Kenneth Ray Waldrop v. Teresa Waldrop , 552 S.W.3d 396 ( 2018 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-15-00058-CV
KENNETH RAY WALDROP APPELLANT
V.
TERESA WALDROP APPELLEE
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FROM THE 393RD DISTRICT COURT OF DENTON COUNTY
TRIAL COURT NO. 2006-61054-393
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OPINION ON EN BANC RECONSIDERATION
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A majority of the court granted Appellant Kenneth Ray Waldrop’s motion
for en banc reconsideration. Accordingly, we withdraw our September 29, 2016
opinion and judgment, and we substitute the following opinion and judgment.
I. INTRODUCTION
We address two primary issues in this appeal. First, whether the
“Contractual Maintenance” provision in Kenneth and Appellee Teresa Waldrop’s
agreed divorce decree is purely contractual or is spousal maintenance governed
by chapter 8 of the family code.1 For the reasons set forth below, we hold that
the Waldrops’ Contractual Maintenance provision is purely contractual, and we
affirm the trial court’s final order in this regard. And second, whether the
language of the Waldrops’ Contractual Maintenance provision authorizes the trial
court to modify or terminate Kenneth’s maintenance obligation by court order
based on a change in Kenneth’s circumstances affecting his maintenance
obligation. For the reasons set forth below, we answer this query in the
affirmative. We therefore reverse the trial court’s final order in this regard and
remand this case to the trial court for proceedings consistent with this opinion.
II. FACTUAL AND PROCEDURAL BACKGROUND
On April 26, 2007, the trial court signed Kenneth and Teresa’s agreed
divorce decree. The agreed decree contained a provision stipulating that it was
1
The Waldrops’ agreed divorce decree was entered on April 26, 2007.
Unless otherwise noted, all references in this opinion to chapter 8 of the family
code will be to sections of chapter 8 as they existed on April 26, 2007. See Act
of May 25, 2005, 79th Leg., R.S., ch. 914, § 1, 2005 Tex. Gen. Laws 3146, 3146
(amended 2011) (current version at Tex. Fam. Code Ann. § 8.051 (West Supp.
2017)); Act of May 25, 2005, 79th Leg., R.S., ch. 914, § 1, 2005 Tex. Gen. Laws
3146, 3147 (amended 2011) (current version at Tex. Fam. Code Ann. § 8.054
(West Supp. 2017)); Act of May 28, 2003, 78th Leg., R.S., ch. 1138, § 1, 2003
Tex. Gen. Laws 3231, 3231 (amended 2011) (current version at Tex. Fam. Code
Ann. § 8.055 (West Supp. 2017)); Act of May 22, 2001, 77th Leg., R.S., ch. 807,
§ 1, 2001 Tex. Gen. Laws 1574, 1577 (amended 2011) (current version at Tex.
Fam. Code Ann. § 8.056 (West Supp. 2017)); Act of May 22, 2001, 77th Leg.,
R.S., ch. 807, § 1, 2001 Tex. Gen. Laws 1574, 1577 (amended 2011) (current
version at Tex. Fam. Code Ann. § 8.057 (West Supp. 2017)).
2
enforceable as a contract.2 The Contractual Maintenance provision in the agreed
decree—which is at the heart of this appeal—requires Kenneth to make monthly
payments of $3,000 to Teresa. It provides, in pertinent part:
Contractual Maintenance
The Court finds that under the circumstances presented in this
case, Teresa Waldrop is eligible for maintenance under the
provisions of Texas Family Code Chapter 8.001 et seq[.] and that
the parties have agreed that Kenneth Ray Waldrop will pay
maintenance to Teresa Waldrop as set out below. The parties have
further agreed that Teresa Waldrop shall have all the rights and
remedies afforded under the Texas Family Code, Chapter 8.001 et
seq. Accordingly, Kenneth Ray Waldrop is ordered to pay as
maintenance the sum of $3,000.00 per month to Teresa Waldrop,
with the first payment being due on February 1, 2007, and a like
amount being due the first day of each consecutive month thereafter
until the earliest of one of the following events occurs:
1. death of either Petitioner or Respondent;
2. remarriage of Teresa Waldrop;
3. further orders of the Court affecting the spousal
maintenance obligation, including a finding of cohabitation by Teresa
Waldrop[;]
4. [t]he first day of the month following the day that Teresa
Waldrop becomes eligible to receive and begins to receive her
portion of the Kimberly Clark pension awarded to her . . . above. In
this event, Kenneth Ray Waldrop is ORDERED to pay to Teresa
2
The “Agreement of Parties” provision states,
The Court finds that the parties have entered into a written
agreement as contained in this decree by virtue of having approved
this decree as to both form and substance. To the extent permitted
by law, the parties stipulate the agreement is enforceable as a
contract. The Court approves the agreement of the parties as
contained in this Final Decree of Divorce.
3
Waldrop as maintenance the difference each month between
$3,000.00 and the amount of the benefit received from the Kimberly
Clark pension, due and payable on the first day of the first month
immediately following the date that Teresa Waldrop becomes eligible
to receive and does receive her portion of the Kimberly Clark
pension and continuing thereafter until the next occurrence of one of
the events 1–3 above. It is the intent of the parties that the
$3,000.00 maintenance paid to Teresa Waldrop by Kenneth Ray
Waldrop be reduced each month in an amount equal to the amount
of the monthly pension benefit received by Teresa Waldrop from
Kimberly Clark.
