Carroll v. Nagatori-Carroll

978 P.2d 814, 90 Haw. 376, 1999 Haw. LEXIS 153
CourtHawaii Supreme Court
DecidedMay 20, 1999
Docket20990
StatusPublished
Cited by6 cases

This text of 978 P.2d 814 (Carroll v. Nagatori-Carroll) is published on Counsel Stack Legal Research, covering Hawaii Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Carroll v. Nagatori-Carroll, 978 P.2d 814, 90 Haw. 376, 1999 Haw. LEXIS 153 (haw 1999).

Opinion

Opinion of the Court by

MOON, C.J.

Plaintiff / cross - defendant - appellant - petitioner John Carroll (Carroll or Husband) appealed from the family court’s denial of a motion for post-decree relief. The Intermediate Court of Appeals (ICA) considered the matter and filed its memorandum opinion on January 2, 1999. See Carroll v. Nagatori-Carroll, No. 20990, — Hawai'i —, — P.2d — (App. Jan. 12, 1999) (mem.). On February 12, 1999, Carroll filed his application for writ of certiorari, wherein he requested this court to reverse only that portion of the ICA’s decision involving “the issue *378 of an award of [his Hawaiian Aviation Contract Services, Inc., (HACS)] stock to Respondent-Wife.”

We granted certiorari on February 19, 1999 and ordered the parties to provide supplemental briefing on the following issue:

Whether the family court erred in awarding the one-half interest in Hawaiian Aviation Contract Services, Inc. (HACS stock) to Wife prior to making a determination of (a) the amounts, if any, that she was entitled to receive under paragraph 10 of the Agreement in Contemplation of Divorce and (b) the value of one-half of [Carroll’s] interest in the HACS stock.

Carroll and his ex-wife, defendant/cross-plaintiff-appellee-respondent Marcia Nagato-ri-Carroll [hereinafter, ex-wife or Wife], filed supplemental briefs with the court on March 22, 1999. In particular, Carroll argues that the ICA erred in allowing the family court to prematurely award ex-wife half of his interest in stock that he owned before making a determination whether she was entitled to any amounts under the Divorce Decree. Ex-wife counters that the ICA correctly affirmed the decision of the family court to award her half of Carroll’s interest in HACS and, moreover, the concerns signaled by this court’s order for supplemental briefing will necessarily be addressed by the family court on remand, pursuant to the ICA’s memorandum opinion and remand order.

For the following reasons, we agree with ex-wife, affirm the decision of the ICA, and issue this opinion to clarify that post-decree sanctions do not necessarily constitute a “re-division” of the marital property awarded pursuant to a divorce decree.

I. BACKGROUND

The following procedural and factual history is taken from the record, the ICA’s memorandum opinion, and the parties’ briefs. Carroll and ex-wife were married on November 24, 1979. The parties executed an Agreement in Contemplation of Divorce (AICD) on August 20, 1992, which merged into the Divorce Decree filed on September 23,1992. 1

The Divorce Decree included various provisions for the enforcement of Carroll’s property division and other obligations. Among his obligations, the Divorce Decree required Carroll to pay premiums on life insurance policies and to make mortgage payments on the marital residence. Additionally, the Divorce Decree provided for the enforcement of these provisions in the event Carroll declared bankruptcy. Specifically, the Divorce Decree provided in pertinent part:

(10) DEBT ... If Husband becomes bankrupt and in doing so deprives Wife of property or benefits conferred hereunder, Husband shall pay Wife such amounts as are necessary to put Wife in a position as favorable as she would have otherwise enjoyed under the terms of this Agreement. Said payment shall be in such form, including alimony, as Wife shall elect, and if elected as alimony shall not be subject to the alimony waiver provisions included in Section (4) of this Agreement.

(Emphases added.)

Following the parties’ divorce, Carroll repeatedly failed to comply with the terms of the Divorce Decree in several respects. Additionally, on March 29, 1994, Carroll commenced Chapter 11 bankruptcy proceedings which were subsequently converted into a Chapter 7 bankruptcy proceeding. On January 24, 1995, ex-wife commenced Adversary Proceeding No. 95-0005 in Carroll’s bankruptcy case, seeking a determination that Carroll’s obligations to ex-wife under the Divorce Decree were nondischargeable in bankruptcy. As described by the Bankruptcy Court in a September 25, 1996 order, Carroll failed to comply with the Divorce Decree in the following relevant respects:

FINDINGS OF FACT

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*379 6. [Carroll] failed to pay the premiums on the Executive Life policy. That policy was canceled. The record does not disclose the present status of the Trans-america policy, for the benefit of the children.
7. Before Bankruptcy, [Carroll] failed to make the marital residence mortgage payments required under the . [AICD]. The lender, First Hawaiian Bank, commenced foreclosure proceedings.
8. Because of [Carroll’s] defaults, [ex-wife] foreclosed her mortgage against [Carroll’s] real property. The foreclosure proceeds received by [ex-wife] totaled $168,942.76, which [ex-wife] used to clear the arrearages on the mortgage on the marital residence.
9. [Carroll’s] failure to make mortgage payments on the marital residence continued. Because [ex-wife’s] income was insufficient to enable her to remain current with mortgage payments to First Hawaiian Bank, [ex-wife] was forced to sell the marital residence.
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11. The net proceeds received by [ex-wife] from the sale of the marital residence and from the foreclosure sale of [Carroll’s] property were less than the capital gains taxes resulting from the sale of the marital residence.
12. On April 11, 1996, [ex-wife’s] counsel wrote a letter to [Carroll’s] counsel which stated that “[t]o the extent that it is decided by the bankruptcy court that [ex-wife] must elect to impose an alimony obligation on [Carroll] in lieu of the property and benefits in order to preserve and protect them against [Carroll’s] bankruptcy, [ex-wife], shall, and does hereby, make said election.”

The Bankruptcy Court also entered the following relevant conclusions of law:

1. Bankruptcy Code Section 523(a)(6) provides in relevant part that “a discharge under [the Code] ... does not discharge an individual debtor from any debt ... to a spouse[ or] former spouse ... for alimony to, maintenance for, or support of such spouse ... in connection with a separation agreement or] divorce decree ....” 11 U.S.C. § 523(a)(5)(1986).
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3. To determine whether an obligation in divorce is in the nature of alimony, maintenance, and support, “the court must look beyond the language of the decree and to the intent of the parties and to the substance of the obligation.'” [In re Shaver, 736 F.2d 1314, 1316 (9th Cir.1984) (emphasis added) ].

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Cite This Page — Counsel Stack

Bluebook (online)
978 P.2d 814, 90 Haw. 376, 1999 Haw. LEXIS 153, Counsel Stack Legal Research, https://law.counselstack.com/opinion/carroll-v-nagatori-carroll-haw-1999.