Wulf v. Wulf

This memorandum opinion was not selected for publication in the New Mexico Appellate Reports. Please see Rule 12-405 NMRA for restrictions on the citation of unpublished memorandum opinions. Please also note that this electronic memorandum opinion may contain computer-generated errors or other deviations from the official paper version filed by the Court of Appeals and does not include the filing date. 1 IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO 2 THOMAS WULF, 3 Petitioner-Appellant, 4 v. No. 36,303 5 LISA REINECKE WULF, 6 Respondent-Appellee. 7 APPEAL FROM THE DISTRICT COURT OF CHAVES COUNTY 8 Kea W. Riggs, District Judge 9 Barbara A. Patterson Law Firm, P.C. 10 Barbara A. Patterson 11 Roswell, NM 12 for Appellant 13 Ragsdale Law Firm 14 Luke W. Ragsdale 15 Roswell, NM 16 for Appellee 17 MEMORANDUM OPINION 18 GARCIA, Judge. 1 {1} Petitioner (ex-husband) appeals from the district court’s order granting 2 Respondent’s (ex-wife’s) motion to show cause and judgment awarding Respondent 3 $87,000 plus reasonable attorney fees and interest for Petitioner’s failure to re-list 4 marital property for sale within a reasonable time since the entry, and the district 5 court’s approval and adoption, of the amended marital settlement agreement (the 6 amended MSA). Unpersuaded that Petitioner demonstrated error, we issued a notice 7 of proposed summary disposition, proposing to affirm. Petitioner has filed a 8 memorandum in opposition to our notice. We have duly considered Petitioner’s 9 response and remain unpersuaded that the district court erred. We affirm. 10 {2} On appeal, Petitioner contends that the district court erred by modifying the 11 amended MSA to include that Petitioner must sell the property “within a reasonable 12 time period[,]” [DS 4] and by holding Petitioner in contempt for failing to sell the 13 property within a reasonable time period. [DS 4-5] Petitioner maintains that the 14 district court’s imposition of a reasonable time frame in which Petitioner was 15 supposed to have complied with the amended MSA was a modification of an order of 16 the court that could be achieved only through Rule 1-060 NMRA. Underlying 17 Petitioner’s contention seems to be the belief that once the district court approved and 18 adopted the amended MSA, then it became an order of the court for all purposes. 19 [MIO 6-9] We are not persuaded. [2] 1 {3} Our courts often recognize: “Generally, once an agreement between divorcing 2 parties has been adopted and incorporated into the final divorce decree, the underlying 3 agreement is deemed to have merged with the decree, extinguishing any independent 4 right one of the parties might assert in contract.” Ottino v. Ottino, 2001-NMCA-012 , 5 ¶ 19, 130 N.M. 168 , 21 P.3d 37 . The merger of an MSA with a court’s order finally 6 dissolving a marriage has specific purposes and “is not a rule to be blindly applied[.]” [7] Id. “Merger is an equitable doctrine, premised upon the principles of res judicata.” Id. 8 ¶ 18. “That is, its purpose is to prevent the relitigation of decided issues.” Id. ¶ 21. 9 Also, “settlement agreements are typically merged with divorce decrees in order to 10 bring the court’s contempt powers to bear on defiant former spouses.” Id. A merger 11 does not destroy the “legal vitality” of the contract. Id. ¶ 17. The merger of a contract 12 into a judgment of the court “changes the [nature] of [the] action,” Tindall v. Bryan, [13] 1950-NMSC-008 , ¶ 8, 54 N.M. 114 , 215 P.2d 355 , from one alleging a breach of 14 contract to one that enforces a judgment, for example. “‘[T]he doctrine of merger will 15 not be carried any further than the ends of justice require.’” Ottino, 2001-NMCA-012 , 16 ¶ 19 (alteration omitted) (quoting Tindall, 1950-NMSC-008 , ¶ 8). Thus, for example, 17 “where application of the doctrine would operate to prevent the enforcement of a valid 18 and recognized right, it need not be applied.” Id. ¶ 22. In sum, Petitioner does not 19 persuade us that merger converts an MSA into an order of the court that is [3] 1 mechanically treated as such for all purposes. 