Approximately six years later, Kenneth initiated litigation concerning the
Contractual Maintenance provision. Kenneth contended that the agreed decree’s
Contractual Maintenance provision imposed chapter 8 spousal maintenance and
was therefore modifiable by the court upon a showing that Kenneth’s
circumstances had materially and substantially changed3 and, that in any event,
he could petition the trial court to modify or terminate his maintenance obligation
for reasons other than the four reasons set forth under paragraph one—either
party’s death, Teresa’s remarriage, a finding of cohabitation by Teresa, or
Teresa’s receipt of payments from the Kimberly Clark pension. Teresa, on the
other hand, argued that the Contractual Maintenance provision was a contractual
provision made outside the family code and was not modifiable by the trial court
except upon the four circumstances set forth under paragraph one. Ultimately,
following a bench trial on Kenneth’s declaratory judgment claim and a
3
See Tex. Fam. Code Ann. § 8.057(c).
4
subsequent hearing on attorney’s fees, the trial court signed a final order and
made findings of fact and conclusions of law.
The trial court declared that the agreed decree’s Contractual Maintenance
provision was purely contractual in nature and not subject to the provisions of
chapter 8 and that the “further orders of the Court” language limited the trial
court’s authority to modify or terminate Kenneth’s maintenance obligation to the
specific circumstances of Kenneth’s or Teresa’s death, Teresa’s remarriage or
cohabitation, or Teresa’s receipt of payments from the Kimberly Clark pension.
The trial court alternatively held that although chapter 8’s “material and
substantial change in circumstances does not apply here,” even if it did, “a
material and substantial change in circumstances was not proven by [Kenneth].”
The trial court ordered that Kenneth continue making payments under the
Contractual Maintenance provision and ordered that he pay Teresa $28,590.53
in attorney’s fees.4
Kenneth perfected this appeal and raises four issues complaining that the
trial court erred by concluding that the Contractual Maintenance provision was
4
The trial court made conclusions of law concerning each declaration.
Conclusion of law 4 states, “The contractual maintenance provision in the Final
Decree of Divorce is contractual.” Conclusion of law 5 states, “Chapter 8 of the
Texas Family Code does not apply to the spousal maintenance in the Final
Decree of Divorce.” And conclusion of law 8 states, in pertinent part, “[T]he
Court alternatively finds that a material and substantial change in circumstance
was not proven by [Kenneth] in order to decrease [his] spousal maintenance
obligation (if such obligation existed).”
5
contractual in nature and was not subject to the provisions of chapter 8 of the
family code, by finding that the Contractual Maintenance provision could not be
modified by further court order except in the four specifically identified
circumstances, by finding that a material and substantial change in his
circumstances had not occurred, and by awarding attorney’s fees to Teresa.
III. STANDARD OF REVIEW
We review declaratory judgments under the same standards as other
judgments and decrees. Tanglewood Homes Ass’n, Inc. v. Feldman, 436
S.W.3d 48, 65 (Tex. App.—Houston [14th Dist.] 2014, pet. denied); McBride v.
James, No. 02-09-00320-CV, 2011 WL 1103758, at *5 (Tex. App.—Fort Worth
Mar. 24, 2011, pet. denied) (mem. op.). We look to the procedure used to
resolve the issue below to determine the standard of review on appeal.
Tanglewood Homes Ass’n, 436 S.W.3d at 65–66; McBride, 2011 WL 1103758, at
*5. When a declaratory judgment is entered after a bench trial, we review the
trial court’s conclusions of law de novo. Trinity Drywall Sys., LLC v. Toka Gen.
Contractors, Ltd., 416 S.W.3d 201, 207 (Tex. App.—El Paso 2013, pet. denied);
Rourk v. Cameron Appraisal Dist., 305 S.W.3d 231, 234 (Tex. App.—Corpus
Christi 2009, pet. denied).
We interpret an agreed divorce decree according to the rules of contract
construction. In re W.L.W., 370 S.W.3d 799, 804 (Tex. App.—Fort Worth 2012,
orig. proceeding [mand. denied]). Our primary concern when interpreting an
agreed divorce decree is to ascertain and give effect to the intent of the parties
6
as it is expressed in the agreement. Coker v. Coker, 650 S.W.2d 391, 393 (Tex.
1983); Perry v. Perry, 512 S.W.3d 523, 527 (Tex. App.—Houston [1st Dist.]
2016, no pet.). We examine the decree as a whole to harmonize and give effect
to the entire agreement so that none of its provisions will be rendered
meaningless. Coker, 650 S.W.2d at 393; Perry, 512 S.W.3d at 527.
IV. WHETHER THE TRIAL COURT ERRED BY CONCLUDING THAT
THE WALDROPS’ CONTRACTUAL MAINTENANCE PROVISION
IS PURELY CONTRACTUAL AND IS NOT SUBJECT TO CHAPTER 8
In his first issue, Kenneth argues that the trial court erred by concluding
that the Contractual Maintenance provision is purely contractual and is not
subject to chapter 8.
A. Contractual Alimony Versus Chapter 8 Maintenance
1. Statutes
Before 1995, a court-ordered award of post-divorce alimony or spousal
maintenance was impermissible under the statutes and public policy of Texas.
McCollough v. McCollough, 212 S.W.3d 638, 642 (Tex. App.—Austin 2006, no
pet.); Ex parte Casey, 944 S.W.2d 18, 19 (Tex. App.—Houston [14th Dist.] 1997,
orig. proceeding). Nonetheless, the Texas Supreme Court recognized that
parties could contractually agree to such awards. McCollough, 212 S.W.3d at
642 (citing Francis v. Francis, 412 S.W.2d 29, 31 (Tex. 1967)). “The mere fact
that an agreement to pay alimony might be incorporated into a divorce decree
and explicitly approved by the court did not render it an unenforceable court
order or award of alimony.” Id. By enacting chapter 8 of the family code,
7
effective September 1, 1995, however, the legislature authorized courts to award
post-divorce spousal maintenance. Id. at 643. But the legislature strictly limited
the circumstances under which spousal maintenance could be awarded. Id.
