O'Keeffe v. O'Keeffe
2020 ND 201 (2020)
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Rule of Law:
Spousal support intended to equalize a substantial and persistent income disparity over a long term is considered non-rehabilitative support. Under N.D.C.C. § 14-05-24.1(3), such support must be terminated upon the recipient's cohabitation unless the divorce agreement explicitly provides for its continuation; a general non-modification clause is insufficient to prevent termination.
Facts:
- Timothy O’Keeffe and Kari O’Keeffe married in 1997.
- At the time of their 2015 divorce, Timothy O'Keeffe earned approximately $17,683 per month, while Kari O'Keeffe's independent income was approximately $106 per month.
- Kari O'Keeffe holds a bachelor's degree in elementary education, has ten years of experience as an insurance agent, and could renew either professional license in less than two years.
- The parties' divorce agreement stipulated that Timothy would pay Kari $5,000 per month in spousal support for 120 months.
- The agreement stated the support amount and duration were 'non-modifiable' and would terminate upon Kari's death or remarriage, but was silent on the issue of cohabitation.
- Beginning in at least January 2016, Kari O'Keeffe began habitually cohabiting with her fiancé in a relationship analogous to marriage.
Procedural Posture:
- Timothy O'Keeffe and Kari O'Keeffe were divorced by a judgment in the District Court of Cass County in November 2015, which incorporated their mediated agreement.
- In February 2019, Timothy O'Keeffe filed a motion in the district court seeking to terminate his spousal support obligation.
- The district court denied Timothy's motion, concluding the spousal support was rehabilitative and thus not subject to termination for cohabitation under state statute.
- The district court also awarded attorney's fees to Kari O'Keeffe.
- Timothy O'Keeffe, as appellant, appealed both district court orders to the Supreme Court of North Dakota.
- Kari O'Keeffe, as appellee, filed a cross-appeal challenging the district court's determination that the parties' agreement did not prevent termination of support upon cohabitation.
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Issue:
Is spousal support that is set for a long duration (120 months) and primarily addresses a large, ongoing income disparity considered 'rehabilitative spousal support' exempt from termination for cohabitation under N.D.C.C. § 14-05-24.1(4)?
Opinions:
Majority - Justice Tufte
No. The spousal support is non-rehabilitative and therefore subject to termination. Rehabilitative support aims to increase a spouse's earning capacity through education or training, while non-rehabilitative (or permanent) support addresses a substantial income disparity by directly transferring income. Here, the significant disparity in income, Kari O'Keeffe's existing education and work experience, and the long 120-month duration (far exceeding the time needed for her to become recertified in teaching or insurance) indicate the support's purpose was to equalize the financial burdens of the divorce, not for rehabilitation. Furthermore, a general 'non-modifiable' clause does not constitute the explicit written agreement required by statute to prevent termination of support upon cohabitation.
Concurring - Chief Justice Jensen
I agree with the majority that the support is non-rehabilitative and should be terminated. I write separately to note that the district court's factual findings were based on Timothy O'Keeffe's affidavit, which was inadmissible hearsay and should not have been considered as evidence. However, because this evidentiary error was not raised on appeal, the majority correctly decided the case based on the record before it. Had the issue been properly handled, the result would be the same because once Timothy proved cohabitation, the burden shifted to Kari to prove the support was rehabilitative. With the affidavit excluded, she would have had no evidence to meet this burden, and termination would have been required.
Analysis:
This decision clarifies the statutory distinction between rehabilitative and non-rehabilitative spousal support in North Dakota, establishing that the purpose and duration of the award are key factors. It sets a precedent that long-term support aimed at balancing a significant income gap is presumptively non-rehabilitative. The ruling also solidifies the requirement for explicit language in divorce agreements to override the statutory termination of support for cohabitation, meaning general 'non-modifiable' clauses are ineffective for this purpose. This places a greater drafting burden on attorneys to specifically address cohabitation if they intend for support to continue.
