Wednesday, August 5, 2009
C.A. Rules Access to Retirement Accounts Not ‘Material Change’
By SHERRI M. OKAMOTO, Staff Writer
A 62-year-old Corona Del Mar woman who reached the age entitling her to access a retirement account she co-owned with her former husband had not experienced a material change of circumstances allowing modification of their dissolution order, the Fourth District Court of Appeal ruled yesterday.
Reversing a post-judgment order by Orange Superior Court Judge Clay M. Smith modifying a stipulated judgment dividing the community property of Park Dietz and Laura Dietz, Div. Three explained that Laura Dietz’s ability to access the retirement accounts on a penalty‑free basis and an increase in the values of those accounts were insufficient grounds to permit a reduction in her spousal support.
The 1999 stipulated judgment addressed custody of Park and Laura Dietz’s then-16‑year‑old son, spousal support and the division of certain assets. It provided that Park Dietz would pay spousal support of $16,500 per month commencing Oct. 1, 1998 and continuing until the death of either spouse, Laura Dietz’s remarriage or further order of the court.
This support was based upon Laura Dietz’s lack of any income and Park Dietz’s monthly income of $87,721 from his job as a forensic psychiatrist.
In October 2002 the pair entered into a stipulation to modify the prior stipulated judgment, which was accepted by the trial court. The modified judgment stated that each would receive “one‑half of the community interest in the retirement plans accumulated by the parties during the marriage…and any increase or decrease in value of such assets related to market conditions.”
About five years later, Park Dietz sought a court order terminating or, alternatively, reducing his spousal support obligation.
At the hearing, Laura Dietz testified that she was 62-years old, had not been employed for over 13 years, and suffered from a respiratory illness which prevented her from working.
The trial court commented that “at first glance the circumstances really don’t seem to be that much different from what they were in 1999 when the prior support order was entered,” but found a material change of circumstances had occurred because Laura Dietz’s marketable securities investment account had increased by about $220,000 and she had reached the age at which she could begin to use her share of the retirement assets accumulated during marriage without penalty in order to provide for her support.
Although Smith noted the undisputed evidence that Laura Dietz was unable to work due to her health condition, he also stated, “[g]iven her assets, one could certainly conclude that she has every ability to be self‑sufficient, even without going out into the workforce. Certainly, with $4 million—not less than a $4 million estate—normally one would be expected to be self-sufficient, even if he or she were unable to work in the normal sense.”
Based on the increase in value of Laura Dietz’s securities and the estimated $500,000 in retirement assets available to her, the trial court ordered that Park Dietz’s spousal support obligation could be reduced by $3,000 without affecting his ex-wife’s standard of living. Smith also denied Laura Dietz’s request that her former husband contribute toward her attorney fees and costs.
Writing for the appellate court, Justice Richard D. Fybel said the trial court erred in finding the accessibility and increased value of the retirement accounts awarded to Laura Dietz in the stipulated judgment constituted a material change of circumstances justifying a decrease in spousal support, because Smith was bound to give effect to the parties’ intent and expectations as expressed in the stipulated judgment.
As the stipulated judgment representing the Dietzes’ bargained-for exchange expressly awarded each equal shares of the retirement accounts, plus any increase in their values, and the evidence was undisputed that Park Dietz’s income had significantly increased while Laura Dietz remained unemployed, Fybel concluded there had not been a material change in circumstances based on the accessibility and value of Laura Dietz’s share of the retirement accounts.
Joined by Justices Kathleen O’Leary and Richard M. Aronson, he remanded the issue of whether the stipulated judgment had addressed the securities the trial court had considered as Laura Dietz’s property and directed the trial court to also reconsider her request for attorney fees under the appropriate standard.
The case is In re Marriage of Dietz, G040640.
Copyright 2009, Metropolitan News Company