Halperin v. Halperin

        Rehearing Denied Dec. 2, 1959.

Page 939

       John H. Benckenstein, Beaumont, for appellant.

       Joe H. Tonahill, Floyd W. Addington, Jasper, for appellee.

       McNEILL, Justice.

       The appeal is by Argonaut Underwriters Insurance Company from the judgment rendered upon a jury verdict in the district court of Jasper County awarding appellee J. R. Byerly total and permanent disability in a lump sum under the Workmen's Compensation Law.

       We are met at the outset with a motion by appellee asserting that since Art. 7.01 of our Insurance Code V.A.T.S., which authorized the execution of a supersedeas bond by one surety company was repealed by the Legislature, effective August 23, 1957, and since the bond in the record was executed by only one surety company, it is without validity and the appeal should be dismissed. The bond was executed on April 27, 1959, by appellant as principal and the Indemnity Insurance Company of North America as surety and was approved by the district clerk of Jasper County on April 29, 1959. Ch. 87, p. 146, Acts of the 56th Legislature, Regular Session, reinstated Art. 7.02 of the Insurance Code, effective April 23, 1959, authorizing the execution of bonds by a single surety company and the motion to dismiss is accordingly overruled.        Appellee alleged that on or about April 29, 1958, as an employee of Spencer Construction Company, he was driving a Euclid earth-mover, hauling dirt on a construction project at the McGee Dam site in Jasper County when he received an accidental injury in the course of his employment. The Euclid hauls some 13 tons of dirt at a load and is a large heavy vehicle, the tires of which stand head high. It was alleged that as appellee drove this vehicle along the area and as he held the steering wheel with his left hand and was using his right hand to shift the manual gear of the vehicle, the left front wheel suddenly struck a large rock, spinning the steering wheel violently, catching his left hand therein and terrifically wrenching his left hand, wrist, arm, elbow, left shoulder and other portions of his body, and that said injury has damaged the tissues, tendons, nerves and bony structures of the members mentioned so that he has become totally and permanently disabled. Appellee, who was 47 years of age, testified as to the manner of injury as set out above and that he has been since disabled to work and has suffered much pain, headaches, discomfort and limitation of motion of his left arm and loss of grip in his left hand.

       Appellant's answer asserted that the injuries, if any, were trivial and were specific injuries which did not extend to nor affect other portions of his body, and that if appellee could not perform the usual tasks of a workman, this was caused and brought about solely by his failure to exercise, use, and work his left hand, arm and shoulder, or that disease or other natural causes had brought about his present condition.

       Appellant assigns 26 points of error in its brief, the first six of which are grouped by it in one discussion. In these points it is asserted that the trial court erred in failing to submit an issue inquiring whether appellee sustained a personal injury and an issue inquiring whether the injury was accidental and tendered issues thereon which the court refused. The trial court must have refused these requested issues upon the ground that appellant had 'admitted its liability herein', as found in the judgment. We take it that this conclusion of the court was based upon the answers of appellant to certain requests for admission. Before the trial appellee had requested certain admissions of appellant, II(a) thereof being that he was accidentally injured while working for Spencer Construction Company in Jasper County on or about April 29, 1958, II(b) that he sustained such injury in the course of his employment with said company, II(c) that said injury was an accidental injury to his left hand, arm, shoulder, neck, and other portions of his body. Appellant answered the first two requests that it was without knowledge thereof. The following is answer to request II(c): 'Defendant is without knowledge of this statement in II(c) and says that the plaintiff did report to John N. Ashby that he was injured while driving a loaded Euclid earth-mover when the front wheel struck large rock, causing steering wheel to spin and catch his hand and twisted his left arm and therefore, this defendant denies any other alleged injuries to the plaintiff occurring at such time and place.' We have concluded that the trial court properly held that from the use of this equivocal language appellant impliedly admitted appellee was accidentally injured while in the course of his employment with Spencer Construction Company, but denied the injury except to appellee's left hand and left arm. Montgomery v. Gibbens, Tex.Civ.App., 245 S.W.2d 311. Upon the trial no real question existed as to the fact that appellee received some injury, but the contest centered solely upon its extent. While the submission of the usual issues involving personal injury, whether accidental, and in the course of employment would have been advisable in the present case and would have eliminated much consideration on the part of this court, we are constrained to hold the trial court did not err in refusing said issues.        The remaining contention under its first group of points was the objection by appellant to the submission of Special Issue No. 1 'because the same has no support in the evidence, is a charge upon the weight of the evidence, in that it assumes that the plaintiff sustained some total incapacity, and also assumes that the producing cause of such total incapacity was the injury sustained by him, if any, on or about April 29, 1958.' Special Issue No. 1 given by the court reads:

