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A Troubling Gray Area in Divorce Cases
June 30, 2014
Gray areas are seldom helpful in family law, as divorced parties benefit by definition.
Where there are black-and-white answers to questions, lawyers can give direction to clients. But when there are no answers, people cannot plan for their future.
Perhaps the greatest gray area in family law in Wisconsin deals with retirement. First, there is no definitive answer to the question, “When can I retire?” Second, there is no definitive answer to the question, “If I can retire, will spousal support be terminated or simply reduced?”
A recent Wisconsin Court of Appeals decision does not do much to answer either question.
On May 13, the District 1 appellate court in Brin v. Brin, No. 2013AP1739, affirmed an order by Milwaukee County Circuit Judge Frederick Rosa holding open future maintenance. However, the facts of the case make application to other cases a law school exercise.
In the case, Edith Brin appealed an order holding open future maintenance from her ex-husband, Bradley Brin. The trial court found that both parties were about 79 years old, had been divorced for 21 years, were both living solely on their investment income and Social Security benefits and that Bradley had been paying maintenance for 10 years after he retired. Edith had $65,000 of yearly income and investments totaling almost $2.5 million.
Not surprisingly, the Court of Appeals’ decision penned by Presiding Judge Patricia Curley held that the trial court properly exercised its discretion.
In doing so, the appellate court, quite appropriately, limited its discussion to the facts of the specific case. These facts do not recur with great frequency. Not many support payers are 79 years old or keep paying a decade after retirement. And few recipients have nearly $2.5 million in investments.
No caselaw specifically deals with retirement. Several cases include the language that “maintenance should not be a permanent annuity,” (e.g., Heppner v. Heppner, 2009 WI App 90, 319 Wis. 237, 768 N.W.2d 26), but even that language is vague.
My experience is that a payor can retire when he or she is at the age the judge or court commissioner hearing the case intends to retire. So, taking early retirement at, say, age 55, is probably not going to go too far if the judge hearing the matter is in his or her 60s.
Still, absent any legal authority, there seems to be a general acceptance that a worker can retire at least at age 65.
But that does not necessarily mean that maintenance should terminate, which leads to the second question: If, after retirement, the payor’s income exceeds the payee’s, should maintenance continue, albeit at a reduced rate? If maintenance is reduced, but not terminated, which was the family court commissioner’s order in Brin, then maintenance would most likely continue until one of the parties dies, as that would probably be the next substantial change in circumstances.
Good lawyers try to negotiate around these issues through the use of Section 71 payments, which define the amount and term of support. That benefits both parties by avoiding future litigation and allowing them to make plans, as they know what they will pay/receive.
But, Section 71 payments cannot be ordered by the court; both sides have to agree.
Absent such agreement, this will continue to be a gray area, at least until the Court of Appeals finds that a trial court did not correctly exercise its discretion, and tells us exactly what exercise of discretion was missing.
This article originally appeared in the Wisconsin Law Journal.