Hennepin County District Court

File No. DC177233

Michael Ormond, Ormond Law Offices, 300 Sexton Building, 529 South Seventh Street, Minneapolis, MN 55415 (for Appellant)

Susan M. Lach, Messerli & Kramer, P.A., 1800 Fifth Street Towers, 150 South Fifth Street, Minneapolis, MN 55402 (for Respondent)

Considered and decided by Willis, Presiding Judge, Schumacher, Judge, and Foley, Judge.

Appellant claims the referee erred in modifying maintenance, determining the portion of his pension that can be treated as income, and awarding respondent attorney fees. We affirm in part, reverse in part, and remand.

Whether to modify maintenance is discretionary with the district court. Claybaugh v. Claybaugh, 312 N.W.2d 447, 449 (Minn. 1981). To modify temporary maintenance to permanent maintenance, the moving party must show a substantial change in circumstances and that the change renders the existing award unreasonable and unfair. Beck v. Kaplan, 566 N.W.2d 723, 725 (Minn. 1997). Stipulated maintenance obligations are accorded deference in modification proceedings. Kaplan, 566 N.W.2d at 726. Where, as here, a stipulated judgment refers to a possible future modification, the deference is not as great. See Ganyo v. Engen, 446 N.W.2d 683, 687 (Minn. App. 1989) (admitting deference to stipulated maintenance, but affirming modification of stipulated maintenance noting the stipulation "anticipated judicial review"). Here, the stipulated judgment anticipated review of its maintenance award.

Respondent's failure to rehabilitate within five years, as contemplated by the judgment, satisfies the requirement of changed circumstances. Hecker v. Hecker, 568 N.W.2d 705, 709-10 (Minn. 1997).[3]

Susan M. Lach, Messerli & Kramer, P.A., 1800 Fifth Street Towers, 150 South Fifth Street, Minneapolis, MN 55402 (for Respondent)

Considered and decided by Willis, Presiding Judge, Schumacher, Judge, and Foley, Judge.

Appellant claims the referee erred in modifying maintenance, determining the portion of his pension that can be treated as income, and awarding respondent attorney fees. We affirm in part, reverse in part, and remand.

Whether to modify maintenance is discretionary with the district court. Claybaugh v. Claybaugh, 312 N.W.2d 447, 449 (Minn. 1981). To modify temporary maintenance to permanent maintenance, the moving party must show a substantial change in circumstances and that the change renders the existing award unreasonable and unfair. Beck v. Kaplan, 566 N.W.2d 723, 725 (Minn. 1997). Stipulated maintenance obligations are accorded deference in modification proceedings. Kaplan, 566 N.W.2d at 726. Where, as here, a stipulated judgment refers to a possible future modification, the deference is not as great. See Ganyo v. Engen, 446 N.W.2d 683, 687 (Minn. App. 1989) (admitting deference to stipulated maintenance, but affirming modification of stipulated maintenance noting the stipulation "anticipated judicial review"). Here, the stipulated judgment anticipated review of its maintenance award.

Respondent's failure to rehabilitate within five years, as contemplated by the judgment, satisfies the requirement of changed circumstances. Hecker v. Hecker, 568 N.W.2d 705, 709-10 (Minn. 1997).[1] Appellant, however, claims this change does not render the existing award unreasonable and unfair because, according to his unrebutted vocational assessment of his wife, she could have rehabilitated by taking a different job. See Hecker, 568 N.W.2d at 710 n.4 (temporary maintenance recipients have obligation to make reasonable efforts to become self-supporting and requirement "is even more appropriate when the temporary maintenance award is the product of the parties' negotiated stipulation").

Appellant's unrebutted vocational assessment of respondent is described in the referee's order, but the referee does not otherwise address the assessment. In light of Hecker, we remand for the district court to address explicitly the assessment and whether respondent has made a reasonable attempt to become self-supporting.[2]

3. The property division set out in the judgment apparently awarded respondent the house in exchange for awarding appellant his pension. A pension-for-house exchange is the "present cash value method" of dividing property and is defined as:

[awarding] the employee spouse the pension and assign[ing] the non-employee spouse assets of a value equal to a portion of the present value of the [pension] benefits.