'Do you find from a preponderance of the evidence that the plaintiff, J. R. Byerly, sustained total incapacity as a natural result of the accidental injury sustained by him in the course of his employment for Spencer Construction Company, Inc. on or about April 29, 1958 in Jasper County, Texas?'

       We have examined the statement of facts and believe that there is sufficient evidence requiring the submission of the issue, in fact appellant now concedes this. (Brief p. 46.) The issue is not upon the weight of the evidence as urged in the above objection. In our judgment Special Issue No. 1 submits both the issues, whether total incapacity was sustained, and whether the injury was the producing cause of the total incapacity. While Rule 277, Texas Rules of Civil Procedure, requires each issue shall be separately submitted, the objection did not urge that it was contrary to this portion of the rule or that it was multifarious. Hodges on Special Issue Submission in Texas, p. 114. Appellant cites the holding of this court in American General Ins. Co. v. Coleman, Tex.Civ.App., 297 S.W.2d 333, at pages 340, 341, that the issue there submitted was error since it involved more than one ultimate fact issue. But this very point was urged in the objection there made.

       Appellant next complains of the court's refusal to submit its requested issues 9 and 10. Its issue 9 is:

'Do you find from a preponderance of the evidence that the incapacity, if any, to the plaintiff's body generally was not caused solely by the injuries to his left hand and left elbow, if any?'

       Its issue 10 is:

'Do you find from a preponderance of the evidence that the incapacity, if any, to the plaintiff generally was not caused solely by injury to his left arm, if any?'

       In submitting the question whether the injury sustained by appellee to his left arm affected other parts of his body, the trial court submitted issues 8 and 9 which, with the answers thereto, are:

'Special Issue No. 8

'Do you find from a preponderance of the evidence that the injury of April 29, 1958 to the plaintiff's left arm affected parts of his body other than the left arm, thereby causing incapacity?

'Answer 'Yes' or 'No'

'Answer: Yes.'

'Special Issue No. 9

'Do you find from a preponderance of the evidence that the injuries to the plaintiff's left arm of April 29, 1958 have extended to and affected other parts of his body thereby naturally resulting in additional disability, if any?

'Answer 'Yes' or 'No'

'Answer: Yes.'

       We think these issues submitted the matter. The requested issues 9 and 10 above were not ultimate issues, answers to which would require a judgment. An issue substantially the same as those in requested issues 9 and 10 was answered by the jury favorably to the insurance carrier in Consolidated Underwriters v. Langley, 141 Tex. 78, 170 S.W.2d 463(5) and the Supreme Court held the issue and its answer was not one upon which judgment may be rendered for the carrier. See also Lumbermen's Mutual Cas. Co. v. Zinn, Tex.Civ.App., 220 S.W.2d 906. Appellant urges that Texas General Indemnity Co. v. Scott, 152 Tex. 1, 253 S.W.2d 651, 652, is authority for its issues 9 and 10. We do not think the cases are similar. The facts as outlined by Justice Smith in the Scott case were as follows:

'Respondent alleged a specific injury to her left foot, and a general injury to her neck. She did not plead and the case was not tried on the theory that the injury to the foot affected other parts of the body * * * Petitioner further alleged in its answer that the injury of plaintiff was confined to and limited to her left foot and that said incapacity to her left foot was temporary and partial * * * any incapacity which plaintiff has had in the past or may have in the future has been and will be caused solely by the incapacity to her left foot.'

