Prince v. Prince ( 2020 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
In re the Marriage of:
TAMMY LYNN PRINCE, Petitioner/Appellee,
v.
KENDALL WILLIAM PRINCE, Respondent/Appellant.
No. 1 CA-CV 19-0565 FC
FILED 11-3-2020
Appeal from the Superior Court in Maricopa County
No. FC2015-090434
The Honorable Joan M. Sinclair, Judge
AFFIRMED IN PART; REMANDED IN PART
COUNSEL
Berkshire Law Office, PLLC, Tempe
By Keith Berkshire, Erica Gadberry
Counsel for Petitioner/Appellee
Rowley Chapman & Barney, Ltd. Attorneys, Mesa
By Alexander R. Arpad, Joshua R. Boyle
Counsel for Respondent/Appellant
PRINCE v. PRINCE
Decision of the Court
MEMORANDUM DECISION
Judge D. Steven Williams delivered the decision of the Court, in which
Presiding Judge Michael J. Brown and Chief Judge Peter B. Swann joined.
W I L L I A M S, Judge:
¶1 Kendall Prince (“Father”) appeals the family court’s ruling in
favor of Tammy Prince (“Mother”) on cross petitions for enforcement of a
consent decree.1 For the following reasons, we affirm in part and remand in
part.
FACTUAL AND PROCEDURAL HISTORY
¶2 Mother and Father married in 1985 and divorced in 2015 by
consent decree (“decree”). At the time of divorce, the parties had two minor
children, as well as an adult child unable to live independently, or be
self-supporting, who received Supplemental Security Income (“SSI”).
¶3 In July 2015, before the decree was filed, Father’s counsel sent
a letter to Mother, accompanied by the decree already signed by Father. The
letter attempted to finalize a comprehensive divorce settlement and
proposed particulars not included within the decree, such as: (1) extending
the length of child support payments for the minor children six months
beyond the youngest child’s emancipation; and (2) a monthly support
payment, when in Mother’s care, for the adult child on SSI, above and
beyond the child support payment for the minor children.
¶4 Regarding the support payment for the adult child, the letter
indicated a clear preference to omit any mention of the same in the decree
to ensure the adult child’s SSI benefit would not be jeopardized, which
Father anticipated might otherwise occur. The letter confirmed the total
combined support and maintenance payments Mother would receive to be
$12,000 in those months the adult child lived with Mother, and $10,650 in
all other months. Mother subsequently signed the decree. Following the
family court’s endorsement, the decree was filed with the clerk’s office on
August 6, 2015.
1 Although the cross petitions also sought contempt sanctions, Father
does not raise any issues on appeal relating to contempt.
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¶5 Per the terms of the decree, Father agreed to pay Mother
directly $1,350 each month for child support of the two minor children, as
well as $9,300 per month in spousal maintenance for 48 months (January
2015 through December 2018). As contemplated in the July 2015 letter, the
decree made no mention of the monthly support payment proposed for the
adult child on SSI, but did provide that “[a]ny financial benefits associated
with [the adult child] will follow [him] whether he lives with Mother,
Father or in a separate care facility.” The parenting plan, incorporated into
the decree, further provided:
ENTIRE AGREEMENT: This Parenting Plan is intended to be
a full, complete and final agreement between the parties
mentioned herein and supersedes all prior understandings or
agreements, whether oral or in writing, pertaining to the
subject matter contained herein.
¶6 The property settlement agreement, also incorporated into
the decree, further awarded Mother the marital residence as her sole and
separate property, but required Father to pay off a Home Equity Line of
Credit (“HELOC”) associated with the residence by the end of 2018. In 2016,
Mother sold the residence and used sale proceeds to pay off the HELOC.
¶7 When Father failed to reimburse Mother for the paid off
HELOC by the end of 2018, Mother filed her petition for enforcement in
January 2019 seeking reimbursement for the $121,232.32 she paid to satisfy
the HELOC. Father filed his own petition for enforcement alleging Mother
failed to provide Father with the SSI payments for their adult child while in
Father’s care, and sought credit for overpayment of child support and
spousal maintenance towards any monies he owed for the HELOC.
