August 28, 2012

Paid In Full? Fourth DCA Holds Former Husband’s Settlement of Debt For Less Than Full Amount Sufficient Where Marital Settlement Agreement Failed to Specify Debt Amount

Cunha v. Cunha, 4D11-1892

The parties’ marriage was dissolved by a final judgment that incorporated a marital settlement agreement (“MSA”). The MSA gave the former husband the responsibility for paying a certain specific debt to a creditor, although the MSA did not specify the amount of that debt. The former wife filed a motion for contempt when the former husband failed to pay the debt. As a result, the trial court ordered the former husband to pay the debt, and named a specified amount of $5,722.

The former husband later fully settled the debt with the creditor by paying the creditor $2,400, an amount that was less than the total amount of the debt, and less than the $5,722 the trial court had ordered the former husband to pay. The former husband moved for relief from the $5,722 judgment under Florida Rule of Civil Procedure 1.540(b)(5) on the grounds that the specifically identified debt on which the judgment was based had been satisfied. The former wife opposed the motion and argued that the former husband had not paid the amount ordered by the court, and that paying an amount less than what was owed negatively affected her credit and tax liability. The trial court denied the motion.

On appeal, the Fourth District Court of Appeal (“DCA”) concluded that the former husband had satisfied the MSA’s requirement that he pay the specific debt. The Fourth DCA noted that the MSA only specified the debt and did not list any specific amount. The court also stressed that the MSA did not prohibit former husband from negotiating the amount of the debt. The court reversed and remanded for the trial court to vacate the judgment.