ms. Riley had already been given a share of the pension as part of the monetary award and therefore has no claim on the balance of the pension. The VA disability benefit, he claims, is exempt from consideration by virtue of Mansell v. Mansell, 490 U.S. —, 109 S.Ct. 2023 , 104 L.Ed.2d 675 (1989) and two statutes — 38 U.S.C. § 3101 (a) and 42 U.S.C. § 662 (f)(2).

We find no merit in these contentions. The first part of Dr. Riley’s challenge overlooks the difference, in nature and function, between alimony and a monetary award based upon marital property. Although ⁴⁰⁶ there is an interrelationship between the two in the sense that, as to each, the court must consider the one in deciding upon the other (see Md. Fam. Law Code Ann. §§ 8-205(a)(9) and ll-106(b)(ll)(ii)), they have quite different purposes and focuses.

See, in general, McAlear v. McAlear, 298 Md. 820 , 469 A.2d 1256 (1984). Whether limited and rehabilitative in nature or indefinite in terms of duration, alimony is intended to provide periodic support to a financially dependent spouse following the divorce. Although, as in the case of a monetary award, present and past circumstances must be taken into account in deciding whether to award alimony, how much to award, and for what period of time to award it, the principal focus is really on the future: what will the needs of the spouse seeking the alimony be upon dissolution of the marriage; what other resources will that spouse have available to meet those needs; what resources will the other spouse have available from which to pay the needed support? A monetary award, on the other hand, is not intended as support, and it focuses not on the future but on the present and past.

The court looks at the property acquired prior to the divorce, especially that acquired during the marriage. The sole purpose of the award is to assure that the disposition of that property upon the divorce will be equitable in terms of the overall contributions that each party made to the acquisition of the property and to the marriage and its breakup. Although the court can direct that the award be paid over a period of time, its function is to provide a present compensation for an existing inequity in the current ownership of property. It is true, of course, that, in awarding and setting the terms of alimony, the court cannot properly consider as a resource of the payor spouse property or income that the spouse does not have.

Thus, if the court removes an asset or source of income from the payor spouse through a monetary award (or otherwise), it cannot premise an alimony award on the assumption that that asset or source of ⁴⁰⁷ income is still available to