When the Waldrops’ agreed decree was signed, chapter 8 spousal
maintenance could be awarded only if
(1) the spouse from whom maintenance is requested was convicted
of or received deferred adjudication for a criminal offense that also
constitutes an act of family violence under Title 4 and the offense
occurred:
(A) within two years before the date on which a suit for
dissolution of the marriage is filed; or
(B) while the suit is pending; or
(2) the duration of the marriage was 10 years or longer, the spouse
seeking maintenance lacks sufficient property, including property
distributed to the spouse under this code, to provide for the spouse’s
minimum reasonable needs, as limited by Section 8.054, and the
spouse seeking maintenance:
(A) is unable to support himself or herself through appropriate
employment because of an incapacitating physical or mental
disability;
(B) is the custodian of a child of the marriage of any age who
requires substantial care and personal supervision because of
a physical or mental disability makes it necessary, taking into
consideration the needs of the child, that the spouse not be
employed outside the home; or
(C) clearly lacks earning ability in the labor market adequate to
provide support for the spouse’s minimum reasonable needs,
as limited by Section 8.054.
Tex. Fam. Code Ann. § 8.051. When the Waldrops’ agreed decree was signed,
an award of spousal maintenance was further limited by sections 8.054 and
8
8.055. Section 8.054 provided that, except in cases of disability, a court could
not order maintenance that remained in effect for more than three years after the
date of the order. Id. § 8.054. And section 8.055 provided that a court could not
order maintenance that required an obligor to pay more than the lesser of $2,500
per month or twenty percent of the spouse’s average monthly gross income. Id.
§ 8.055.
2. Case Law
When parties agree or stipulate that a maintenance provision set forth in
their divorce decree is enforceable as a contract, absent express language
indicating chapter 8 governs the maintenance provision, courts will enforce the
maintenance provision as a matter of contract law, independent of chapter 8.
See Lee v. Lee, No. 02-14-00064-CV, 2015 WL 601054, at *1 (Tex. App.—Fort
Worth Feb. 12, 2015, no pet.) (mem. op.) (holding chapter 8 did not apply to
agreed decree’s maintenance provision); Ammann v. Ammann, No. 03-09-
00177-CV, 2010 WL 4260955, at *1 (Tex. App.—Austin Oct. 28, 2010, no pet.)
(mem. op.) (same); Kee v. Kee, 307 S.W.3d 812, 813–14 (Tex. App.—Dallas
2010, pet. denied) (same); McCollough, 212 S.W.3d at 647–48 (same). In
determining whether the parties intended for chapter 8 to apply to an agreed
maintenance provision, courts additionally examine whether the agreed
maintenance provision sets forth the criteria required to trigger chapter 8 spousal
support and imposes a support obligation that is within chapter 8’s limit on the
amount and duration of such support. See Lee, 2015 WL 601054 at *2 (noting
9
that no indication existed that trial court considered all of chapter 8’s factors in
determining maintenance); Ammann, 2010 WL 4260955, at *2 (“The decree
contains no references to the factors the court must consider in determining the
nature, amount, duration, and manner of payments pursuant to chapter 8.”); Kee,
307 S.W.3d at 815 (noting the decree “failed to follow [chapter 8’s] guidelines
with respect to the amount of support and the duration of the support”);
McCollough, 212 S.W.3d at 646 (“Randy’s agreed alimony obligation also would
have violated chapter 8 from its inception” by allowing payments over a period of
ten years in an amount of $5,000 per month). An agreed maintenance provision,
enforceable as a contract, is not subject to chapter 8 merely because it
references chapter 8 or states that a spouse is eligible for spousal maintenance
under chapter 8. See Ammann, 2010 WL 4260955, at *2 (“The mere reference
to family code chapter 8 in a divorce decree does not transform a contractual
alimony obligation into a court-ordered maintenance obligation governed by that
chapter.”); Kee, 307 S.W.3d at 814–15 (holding chapter 8 did not apply to
maintenance provision despite recitation in decree that wife was “eligible for
maintenance” under the family code). We now apply these principles to the
Waldrops’ Contractual Maintenance provision.
10
B. Analysis of the Waldrops’ Contractual Maintenance Provision
Kenneth argues that a plain reading of the divorce decree makes it clear
that the Contractual Maintenance provision provides for chapter 8 spousal
maintenance and not contractual alimony. He points to the fact that the term
“alimony” is never used in the decree, while the term “maintenance” is used
fourteen times. He also points to three references to chapter 8 contained in the
Contractual Maintenance provision—that Teresa was eligible for maintenance
under “Chapter 8.001 et seq[.],” that she would have “all rights and remedies
afforded under . . . Chapter 8.001 et seq[.],” and that “a copy of subchapter E of
chapter 8” was to be attached to the decree—as evidence that the decree
provides for chapter 8 spousal maintenance rather than contractual alimony.
Teresa counters that the terms of the Contractual Maintenance provision
are “clearly . . . outside the bounds of Chapter 8 maintenance”—an indication
that the divorce decree is governed by contract rather than chapter 8. She
argues that the duration of the payments contemplated by the decree violates
chapter 8 because it allows for payments to continue for more than the three-
year limit imposed by the version of section 8.054 applicable when she and
Kenneth signed their agreed decree. See Tex. Fam. Code Ann. § 8.054. She
also points to the fact that Kenneth’s payment obligation was $3,000 per month,
which was outside the $2,500 monthly limit imposed by chapter 8 at the time the
parties entered the agreed decree. See id. § 8.055.
