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Lesh v. Lesh

Court of Appeals of North Carolina

January 16, 2018

TIMOTHY LESH, Plaintiff,
v.
MARGARET S. LESH, Defendant.

          Heard in the Court of Appeals 19 September 2017.

         Appeal by plaintiff from order entered 27 January 2017 by Judge Meader W. Harriss, III, in Currituck County District Court No. 14 CVD 308.

          The East Carolina Law Group, by Timothy P. Koller, for plaintiff-appellant.

          The Twiford Law Firm, PC, by Courtney S. Hull, for defendant-appellee.

          DAVIS, JUDGE.

         The primary issue in this appeal is whether federal law prohibits a veteran's military disability benefits from being considered as income for purposes of satisfying a distributive award to his former spouse pursuant to an equitable distribution order. Timothy Lesh ("Mr. Lesh") appeals on federal preemption grounds from the trial court's order denying his motion pursuant to Rule 60(b) of the North Carolina Rules of Civil Procedure to set aside a portion of the parties' equitable distribution order and holding him in civil contempt for failing to make payments required under that order. Because we conclude that federal law does not preclude the treatment of his disability payments as income for this purpose, we affirm.

         Factual and Procedural Background

         Mr. Lesh was married to Margaret S. Lesh ("Ms. Lesh") on 14 October 1989. On 1 December 2012, the parties separated, and they divorced on 16 September 2014. On 1 August 2014, Mr. Lesh filed a complaint for absolute divorce in Currituck County District Court. Ms. Lesh filed an answer and counterclaim on 27 August 2014, seeking post-separation support, alimony, and equitable distribution of the parties' marital property.

         On 22 and 23 February 2016, a hearing was held before the Honorable Meader W. Harriss, III. On 13 April 2016, the trial court entered an order (the "Equitable Distribution Order") distributing 75% of the marital estate to Mr. Lesh and 25% to Ms. Lesh. The court further concluded that "[i]n order for [Ms. Lesh] to receive her share of the net marital estate, it is necessary for [Mr. Lesh] to pay [Ms. Lesh] a distributive award in the sum of $31, 590.59, which reflects her 25% of the estate minus the $3, 010.00 value of the marital property hereby distributed to her and in her possession." The trial court ordered that this distributive award "be paid in monthly installments in the amount of $877.22, the first of which is due April 1, 2016 to continue to be due the first of the month every month until said sum is paid in full." The Equitable Distribution Order further permitted Mr. Lesh to "pay off the remaining balance of the lump sum at any time, in lieu of continuing monthly installment payments."

         On 11 May 2016, Mr. Lesh filed a notice of appeal from the Equitable Distribution Order. However, he dismissed his appeal on 28 July 2016. On 8 August 2016, Mr. Lesh filed a motion in the cause pursuant to Rule 60(b) seeking to set aside the portion of the Equitable Distribution Order requiring his monthly payments of the distributive award. In this motion, he contended that the Equitable Distribution Order was an "irregular" judgment because it would require him to use his military disability benefits to make the distributive award payments despite the fact that federal law preempted the trial court's ability to require him to do so.

         On 7 September 2016, Ms. Lesh filed a motion for contempt, requesting that the trial court hold Mr. Lesh in contempt for "fail[ing] and refus[ing] to comply with [the Equitable Distribution] Order in that [he] ha[d] not made any payments to [her] . . . and his failure to comply [wa]s willful, without just cause or excuse." A hearing on Mr. Lesh's motion in the cause and Ms. Lesh's motion for civil contempt was held on 17 October 2016. On 27 January 2017, the trial court entered an order captioned "Amended[1] Order of Contempt" denying Mr. Lesh's motion under Rule 60(b) and granting Ms. Lesh's motion for civil contempt. Mr. Lesh filed a timely notice of appeal.

         Analysis

         On appeal, Mr. Lesh argues that the trial court erred by (1) denying his Rule 60(b) motion to set aside the portion of the Equitable Distribution Order requiring monthly distributive payments based on his contention that his only source of income is his military disability benefits, which under federal law cannot be distributed as divisible property; and (2) holding him in civil contempt for failing to make the monthly payments required by the Equitable Distribution Order. We address each argument in turn.