2 {4} Specifically, we observe that our courts routinely recognize that where a court 3 approves and adopts an MSA, resulting in a merger into a final judgment of 4 dissolution marriage, we nevertheless construe the MSA under contract principles. 5 See, e.g., Cortez v. Cortez, 2009-NMSC-008, ¶¶ 3, 13-30 , 145 N.M. 642 , 203 P.3d 6 857 (observing that the MSA was merged into a final divorce decree and applying 7 contract principles in construing it; including, examining the nature of the parties’ 8 bargain, their intentions, and applying equity to interpret the silence in the contract). 9 Similar to the equity our Supreme Court applied in Cortez to interpret the silence in 10 the contract with regard to the manner and timing of payment at issue there, our notice 11 proposed to affirm the district court’s imposition of a reasonable time frame to fill the 12 silence on the timing of Petitioner’s required compliance with the terms of the 13 amended MSA. [CN 2-5] See ConocoPhillips Co. v. Lyons, 2013-NMSC-009, ¶ 67 , [14] 299 P.3d 844 (“[W]hen a contract is silent on an issue, the law implies a reasonable 15 term to cover that issue.” (internal quotation marks and citation omitted)); Castle v. 16 McKnight, 1993-NMSC-076 , ¶ 14, 116 N.M. 595 , 866 P.2d 323 (“We hold today that 17 reasonableness in performance will be implied in fact by this Court in a contract 18 dispute if a requirement of reasonableness in performance will achieve the apparent 19 intent of the parties and the purposes of the contract, and so long as the parties do not [4] 1 expressly state a contrary intention.”). 2 {5} As our notice explained, in the current case, the amended MSA, as adopted by 3 stipulated order of the district court, required Petitioner to pay Respondent $87,500 4 due at closing on the sale by Petitioner of 1908 Carolina Way, and did not specify a 5 time for Petitioner’s performance of this obligation. [RP 335] Respondent fulfilled her 6 obligations under the terms of the amended MSA. [RP 443] Petitioner, however, 7 removed the house from the market and failed to re-list the house for about four years 8 thereafter. [RP 437] Upon Respondent’s motion for an order to show cause, the 9 district court read into the amended MSA that the home was to be sold within a 10 reasonable period of time, stating that “[t]o conclude otherwise would frustrate the 11 intent of the [amended] MSA.” [RP 444] We see no error with the district court’s 12 inference of reasonableness with respect to the timing of Petitioner’s performance, in 13 the absence of a contractual time line or an expressly-stated intent to the contrary. 14 See Castle, 1993-NMSC-076 , ¶ 14. 15 {6} We continue to be unpersuaded by Petitioner’s argument that the inference of 16 reasonableness with respect to the deadline for Petitioner’s performance constituted 17 a modification of the district court’s order, such that the district court lacked 18 jurisdiction to so in the absence of a motion under Rule 1-060(B). [MIO 6-8] See Hall 19 v. Hall, 1992-NMCA-097 , ¶ 38, 114 N.M. 378 , 838 P.2d 995 (“As a general rule, [5] 1 while a court has jurisdiction after the judgment to enforce that judgment, it lacks 2 jurisdiction to modify the judgment except under limited circumstances.”). “ ‘Enforce’ 3 means to compel obedience to, or to cause the provisions to be executed.” Id. ¶ 41. “ 4 ‘Modify’ on the other hand means to alter, change, or vary.” Id. We continue to 5 believe that the district court was enforcing its judgment, not modifying it. 6 {7} In Hall, the district court changed the divorce decree from an award of a ten- 7 year payout to the wife to an award of property to the wife that the final decree had 8 awarded to the husband as his separate property. Id. ¶¶ 39-40, 42. We held that, 9 although the district court was attempting to enforce the money award to the wife in 10 its final decree, the district court’s order constituted an improper modification of the 11 final decree that should have been sought under Rule 1-060(B). Hall, 1992-NMCA- 12 097, ¶¶ 38, 42. 