Lujan v Lujan [2012] GUSC 7; 2012 Guam 07 (15 June 2012)

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Appeal from the Superior Court of Guam
Argued and submitted on May 25, 2011
Dededo, Guam

Appearing for Plaintiff-Appellant:
Thomas L. Roberts, Esq.
Dooley Roberts & Fowler LLP
Orlean Pacific Plaza
865 S. Marine Corps Dr., Ste. 201
Tamuning, GU 96913

Appearing for Defendant-Appellee:
Ronald P. Moroni, Esq.
Moroni Law Offices
San Ramon Bldg.
115 San Ramon St., Ste. 301
Hagåtña, GU 96910

BEFORE: F. PHILIP CARBULLIDO, Chief Justice; ROBERT J. TORRES, Associate Justice; KATHERINE A. MARAMAN, Associate Justice.

[1] Plaintiff-Appellant Timothy C.S.A. Lujan appeals from a Decision denying his Motion to Modify Divorce Decree. He argues that the trial court erred in holding that the Final Decree of Divorce was non-modifiable under Guam law. He contends that his assumption of the parties' mortgage payments in the parties' Divorce and Property Settlement Agreement, which underlies the divorce decree, is an agreement to pay spousal support rather than a division of property, and it is therefore subject to modification.

[2] Conversely, Defendant-Appellee Rita M.S. Lujan argues that the provision in the parties' settlement agreement requiring Timothy Lujan to assume the mortgage payments is a non-modifiable provision related to the division of property. She also argues that even if the assumption of the mortgage was intended to be a form of spousal support, such support provision is part of a non-severable, integrated property settlement agreement, such that it is not subject to modification.

[3] For the reasons discussed below, we reverse the trial court's decision and remand for further proceedings.

[4] In October 2002, Plaintiff-Appellant Timothy C.S.A. Lujan ("Tim") and Defendant-Appellee Rita M.S. Lujan ("Rita") separated after over twenty-one years of marriage, and Tim filed a Complaint for Divorce. The parties entered into a Divorce and Property Settlement Agreement on September 4, 2003.

[5] The settlement agreement was divided into six enumerated sections, labeled as follows: I. Statistical Facts; II. Separation of the Parties; III. Child Custody and Child Support; IV. Division of Community Property and Separate Property; V. Tim's Separate Debt; and VI. Miscellaneous. Record on Appeal ("RA"), tab 42 at 1-6 (Divorce & Prop. Settlement Agreement, Sept. 8, 2003).

[6] Under section III of the settlement agreement ("Child Custody and Child Support"), the parties agreed to share joint, legal custody of their minor daughter, with Rita having primary physical custody. Tim agreed to pay $755.92 per month in child support for their daughter until she reached age 18, after which Tim would deposit $300.00 per month into an account under their daughter's name until her twentieth birthday.

[7] Under section IV ("Division of Community Property and Separate Property"), the parties divided the marital property, agreeing to take as their separate property equal shares in the monetary value of Tim's various profit sharing, retirement, and 401k plans as of the date of the parties' divorce, including any future increases or losses in these plans, as well as equal shares in the parties' 2002 income tax return and the cash surrender value of certain life insurance policies. Tim was to take as his separate property a 1995 Ford truck, while Rita was to take as her separate property a 2002 Chrysler PT Cruiser, which was to be registered in her name immediately after the loan on the vehicle was paid in full, and household furniture and appliances.

[8] Under section V ("Tim's Separate Debt"), the parties agreed that Tim would assume as his separate debts: two mortgage loans, one with a monthly payment of $905.61 and a maturity date of April 18, 2021, and the other with a monthly payment of $468.43 and a maturity date of August 25, 2007; the balance owed on four different credit cards totaling $4,450.00; accounts payable to Takagi & Associates, Tim's employer, in the amount of $468.00 per month for six months per year for vehicle and homeowner's insurance; a loan payable to Takagi & Associates in the amount of $468.00 per month for six months per year; life insurance premiums with AFLAC in the amount of $158.16 per month; life insurance premiums for three separate John Hancock policies; approximately $8,299.14 in medical bills; and the loan on the PT Cruiser with a monthly payment of $450.94.