11
The Waldrops’ Contractual Maintenance provision would have violated
chapter 8 from its inception because it required Kenneth to make payments for a
duration longer than the three-year period then permitted under section 8.054
and required him to make monthly payments greater than the $2,500 limit set by
section 8.055. See id. §§ 8.054, 8.055. While the Contractual Maintenance
provision does make three references to chapter 8, these references do not
subject the Contractual Maintenance provision to the terms of chapter 8; indeed,
they cannot because the Contractual Maintenance provision imposes upon
Kenneth a maintenance obligation that exceeds the amount and duration limits of
the then-applicable chapter 8. See id. §§ 8.054, 8.055; Ammann, 2010 WL
4260955, at *2 (holding maintenance provision not subject to chapter 8 when
payment amount and duration violated chapter 8); Kee, 307 S.W.3d at 815
(same). Kenneth is correct that the Contractual Maintenance provision uses the
term “maintenance,” but the provision’s use of the term “maintenance” and its
nonuse of the term “alimony” is, in the context of the entire provision, mere
nomenclature incapable of altering the substance of the provision. See Lee,
2015 WL 601054, at *1, *3 (holding despite use of term “maintenance” in decree,
payment obligation was not governed by chapter 8); Ammann, 2010 WL
4260955, at *1–3 (same).
Kenneth attempts to factually distinguish McCollough and Kee, pointing out
that the parties in those cases signed separate contractual agreements for
maintenance or alimony outside of the divorce decree—an agreement incident to
12
divorce and a partition and exchange agreement—while there is no contract
outside of the decree here. In Lee, we addressed and rejected this same
argument:
[D]espite Jerry’s attempt to distinguish contractual alimony provided
in an agreement incident to divorce or partition and exchange
agreement from the spousal maintenance agreement he entered
into with Danelle as part of the agreed decree of divorce, that the
agreed spousal support is part of the decree and not incident to it is
not relevant to our treatment of the decree as a binding contract. An
agreed divorce decree, such as the one in this case, is a contract
subject to the usual rules of contract construction.
2015 WL 601054, at *3 (quotation omitted). We again decline to draw a
distinction between contractual agreements set forth in a divorce decree and
those incident to, but not set forth in, a divorce decree. See id.; see also Hicks v.
Hicks, 348 S.W.3d 281, 283 (Tex. App.—Houston [14th Dist.] 2011, no pet.)
(“Because the parties entered into an agreed divorce decree, it is treated as a
contract between the parties with the law of contracts governing the interpretation
of the decree’s legal force and meaning.”); Giles v. Giles, 830 S.W.2d 232, 238
(Tex. App.—Fort Worth 1992, no writ) (“[T]here is no reason the separate
contractual agreement between the spouses must be in written form prior to the
trial court’s signing the written judgment—the judgment itself operates as the
written manifestation of the parties’ agreement.”).
Kenneth also argues that the Contractual Maintenance provision is
governed by chapter 8 because the payment obligation “terminates pursuant to
the factors set forth in [s]ection 8.056 of the Texas Family Code” and because it
13
“reflects the language proposed by the Texas Family Law Practice Manual for
court ordered spousal maintenance.” But the mere fact that the payment
obligation may terminate pursuant to some of the factors listed in section 8.056,
or that the language contained in the Contractual Maintenance provision may
mirror some of the language used in the Texas Family Law Practice Manual for
court-ordered spousal maintenance, does not convert the parties’ agreement into
something other than a contract.5 Kenneth and Teresa were free to include
selected language from chapter 8 or from a family law practice manual without
automatically converting their Contractual Maintenance provision into chapter 8
spousal maintenance. See 8 ARTHUR L. CORBIN, CORBIN ON CONTRACTS § 36.2
(4th ed. 2000) (“Theoretically, at least, people are free to contract as they
choose, limiting their rights and duties in ways that are unusual or absurd or
unprofitable.”); see also Solar Applications Eng’g, Inc. v. T.A. Operating Corp.,
327 S.W.3d 104, 112 (Tex. 2010) (“[P]arties are free to contract as they
choose.”).6
5
The section of the Texas Family Law Practice Manual that Kenneth points
to contains the following language: “[This section] applies only to court-ordered
spousal maintenance. If the parties have agreed to contractual alimony, such
provisions may be part of the final decree of divorce.” [Emphasis in original.]
6
Kenneth argues that the Contractual Maintenance provision itself makes
no reference that its provisions are enforceable in contract. But we are to
examine the decree as a whole to harmonize and give effect to the entire
agreement. See Coker, 650 S.W.2d at 393; Perry, 512 S.W.3d at 527. As set
forth previously, the “Agreement of Parties” provision provided that the agreed
decree was enforceable as a contract. The Contractual Maintenance provision’s
14
Kenneth further argues that certain 2013 amendments to chapter 8 support
his position that the Contractual Maintenance provision is governed by chapter 8.
He points to section 8.101(a-1) and (a-2), which now allow a trial court to
withhold earnings from an obligor “in a proceeding in which there is an
agreement for periodic payments of spousal maintenance under the terms of
[chapter 8] voluntarily entered into between the parties and approved by the
court” and further provides that the trial court may not order income withholding
in an agreed order “for maintenance [that] exceeds the amount of periodic
support the court could have ordered under [chapter 8] or for any period of
maintenance beyond the period of maintenance the court could have ordered
under [chapter 8].” Tex. Fam. Code Ann. § 8.101(a-1), (a-2) (West Supp. 2017).