¶8 At the evidentiary hearing, over Father’s objection, the family
court allowed the admission of the July 2015 letter into evidence, treating it
as a Rule 69 agreement. See Ariz. R. Fam. Law P. 69. The court concluded
that Father owed Mother the entirety of the HELOC and had made no
overpayment of child support or spousal maintenance.
¶9 Father timely appealed and we have jurisdiction pursuant to
Article 6, Section 9, of the Arizona Constitution and A.R.S.
§§ 12-120.21(A)(1) and -2101(A)(2).
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Decision of the Court
DISCUSSION
I. Rule 69 Agreement
¶10 Father contends the family court erred by treating the July
2015 letter as a Rule 69 agreement. We interpret procedural rules de novo.
Ames v. Ames, 239 Ariz. 246, 249, ¶ 14 (App. 2016).
¶11 In 2015, at the time of divorce, Rule 69 required that an
agreement between the parties be “in writing,” or be “set forth on the
record” or “on any audio recording device before a mediator or [at a]
settlement conference.” Ariz. Supreme Ct. No. R-09-0042, Order Amending
Rules 5.1, 47, 67(b), 69, 74 and 78, Arizona Rules of Family Law Procedure
(Oct. 2, 2010), https://www.azcourts.gov/Portals/20/2010Rul
es/R090042.pdf. That rule was amended, effective January 1, 2019, and now
requires, in relevant part, that the written agreement also be “signed by the
parties personally or by counsel on a party’s behalf.” Ariz. R. Fam. Law P.
69(a)(1).
¶12 Father argues the current version of Rule 69 governs because
the cross petitions for enforcement were filed after January 1, 2019. Mother
argues the former version of the rule controls because the letter was written
years before the rule’s amendment.
¶13 The current version of Rule 69 “appl[ies] to all actions filed on
or after January 1, 2019.” Ariz. Supreme Ct. No. R-17-0054, Order
Amending the Arizona Rules of Family Law Procedure, etc. (Aug. 30, 2018),
https://www.azcourts.gov/Portals/20/2018%20Aug%20Rules/R170054.
PDF?ver=2018-08-30-122516-103. The filing of cross petitions for
enforcement in 2019 did not initiate a new “action.” Rather, the petitions
sought to enforce an order from an action filed in 2015. Because the action
was filed years before the amended rule took effect, the former version of
Rule 69, not the current, appropriately governs.
¶14 Rule 69 was adapted from Arizona Civil Rule of Procedure
80(d). See Murray v. Murray, 239 Ariz. 174, 178, ¶ 13 (App. 2016).
Consequently, we look to cases interpreting Rule 80(d) for guidance in
determining whether an agreement exists. See id. (citation omitted). For an
agreement to be enforceable under Rule 80(d), both the terms of the
agreement and the manifestation of assent, evinced by the parties
themselves or through counsel, must be in writing.” See Robertson v. Alling,
237 Ariz. 345, 348, ¶ 14 (2015).
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PRINCE v. PRINCE
Decision of the Court
¶15 At first glance, the July 2015 letter purports to be simply a
settlement letter. Paragraph one indicates:
Please be advised that this letter is being sent pursuant to Rule
408, Arizona Rules of Evidence, and is for settlement purposes
only and shall not be used at any court proceedings in this
matter, except to the extent necessary to establish the
reasonableness of attorney’s fees and costs on my client’s
behalf.
And, while Father’s manifestation of assent to the terms of both the letter,
and the accompanying consent decree he signed, were clearly established,
it is not until the final language of the letter that our analysis is complete:
[T]his is [Father’s] final attempt to settle this matter . . . If you
are in agreement then please sign the attached documents and
submit them to the Court.
(Emphasis added.) Mother did just that; she signed the attached documents
(the consent decree), submitted them to the family court, and in doing so
manifested her assent, not just to the consent decree, but also to the
additional terms in the letter which the parties intentionally omitted from
the decree. The letter was effectively converted to a Rule 69 agreement.
¶16 And although the parenting plan, incorporated into the
decree, declared it was “intended to be a full, complete and final agreement
between the parties . . . [superseding] all prior understandings or
agreements, whether oral or in writing” as to parenting time, support and
related matters, it is clear the parties intended the additional terms of the
letter to be part of a comprehensive agreement, which they expressly and
intentionally omitted from the decree. The following excerpts from the
letter are illustrative of the parties’ intention to be bound by additional
terms:
[Excerpt 1]: Spousal maintenance will be $9,300.00 for 48
months unless you remarry or either of you pass away. The
total combined support you are to receive is to be $12,000.00.