[9] Under section VI ("Miscellaneous"), the parties agreed, inter alia, that title to their Barrigada residence shall pass by testate or intestate succession equally to their two children, and that Rita shall be entitled to exclusive physical possession of the residence for the rest of her life. The parties agreed that "[i]t is the intent of the Parties that Rita shall effectively have all of the benefits ordinarily enjoyed under a life estate in the home, although no deed therefor shall pass from Tim to Rita." Id. at 7. The settlement agreement also required that Rita be responsible for paying the premiums necessary to maintain her health insurance with Tim's employer for so long as COBRA[1] permits.

[10] Section VI further provided that "[i]n the event of a dispute over the meaning of this Agreement, no party shall be deemed to have been the drafter of the Agreement for the purpose of interpreting it." Id. Finally, section VI, paragraph 8 states:

Tim's agreement to the terms of this Divorce and Property Settlement Agreement is contingent upon his ability to satisfactorily refinance all the parties' community debts into one mortgage loan. If Tim is unable through reasonable efforts to do this, this Divorce and Property Settlement Agreement shall be null and void, and the parties agree to continue negotiating in good faith to come to an agreement on all outstanding issues.
Id.

[11] The trial court issued an Interlocutory Decree of Divorce on October 30, 2003, granting a divorce to Tim on the grounds of irreconcilable differences and incorporating verbatim the parties' settlement agreement. RA, tab 45 at 1 (Interlocutory Decree of Divorce, Oct. 30, 2003) ("The Divorce And Property Settlement Agreement is hereby incorporated into the Interlocutory Decree setting out the property division and matters pertaining to child custody and child support, a copy of which is attached hereto."). A Final Decree of Divorce was filed the same day, incorporating verbatim the Interlocutory Decree of Divorce. No appeal was taken from the final decree.

[12] On May 13, 2010, Tim filed a Motion to Modify Divorce Decree, asking the trial court to relieve him of the obligation to pay the mortgage on the parties' Barrigada residence and order Rita to make the payments instead. Alternatively, Tim requested that the court order Rita to take out a loan in her name and buy Tim out from the mortgage. As a last resort and in the event Rita was unable or unwilling to pay the mortgage or qualify for a loan in her own name, Tim asked the court to order the house sold and the proceeds divided equally between the parties.

[13] Tim cited to several changed circumstances in support of his motion to modify, including the fact that the parties' children have grown up and that Tim has fulfilled all child support and other obligations toward his children, as well as the fact that he has remarried. Tim claimed that he "is no longer able to support his ex-wife Rita as well as his current wife Anna, in any fashion that any reasonable observer would say was fair or reasonable." RA, tab 52 at 2 (Mot. to Modify Divorce Decree, May 13, 2010). He then listed all of his monthly bills, including his monthly payments of $2,020.00 toward the mortgage on the parties' Barrigada residence, adding that there are nearly thirty years left on the mortgage.

[14] The trial court issued a Decision denying Tim's motion to modify the divorce decree, holding that contrary to Tim's contention, his assumption of the mortgage was not spousal support but rather was a "finite, binding and non-modifiable contractual provision forever disposing of the rights of the parties to the residence, and the debt thereon." RA, tab 65 at 4 (Dec., Sept. 22, 2010).

[16] This court has jurisdiction over an appeal from an order made after final judgment pursuant to 48 U.S.C.A. § 1424-1(a)(2) (Westlaw current through Pub. L. 112-104 (2012)) and 7 GCA §§ 3107(b) and 25102(b) (2005).

[17] "'A divorce decree incorporating a settlement agreement is simply a consent decree.'" Blas v. Cruz, 2009 Guam 12 ¶ 18 (quoting Leon Guerrero v. Moylan, 2000 Guam 28 ¶ 8). Decisions interpreting a consent decree and the agreements underlying them are reviewed de novo. Leon Guerrero, 2000 Guam 28 ¶ 8 (citing Richardson v. Edwards, 127 F.3d 97, 101 (D.C. Cir. 1997)); Blas, 2009 Guam 12 ¶ 11.

[18] The trial court's interpretation of a statute is a question of law reviewed de novo. Guerrero v. Santo Thomas, 2010 Guam 11 ¶ 8 (citing Apana v. Rosario, 2000 Guam 7 ¶ 9).

[19] There is essentially only one issue to be decided in this case; that is, whether Tim's agreement to assume the mortgage on the parties' residence as his separate debt constituted an agreement to pay spousal support, which is subject to modification at the trial court's discretion, or, rather, a non-modifiable division of the parties' property.

Supreme Court of Guam

Lujan v Lujan [2012] GUSC 7; 2012 Guam 07 (15 June 2012)