He also points to section 8.059(a-1), which provides that a trial court may not
enforce by contempt any provision of an agreed order for maintenance that
exceeds the amount or duration of maintenance the court could have ordered
under chapter 8. Id. § 8.059(a-1) (West Supp. 2017) Kenneth argues that these
sections, when read in conjunction with section 8.057’s modification provisions,
support his position that chapter 8 governs the Contractual Maintenance
provision. Alternatively, he argues that sections 8.057, 8.059, and 8.101 allow
for $2,500 of the $3,000 monthly payment obligation to be considered spousal
failure to restate a second time that it is enforceable as a contract is not
controlling.
15
maintenance under chapter 8 and the remaining $500 to be considered
contractual alimony.
The 2013 additions of section 8.101(a-1) and (a-2) and section 8.059(a-1)
to chapter 8 have no bearing on our construction of the Waldrops’ 2007 agreed
divorce decree. When construing a contract, we look to the overall agreement to
“determine what purposes the parties had in mind at the time they signed it.”
Fischer v. CTMI, L.L.C., 479 S.W.3d 231, 239 (Tex. 2016) (emphasis added)
(internal quotation omitted). While chapter 8 may now contemplate agreed
orders for spousal maintenance under chapter 8, no such provision existed in
2007 when the parties signed their agreed divorce decree. We therefore decline
to depart from the precedent set by Lee (a case we decided in 2015), Ammann,
Kee, and McCollough. See Lee, 2015 WL 601054, at *1, *3; Ammann, 2010 WL
4260955, at *2; Kee, 307 S.W.3d at 815; McCollough, 212 S.W.3d at 647–48.
Applying controlling rules of construction and existing case law in
conducting our de novo review of the trial court’s conclusions of law numbers 4,
5, and 8, we hold that the trial court did not err by concluding that the Contractual
Maintenance provision was purely contractual in nature and not subject to
chapter 8. See Trinity Drywall Sys., 416 S.W.3d at 207; Rourk, 305 S.W.3d at
234. We overrule Kenneth’s first issue.
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V. WHETHER THE TRIAL COURT ERRED BY CONCLUDING THAT THE WALDROPS’
CONTRACTUAL MAINTENANCE PROVISION CANNOT BE MODIFIED BY FURTHER COURT
ORDER ABSENT THE FOUR LISTED CIRCUMSTANCES
In his second issue, Kenneth argues that even if the Contractual
Maintenance provision is purely a matter of contract and chapter 8 does not
apply to it, the trial court still erred by concluding that the maintenance provision
could not be modified by further court order absent one of the four specific
circumstances set forth under paragraph one of the provision.
A. The Further-Orders Language and the Trial Court’s Conclusion
The Contractual Maintenance provision states that Kenneth is to pay
Teresa $3,000 per month beginning on February 1, 2007, and continuing until the
earliest of one of the following events occurs: (1) either party’s death; (2)
Teresa’s remarriage; (3) “further orders of the Court affecting the spousal
maintenance obligation, including a finding of cohabitation by Teresa”; and (4)
when Teresa becomes eligible to receive and begins to receive her portion of the
Kimberly Clark pension awarded in the decree, at which time, Kenneth is to pay
monthly to Teresa the difference between $3,000 and the amount of the monthly
benefit Teresa receives from the Kimberly Clark pension.
In its final order, the trial court declared the following regarding the phrase
“further orders of the Court” contained in the Contractual Maintenance provision:
“[F]urther orders of the Court” is interpreted to refer only to the three
instances of termination as stated, specifically upon the death of
either [Teresa] or [Kenneth], upon the remarriage of [Teresa], or
upon the cohabitation of [Teresa]; it refers only to one instance of
modification of the amount of support, and that is to the equal offset
17
reduction provided by the Kimberly Clark Pension upon the
beginning of [Teresa] receiving her benefit.7
B. Application of Rules of Contract Construction
to the Waldrops’ Contractual Maintenance Provision
Having held that the Contractual Maintenance provision in the Waldrops’
agreed divorce decree is purely contractual, we apply the rules of contract
construction to determine whether the Contractual Maintenance provision and its
further-orders-of-the-court language authorizes the trial court to modify or
terminate Kenneth’s maintenance obligation for reasons in addition to the
specifically listed reasons under paragraph one of the Contractual Maintenance
provision—either party’s death, Teresa’s remarriage, a finding of cohabitation by
Teresa, or Teresa’s receipt of payments from the Kimberly Clark pension. See,
e.g., McGoodwin v. McGoodwin, 671 S.W.2d 880, 882 (Tex. 1984) (op. on reh’g)
(construing marital property settlement agreement though incorporated into a
final divorce decree pursuant to rules of contract construction); Perry, 512
S.W.3d at 527 (“We interpret an agreed divorce decree according to the rules of
contract construction.”).
When construing a written contract, intermediate appellate courts give
effect to the true intentions of the parties as expressed in the agreement. El
Paso Field Servs., L.P. v. MasTec N. Am., Inc., 389 S.W.3d 802, 805 (Tex.
2012). In so doing, we consider the entire written contract and attempt to
This language also appears in the trial court’s findings of fact and
7
conclusions of law.
18
harmonize and to give effect to all of the provisions of the contract by analyzing
the provisions with reference to the whole agreement. Frost Nat’l Bank v. L & F
Distribs., Ltd., 165 S.W.3d 310, 311−12 (Tex. 2005). We “construe contracts
‘from a utilitarian standpoint bearing in mind the particular business activity
sought to be served’ and ‘will avoid when possible and proper a construction
which is unreasonable, inequitable, and oppressive.’” Id. (quoting Reilly v.