       After the jury had found that two separate injuries had occurred the trial court submitted an issue inquiring if the accidental injury was a producing cause of the incapacity. The trial court did not say which injury. The court therefore held that the defendant was entitled to have an issue submitted to the jury inquiring if the injury to the left foot was the sole cause of the incapacity.

       By point 9 appellant asserts that the court erred in refusing to submit its requested issue 15 which is:

       'Do you find from a preponderance of the evidence that the effect of the injuries to plaintiff's left hand and left elbow, if any, were confined to said left hand and left elbow?' If answered 'yes' as no doubt appellant would prefer, it would not be controlling. Appellee testified that in addition to his hand and elbow being hurt, his shoulder and nect were also injured, that his shoulder and neck became sore and painful and bothered him at all times; that a muscle was torn loose in his neck, that he had a knot in his neck, and that his sore shoulder caused his neck to hurt and caused him headaches; that since his accident he does not rest at night and is unable to do manual labor, the only kind of work he could do. A finding, therefore, that the effect of the injuries to appellee's hand and left elbow were confined solely to his hand and elbow without also a finding that he sustained no other injury would amount only to an incomplete defense. Requested issue 15, therefore, was properly refused.

       Point 10 asserts that the court erred in failing to submit an issue whether the injury, if any, was a producing cause of total disability, if any, of appellee and point 11 complains of failure of the court to submit its issue 28 submitting the question. An examination of the above quoted issue No. 1 given by the court reveals that the inquiry was, had Byerly sustained total incapacity, 'as a natural result' of the accidental injury received by him. The court in connection with this issue defined 'natural result':

       'You are instructed that by the term 'natural result,' as used in this charge, is meant that result produced by an injury, if any, or injuries, if any, by itself or by themselves or in connection with another cause or other causes in the usual course of events, in a natural and continuous sequence, and which result would not have occurred but for such injury, if any, or injuries, if any.' This definition complies with the substance of the definition of 'producing cause' set forth in Jones v. Traderss&sGeneral Ins. Co., 140 Tex. 599, 169 S.W.2d 160.

       Appellee's injury as testified by him was to his left hand, left arm, shoulder and neck. Both Doctors Richardson and Dickerson of Jasper examined and treated appellee. Dr. G. Bruce Stephenson, an orthopedic surgeon of Beaumont, also examined appellee. Each of these doctors advised him to exercise his hand and arm as well as he could consistently with the pain involved, for exercise would aid recovery. Appellee testified that he had followed the doctors' advice as far as he could. But the facts show that he had worked only about one week some few weeks following his injury for his employer and that when he returned the second week he found the Euclid he had been driving was being operated by another and his job was gone. He testified he had not done any other work because he was not able to. Appellant, contending that appellee did not properly exercise his arm and elbow as advised by the doctors, requested Special Issue No. 17-a, which reads: 'Do you find from a preponderance of the evidence that the plaintiff failed to exercise his left elbow?' The court declined to give this issue, hence appellant's 12th point. Appellant also requested Special Issue No. 17-b, which is: 'Do you find from a preponderance of the evidence that such failure, if any, is a producing cause of plaintiff's incapacity, if any.' This issue was also refused, hence appellant's 13th point. Appellant relies upon that portion of Sec. 4 of Art. 8307, Vernon's Annotated Civil Statutes, reading as follows:

'If any employee shall persist in insanitary or injurious practices which tend to either imperil or retard his recovery, * * * as is reasonably essential to promote his recovery, the board may at its discretion, order or direct the association to reduce or suspend the compensation of any such injured employee * * *',

       to sustain its contention that the issues requested should have been given. Appellant properly pleaded the issue, but we do not believe that the evidence raises it. No doctor had informed appellee that he was doing or failing to do anything that would hinder his recovery, while the claimant was repeatedly so informed in the case of Goff v. Texas Emp. Ins. Ass'n, Tex.Civ.App., 278 S.W.2d 326, relied upon by appellant. It is the view of this court that the rule set forth in Texas Employers Ins. Ass'n v. Galloway, Tex.Civ.App., 40 S.W.2d 973, to the effect that in order to raise the issue of insanitary or injurious practices on the part of the injured employee which tends to either imperil or retard recovery of his injury within the meaning of the quoted section, it should be shown that he was requested to refs not part of your historic so it wouldn't make a difference, then I probably wouldn't—it wouldn't have mattered to me."

