Loading...
HomeMy WebLinkAbout2004-1088 Civil FRANCES PIPER, PLAINTIFF IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. KENNETH PIPER, DEFENDANT 04-1088 CIVIL TERM IN RE: PETITION TO SET ASIDE MARITAL SETTLEMENT AGREEMENT OPINION AND ORDER OF COURT Bayley, J., May 24, 2006:-- Plaintiff, Frances Piper, filed a petition to set aside her marital settlement agreement with defendant, Kenneth Piper. A hearing was conducted on May 22, 2006. We find the following facts. On August 2, 2005, at a hearing before a Divorce Master to take testimony as to marital misconduct regarding wife's claim for alimony, the parties, who were each represented by counsel, informed the Master that they had reached a comprehensive settlement of all outstanding economic claims. The settlement was placed on the record with the statement by the Master that: "When the parties leave the hearing today, even though there is not subsequently a signing of the agreement affirming the terms of settlement, nevertheless, they are bound by the terms of the agreement as stated on the record." The agreement distributed their personal property, each spouse retained a vehicle, husband was required to pay a bank loan, wife received $12,914.61 from the sale of the marital residence that was then in escrow, husband was required to make a final payment of $840 on a spousal support order, wife waived her claim for alimony and attorney fees, and Paragraph 5 provided: 04-1088 CIVIL TERM Mr. Piper currently receives a monthly retirement benefit through the Central Pennsylvania Teamsters Pension Fund. His effective retirement date was September 1, 2003, and on that date he selected a single life annuity with 36 month certain payments, under which he receives the gross amount of $3,100.00 per month for life. The parties agree that the coverture fraction in this matter is equal to 11 over 36. Mrs. Piper shall receive 50% of the marital portion of Mr. Piper's monthly retirement. Each party will be responsible for the taxes and other obligations on their divided interest. The parties agree that Mrs. Piper shall be entitled to obtain a separate annuity based on one-half of the marital interest in Mr. Piper's pension. Legal counsel for Mrs. Piper will prepare the necessary QDRO for initial approval by the Central Pennsylvania Teamsters Pension Fund and legal counsel for both parties will sign the approved QDRO for submission to the Court. The parties agree that the QDRO shall provide that Mrs. Piper shall take her own single life annuity using 50% of the coverture fraction specified above. In addition to applying the coverture fraction and 50% of husband's benefit, wife's annuity will be determined based on her life expectancy; not husband's life expectancy. This will be effective upon Court approval and acceptance by the plan administrator. (Emphasis added.) Wife, who was seeking security, was not willing to enter into the overall settlement agreement, which included her waiver of alimony, with her receiving fifty percent of the marital property of husband's pension if the payments did not last until her death. Husband was willing to enter into the overall settlement agreement that included such a provision. The day before the hearing, counsel for wife was informed during a phone call with a representative of the Teamsters Pension Fund, that an annuity to wife could be set based on her own life expectancy rather than husband's life expectancy, although a QDRO had to be approved by the Fund's attorney. At the hearing, before the entry of the agreement, husband's counsel was informed during a -2- 04-1088 CIVIL TERM phone call with a representative of the Teamsters Pension Fund, that wife's counsel had contacted the fund, that a single life annuity for wife was an option, and that any QDRO had to be approved by the Fund's attorney. That resulted in the entry into the marital settlement agreement, after which, wife's counsel prepared a QDRO pursuant to its terms. It was submitted to the Teamsters Pension Fund that advised by letter that a single life annuity to wife was not possible, because: As the Participant is currently receiving his monthly pension, the Alternative Payee cannot receive a separate interest, but will instead receive a shared interest pension with the Participant. As a result, benefits to the Alternate Payee will cease at the earlier occur of: (i) the Participant's death; or (ii) the Alternative Payee's death. Plaintiff seeks to set aside the marital settlement agreement upon a claim of mutual mistake of fact. In Gocek v. Gocek, 417 Pa. Super. 406 (1992), the Superior Court of Pennsylvania, stated: First, a property settlement agreement between husband and wife will be enforced by the courts in accordance with the same rules of law applicable to ascertaining the validity of contracts generally. Kleintop v. Kleintop, 291 Pa.Super. 491, 436 A.2d 223, 225 (1981). Second, "the misconception which avoids a contract is necessarily a mutual one, and a fact which entered into the contemplation of both parties as a condition of their assent". Ehrenzeller v. Chubb, 171 Pa.Super. 460, 90 A.2d 286, 287 (1952). And, in Vrabel v. Scholler, 369 Pa. 235, 85 A.2d 858, 860 (1952), the general rule was again stated thusly: "'A contract [made under] a mutual mistake as to an essential fact which formed the inducement to it, may be rescinded on discovery of the mistake, if the parties [can be] placed in their former position with reference to the subject matter.'" (Citation omitted). . . . In the case sub judice, the parties were in agreement as to the method of -3- 04-1088 CIVIL TERM calculation of a single life annuity to wife for fifty percent of the marital portion of husband's pension. That was an inducement for the entry into the comprehensive property settlement agreement which was viewed by both parties as a benefit in that it resolved their economic dispute. The mutual mistake of fact, wherein the agreed distribution of wife from husband's pension could not be made in a single life annuity, was shared and relied on by both parties. They can be placed in their former position with reference to the distribution of their marital estate. Although what each obtained as a result of the marital agreement may be different than what each had in their possession before the agreement, the amount of the assets and distributable debt has not changed, and wife may pursue alimony and counsel fees. Therefore, the following order is entered. ORDER OF COURT AND NOW, this day of May, 2006, the marital settlement agreement of Frances Piper and Kenneth Piper, IS SET ASIDE. By the Court, Edgar B. Bayley, J. John A. Abom, Esquire For Plaintiff Douglas Miller, Esquire F or Defendant -4- 04-1088 CIVIL TERM :sal -5- FRANCES PIPER, PLAINTIFF IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. KENNETH PIPER, DEFENDANT 04-1088 CIVIL TERM IN RE: PETITION TO SET ASIDE MARITAL SETTLEMENT AGREEMENT ORDER OF COURT AND NOW, this day of May, 2006, the marital settlement agreement of Frances Piper and Kenneth Piper, IS SET ASIDE. By the Court, Edgar B. Bayley, J. John A. Abom, Esquire For Plaintiff Douglas Miller, Esquire F or Defendant :sal