Child support for the two youngest children is $1,350 and the
support for [adult child], as explained below, is $1,350. Thus,
the total of those three amounts is $12,000.00. When [minor
child 1] emancipates the child support will not reduce and
will continue to be $1,350 until December 2018, even though
[minor child 2] will have emancipated at that time.
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PRINCE v. PRINCE
Decision of the Court
[Excerpt 2]: [Adult child] is listed as possibly being disabled
and unable to live independently. If either of you were to pay
child support for [adult child] to the other parent then [adult
child’s] Social Security would likely cease. [Father] is still
willing to pay $1,350 if [adult child] is living with you but will
pay you separately. [Father] will pay but to alleviate any
concern: if you are not receiving payment from [Father] then
you could take this matter to court in the future to establish
child support.
¶17 Because it is clear the parties manifested their assent to be
bound by the additional terms contained within the letter, the family court
did not err in concluding the July 2015 letter constituted a Rule 69
agreement. Further, because the letter was an agreement, not simply a
settlement letter as Father contends, the court also did not err in overruling
Father’s objection to its admission under Arizona Rule of Evidence 408.2
II. Allocation of Adult Child’s Supplemental Security Income
¶18 Mother, who is the representative payee of the adult child’s
SSI benefits, failed to provide Father will those benefits in months where
the adult child lived with Father. Father contends the family court erred by
refusing to enforce allocation of the adult child’s SSI benefits per the terms
of the decree, which provides: “[a]ny financial benefits associated with [the
adult child] will follow [him] whether he lives with Mother, Father or in a
separate care facility.”
¶19 SSI benefits are federal benefits, administered and regulated
by the federal government through the Social Security Administration
(“SSA”). And, because “Congress [has] intended the federal government to
occupy [this area] exclusively,” “[s]tate law is preempted by federal law.”
See Hutto v. Francisco, 210 Ariz. 88, 90, ¶ 7 (App. 2005). Stated differently,
this court previously held that Arizona courts lack authority to review the
management of derivative Social Security benefits. Peace v. Peace, 234 Ariz.
546, 548, ¶ 9 (App. 2014) (holding, inter alia, “[b]ecause federal law occupies
2 Rule 408 prohibits the admission of “statement[s] made during
compromise negotiations.” See Ariz. R. Evid. 408(a)(2). In determining the
admissibility and relevance of evidence, the trial court is invested with
considerable discretion, see Burgbacher v. Mellor, 112 Ariz. 481, 483 (1975),
which we review for an abuse of discretion, see Selby v. Savard, 134 Ariz. 222,
227 (1982).
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PRINCE v. PRINCE
Decision of the Court
the field, a family court is preempted from reviewing the [management of
derivative Social Security benefits] of a representative payee”).
¶20 Thus, although the terms of the decree direct that the adult
child’s “financial benefits . . . will follow [him] whether he lives with
Mother, Father or in a separate care facility,” the family court lacked
jurisdiction to enforce this provision of the decree. The court had no
authority to make any decision regarding the SSI benefit. Consequently, we
do not address the merits of Father’s argument.
III. Overpayment of Child Support and Spousal Maintenance Payments to
Offset the HELOC
¶21 Father’s final argument is that he made overpayments in child
support and spousal maintenance to Mother, and those overpayments
should be considered offsets toward the total HELOC obligation. We will
affirm a family court’s findings of fact unless they are clearly erroneous. See
Ariz. R. Fam. Law P. 82(a)(5). Where conflicting evidence is presented, we
defer to the court’s evaluation of the credibility of witnesses. Gutierrez v.
Gutierrez, 193 Ariz. 343, 347–48, ¶ 13 (App. 1998); see also Ariz. R. Fam. Law
P. 82(a)(5) (“[T]he reviewing court must give due regard to the trial court’s
opportunity to judge the credibility of witnesses.”).
¶22 Following the evidentiary hearing, the family court made
findings relative to Father’s support and maintenance payments:
39. [Father] claims he paid [Mother] $180,404.35 in 2015.