         I. Denial of Rule 60(b) Motion

         Mr. Lesh argues that the trial court erred by denying his motion under Rule 60(b)(6) because the Equitable Distribution Order was an irregular judgment. Specifically, he contends that the order was irregular because it required him to make monthly payments of the distributive award despite the trial court's awareness that the entirety of his monthly income was comprised of his military disability benefits.

         Ms. Lesh, conversely, contends that this portion of his appeal lacks merit due to the fact that he withdrew his appeal of the Equitable Distribution Order and therefore lost his right to challenge the validity of that order. She further contends that his motion in the cause was defective due to the fact that Rule 60(b)(6) cannot be used as a substitute for appeal.

         A. Applicability of Rule 60(b)(6)

         Rule 60(b) states, in pertinent part, as follows:

(b) Mistakes; inadvertence; excusable neglect; newly discovered evidence; fraud, etc. - On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order, or proceeding for the following reasons:
(1) Mistake, inadvertence, surprise, or excusable neglect;
(2) Newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b);
(3) Fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party;
(4) The judgment is void;
(5) The judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or
(6) Any other reason justifying relief from the operation of the judgment.

N.C. R. Civ. P. 60(b).

         Rule 60(b)(6) "serves as a grand reservoir of equitable power by which a court may grant relief from a judgment whenever extraordinary circumstances exist and there is a showing that justice demands it." Dollar v. Tapp, 103 N.C.App. 162, 163- 64, 404 S.E.2d 482, 483 (1991) (citation and quotation marks omitted). We have held that "[a] party seeking to set aside an irregular judgment may properly do so by filing a motion for relief from judgment pursuant to Rule 60(b)(6)." Brown v. Cavit Scis., Inc., 230 N.C.App. 460, 464, 749 S.E.2d 904, 908 (2013) (citation omitted). "It is well settled, however, that Rule 60(b)(6) does not include relief from errors of law or erroneous judgments." Garrison ex rel. Chavis v. Barnes, 117 N.C.App. 206, 210, 450 S.E.2d 554, 557 (1994) (internal citations omitted). "We review the denial of a motion pursuant to Rule 60(b)(6) for an abuse of discretion." Sharyn's Jewelers, LLC v. Ipayment, Inc., 196 N.C.App. 281, 284, 674 S.E.2d 732, 735 (2009) (citation omitted).

         Our Supreme Court has explained the distinction between irregular, erroneous, and void judgments as follows:

A judgment may be valid, irregular, erroneous, or void. . . . An irregular judgment is one rendered contrary to the course and practice of the court, as for example, at an improper time; or against an infant without a guardian; or by the court on an issue determinable by the jury; or where a plea in bar is undisposed of; or where the debt sued on has not matured; and in other similar cases (citing authorities). An erroneous judgment is one rendered according to the course and practice of the court, but contrary to law, or upon a mistaken view of the law, or upon an erroneous application of legal principles, as where, judgment is given for one party when it [should] have been given for another; or where the pleadings require several issues and only one is submitted; or where the undenied allegations of the complaint are not sufficient to warrant a recovery; and in other cases involving a mistake of law (citing authorities). . . . A void judgment is one that has semblance but lacks some essential element, as jurisdiction or service of process.

Wynne v. Conrad, 220 N.C. 355, 359-60, 17 S.E.2d 514, 518 (1941) (internal citations and quotation marks omitted).

         "The correct procedure for attacking a judgment is dependent upon the type of defect asserted." Burton v. Blanton, 107 N.C.App. 615, 616, 421 S.E.2d 381, 383 (1992).

The last subsection of Rule 60(b) authorizes the court to relieve a party from the operation of a judgment for any other reason not enumerated in the first five clauses. While Rule 60(b)(6) and the first five clauses of this rule are mutually exclusive, clause (6) should not be characterized as a catchall provision. Rule 60(b)(6) is not intended as substitute relief for reasons that would be deficient if asserted under one of the ...

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