Zealand v. Zealand, No. A-08-704 (Neb. App. 1/20/2009)

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TERI D. ZEALAND, APPELLANT AND CROSS-APPELLEE, v. GORDON K. ZEALAND, APPELLEE AND CROSS-APPELLANT.

No. A-08-704.

Court of Appeals of Nebraska.

Filed January 20, 2009.

Appeal from the District Court for Douglas County: J. MICHAEL COFFEY, Judge. Affirmed as modified.

Michael F. Pistillo, of Pistillo & Pistillo, P.C., L.L.O., for appellant.

Thomas R. Hickey for appellee.

IRWIN, CARLSON, and CASSEL, Judges.

MEMORANDUM OPINION AND JUDGMENT ON APPEAL

CASSEL, Judge.

INTRODUCTION

The district court determined that Teri D. Zealand and Gordon K. Zealand orally agreed that effective September 1, 2000, Gordon's monthly alimony obligation would be reduced from $500 to $250 in lieu of Gordon's seeking child support from Teri and ordered Teri to pay $750 attorney fees on Gordon's behalf. Teri appeals, arguing that the court erred in finding that an oral agreement could modify the decree and in ordering her to pay attorney fees. Gordon cross-appeals, asserting that the court abused its discretion by not terminating his alimony obligation and in awarding an insufficient amount of attorney fees. We affirm as modified.

BACKGROUND

The district court dissolved the parties' marriage on April 26, 1999, via a decree of dissolution. The court determined that the parties would share custody of their minor child, born in December 1986. The decree awarded Teri physical custody of the child until June 1, 1999, and declared that Gordon would be the primary custodial parent thereafter. The court ordered Gordon to pay $1,000 in child support for April and May and provided that Teri would have no child support obligation "at this time" when the child moved to Gordon's home. The court ordered Gordon to pay $500 a month in alimony beginning June 1 and continuing until either 120 months passed, one of the parties died, or Teri remarried.

On June 30, 2006, Gordon filed a complaint to set aside the decree or, alternatively, to modify the decree. The court subsequently sustained in part a motion to strike filed by Teri. The surviving parts of Gordon's complaint alleged that shortly after entry of the decree, Teri disavowed any further contact with the parties' child, and that once Gordon became aware that Teri was failing to fill any emotional or financial needs of the child, he informed Teri that he would have to go to court to modify the provisions of the decree to seek child support and a reduction in alimony. Gordon alleged that the parties reached a verbal agreement that he would reduce alimony payments to $250 a month in lieu of any change in child support and that he would make the payments directly to Teri because she was having difficulty getting the money from the clerk of the district court. Gordon alleged that he regularly and routinely had paid alimony of $250 a month. Gordon alleged that Teri had willfully misled the court by obtaining a garnishment order against him—shortly after the child turned 19 years old—in an amount that Teri was aware was not fair or accurate and was contrary to the agreement of the parties.

Gordon alleged in the complaint that "[t]he material and substantial change in circumstances requires the immediate cessation of all alimony, an accounting for back alimony paid, and credit for property [Teri] has failed and refused to turn over toward any alimony delinquency and interest." Gordon requested the court to modify the decree to adjust or cease alimony payments, order the clerk of the district court to credit Gordon for alimony paid directly to Teri, grant Gordon credit for the agreement of the parties' setting off alimony and child support, and order Teri to pay Gordon's attorney fees. In partly overruling Teri's motion to strike, the court stated that "the motion to strike relative to [the allegations we summarized above] is overruled and denied insofar as said paragraphs constitute a request by [Gordon] for a credit on monies which he was ordered to pay or may still be required to pay pursuant to the terms of said decree."

On November 13, 2007, the court held a hearing on Gordon's complaint to modify. There is no dispute that Teri had not contributed money toward any of the child's expenses once the child began living with Gordon in May 1999.

Teri testified that Gordon operated a heating and air-conditioning business during the marriage and that he earned over $100,000 a year. Shortly after the divorce, Teri became aware that the business ceased to operate. Gordon testified that from April 1999 to February 2000, he was "unemployed" while trying to restructure the business but that it was making no money. Gordon clarified that in April 1999, he was not taking a paycheck from the business but still had an ongoing business that he was trying to make work.

