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Bergmann v. Bergmann

Court of Appeals of Utah

June 28, 2018

Karen Bergmann, Appellee,
v.
Eugene D. Bergmann, Appellant.

          Fourth District Court, Provo Department The Honorable James R. Taylor No. 144400815

          Emily Adams, Attorney for Appellant

          Thomas J. Burns and Philip M. Ballif, Attorneys for Appellee

          Judge Michele M. Christiansen authored this Opinion, in which Judges David N. Mortensen and Ryan M. Harris concurred.

          OPINION

          CHRISTIANSEN, JUDGE:

         ¶1 Eugene D. Bergmann and Karen Bergmann, now known as Karen Christensen, divorced by bifurcated decree in May 2015. The trial court reserved several issues for trial, including the legal effect of a premarital agreement (the Premarital Agreement) the parties entered into in 2001 and a subsequent agreement they executed in 2011 (the 2011 Agreement). In January 2016, the trial court issued its amended findings of fact and conclusions of law, which addressed all of the remaining issues. Bergmann moved to alter or amend judgment, which the court denied. Bergmann now appeals from the denial of that motion. We affirm and remand for the limited purpose of Bergmann v. Bergmann calculating Christensen's reasonable attorney fees incurred on appeal.

         BACKGROUND

         ¶2 Bergmann and Christensen married in 2001. Before they married, the parties executed the Premarital Agreement, which provides, in relevant part:

4.02 Living Expenses. During their marriage, the parties shall establish a joint checking account which will be the fund used for basic family living expenses, such as home mortgage payments, public liability and content insurance, utilities, property taxes, property maintenance as to the primary residence . . ., together with food and similar basic living expenses. Each party shall make deposits to such joint checking account in such portions and such amounts as from time to time may be determined necessary by them for such purposes. Initially, the parties have determined that Eugene will contribute $4, 000 per month and Karen will contribute $2, 000 per month, plus Social Security payments received by her.[[1]The parties recognize that each is able to make such contributions. . . . If the parties cannot agree as to the contribution to be made hereunder, each party shall bear the costs of his or her respective living expenses, unless one of the parties determines to pay more than his or her share which he or she shall be entitled to do.

         ¶3 After they married, the parties operated for years without referring to the Premarital Agreement. During the marriage, the parties agreed that they would contribute equally to the family budget, and they both contributed to the joint checking account for basic family living expenses. Consistent with that understanding, the parties tracked their contributions and withdrawals in a spreadsheet available to both of them. Over time, Christensen's contributions were significantly larger than Bergmann's. Bergmann acknowledged this fact in a November 2010 email to Christensen, in which he stated that he was approximately $159, 000 "in debt" to her.

         ¶4 Shortly after the 2010 email, Bergmann indicated to Christensen that he needed money to help pay the basic family living expenses. Because Christensen had paid more of the basic family living expenses over the years than Bergmann, she agreed to give Bergmann $20, 000 only if Bergmann agreed to provide "some assurance that [she] would get paid back." Bergmann suggested "that he would transfer [his] equity [in the parties' marital home] to [Christensen] upon the sale of the home." On January 7, 2011, the parties entered into the 2011 Agreement, which provides,

AGREEMENT
January 7, 2011: It is agreed that Eugene Bergmann and Karen Bergmann share equal ownership in their home . . . . It is also agreed to that Eugene will assign an amount of his equity to Karen in the amount of 170, 000 dollars. This . . . amount constitutes an[] approximate amount of additional joint expenditures that Eugene has agreed to and is owing to Karen. This exact amount will be verified at some time in the future in a spreadsheet which they will both come to a further mutual agreement on. This spreadsheet will then be memorialized into a more formal agreement to [supersede] this one.

         Two days later, Christensen deposited $20, 000 into the parties' joint checking account, and Bergmann used the money to pay the basic family living expenses.

         ¶5 Christensen filed for divorce in 2014. The trial court entered a bifurcated decree of divorce, dissolving the marriage and reserving several issues for trial. The two primary issues at trial were (1) whether the Premarital Agreement required the parties to make equal contributions to the basic family living expenses, and (2) whether, under the terms of the 2011 Agreement, Bergmann was required to assign to Christensen $170, 000 of his initial one-half share of the proceeds from the sale of the parties' marital home.

         ¶6 The trial court held a one-day bench trial, at which both parties testified. The court determined that the Premarital Agreement was an enforceable agreement but that Section 4.02 of the Premarital Agreement "does not say that [Bergmann and Christensen] are each going to be exactly responsible for fifty percent of the basic family living expenses forever and through the life of the Premarital Agreement." The court noted that throughout the marriage, the parties had "not worr[ied] about the technicalities of the Premarital Agreement. In fact, they operated for years without referring to a copy of it." Although the parties had maintained a spreadsheet tracking their individual contributions to the joint checking account, the court found that "this practice of handling basic family living expenses did not create a substitute contract that obligated them to divide and pay basic family living expenses on a fifty-fifty basis forever." The court found that during the course of the marriage, the parties had some disputes about who would pay for what, but the parties "work[ed] this out when they entered into the [the 2011 Agreement]."

         ¶7 The court observed that, in the 2011 Agreement, the parties acknowledged that Christensen had paid more of the basic family living expenses than Bergmann, that Bergmann owed Christensen "an unspecified amount" of money, and that Bergmann agreed to assign to Christensen $170, 000 of his equity share in the parties' marital home on this basis. The court then determined that the 2011 Agreement was an enforceable agreement, supported by consideration. Specifically, at Bergmann's request, Christensen transferred $20, 000 into the parties' joint checking account to help pay past due and upcoming basic family living expenses, and, in return, Bergmann assigned to Christensen $170, 000 of his share of equity in the marital home. The court ultimately concluded that the 2011 Agreement was not a modification to the Premarital Agreement but that it was "an additional, enforceable agreement anticipated by the Premarital Agreement."

         ¶8 Accordingly, the court awarded Christensen $170, 000 from Bergmann's initial one-half share of the proceeds from the sale of the marital home. The court also awarded Christensen her attorney fees incurred in connection with responding to a pretrial motion in limine Bergmann had filed, concluding that the motion was "frivolous and patently inappropriate." The court determined that the parties were otherwise responsible for their own attorney fees and costs.

         ¶9 After trial, Bergmann moved to alter or amend the judgment pursuant to rule 59(a)(7) of the Utah Rules of Civil Procedure. See Utah R. Civ. P. 59(a)(7) ("[A] new trial may be granted to any party on any issue for any of the following reasons: . . . that the verdict or decision is contrary to law or based on an error in law."). In his motion, Bergmann asserted that when the parties entered into the 2011 Agreement, "both parties believed that there was a contractual duty under [the Premarital Agreement] that they each pay 50/50 for all joint living expenses." According to Bergmann,

[i]nasmuch as the Court ruled that in fact there was no legal obligation for [Bergmann] to reimburse [Christensen] for 50% of all marital expenditures, where [the 2011 Agreement] was fundamentally based on the mutual mistake that there was a contractual obligation under [the Premarital Agreement] for a 50/50 responsibility of family living expenses, this contract should not be enforced by the Court.

         Bergmann also asserted that the 2011 Agreement was based on the parties' mutual mistake regarding the amount Bergmann owed Christensen. Bergmann requested that the court "reverse its finding that [Christensen] receive[] $170, 000 from [Bergmann] and order that [Christensen] return those funds to him." Christensen filed a response to the motion to amend, asserting that Bergmann's motion was "merely a rehash of closing argument." ...


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