We conclude that the court's determination that the parties intended to include the income at issue in the plaintiff's total income for purposes of determining his unallocated support obligation is not clearly erroneous. "Historically," as used in the income definition modifies "total income," which references income on line 22 of IRS Form 1040. Further support for this conclusion is found in the inclusions and exclusions that immediately follow the disputed phrase. Notably, total income under the separation agreement expressly includes "all employment, business, [and] partnership . . . income . . . ." (Emphasis added.) As the trial court found, the plaintiff characterized his income from CSCE and ISOI as partnership income on schedule E of his federal tax returns, and the plaintiff himself recognizes that his profits from CSCE are reflected on line 22 of IRS Form 1040.

The plaintiff argues that "a fair reading of [§] 8 [of the separation agreement] as a whole requires that the income used to calculate [the] defendant's unallocated support under the agreement can only be viewed in a context that is retrospective." This retrospective view, according to the plaintiff, encompassed how "the plaintiff 'historically' earned money as a physician," i.e., his biweekly salary and quarterly bonuses. Total income under the agreement, however, expressly excludes "all interest, dividend and capital gains income realized from assets divided as part of the property distribution component of this dissolution [j]udgment and any income received by the plaintiff . . . as the result of patents or inventions which he has created and obtained." Were the plaintiff's construction of the disputed provision to be correct, namely, that the phrase "historically been listed" referred only to how the plaintiff had historically earned money as a physician, this exclusion would be superfluous. "[I]n construing contracts, we give effect to all the language included therein, as the law of contract interpretation . . . militates against interpreting a contract in a way that ren- ders a provision superfluous." (Internal quotation marks omitted.) Isham v. Isham, supra, 292 Conn. 182.

The plaintiff points to other provisions of § 8 of the separation agreement that he contends support his interpretation. First, he points to the statement that, "[h]istorically, the plaintiff has been paid by way of a weekly/biweekly draw and periodic bonuses." That language, however, is positioned within a paragraph discussing the timing and duration of the support payments. Specifically, the statement directly follows language stating that "[t]he plaintiff shall pay his obligation on a weekly or biweekly basis, via direct deposit," and immediately precedes language stating that "[t]he defendant shall be paid her percentage share of the plaintiff's gross income at the time the income is received by the plaintiff." Accordingly, we do not interpret this language as controlling the sources of income from which the support is calculated. Second, the plaintiff directs this court's attention to language in § 8 that provides for the plaintiff's payment of decreasing percentages of his "gross base income," "base bi-weekly gross income," "quarterly bonuses," and "quarterly gross bonuses." Although this language appears to focus on the plaintiff's earnings as a physician, we cannot conclude that it amends the parties' express definition of total income for purposes of determining his unallocated support obligation.

The plaintiff next argues that his interests in CSCE and ISOI were purchased using cash assets awarded to him at the time of the dissolution and, therefore, the income received from his investment of the cash assets "should not be redistributed yet again." In support of his argument, he cites Gay v. Gay, 266 Conn. 641, 835 A.2d 1 (2003), Schorsch v. Schorsch, 53 Conn. App. 378, 731 A.2d 330 (1999), and Denley v. Denley, 38 Conn. App. 349, 661 A.2d 628 (1995), a line of cases that he concedes is "factually distinguishable" but that he suggests evidences a "modern trend" in our courts of reluctance to "designate as income for purposes of support, funds received as a result of the conversion of assets awarded at the time of the dissolution." The defendant responds that "[t]he plaintiff's argument confuses an award of assets with a support award based on the income stream derived from an asset." We agree with the defendant.