Rangers Mgmt., Inc., 727 S.W.2d 527, 530 (Tex. 1987)). “No single provision
taken alone will be given controlling effect; rather, all the provisions must be
considered with reference to the whole instrument.” Innovate Tech. Sols. v.
Youngsoft, Inc., 418 S.W.3d 148, 151 (Tex. App.—Dallas 2013, no pet.) (quoting
J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003)). We construe
the decree as a whole to harmonize and to give effect to the entire agreement so
that none of its provisions will be rendered meaningless. Howard v. Howard, 490
S.W.3d 179, 184 (Tex. App.—Houston [1st Dist.] 2016, pet. denied).
On appeal, Kenneth and Teresa both contend that the further-orders-of-
the-court language of the Contractual Maintenance provision is unambiguous.
Kenneth argues that the phrase indicates that “the maintenance amount can be
modified or reduced by the Court.” Teresa, on the other hand, argues that the
phrase “was only meant to speak of the four already enumerated conditions by
which the payments could be terminated or reduced.” An ambiguity does not
arise simply because the parties offer conflicting interpretations. See Grain
Dealers Mut. Ins. Co. v. McKee, 943 S.W.2d 455, 458 (Tex. 1997). An ambiguity
19
exists only if the contract language is susceptible to two or more reasonable
interpretations. Kelley-Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462,
465 (Tex. 1998).
Agreed contractual maintenance provisions will not be terminated or
modified by courts except as provided for in the agreement. See, e.g., Lee, 2015
WL 601054, at *3 (holding contractual maintenance provision in agreed decree,
which provided that husband’s maintenance obligation terminated upon wife’s
death or remarriage, did not terminate on wife’s cohabitation); Ammann, 2010
WL 4260955, at *1–2 (holding contractual maintenance provision in agreed
decree, which provided that husband’s maintenance obligation terminated upon
date certain or wife’s death, did not terminate on wife’s cohabitation); see also
Kee, 307 S.W.3d at 814–15 (holding that because contractual maintenance
agreement did not authorize income withholding from husband, court could not
order it). In contrast, however, when an agreed contractual maintenance
provision does provide for court termination or modification of the contractual
maintenance by limiting continuance of the agreed-upon maintenance “until
further order of the court,” court modification or termination of the agreement is
authorized on common law or statutory grounds unless the agreement elsewhere
expressly prohibits it. See McCollough, 212 S.W.3d at 646–47 (recognizing
agreed contractual maintenance provision authorized judicial modification via bill
of review proceeding); In re Marriage of Udis, 780 P.2d 499, 502 (Colo. 1989)
(holding agreed maintenance provision, which provided for “readjust[ment] as
20
agreed between the parties or determined by the Court,” authorized trial court to
modify contractual maintenance provision on ground of unconscionability); Pohl
v. Pohl, 15 N.E.3d 1006, 1013–14 (Ind. 2014) (construing the phrase “until further
order of the court” as making a contractual maintenance agreement “modifiable
by the [agreement’s] own terms, even though it would not be otherwise”); see
also Hidalgo v. Hidalgo, No. 05-06-00966-CV, 2011 WL 1797621, at *1 (Tex.
App.—Dallas May 10, 2011, no pet.) (mem. op. on remand) (noting that although
agreement provided, “[t]his spousal support shall continue on the first day of the
month and thereafter until the death of either party, or further Order of the
Court[,]” it also stated that the contract’s provisions for spousal support “shall not
be subject to modification or revocation by any court, with the exception of Wife’s
death”).
In Pohl, after recognizing the policy considerations on both sides of the
issue, the Indiana Supreme Court ruled that even in cases in which the trial court
could have unilaterally ordered a maintenance award identical to the one agreed
to by the parties, nonetheless, the court would presume the parties intended their
agreement to be final and nonmodifiable unless they specifically provided
otherwise. 15 N.E.3d at 1013–14. The Pohl court held, however, that a
contractual maintenance provision requiring payments to continue “until further
order of the court” or “agreement of the parties” made the provision modifiable by
its own terms. Id. at 1014. The Pohl court explained,
21
But here, the Addendum does contain precisely such a provision,
calling for Barbara’s payments to continue “until further order of the
court or agreement of the parties” (emphasis added). Because
“further order of the court” is expressed in the alternative to
“agreement of the parties,” we should construe the contract in a way
that gives each term independent meaning, rather than rendering
one surplusage. E.g., Whitaker v. Brunner, 814 N.E.2d 288, 294
(Ind. Ct. App. 2004), trans. denied (“We read the contract as a whole
and will attempt to construe the contractual language so as not to
render any words, phrases, or terms ineffective or meaningless.”).
And here, we would be hard pressed to ascribe any independent
meaning to the “further order of the court” provision unless it serves
the same purpose as similar language in the incapacity maintenance
statute, which permits modification of such awards by making them
“subject to further order of the court.” I.C. § 31–15–7–2(1); Haville v.
Haville, 825 N.E.2d 375, 378 n.2 [(Ind. 2005)]. Accordingly,
maintenance under the Addendum is modifiable by the Addendum’s
own terms, even though it would not be otherwise.
Id.; see John J. Michalik, Annotation, Divorce: Power of Court to Modify Decree
for Alimony or Support of Spouse Which Was Based on Agreement of Parties, 61
A.L.R. 3d 520 (1975).