Dubois v. Dubois, 335 N.W.2d 503, 505 (Minn. 1983) (emphasis added). "[P]resent value" is a term of art with a precise meaning: "'Present value' discounts an award to that amount which, if presently received, could be invested in order to yield the future sum." Id. at 506. Because the judgment awarded appellant his pension as property, and because Minn. Stat. § 518.54, subd. 3 (1996) defines maintenance as a payment from income, appellant cannot be required to pay maintenance from his pension until he has "received from the pension an amount equivalent to its value as determined in the original property distribution." Kruschel v. Kruschel, 419 N.W.2d 119, 123 (Minn. App. 1988). For Kruschel to be consistent with Dubois, the "value as determined in the original property distribution" must be the "present value" upon which the pension-related portion of the property division is based.

Here, the pension was not valued in the dissolution, but estimates of the pension's value were entered in the modification proceeding. Because the referee valued the pension at $308,150, it appears the referee adopted the value in an actuarial statement that indicates the pension's "DISCOUNTED CURRENT VALUE" is $308,148. Use of this figure to value the pension is suspect for each of at least three reasons: (1) the term "discounted current value" is not defined and it is unclear how it is related, if at all, to the pension's "present value" as of the dissolution; (2) the referee did not address why she used the $308,148 figure when the actuarial statement indicated only $219,611 of the $308,148 figure was marital; and (3) while the actuarial statement's valuation is based on appellant having 26.832 years of pension credit, appellant testified he had 23.5 years of pension credit. On remand, the district court shall determine the present value of appellant's pension as of the dissolution. The district court shall also determine the date when appellant received (or will receive) an amount that is the actuarial equivalent to that present value.

4. The referee ordered appellant to pay $1,000 of respondent's attorney fees based on a disparity between the parties' "income and liquid resources." He claims the award is based on an improper failure to distinguish between income and property. The district court has "considerable discretion" in awarding attorney fees, and "disparate financial circumstances" are a basis for an award of fees. Kaplan, 566 N.W.2d at 727 (citing Kiesow v. Kiesow, 270 Minn. 374, 389, 133 N.W.2d 652, 663 (1965)). On this record, we affirm the award of attorney fees to respondent.

5. Respondent's request for attorney fees on appeal is denied.

6. On remand, whether to reopen the record shall be discretionary with the district court, and any findings made on remand shall comply with Dean. Nothing in this opinion is an expression of how to decide the remanded issues.

Affirmed in part, reversed in part, and remanded.

[ Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.

1] We note Hecker was not released until after oral arguments in this case. Citing various cases, respondent argues that motions to extend maintenance from temporary to permanent are governed by the changed circumstances requirement "unless" a court previously provided for review of the award. While we disagree with respondent's characterization of these cases, in light of Kaplan and Hecker, we do not address them.

[2] The remand to address whether respondent made a reasonable effort to become self-supporting makes it unnecessary to address appellant's challenges to the findings addressing respondent's work history and the possibility that ultimately she may become self-supporting in her current employment. Appellant also challenges certain findings prefaced with "[a]t the hearing, [respondent] testified as follows: * * *." Such findings are not findings of fact but findings of what respondent testified to and are not reviewable. See Dean v. Pelton, 437 N.W.2d 762, 764 (Minn. App. 1989) (findings stated in terms of what party "claims" or "asserts" not "true findings but merely [recitations] of the party's claims" and inadequate for review). To the extent appellant challenges certain other unidentified but "related" findings, because he did not identify the findings in question, he waived his challenge to those findings. See Schoepke v. Alexander Smith & Sons Carpet Co., 290 Minn. 518, 519-20, 187 N.W.2d 133, 135 (1971) (assignment of error based on "mere assertion" and not supported by argument or authority in appellant's brief waived unless error obvious).