An analysis of the cases relied on by the plaintiff leads us to conclude that the holdings in those cases are inapplicable here. The plaintiff cites Schorsch v. Schorsch, supra, 53 Conn. App. 380, in which the defendant sought a postdissolution modification of his alimony obligation. The issue on appeal was whether the trial court improperly had included in the calculation of the defendant's monthly income certain principal payments that he was receiving pursuant to a purchase money mortgage that he held on real property that had been awarded to him in the dissolution decree. Id., 384. This court held that the trial court improperly included as income the principal portion of the mortgage payment generated from the sale because "[t]he mere exchange of an asset awarded as property in a dissolution decree, for cash, the liquid form of the asset, does not transform the property into income." (Internal quotation marks omitted.) Id., 385-86. The court in Schorsch addressed only the principal portion of the mortgage payments, which constituted the liquid form of the asset the defendant received in the dissolution decree, and the interest portion of the payments were not at issue.

In Denley v. Denley, supra, 38 Conn. App. 350, the plaintiff sought a postjudgment modification of alimony, arguing that, because he had lost an important client, his income had decreased substantially. The trial court concluded that the plaintiff had not met his burden of proving a substantial change in circumstances. Id. In determining whether the plaintiff's income had decreased substantially, the court included in income the profit that the plaintiff had received through the redemption of stock options that had been awarded to him as property in the dissolution decree. Id., 350, 353. On appeal, this court agreed with the plaintiff that, "because he was awarded the stock options as property in the dissolution decree, any money that he received from the exercise of those stock options was simply a conversion of an asset and should not have been considered income by the trial court for purposes of assessing whether there had been a substantial change in circumstances." Id., 353. This court concluded that the trial court should not have included the profit that the plaintiff generated by exercising his stock options in determining whether there had been a substantial change of circumstances because the exercise of the stock options resulted in a conversion of the asset to cash and did not transform the property into income. Id.

In Gay v. Gay, supra, 266 Conn. 642, our Supreme Court considered whether the trial court properly ordered a modification in alimony payments based in part on the court's determination that capital gains realized by the plaintiff from the sale of assets constituted income. Our Supreme Court concluded that "capital gains are not income for purposes of modification of an order for continuing financial support if those gains do not constitute a steady stream of revenue. This is true without regard to whether the assets from which those gains are derived were acquired before or after the dissolution." Id., 647-48. Underlying this conclusion was the court's recognition that, "[a]t least where, as is generally the case, capital gains do not represent a steady stream of revenue, the fact that a party has enjoyed such gains in a particular year does not provide a court with an adequate basis for assessing that party's long-term financial needs or resources." (Footnote omitted.) Id., 647. It found persuasive Judge Schaller's reasoning expressed in his dissenting opinion in the Appellate Court, which stated that "a conversion of an asset from one form to another does not constitute the creation of income. Implicit in this conclusion is the underlying concept that the growth in value of the asset distributed at dissolution is not income when it is converted to another form. Rather, the growth, and resulting cash value when converted, simply represents the accrual in value of that asset itself. In other words, the category the item falls into, namely, either capital asset or income, does not change because the asset has appreciated in value and then is converted as a matter of form." (Internal quotation marks omitted.) Id.; see Gay v. Gay, 70 Conn. App. 772, 788-89, 800 A.2d 1231 (2002) (Schaller, J., dissenting).

Each of the cases relied on by the plaintiff is distinguishable from the present case. Schorsch and Denley both involved the conversion of assets awarded in a dissolution to cash. In the present case, the defendant is not seeking a portion of the plaintiff's ownership interest in CSCE and ISOI but, rather, seeks a portion of the income stream generated by those ownership interests, which, pursuant to the terms of the separation agreement, is required to be included as total income for the purposes of calculating the plaintiff's unallocated support obligation. Gay is likewise inapplicable, given that it addressed the question of whether capital gains, which did not constitute a steady stream of revenue, constituted income for purposes of alimony modification. In the present case, the court properly found that the plaintiff's income received from CSCE and ISOI was not a conversion of marital assets and was not excluded from total income under the parties' separation agreement. In support of this conclusion, the court found that the income was "something more and different from the original asset, the 'converted' asset, interest, dividends or capital gains." We agree. Accordingly, the plaintiff's argument fails.