Turning to the express language used by Kenneth and Teresa in their
Contractual Maintenance provision, they agreed that Kenneth’s obligation could
cease “upon further orders of the Court affecting the spousal maintenance
obligation, including a finding of cohabitation by Teresa.” If Kenneth and Teresa
had intended to limit the modification and termination of Kenneth’s contractual
maintenance payments to only either party’s death, Teresa’s remarriage,
Teresa’s cohabitation, or when Teresa begins receiving the Kimberly Clark
pension, they could have easily done so by simply omitting the words “further
orders of the Court affecting the spousal maintenance obligation, including a
22
finding of.” See, e.g., Hidalgo, 2011 WL 1797621, at *1 (addressing contractual
maintenance provision that was nonmodifiable because it stated it would “not be
subject to modification or revocation by any court, with the exception of Wife’s
death”); see also Croom v. Croom, 406 S.E.2d 381, 382 (S.C. Ct. App. 1991)
(addressing contractual maintenance provision that was nonmodifiable because
it stated that it was “not modifiable by the parties or any court without written
consent of the Husband and Wife”). The Waldrops’ Contractual Maintenance
provision contains no language making it expressly nonmodifiable despite the
“further orders of the court” language.
Because Kenneth and Teresa used the language “further orders of the
Court affecting the spousal maintenance obligation, including a finding of” as one
possible end point for Kenneth’s $3,000 monthly maintenance obligation, we
must give this language some effect; we cannot construe the Contractual
Maintenance provision as if this language did not exist.8 See Philadelphia Indem.
Ins. Co. v. White, 490 S.W.3d 468, 477 (Tex. 2016) (“[W]e strive to construe
contracts in a manner that avoids rendering any language superfluous.”). And
here, we would be hard pressed to ascribe any independent meaning to this
language unless it authorizes the trial court to sign an order modifying Kenneth’s
8
Teresa’s interpretation of the Contractual Maintenance provision treats
this language as nonexistent, as if cohabitation is the only term in this listed
circumstance supporting modification or termination of Kenneth’s obligation.
23
maintenance obligation in some respect. See Coker, 650 S.W.2d at 393; Perry,
512 S.W.3d at 527; see also Pohl, 15 N.E.3d at 1013–14.
This construction of the Waldrops’ Contractual Maintenance provision is
consistent with the provision’s “including a finding of cohabitation by Teresa”
language. [Emphasis added.] General rules of contract construction provide that
the terms “includes” and “including” are terms of enlargement and not of
limitation or exclusive enumeration, and the use of those terms does not create a
presumption that components not expressed are excluded. See Tex. Gov’t Code
Ann. § 311.005(13) (West 2013). The language used by Kenneth and Teresa in
their Contractual Maintenance provision provides that Kenneth’s $3,000 monthly
maintenance obligation continues “until the earliest of one of the following events
occurs” and includes in the list of events “further orders of the Court affecting the
spousal maintenance obligation, including a finding of cohabitation by Teresa.”
[Emphasis added.]
In summary, the language chosen by the parties—that “Kenneth Ray
Waldrop is ordered to pay . . . maintenance . . . until the earliest of one of the
following events occurs: . . . 3. further orders of the Court affecting the spousal
maintenance obligation, including a finding of cohabitation by Teresa Waldrop”—
has a certain and definite legal meaning: that the parties agreed and
contemplated that the payment obligation under the Contractual Maintenance
provision could be modified by a subsequent, further order of the trial court. See
Coker, 650 S.W.2d at 393; Perry, 512 S.W.3d at 528; see also Pohl, 15 N.E.3d at
24
1015 (“If divorcing parties want to make judicial modification available for their
maintenance agreements, they must say so in their contract—as the parties did
here.”). This language is not ambiguous; it clearly vests the trial court with
authority to subsequently judicially modify Kenneth’s payment obligation under
the Contractual Maintenance provision. See Coker, 650 S.W.2d at 393; Perry,
512 S.W.3d at 528; see also Pohl, 15 N.E.3d at 1015. Therefore, although
Kenneth’s declaratory judgment action pleaded for clarification of “the rights and
obligations of both parties, to provide a date certain of when the maintenance
obligation ends, or alternatively, to define the criteria for terminating or reducing
the maintenance obligation,” the trial court did not address this aspect of
Kenneth’s declaratory judgment action because it erroneously determined that
the Contractual Maintenance provision “refers only to one instance of
modification of the amount of support, and that is to the equal offset reduction
provided by the Kimberly Clark Pension upon the beginning of [Teresa] receiving
her benefit.” Because the Contractual Maintenance provision can be modified by
further court order absent either party’s death, Teresa’s remarriage, Teresa’s
cohabitation, or when Teresa begins receiving the Kimberly Clark pension, we
sustain Kenneth’s second issue.
Because we sustain Kenneth’s second issue, we will remand this case
back to the trial court for a determination of whether Kenneth’s maintenance
obligation should be modified or terminated by further orders of the court. We
leave it to the trial court’s discretion, as did the parties in the Contractual
25
Maintenance Provision, to determine whether Kenneth’s maintenance obligation
should be terminated or modified and to determine the amount, if any, of a
modification.9 See, e.g., Marriage of Udis, 780 P.2d at 502 (explaining language
in contractual maintenance provision authorized judicial modification on ground
of unconscionability); Pohl, 15 N.E.3d 103–14 (explaining language in contractual
maintenance provision authorized judicial modification on same grounds as
incapacity maintenance statute); Schwartz v. Schwartz, 247 S.W.3d 804, 806
(Tex. App.—Dallas 2008, no pet.) (explaining language in contractual
maintenance provision authorized judicial modification upon consent of the
9
We share some of the concerns and sentiments expressed in the
concurring and dissenting opinions. We would like to assist the trial court by
enunciating criteria for its consideration in whether to terminate or to modify
Kenneth’s maintenance obligation. But, although Kenneth’s pleadings in the trial
court expressly sought such a declaration, the trial court correctly did not rule on
it. The Uniform Declaratory Judgments Act gives the trial court no power to pass
upon hypothetical or contingent situations or to determine questions not then
essential to the decision of an actual controversy, even though such questions
may in the future require adjudication. See, e.g., Riner v. City of Hunters Creek,
403 S.W.3d 919, 922 (Tex. App.—Houston [14th Dist.] 2013, no pet.). Because
the trial court declared that “further orders of the Court” could be entered only
upon either party’s death, Teresa’s remarriage, a finding of cohabitation by
Teresa, or Teresa’s receipt of payments from the Kimberly Clark pension, it had
no power to pass on the hypothetical, contingent situation of what equitable or
legal criterion it might apply if the “further orders of the Court” language did
authorize it to terminate or modify Kenneth’s maintenance obligation. Because
the trial court did not address this aspect of Kenneth’s request for declaratory
relief, because the trial court’s judgment does not rule on it, because the trial
court made no findings of fact or conclusions of law on it, and because the
parties did not brief it on appeal, it is simply not teed up for our disposition in this
appeal. Therefore, we decline to address it. See Tex. Civ. Prac. & Rem. Code
Ann. § 37.010 (West 2015) (providing that declaratory judgments are reviewed
under the same standards as other judgments).
