Be Mindful of The Language You Use In Your Divorce Settlement Agreement: Smith v. Thompson
I have pointed out before that there are only a few ways in which you can terminate your obligation to pay spousal support. One ways is if your former spouse re-marries or lives with another individual as if they were married for a year or more (see Section 20-109(D), Virginia Code).
But what if your marriage settlement agreement or court order requiring alimony requires you to make certain payments for the benefit of your ex-spouse “in lieu of spousal support?” Can you automatically stop making these payments if your former spouse remarries?
Smith v. Thompson, the Virginia Court of Appeals was faced with this very question when
an ex-husband sought to terminate payments made in lieu of spousal support
after his ex-wife remarried.
Specifically at issue was the language from the former couple’s joint property settlement agreement, which was incorporated into their final order of divorce. It read:
“IV. WAIVER OF RIGHT TO SUPPORT: In consideration of the other terms of this agreement, and whereas both spouses are fully self-supporting, both parties waive all right or claim which they may now have to receive support or maintenance from the other, subject to the below listed provisions. No court shall have jurisdiction to award spousal support at any time regardless of any circumstances that may arise, other [than] those expressly listed within this agreement.
A. Husband acknowledges that he is presently liable to wife for the cost of child care and support in the amount of $200 a month . . . up to and including (with final payment) July 1, 2009.
B. Wife agrees to waive receipt of spousal support in lieu of:
1. Husband maintaining the cost of medical, dental and auto insurance coverage for Wife and Minor Child, cost of all personal property taxes on the two vehicles currently owned by the parties and monthly cost of maintenance and insurance of the Sprint cell phones for Wife and Minor Child.
2. Husband will continue to maintain life insurance policies on Husband, naming Wife as beneficiary and in the event of Wife pre-deceasing Husband, beneficiary will be Minor Child . . . .”
Consequently, the ex-husband claimed he could terminate his continued payment of insurance and tax costs because these payments were made instead of alimony. In other words, the husband claimed he was paying spousal support, just not in the typical form of monthly payments directly to his ex-wife.
The ex-wife, on the other hand, claimed there was nothing for the court to terminate because the ex-husband was not paying spousal support. The ex-wife argued that she clearly waived her right to spousal support, as had the parties intended the ex-husband’s payment of insurance and taxes to constitute alimony they would have said so in their agreement.
Despite the ex-wife’s persuasive argument, the Virginia Court of Appeals disagreed. The court reasoned,
“Paragraph IV of the agreement covers spousal support and child support. Although it is titled ‘Waiver of Right to Support,’ it specifically provides for a set amount of monthly child support […] Clearly, therefore, it does not reflect a waiver of all support. Further, the introductory paragraph that follows the heading and precedes the lettered and numbered subparagraphs contains additional relevant language. The first sentence of that paragraph refers generally to all types of support. It states that both parties waive any right to ‘receive support or maintenance from the other,’ but it makes that waiver ‘subject to the below listed provisions’ This language, although general, implies that the provisions that follow involve support. The second sentence of the introductory paragraph is more specific and states that no court has jurisdiction to award ‘spousal support at any time regardless of any circumstances . . . other [than] those expressly listed within this agreement’ This language, like the language in the first sentence, implies that payments made pursuant to other ‘circumstances’ listed in this portion of the agreement do, in fact, constitute spousal support.”
Essentially, the court’s rationale centered on basic linguistics. Although the agreement specifically stated that the parties waived spousal support and that no court could subsequently order alimony payments, the language of the agreement qualified the waiver of support by indicating that the husband’s payment of insurance and taxes constituted spousal support.
Due to his ex-wife’s remarriage, the former husband no longer had to pay for the insurance costs or taxes listed in the agreement.
Regardless of whether it is a couple’s actual intent to consider the ex-husband’s tax/insurance obligations as a form of alimony, the case of Smith v. Thompson illustrates the necessity of a carefully worded property settlement agreement. Even provisions you and your former spouse seem to understand at the time the agreement is drafted can take on an ambiguous meaning in the future, especially when an ex-spouse decides to modify or terminate support.
The Smith v. Thompson case also highlights the importance of hiring a skilled family law attorney for your divorce or separation case. An attorney can ensure that the language in your divorce settlement or order is precise, appropriately reflects your needs and the understandings of you and your former spouse, and is not subject to unintended modification in the future.
If you are seeking a divorce, currently going through a divorce and/or considering a final property settlement agreement, be sure to consult with an experienced family law attorney who knows the law and can protect your rights. DiPietro Law Group has teams of experienced family lawyers in Northern Virginia and Washington, DC. Contact us to schedule a consultation today at (888) 530-4374.