Spousal Support Overpayments

Domestic Relations: Husband entitled to credit for support overpayments

In Shell v. Davis, the court held that the husband's modification for overage payments was not precluded by Rule 1:1, res judicata, or Code § 20-107.1 where the J&DR court reduced the husband's spousal support obligation but did not reference overages or set a repayment schedule until after a hearing several months later.

Support modification

The separation agreement between the parties required the husband to pay the wife spousal support. The husband moved the J&DR court to modify his support obligation due to changed circumstances. The court ordered reduced payments beginning in April 2018 through July 2019. Because the reduction was retroactive, the husband had overpaid for that period and the J&DR court's July 17, 2019, order did not reference any overage.

On November 4, 2019, the husband moved for a repayment schedule for the overage. The J&DR court granted the motion and found that the husband had overpaid by $28,000 and ordered the wife to repay at $500 per month. The wife appealed to the circuit court where she claimed that the husband's motion was barred by Rule 1:1 of the Rules of the Supreme Court of Virginia, the doctrine of res judicata, and Code § 20-107.1. The circuit court found that the amount of support overpayments was $15,250 as of November 9, 2020, and that husband was permitted to deduct $500 from his monthly spousal support obligation until it was paid in full.

Rule 1:1

The wife argued that Rule 1:1 was a bar to the husband's motion because the support order was entered on July 17, 2019, and the husband did not file his motion until November 4, 2019. Rule 1:1 states that "[a]ll final judgments, orders, and decrees...may be modified, vacated, or suspended for twenty-one days after the date of entry, and no longer." The husband did not file his motion for overage payments until well after twenty-one days had passed from the entry of the support order. However, Rule 1:1 did not bar the husband's motion because the support order did not dispose of 'the entire matter' regarding overages. Even though the support order implied that overpayments existed because the lowered support obligation was retroactive, the order did not explicitly state this, nor did it address repayment.  

The order of the lower court created the issue of support overpayments and left it unresolved, but the support order could have disposed of the overage issue. Since it did not, the issue was still pending and unresolved by the order and the J&DR court retained jurisdiction regarding the issue of overpayments. Because of this, the court held that the lower court did not err by holding that husband's motion was not barred by Rule 1:1.

Res Judicata

The wife also argued that the doctrine of res judicata barred the J&DR court from hearing the husband's motion because it "arose out of the same conduct, transaction or occurrence" as his previous motion to amend spousal support. The husband's first claim was that he had experienced a material change in circumstances and warranted modification in his support obligation. He claimed that the retroactive order implicitly created overages, but it neither established an amount nor a repayment schedule. The husband was not barred by res judicata because the support order first made the grounds for his latter claim.

Statute

The wife also argued that the husband's motion was barred by Code § 20-107.1(H) because it states that any order directing the payment of spousal support must address support arrearages. She asserted that the support order violated the statute because it did not reference or state any support overages. The wife asked the court to interpret the word "arrearages" in Code § 20-107.1(H) to mean "overages," and the court rejected this argument at the hearing. Thus, the husband's payments were retroactively modified as permitted by Code § 20-112.

The court correctly found that the plain language used by the General Assembly only requires that support orders address arrearages, not overages. The statute's plain language establishes that the General Assembly intended for Code § 20-112 to apply to cases precisely like this in proceedings to decrease spousal support. Where a decrease in spousal support is warranted, the statute allows a retroactive adjustment to support. Thus, the language of Code § 20-112 directly contradicts the wife's argument that the circuit court's finding was contrary to legislative intent.