26
parties or upon a showing of fraud, accident, or mutual mistake of fact);
McCollough, 212 S.W.3d at 647 (explaining language in contractual maintenance
provision authorized judicial modification via bill of review).
VI. WHETHER THE TRIAL COURT ERRED BY CONCLUDING
THAT CHAPTER 8’S STANDARD WAS NOT MET
In his third issue, Kenneth argues that the trial court erred by concluding, in
the alternative, that if chapter 8 applied, then under chapter 8 Kenneth had not
shown a material and substantial change in his circumstances as required to
trigger modification of his $3,000 monthly maintenance obligation.10 See Tex.
Fam. Code Ann. § 8.057(c) (providing that trial court may modify order or portion
of a decree providing for maintenance on a proper showing of a material and
substantial change in circumstances). We have held that the Waldrops’
Contractual Maintenance provision is not subject to chapter 8. Therefore, the
trial court’s alternative holding applying chapter 8 was in error. We sustain
Kenneth’s third issue.
10
The trial court’s conclusion of law number 8 states:
Although the Court interprets that the Final Decree contains
provisions regarding contractual alimony, and not spousal
maintenance as defined by Chapter 8 of the Texas Family Code, the
Court alternatively finds that a material and substantial change in
circumstances was not proven by [Kenneth] in order to decrease
[Kenneth’s] spousal maintenance obligation (if such obligation
existed).
Conclusion of law 8 is not supported by any findings of fact.
27
VII. WHETHER THE TRIAL COURT ERRED BY
AWARDING ATTORNEY’S FEES TO TERESA
In his fourth issue, Kenneth argues that the trial court erred by awarding
attorney’s fees to Teresa. Because we have sustained Kenneth’s second and
third issues and because we will reverse in part the trial court’s final order on
Kenneth’s declaratory judgment action, we likewise reverse the trial court’s
award of attorney’s fees to Teresa and remand that issue back to the trial court.
See Grohman-Kahlig v. Kahlig, No. 04-07-00468-CV, 2008 WL 5377704, at *1
(Tex. App.—San Antonio Dec. 17, 2008, no pet.) (mem. op.) (op. on reh’g)
(“[B]ecause we reverse the portion of the trial court’s judgment granting the
declaratory relief, we also reverse the award of attorney’s fees and remand the
cause to determine, in part, what award of attorney’s fees, if any, is equitable and
just in light of our holdings.”) (internal quotation omitted); SAVA Gumarska in
Kemijska Industria D.D. v. Advanced Polymer Scis., Inc., 128 S.W.3d 304, 324
(Tex. App.—Dallas 2004, no pet.) (“[W]hen we reverse a declaratory judgment
and the trial court awarded attorney’s fees to the party who prevailed at trial, we
may remand the attorney’s fee award for reconsideration in light of our
disposition on appeal.”). We sustain Kenneth’s fourth issue.
VIII. CONCLUSION
Having overruled Kenneth’s first issue, we affirm the portion of the trial
court’s final order on Kenneth’s declaratory judgment declaring the Contractual
Maintenance provision to be purely contractual. Having sustained Kenneth’s
28
second, third, and fourth issues, we reverse the portion of the trial court’s final
order on Kenneth’s declaratory judgment declaring that the “further orders of the
court, including” language does not authorize the trial court to modify the
Contractual Maintenance provision, we reverse the trial court’s alternative
declaration that chapter 8 applies, and we reverse the award of declaratory-
judgment attorney’s fees to Teresa. We remand this case back to the trial court
for a determination of whether Kenneth’s maintenance obligation should be
modified or terminated by further orders of the trial court and to determine an
award of attorney’s fees, if any, for either of the parties.
/s/ Sue Walker
SUE WALKER
JUSTICE
EN BANC11
SUDDERTH, C.J., filed a dissenting opinion in which PITTMAN, J., and LEE
ANN DAUPHINOT (Senior Justice, Retired, Sitting by Assignment) join.
MEIER, J., filed a concurring opinion.
BIRDWELL, J., joins Parts I-IV of the majority opinion—and Part V, with the
exception of the disposition—but would affirm the trial court’s judgment because
Kenneth did not prove a material and substantial change in circumstances
justifying further orders of the court, which is the statutory burden the parties
incorporated into their contractual maintenance provision.
DELIVERED: June 7, 2018
11
The constitution of the en banc court for this appeal consists of all
members of the court and Senior Justice Lee Ann Dauphinot and Justice
Rebecca Simmons (sitting by assignment). See Tex. R. App. P. 41.2(a).
29