Lussier v. Lussier

807 A.2d 374, 174 Vt. 454, 2002 Vt. LEXIS 145
CourtSupreme Court of Vermont
DecidedJune 21, 2002
DocketNo. 01-416
StatusPublished
Cited by6 cases

This text of 807 A.2d 374 (Lussier v. Lussier) is published on Counsel Stack Legal Research, covering Supreme Court of Vermont primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lussier v. Lussier, 807 A.2d 374, 174 Vt. 454, 2002 Vt. LEXIS 145 (Vt. 2002).

Opinion

Plaintiff Catherine Lussier appeals from an order of the Chittenden Family Court declaring void plaintiffs “entitlement order” drawn on a trust account created by her former husband, Francis Lussier, demanding that the corpus of the trust be transferred to her; enjoining plaintiff from attempting to obtain control of defendant’s assets in the trust account; and ordering plaintiff to pay defendant’s legal fees. Plaintiff argues that the family court was without jurisdiction to hear this matter, that she was entitled to exercise control over defendant’s account, and that because the court erred in its order below, the payment of attorney’s fees ought to be reversed. We affirm.

The parties were divorced pursuant to a final order of the Chittenden Family Court on December 15, 2000. The final order provided, in part, that defendant pay plaintiff maintenance in the amount of $75,000 per quarter until 2012. The maintenance obligation would not terminate in the event of defendant’s death, but would terminate in the event of plaintiff’s death. To secure the maintenance, the original divorce order required defendant to establish a trust account of sufficient value, in which plaintiff would hold a perfected lien. Automatic distributions were to be made to plaintiff according to the schedule set by the order.

To fulfill the family court’s order, the parties executed several documents. First, defendant established the Lussier Trust, a revocable trust containing assets in an account held by Salomon Smith Barney sufficient to pay defendant’s obligations under the final order. To perfect plaintiffs lien on the account, a [455]*455Security Agreement signed by both parties gave plaintiff a first and exclusive security interest in the trust account. The trust also executed an Account Control Agreement that set out in greater detail the assets in the account, Salomon Smith Barney’s responsibility to pay on demand, and the plaintiff’s ability, as the secured party, to give Salomon Smith Barney entitlement orders to the account.

On July 13,2001, relying on a provision in the Account Control Agreement, plaintiff issued an entitlement order to Salomon Smith Barney ordering it to transfer all of the assets in the trust account, approximately $3.5 million, to an account in her name. Defendant was not in default under the terms of the final order. After defendant filed several motions to prevent this transaction, the family court issued a temporary order declaring the entitlement order null and void, and ordering plaintiff not to take any actions to obtain possession or title to the assets in the account. The family court ruled that defendant had not defaulted on his maintenance obligation, and that plaintiff was not entitled to accelerate the maintenance award to a lump sum payment rather than the quarterly awards ordered by the court. On August 7, 2001, the court made that order final following a hearing. Plaintiff appeals.

Plaintiff argues that the Account Control Agreement was an independent contract entered into after the divorce was final and therefore outside the jurisdiction of the family court. Plaintiff also claims that the plain language of the Account Control Agreement gives her the exclusive right to control the account by issuing entitlement orders to Salomon Smith Barney. The entitlement order that she issued directing that the account be turned over to an account in her name, she contends, was part of that Agreement. She claims the family court erred in construing the Account Control Agreement as only a security agreement that is part of the final divorce order. Finally, she argues that the court erred in ordering her to pay attorney’s fees.

When parties to a divorce stipulate to the terms of the dissolution of their marriage, we will honor the agreement under the ordinary rules of contract. Duke v. Duke, 140 Vt. 543, 546, 442 A.2d 460, 462 (1982). As such, the agreements must be interpreted according to the parties’ intent as expressed in the writing. Hamelin v. Simpson Paper (Vermont) Co., 167 Vt. 17, 19, 702 A.2d 86, 88 (1997). We find no support in the facts of this case for plaintiff’s claim that the Account Control Agreement gives plaintiff a right to control the assets of the trust account independent of the provisions of the final order of the family court, and is therefore outside the jurisdiction of the court. The final order describes in detail the financial mechanism by which plaintiffs maintenance would be provided. That' order includes the requirement that defendant establish an account at Salomon Smith Barney in which plaintiff would hold a perfected lien, and that each party execute whatever documents are “necessary to establish and maintain such account and security interest.” To comply with the order, the parties executed the Security Agreement to ensure that plaintiff will continue to receive her maintenance payments in the event defendant defaults or dies before the end of the period specified in the divorce order. The Security Agreement specifically references the final divorce order, the provisions of which impose the obligation to provide plaintiff with maintenance through a secured interest in a trust account. Further, the Security Agreement states that the Account Control Agreement was created to further describe the account and the security interest and to perfect the security interest.

It is within this context that the Account Control Agreement on which plaintiff relies was signed. The document itself describes the security interest that has [456]*456been created for plaintiff and states that the account control provisions are “in connection therewith.” By its terms, the Account Control Agreement is an extension of the security agreement between the parties, as required by the divorce order. It describes the assets in the account and notes that the “[a]ssets are pledged according to the terms of the Security Agreement.” The provision at issue here, on which plaintiff asserts her right to the corpus of the trust, is to protect Salomon Smith Barney, as the administrator of the account, from liability for responding to a payment demand that may have been issued wrongfully. Thus, if Salomon Smith Barney had transferred the $3.5 million dollars in the account to plaintiff, it would not be liable to the trust, even if plaintiffs actions were in violation of the final divorce order. Despite plaintiffs argument, the provision on entitlement orders was not intended, under the circumstances here, to create a light in plaintiff to the money in the account different from the rights she has under the final divorce order. Indeed, it is clear that the trust was established to pay plaintiffs maintenance from the interest generated by the corpus, so that defendant’s principal would remain at the end of his obligation. Plaintiff had no light to the entire corpus of the trust at the time of her order. Nor was the Account Control Agreement intended to convey any authority to plaintiff outside the context of the security interest in the trust account. Cf. In re Stacey, 138 Vt. 68, 72, 411 A.2d 1359, 1361 (1980) (in contract interpretation courts look to overall context and all material parts). It is a mechanism to implement the terms of the final order and security agreement, should it be necessary to do so.

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Cite This Page — Counsel Stack

Bluebook (online)
807 A.2d 374, 174 Vt. 454, 2002 Vt. LEXIS 145, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lussier-v-lussier-vt-2002.