13 {8} The district court’s order and judgment in the current case did not change any 14 award of the assets or redistribute the property in a manner contrary to the terms of the 15 amended MSA. Cf. id. ¶ 42. Rather, the district court’s order simply enforces the 16 terms of the amended MSA and guarantees that the parties’ reasonable expectations 17 with regard to the property at 1908 Carolina Way be satisfied in a more timely 18 fashion, by preventing Petitioner from unilaterally delaying those expectations any 19 further. See Hadrych v. Hadrych, 2007-NMCA-001, ¶ 18 , 140 N.M. 829 , 149 P.3d 6 1 593 (rejecting the husband’s argument that the district court was modifying, rather 2 than enforcing, the final decree by prohibiting his unilateral attempt to convert the 3 wife’s retirement benefits to disability benefits, where the decree was silent on the 4 matter, and holding that the district court’s “order simply enforces the division set by 5 the final decree, guarantees that the reasonable expectations of the parties concerning 6 the allocation of the retirement benefits would be protected, and ensures that [the 7 h]usband’s unilateral attempt to reduce [the w]ife’s benefits would go unrewarded”); 8 cf. Palmer v. Palmer, 2006-NMCA-112, ¶ 18 , 140 N.M. 383 , 142 P.3d 971 (holding 9 that remedial enforcement against the diminishment of a spouse’s entitlement to 10 property “is not a modification seeking an additional or different value”). If we were 11 to hold otherwise, then we would permit a mechanical application of either the merger 12 doctrine or contractual silence to prevent the enforcement of a valid and recognized 13 right and deprive Respondent of her bargained-for benefit indefinitely. Based on the 14 foregoing, we are not persuaded that the district court improperly modified the 15 amended MSA. 16 {9} Lastly, Petitioner argues that the district court erred by holding him in contempt 17 for failing to pay Respondent $87,500, because Petitioner was necessarily unaware of 18 the implied term the district court read into his obligation. [MIO 4-5] We are not 19 persuaded that Respondent can disavow an obligation to act reasonably under a [7] 1 contract that the court can enforce under its contempt powers, nor are we persuaded 2 that Petitioner was unaware of his obligation under the express terms of the amended 3 MSA. See ConocoPhillips Co., 2013-NMSC-009, ¶ 67 (“[W]hen a contract is silent 4 on an issue, the law implies a reasonable term to cover that issue.” (internal quotation 5 marks and citation omitted)). By taking the home off the market and never paying 6 Respondent $87,500, Petitioner was in violation of the district court’s order requiring 7 him to sell the home in order to give $87,500 to Respondent at closing. Petitioner kept 8 the home off the market for nearly four years when Respondent filed the motion for 9 an order to show cause. [RP 437] We are not persuaded that these facts give rise to 10 any concern that the district court was reading language into the amended MSA to 11 hold him contempt. Cf. Hall, 1992-NMCA-097 , ¶ 2 (acknowledging that a district 12 court can “enforce the ‘property division’ award through the use of its contempt 13 powers”). Additionally, “[w]hat constitutes a reasonable time, under the evidence, is 14 a question of fact” for the fact-finder. Smith v. Galio, 1980-NMCA-134 , ¶ 5, 95 N.M. 15 4 , 617 P.2d 1325 . Under the evidence, we hold that the district court could properly 16 rule that Petitioner acted in defiance of the amended MSA, and that, after nearly four 17 years, an unreasonable time period had lapsed before Petitioner made any efforts to 18 comply with the amended MSA. See Ottino, 2001-NMCA-012, ¶ 21 (stating that 19 “settlement agreements are typically merged with divorce decrees in order to bring the [8] 1 court’s contempt powers to bear on defiant former spouses”). We see no error in the 2 district court’s ruling. 3 {10} For the reasons stated above and in our notice, we affirm the district court’s 4 order. 5 {11} IT IS SO ORDERED. 6 ________________________________ 7 TIMOTHY L. GARCIA, Judge 8 WE CONCUR: 9 _______________________________ 10 LINDA M. VANZI, Chief Judge 11 _______________________________ 12 MICHEL E. VIGIL, Judge