Argued
February 19, 2019
Page 494
The
Superior Court, Judicial District of Stamford-Norwalk,
Heller, J.
Page 495
Edward
M. Kweskin, with whom, on the brief, was Sarah Gleason, for
the appellant (defendant).
Samuel
V. Schoonmaker IV, with whom, on the brief, was Wendy Dunne
DiChristina, for the appellee (plaintiff).
Robinson,
C. J., and McDonald, DAuria, Mullins, Kahn and Ecker, Js.
OPINION
McDONALD,
J.
[334
Conn. 345] This postdissolution matter stems from the
parties oral stipulation following a motion for modification
of alimony, the trial courts adoption of that stipulation as
a court order, and subsequent litigation efforts by the
defendant, Gregory Puff, on one hand, to carry the order into
effect, and by the plaintiff, Claudia Puff, on the other
hand, to challenge the order. At issue is the trial courts
decision granting the defendants motion for sanctions and
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for contempt and awarding him more than $169,000 in
attorneys fees and expert fees, i.e., all the litigation
expenses he had incurred following the entry of the order
adopting the stipulation. In his certified appeal, the
defendant challenges the Appellate Courts judgment reversing
the judgment of contempt. See Puff v. Puff, 177
Conn.App. 103, 129, 171 A.3d 1076 (2017). He contends that
the award was based on a broader course of conduct than the
one part of the order considered by the Appellate Court and
that the trial courts award was proper. On the basis of the
trial courts articulation ordered by this court, we conclude
that, insofar as the award is based on contempt, it cannot
stand on any of the grounds articulated by the trial court.
Insofar as the award is based on litigation misconduct, it
lacks the requisite findings. We therefore affirm the
Appellate Courts judgment but direct that court to remand
the case to the trial court for further proceedings on the
defendants motion for sanctions for litigation misconduct.
I
The
record reveals the following facts, either found by the trial
court or otherwise undisputed. The parties fourteen year
marriage was dissolved in 2002. The judgment of dissolution
incorporated a separation agreement, under which the
defendant was obligated to pay periodic alimony of $5900 per
month for a period of ten years, plus biannual payments
totaling an additional [334 Conn. 346] $10,000 for that same
period.[1] In 2009, three years before those
obligations were to terminate, the plaintiff filed a motion
seeking to modify the alimony related orders. The grounds
alleged for the modification were an increase in the
defendants income and the plaintiffs deteriorating health
due to a recent diagnosis of a serious medical issue. The
trial court, Emons, J., granted the motion,
increasing the monthly alimony to $6100 and extending the
duration of those payments to February, 2016, with both the
amount and the duration not subject to further modification.
Weeks after that decision was issued, the plaintiff filed a
motion to open and vacate the judgment on the ground that the
defendant had not disclosed to the court an imminent offer of
employment at considerably higher compensation, which became
final days after the modification was ordered. The court
granted the motion in April, 2013, opening the judgment for
the purpose of hearing new evidence.[2]
A
Entry
of an Oral Stipulation as a Court Order
In
February, 2014, the parties and their counsel appeared before
the court, requesting to put an oral stipulation on the
record that they had negotiated. The
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[334 Conn. 347] defendant was represented by Edward M.
Kweskin, and the plaintiff was represented by Norman Roberts.
Kweskin made prefatory remarks about the agreement before
stating the particulars on the record. He stated that it was
the parties intention to have the court enter the
stipulation as an order if the court were to approve it. He
explained that this process was intended to confirm the terms
on which the parties had agreed before the defendant returned
to his foreign residence. Kweskin stated that the parties
intention was to distill the agreement into writing, after
experts had been consulted on certain mechanics of the
agreement still to be determined, and to have any disputes
about the writing brought to the court for resolution
consistent with the oral stipulation. He made clear, however,
that the parties intended for the stipulation to be an
enforceable order that was not conditioned on the execution
of the written agreement.
Kweskin
then recited the twelve paragraphs that comprised the
stipulation, while Roberts weighed in with any clarifications
that he thought necessary. The principal substantive terms of
the stipulation were as follows. The defendant was required
to pay, along with certain other obligations, $10,000 per
month for a period of ten years, as alimony taxable to the
plaintiff and tax deductible by the defendant. The plaintiff
had the right to assign those payments to a special needs
trust.[3] The defendant would be made a residual
beneficiary of the trust, in the same proportion to the
payments that he had made to the trust. In order for the
defendant to be secure in his right to a tax deduction under
present law or in the event of changes to the law, should any
tax deduction be disallowed, he had the right to recoup from
the trust the value of that deduction and any penalties [334
Conn. 348] assessed if sufficient offsets could not be made
from pending payment obligations to the plaintiff.