The plaintiff's final argument on appeal is one resting on equitable principles. He maintains that "the court should be mindful that the cash assets the plaintiff invested in CSCE are net, after tax, cash assets that he has from the property distributed to him as part of his marital dissolution property settlement and/or yearly postdissolution postdistribution property settlement (net, after tax, cash assets after he has made his required unallocated support payments)." He argues that the general risks accompanying investments "become compounded if [the] plaintiff is required to give part of his return to [the] defendant, especially if that is before he recoups his net, after tax, cash assets utilized in the investment." He also points to the separation agreement's provision that "[c]apital losses, for whatever purpose, shall not serve as a reduction of a parties' income," in support of his argument that it is "unques- tionably unjust that [the] defendant could be allowed to sit back, completely insulated from any risk, and profit while [the] plaintiff is the only one who takes on any risk with his investments."

The plaintiff, recognizing that Dan v. Dan, supra, 315 Conn. 1, is distinct because it involves modification of alimony, nevertheless contends that the principles and logic of that decision apply. He points to language from Dan stating that, "when the sole change in circumstances is an increase in the income of the supporting spouse, and when the initial award was and continues to be sufficient to fulfill the intended purpose of that award, we can conceive of no reason why the supported spouse, whose marriage to the supporting spouse has ended and who no longer contributes anything to the supporting spouse's income earning efforts, should be entitled to share in an improved standard of living that is solely the result of the supporting spouse's efforts." (Emphasis in original.) Id., 14-15. Our Supreme Court held that, in the absence of certain exceptional circumstances, an increase in a supporting spouse's income, standing alone, will not justify the granting of a motion to modify an alimony award. Id., 4, 10.

The guidance of Dan is inapplicable. The present case does not involve a party seeking to modify an alimony award on the basis that the supporting spouse's income has increased. Rather, the question in the present case is whether the plaintiff's income from CSCE and ISOI is includable in the plaintiff's income for purposes of determining his unallocated support obligation pursuant to the terms of the separation agreement. Moreover, "[i]t is hornbook law that courts do not rewrite contracts for parties. . . . [A] court simply cannot disregard the words used by the parties or revise, add to, or create a new agreement." (Internal quotation marks omitted.) Hammond v. Hammond, 145 Conn. App. 607, 612-13, 76 A.3d 688 (2013). As the trial court stated in the present case, "[the] plaintiff may have been under a great deal of pressure to settle, and he may not now like the deal he struck with [the] defendant over [five] years ago, but she is entitled to the benefit of her bargain. The court cannot and will not undo or rewrite their agreement with the benefit of hindsight."

We conclude that the court properly determined that, pursuant to the separation agreement, the plaintiff's income received from CSCE and ISOI was required to be included in the plaintiff's total income for purposes of calculating his unallocated support obligation.

The judgment is affirmed.

In this opinion the other judges concurred.

• The plaintiff husband shall provide wife with copies of his quarterly pay statements for the period ending March 30th, June 30th, September 30th and December 31st each year, all W-2's, K-1's, 1099's from the entities which employ him upon receipt as soon as they are available. The defendant wife shall contemporaneously provide copies of her pay stubs to the plaintiff husband on a quarterly basis. The parties shall review their financial information on or before March 31st or sooner availability of records each year to verify that the plaintiff husband paid alimony in accordance with this Agreement. The parties agree that an accountant designated by the defendant wife, shall audit, at the wife's expense, the above documents to determine if the defendant wife has received the monies due her from the plaintiff husband in accordance with the terms of this Agreement. If the plaintiff husband disagrees with the defendant wife's auditor, he shall have the right to choose his own auditor to verify the amount of alimony payable, at his expense."