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Mahl v. Mahl

Case Nos. 2021-SC-0481-DG and 2021-SC-0487-DG

Appeals from Jefferson Circuit Court

Opinion by Bisig, Judge

Date Rendered: April 27, 2023

Issue: Whether Substantial and Continuing Change in Circumstances existed Warranting Modification of Maintenance Award, and Whether Failure to Name Attorney as a Party to an Appeal of and Award of Attorney Fees could be Reviewed on Appeal

Husband and Wife divorced after twenty-eight years of marriage and two children. During the marriage, Husband owned an ophthalmology practice and wife worked in the practice as a surgical nurse and office manager. Husband became disabled from back problems. At that time, Wife was unemployed, and suffered from back pain.

The Trial court awarded each party $4.5 million in assets. Additionally, Wife was awarded $6,000 maintenance per month until Husband reached age 65.

Husband appealed, arguing the family court failed to make sufficient findings that Wife lacked sufficient property to meet her reasonable needs. Wife cross-appealed, arguing the Court erred when it ordered maintenance to cease when Husband turned 65. The Court of appeals affirmed the maintenance award.

While the Court of Appeals case was pending, the parties’ financial advisor lost a significant amount of the parties’ funds held at West End Financial to a Ponzi scheme. However, Husband continued paying Wife $6,000 in monthly maintenance until he turned age 65.

When Husband turned 65, Wife filed a motion with the Family Court to modify maintenance alleging changed circumstances, including Husband having returned to work and having lost significant assets in the Ponzi scheme. The Circuit Court ordered the prior maintenance award unconscionable due to changed circumstances and ordered Husband to pay Wife $8,688 per month in maintenance until her death, remarriage, cohabitation, or death, or until she collected the funds originally awarded to her in the Divorce decree. The Circuit Court also ordered Husband to pay $45,619.60 of Wife’s attorney fees.

Husband filed a notice of appeal, arguing that the Circuit Court abused its discretion in modifying maintenance and ordering attorney’s fees. Husband did not name the Attorney as a party in the notice of appeal, or the prehearing statement at the Court of Appeals.

The Court of Appeals concluded that the circuit court abused its discretion in granting Wife’s motion to modify maintenance. The Court of Appeals reasoned that both parties suffered loss, and that Wife could have achieved stability through proper management of the maintenance and assets she did receive. The Court of Appeals declined to review the Attorney Fee award.

 Both Husband and Wife filed motions for discretionary review with the Kentucky Supreme Court.

The Supreme Court first held that modification of maintenance was warranted, affirming the Circuit Court’s judgment and reversing the Court of Appeals.

The Supreme Court then held that Husband’s failure to name Wife’s attorney as a party to the appeal was not a fatal error, and that the Court of Appeal’s erred by declining to examine the attorney fee issue. The Supreme Court reasoned that Wife’s attorney was included on the distribution list and therefore had adequate notice of the appeal and the ability to protect his own interest in seeking affirmation of the attorney’s fee award. Finally, the Supreme Court held that the Circuit Court did not err in awarding attorney’s fees pursuant to KRS 403.220.

Digested by Emily T. Cecconi