The
defendant also was obligated to make a specific contribution
toward the attorneys fees of a designated special needs
trust attorney. His counsel had the right to review the terms
of the trust before it was executed by the plaintiff to
ensure that the trust conformed to the terms of the oral
stipulation.
The
stipulation obligated the plaintiff to "immediately ...
secure or endeavor to secure a legal opinion that the
deductibility by the defendant of the alimony is not impacted
by any action taken by the plaintiff to assign the alimony to
the trust." Counsel acknowledged that the mechanics of
transferring the alimony by means that would ensure the
deduction had not yet been determined, but the stipulation
further provided that, "in order to accomplish the
deductibility ... the parties, through counsel, will work in
good faith to achieve [that method], with the result that the
defendant shall have the right [under federal tax law] to
deduct the alimony ...."
Roberts informed the court that he had been told that the tax
deduction would not be a problem and that they were in the
process of getting an opinion letter. Roberts explained that
"the linchpin of this whole deal is that [the defendant]
wants the income tax deduction on the $10,000 a month ... and
that [the plaintiff] wants to actually receive the $10,000 a
month. You can imagine that the delta between those two
things, given what the financial affidavits look like, is
somewhere in the neighborhood
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of 40, 45 percent. So its really, really important to each
of these people to have the tax treatment that we believe,
and have both been advised, exists. In order
[to ] sign off on paragraph 10 [allowing
the defendant to recoup disallowed deductions and penalties],
[the plaintiff], in an, I dont even think its [334 Conn.
349] abundance of caution, just some, in prudent practice, is
going to get an opinion letter from a special needs and a tax
person, who will opine that, yes, [the defendants]
deductibility is not impacted at all by the scheme that we
contemplate." (Emphasis added.) Just before Kweskin put
the recoupment, or safety net, provision on the record,
Roberts stated that this provision "is the reason that
we are going to need the opinion letter before this can
be done. " (Emphasis added.)
After
the stipulation was read into the record, the court canvassed
the parties. It inquired whether their counsel had discussed
the terms of the stipulation with them, whether they
understood the terms, and whether they agreed that the terms
were fair and equitable. The parties gave affirmative
responses to each question. The plaintiff asked only one
question, obtaining confirmation that she would be receiving
$10,000 per month for ten years. The court then approved and
ordered the stipulation. The court suggested that the parties
"probably should have the full agreement with the terms
of the trust ... also so ordered by the court."
B
The
Defendants Motion for Order and the Plaintiffs Objection
Thereto
In
April, 2014, approximately two months after this order was
entered, Roberts sought permission to withdraw as the
plaintiffs counsel, which the court granted the following
month. In May, 2014, the defendant filed a motion for order,
asking the court to approve a written embodiment of the oral
stipulation prepared by his counsel, a copy of which had been
provided to the plaintiff on that date. The day before a June
hearing on the motion, the plaintiff, through new counsel,
Amy J. Greenberg, filed an objection. Although the objection
addressed the defendants proposed draft, asserting that it
contained certain additions or omissions that [334 Conn. 350]
rendered it nonconforming to the oral stipulation, its
principal thrust was numerous arguments as to why the
stipulation itself was not binding or could not be enforced.
The plaintiff claimed that, unbeknownst to the parties when
they drafted the stipulation, it was impossible either to
create a legally valid special needs trust or to afford the
defendant a tax deduction for the alimony under the terms of
the stipulation.[4] She further contended that the
stipulation was too ambiguous and contained too many unknowns
to result in an enforceable agreement, that these
uncertainties precluded the parties knowing consent, that
the terms were unconscionable,[5] and that the canvass of
the plaintiff had been insufficient. The plaintiff asserted
that the defendants motion for order
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should be denied and that the stipulation should be vacated.
The
trial court held a hearing on the defendants motion for
order in June, 2014. Greenberg argued, among other things,
that viability of the stipulation was dependent on the
availability of the tax deduction and that, after the oral
stipulation was made, Roberts had obtained an expert opinion
from an accountant that the alimony would not be deductible
under the oral stipulations terms. In response to Kweskins
claim that he had never seen this opinion, Greenberg
countered that Kweskin had been made aware of it, claiming
that Roberts records reflected communications between [334
Conn. 351] counsel regarding the opinion and whether the
defendant would be willing to forgo the residuary benefit to
save the tax deduction. The court declined to address this
matter, concluding that it was probably necessary to address
the issues before the court in two steps, first determining
whether the defendants written stipulation accurately
reflected the oral stipulation and then considering arguments
as to why the agreement could not be carried out. The court
acknowledged that the plaintiffs objection had included
arguments as to discrepancies between the oral stipulation
and the defendants written stipulation and indicated that
those concerns would be considered. The court scheduled
another hearing on the matter for a later date.
C
The
Plaintiffs Motion To Open and Vacate the ...