In 2000, Gordon began working for R.W. Jones at a salary of $30,000. He continued to work for R.W. Jones until May 2004, and his highest salary was $50,000. Gordon was then unemployed for 1 year. In May 2005, he obtained employment with Meylan Enterprises, where he continues to work. In 2006, he earned $42,000. At the time of the November 2007 hearing, Teri was earning $24,000 to $26,000 a year in salary, with the ability to work overtime. She testified that her monthly expenses were approximately $2,100.

Gordon had difficulty paying alimony. Teri testified that Gordon made three or four $500 payments, but she thought that three of the payments "bounced." In May 2000, Teri hired an attorney to pursue the alimony delinquencies. On May 23, Teri's counsel sent Gordon a letter notifying Gordon that he was delinquent in alimony payments and stating that "if this is not paid current by June 30, 2000, or if you have failed to contact me to work out any other arrangement that [Teri] will agree to, then I am to begin contempt proceedings against you." On June 12, Teri's counsel wrote Teri a letter stating that Gordon told the attorney that he would pay $500 each month but would need some time to "catch up" on the arrearage, which Gordon told the attorney was less than the $2,000 that Teri claimed. Gordon testified that a July 5 check was the last payment of $500 that he paid to Teri and that he had since been making payments of $250 every month. Teri testified that after July, she had conversations with Gordon about alimony which she described as "always consist[ing] of you'll take what I got." She testified that over the last 7 years she "pretty regular[ly]" received a check from Gordon for $250 but that the checks were often late.

Gordon testified that he met with an attorney in approximately August 2000. He testified that he then spoke with Teri about alimony and child support to explain to her that the attorney had advised Gordon that child support "was a no-brainer" and that Gordon could get between $350 and $375 a month. Gordon testified that he told Teri that he did not "have to go after the child support if [the parties] can strike a deal for this alimony, $250 instead of the [$]500" and that Teri said she would "get back" to him. Gordon testified that Teri called him a few days later, told him that she could not afford the child support payments, and agreed to accept $250 in alimony instead of being charged child support. Teri agreed that she and Gordon had a conversation in July or August 2000 where Gordon told her that he would take her to court for child support if she did not agree to $250 per month as alimony. She testified that she told Gordon that she could not support herself and that she could not pay child support. Teri denied agreeing to a reduction in alimony.

Gordon testified that the parties spoke about his paying Teri directly because "the [c]ourt took too long." He testified that the parties also spoke about their desire to not hire attorneys because neither party could afford an attorney. The parties did not memorialize the agreement in writing, and Gordon assumed that canceled checks would be sufficient evidence of his payments.

Gordon testified that between August 2000 and the child's 19th birthday in December 2005, the parties did not have any further conversations about why Gordon was not paying $500 a month or whether he was behind on payments. When Teri was asked why she did not pursue alimony payments prior to filing the garnishment action, Teri explained that she did not have the money. She testified that she did not initiate a contempt proceeding against Gordon because "he threatened to sue me for child support. He told me he would have alimony reduced or eliminated if I tried to do anything to have the alimony back to $500. He knew I didn't have any money."

On January 22, 2008, the court entered an "Order of Modification." The court found that Gordon paid alimony of $250 per month from July 2000 to the present. The court stated that in July 2006, approximately 6 months after the child turned age 19, Teri retained counsel to garnish Gordon's wages to satisfy alimony arrearage that she claimed to be $47,000. The court found that the parties agreed that Gordon would make alimony payments directly to Teri, and the court found that the garnishment action did not credit Gordon with any such payments and was "clearly inaccurate."

The district court found that the parties agreed to reduce Gordon's alimony obligation to $250 per month in lieu of his filing an application to modify the decree for child support. The court stated that "[t]here was consideration for the proposed agreement made by [Teri] with [Gordon] relative to the reduction of his child support obligation in lieu of the filing of an application to modify the decree and the possibility of the court subsequently awarding child support to [Gordon]." The court found that "pursuant to said agreement [Gordon's] alimony obligation was reduced to the sum of $250 per month commencing on the 1^st day of September, 200[0] and continuing on the 1^st day of each month thereafter until alimony has been paid by [Gordon] to [Teri] for a total of 120 months." The...