Schillmoeller v. Younkle

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SUZANNE MARIE SCHILLMOELLER v. ANDREW RYAN YOUNKLE

No. 1165-21-4

Court of Appeals of Virginia

February 14, 2023

FROM THE CIRCUIT COURT OF FAIRFAX COUNTY Richard E. Gardiner Judge

Virginia C. Haizlip (Kathryn C. Swain; McCandlish &amp Lillard, PC, on briefs), for appellant.

Michael C. May (May Law, L.L.P., on brief), for appellee.

Present: Chief Judge Decker, Judges Ortiz and Causey Argued at Fairfax, Virginia

MEMORANDUM OPINION ^[*]

DORIS HENDERSON CAUSEY JUDGE

Suzanne Schillmoeller ("wife") appeals from a divorce decree of the Circuit Court of Fairfax County ("trial court"). Both wife and Andrew Younkle ("husband") dispute the terms of a marital separation agreement ("MSA") that they executed before their divorce. Wife argues that the trial court erred in: (1) "determining that the [MSA] was clear and unambiguous on its face and did not require the introduction of parol evidence"; (2) "interpreting the MSA as providing for spousal support despite the contradictory language employed by the parties"; and (3) "deciding in favor of Appellee[,] in violation of the Massey [sic] doctrine."^[1] Husband argues in his cross assignments of error that the trial court erred in: (1) "refusing to allow" him to argue that he should be awarded attorney fees; and (2) "summarily deny[ing] the award of attorney fees to him."

For the following reasons, we affirm in part, reverse in part, and remand for further proceedings consistent with this opinion. We hold that the MSA is unambiguous and affirm the trial court's decision to deny parol evidence. We hold that the MSA classifies husband's "disposable military retired pay"^[2] as a marital asset, subject to equitable distribution, rather than spousal support. Therefore, we reverse the trial court's classification of husband's military retirement pay as spousal support. Accordingly, "wife shall have 50% of [husband's] military retirement, when a military retirement is earned by Husband."^[3] Further, we hold that the trial court did not err in denying husband attorney fees and affirm its decision not to award those expenses. Finally, we deny both parties' requests for an award of attorney fees and costs incurred on this appeal.

I. Background

Husband and wife separated after almost ten years of marriage. Without representation,^[4]both drafted and entered a MSA using a generic template. The trial court affirmed, ratified, and incorporated by reference the MSA into the parties' final decree of divorce in April 2010. The MSA is a seven-page pre-formatted document divided into twelve numbered sections with various subsections and titles. Under the MSA and specifically in dispute on this appeal is Section 8, which is titled "SPOUSAL SUPPORT" and states that husband "shall pay to Wife spousal support in the sum of zero dollars" for a period of "N/A." This section further provides that "[a]lso, Husband agrees that Wife shall have 50% of his military retirement, when a military retirement is earned by Husband."

Other relevant sections and subsections included: subsection "C" of Section 2 labeled "OTHER PERSONAL PROPERTY" which states, "[t]he goods have already been divided"; and Section 10 titled "FINAL AGREEMENT" which states, "[t]his agreement sets forth the entire agreement and understanding between the Husband and Wife relating to the settlement of marital property and finances and supersedes all prior discussions between us." The divorce decree included no spousal support provisions, and neither party completed the spousal support notice requirements established in Code § 20-107.1(H). Husband re-enlisted in the military in May 2010 and remains on active duty. Wife remarried in 2012.

In 2020, wife applied for her share of husband's military retirement pay. Husband filed an "Amended Motion for Declaratory Relief," arguing that under Section 8 of the MSA, husband's military retirement was a spousal support award that terminated upon wife's remarriage in 2012. Husband also requested attorney fees. Wife responded, asserting that the award of husband's military retirement pay should be considered marital property subject to equitable distribution, not spousal support. Husband filed a motion in limine to exclude parol evidence, arguing that the MSA was unambiguous.

The trial court found that the terms of the MSA were not ambiguous and parol evidence was unnecessary. The trial court held that the award of husband's military retirement pay was spousal support and that wife's remarriage terminated her right to spousal support. The trial court further held that the parties would be responsible for their own attorney fees. Wife filed a motion to reconsider, which the court denied. This appeal follows.