Exhibit 18.
40. Upon review of this exhibit, the Court found that [Father]
paid [Mother] $149,114.00. The Court only included amounts
noted as being paid directly to [Mother] and omitted car
insurance and other payments including the $350 payment
that did not correspond to an amount owed for child support
or spousal maintenance. The Court also included a $12,000
check noted on July 14th where it was handwritten in the
record that this was a payment to “[Mother].”
41. [Father] claims he paid [Mother] $134,962.00 in 2016.
Exhibit 19.
42. The Court agrees that [Father] paid [Mother] this amount
of money in 2016.
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PRINCE v. PRINCE
Decision of the Court
43. [Father] claims he paid [Mother] $137,680.00 in 2017.
Exhibit 20.
44. The Court reviewed this exhibit and found that [Father]
paid [Mother] $137,500 in 2017. The Court omitted the $180
payment.
45. [Father] claims he paid [Mother] $121,500.00 in 2018.
Exhibit 21.
46. The Court agrees that [Father] paid [Mother] this amount
of money in 2018.
47. In reviewing [Father’s] bank statements and his payments
to [Mother], he clearly paid $12,000 on some months and
approximately $10,650 on other months. On months where he
paid [Mother] more than once, she returned the extra money
back to him. Exhibit 18, p. 27; exhibit 19, p. 114; exhibit 21, pp.
319-320.
48. [Mother] testified that she did not dispute the amounts of
the payments, but only the reason for those payments. She
argues that the extra money paid was for the $1,350 that
[Father] agreed to pay for [adult child] when he was in her
care.
49. [Father] testified that he made extra payments to [Mother]
and that these payments were for the HELOC.
50. The only documentation of any discussion between the
parties as to extra payments being used to pay down the
HELOC is in exhibit 27. That exhibit demonstrates only that
this is [Father’s] position, not that there is any agreement for
this arrangement.
...
53. Based on this record, the Court does not find that there
was any agreement between the parties for additional
payments to be used to reduce the HELOC payment.
...
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PRINCE v. PRINCE
Decision of the Court
63. [Father] stated that the $10,650 and $12,000 payments were
not reflective of when [adult child] was living with [Mother].
The Court did not find this testimony credible.
64. [Mother] testified that the $12,000 payments were for the
months that [adult child] lived with her. She stated that there
were no overpayments from [Father]. The Court found this
testimony to be credible.
¶23 Most of the family court’s findings are explained in detail,
reference the exhibits relied upon, make determinations of credibility
between the witnesses, and are supported by the record. And while Father
argued he made additional payments to Mother not included within the
court’s totals, and that some of the payments he made were intended to be
attributed towards the HELOC rather than support payments, the court
exercised its discretion in assessing credibility between the witnesses.
¶24 However, with respect to those payments the family court
concluded were made in support of the adult child, and thus not
overpayments, the record does not support the court’s conclusions. For
example, the court indicated it was unable to determine which months
adult child was with Mother, but then summarily concluded any payment
above $10,650 was a support payment for adult child:
65. The Court finds that the parties were abiding by their prior
agreements with [Father] paying an extra $1,350 for the
months [adult child] was living with [Mother]. Because there is
insufficient evidence to demonstrate which months [adult child]
lived with which parent, the extra $1,350 paid on some months to
[Mother] was not an overpayment by [Father].
(Emphasis added.)
¶25 By concluding there was “insufficient evidence to
demonstrate the months [adult child] lived with which parent,” while then
categorically refusing to credit Father with any “overpayment” of support,
the family court erred. On remand, the court should not categorize as
support for adult child any monthly payment above the combined support
and maintenance amount of $10,650 unless there is evidence that adult child
was living with Mother during that particular month. To conclude
otherwise would constitute error. In its discretion, the court may hold
additional hearings to aid in obtaining additional evidence.
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PRINCE v. PRINCE
Decision of the Court
CONCLUSION
¶26 For the foregoing reasons, we affirm in part and remand in
part. Mother and Father have each requested an award of attorneys’ fees
and costs pursuant to A.R.S. § 25-324. After considering the parties’
financial resources and the reasonableness of their positions, in our
discretion we deny both parties’ requests.
AMY M. WOOD • Clerk of the Court
FILED: AA
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