II. Analysis

"Property settlement agreements are contracts and are subject to the same rules of construction that apply to the interpretation of contracts generally." Price v. Peek, 72 Va.App. 640, 646 (2020) (quoting Jones v. Gates, 68 Va.App. 100, 105 (2017)). "[T]his Court reviews the circuit court's 'interpretation of the parties' agreement de novo.'" Id. "We do not defer to a trial court's determination because 'we have an equal opportunity to consider the words of the contract within the four corners of the instrument itself.'" Worsham v. Worsham, 74 Va.App. 151, 164 (2022) (quoting Va. Elec. & Power Co. v. N. Va. Reg'l Park Auth., 270 Va. 309, 315 (2005)). A court's determination of "[w]hether contractual provisions are ambiguous is a question of law and not of fact." Id. (alteration in original) (quoting Nextel Wip Lease Corp. v. Saunders, 276 Va. 509, 515 (2008)).

The issue before this Court is the same as it was in the lower court: did the parties' agreement that wife shall have 50% of husband's military retirement pay terminate upon wife's remarriage? Clearly, classifying husband's military retirement as spousal support would terminate his financial obligation to wife. See Code § 20-109(D).^[5] In contrast, if the military retirement provision is classified as a property division, wife's entitlement to the military retirement is unaffected by her remarriage.

A. Interpreting the Language of the MSA

Wife contends that the trial court erred in: (1) determining that the contract (MSA) was clear and unambiguous on its face; and (2) interpreting the MSA as providing for spousal support despite the contradictory language employed by the parties. We agree with the trial court that the MSA is clear and unambiguous on its face, but we reverse the court's classification of husband's military retirement pay as spousal support. We hold that the MSA classifies husband's military retirement as a marital asset subject to equitable distribution.

We agree with the trial court that the contract is "clear and unambiguous" on its face and did not require the introduction of parol evidence. "An agreement should be deemed 'ambiguous if it may be understood in more than one way or when it refers to two or more things at the same time.'" Vilseck v. Vilseck, 45 Va.App. 581, 588 (2005) (quoting Video Zone, Inc. v. KF & F Props., 267 Va. 621, 625 (2004)). Parol evidence is admissible when the contract's language is ambiguous. Stroud v. Stroud, 49 Va.App. 359, 367 (2007). "A contract is not ambiguous merely because the parties disagree as to the meaning of the terms used." Plunkett v. Plunkett, 271 Va. 162, 167 (2006). "An ambiguity is not present simply because one could 'hypothesize "opposing interpretations" of the same contractual provision.'" Worsham, 74 Va.App. at 168 (quoting Erie Ins. Exch. v. EPC MD 15, LLC, 297 Va. 21, 29 (2019)). "In reviewing a property settlement agreement, the court must determine 'the intent of the parties and the meaning of the language . . . from an examination of the entire instrument, giving full effect to the words the parties actually used.'" Jones, 68 Va.App. at 106 (alteration in original) (quoting Layne v. Henderson, 232 Va. 332, 337-38 (1986)).

When Congress passed the Uniformed Services Former Spouses Protection Act ("USFSPA") in 1982, the Act allowed state courts to treat "disposable [military] retirement pay" as the property of exclusively the veteran or both the veteran and the veteran's spouse under the state's domestic relations law. Mansell v. Mansell, 490 U.S. 581, 584 (1989). The USFSPA expressly gave state courts "the authority to treat disposable retired pay as community property" in divorce proceedings. Id. at 589. Thus, the Act is clear that disposable military retirement pay can be subject to equitable distribution. The division of that property can be effected by an order of the court or an agreement between the parties. Here, the division was an agreement between the parties.

Nothing in the USFSPA prohibits disposable military retirement pay from being classified as spousal support especially upon an agreement between the parties. Since the USFSPA allows courts to treat military retirement pay as the exclusive property of both the veteran and the veteran's spouse under the state's domestic relations law, the parties can certainly contract regarding their property within the boundaries set by both state and federal law. Additionally, spousal support is allowed to be paid from the retired pay. 10 U.S.C. § 1408(d)(1). Thus, disposable military retirement payments can be classified as spousal support upon an agreement between the parties. However, here there was no such agreement for spousal support.

Reading marital separation agreements or property settlement agreements to determine whether retirement payments are classified as spousal support or marital property, courts in Virginia typically look to the terms of the parties' agreement with an eye toward the intent and function of the payments. See Langley v. Johnson, 27 Va.App. 365,...