Remedial and Punitive Sanctions for Contempt in Divorce Proceedings

Eric Martinson[1]

Protecting your clients’ economic interests after divorce is a challenging undertaking, especially in this economic recession. This paper provides an overview of Colorado Rule of Civil Procedure Rule 107 “Remedial and Punitive Sanctions for Contempt,” in divorce proceedings.[2] Specifically, it addresses considerations for family law practitioners who represent the party named on the loan yet not awarded the underlying property in the divorce decree.

“This Order isn’t worth the paper that it was printed on!” This has become a common sentiment among recent divorcees who seek to enforce court orders, particularly those relating to the parties’ marital home. The recent real estate “bubble burst,” tightened real estate finance markets. Divorcees awarded encumbered property may not qualify for loans obtained during the marriage. Especially in high conflict divorces, the divorce decree is just the beginning of the journey. Particularly now, contempt proceedings can be critical.

Throughout this article the available contempt remedies will be applied to the hypothetical situation of a wealthy divorcing couple, with the marital home awarded to the husband. Either party could use liquid funds to pay off the home’s mortgage,but the court simply orders that the husband refinance the property within six months to remove the wife’s name from the mortgage.[3]  As in many divorces, the parties disputed who should pay several bills; the heating bill, the credit card bills, and others were left unpaid during the pendency of the divorce.[4]  The parties’ income and credit scores plummeted. Thus, the divorced individual qualifies for inferior loan terms.

Out of spite, Husband decides to buy a new home and abandon the marital home awarded to him in the divorce. The home faces foreclosure and each party is facing a serious threat of economic harm to their credit.[5] In Colorado, contempt proceedings divide actions between two types of contempt, direct and indirect, and two types of sanctions, punitive and remedial.[6] Since both types of contempt can result in either type of sanction, the able practitioner should seek the appropriate sanction to attain a timely remedy.[7]

Direct and Indirect Contempt

Direct contempt occurs within the courtroom, indirect contempt occurs outside of the courtroom.[8] Using Joe Pesci’s character in My Cousin Vinny as an example, the different nature of the remedies becomes apparent. During the initial courtroom scene, the judge asked Vinny to plead either guilty or not guilty.[9] During their discussion, the judge demonstrated the difference between remedial sanctions and punitive sanctions.[10] Initially, the judge said that Vinny will be held in contempt until he enters a plea.[11] This is a remedial sanction. Later, when the court felt disrespected, the judge said that, if the next word out of Vinny’s mouth was not a “yes” or a “no,” Vinny would spend the night in jail, a fixed time.[12] This is a punitive sanction. Punitive sanctions protect the court’s respect and dignity while remedial sanctions are used to seek compliance and purge ongoing noncompliance with court orders.[13] The practitioner handles indirect contempt much more frequently than direct contempt, which the judge can handle immediately.

Punitive Sanctions

Family law practitioners can effectively enforce court orders with sanctions for remedial contempt, punitive contempt, or both.[14] Punitive sanctions for contempt, formerly criminal contempt, allow the court to place a fixed and unconditional fine, prison sentence, or both, for conduct that is offensive to the authority and dignity of the court.[15] Procedurally, punitive contempt still reflects the criminal nature of the sanction. The contemnor has quasi-criminal rights and procedural safeguards. A party accused of punitive contempt has a plethora of rights.[16]

Husband can extend and prolong the quasi-criminal proceeding by issuing subpoenas,[17] requesting a new judge, requesting a jury, and presenting evidence. Also, Wife’s attorney fees cannot be awarded to Husband in a punitive contempt action but the court may appoint special counsel to prosecute the contempt action, saving Wife most of the costs. The likelihood of success on an action for punitive sanctions is high, particularly is the contemnor is willfully not paying the mortgage payments when foreclosure is pending.

Remedial Sanctions

If the heightened procedural safeguards along with the heightened burden of proof will thwart the contempt action, a practitioner can take the route of remedial contempt by proving that Husband has the present ability to purge the contempt. Remedial contempt is an inherent power of the court to encourage compliance with its orders. Unlike punitive contempt, attorney fees may be awarded. Many of the procedural safeguards required in punitive sanctions are not required in remedial sanctions. The standard of proof is lowered to a preponderance of the evidence, finding it more likely than not that contempt was committed. The remedies must be conditioned on Husband’s compliance.[18] For example, the judge can remand Husband to jail until he purges the contempt, or force Husband to pay $500 per day until compliance.  Remedial sanctions end as soon as Husband complies.

Present Ability to Pay

If the relief’s time-sensitivity prevents an action for punitive sanctions, the largest hurdle for remedial sanctions is proving that contemnor has the present ability to pay. An analogous probate case highlights the determination of whether the contemnor has the present ability to pay. [19] In that case, the decedent’s adult daughter was executor of the estate and absconded with approximately $100,000 from the sale of decedent’s home.[20] Ten months after receiving the funds, daughter testified that the money was gone, claiming that she gave money to her children and spent $25,000 on a condominium.[21] The trial court stated:

I have to tell you . . . I don’t find [daughter’s] testimony credible. I think she could easily get her hands on this money and that she has not. She has chosen not to do it out of spite toward her brother, and that is the basis of the Court order of contempt.[22]

Nevertheless, the Supreme Court of Colorado, sitting en banc rejected the probate court’s findings of fact regarding her present ability to comply on a clearly erroneous standard, holding that the probate court abused its discretion and failed to comply with Rule 107. The Supreme Court of Colorado directed the probate court judge to disqualify herself so another judge could adjudicate the contempt proceedings.[23] A past or future ability to comply are not sufficient grounds for a remedial contempt order, there must be a present ability to comply.[24]

The Supreme Court, in addition to unfavorably referencing the judge’s conduct, allowed daughter’s self-serving testimony, which the probate court found not credible, to disprove the finding that Daughter had the present ability to pay.[25] Opposing parties rarely successfully contest the testimony because they can’t prove how the money was spent. This precedent creates a strong standard of proof for determining that contemnor has the present ability to comply before issuing remedial sanctions.

In the situation where Husband’s inaction threatens to put a foreclosure on Wife’s credit record, meeting the standard for present ability to comply will be challenging. Under the Supreme Court of Colorado’s analogous standard applied in In re Estate of Elliott,[26] a Husband may be able to thwart a finding of his present ability to refinance by offering undisputed self-serving testimony that he cannot get a new loan. Husband may also provide a letter denying Husband a loan on the same terms as the previous loan. Unavailability of financing will be strengthened if Husband’s liquid assets from the decree are no longer available because he spent or invested them.[27] With a facially valid loan denial, Husband may avoid remedial sanctions because Wife cannot prove otherwise.[28] After proving contempt, the burden shifts to the putative contemnor to prove inability to comply, a difficult burden to meet.[29]

There are disadvantages to seeking both remedial and punitive sanctions. A court will likely merge the two actions since they involve the same parties and subject matter. In the example of a home approaching foreclosure, seeking both types of sanctions can harm the client because they will likely be adjudicated on the lengthy punitive sanctions timeline. Justice delayed is justice denied and a timely remedy is paramount because a foreclosure cannot be undone. Pragmatically, punitive sanctions have a longer timeframe to successfully purge the contempt.[30]

In conclusion, the sanctions sought have two distinct procedures.  Generally, remedial sanctions should be added to an action for punitive contempt. Urgent actions for remedial sanctions should not include punitive sanctions.  In our example, exclusively remedial sanctions should be sought to avoid the pending foreclosure, with attention given to the proof that contemnor Husband has the present ability to comply. If not, the foreclosure may be unavoidable.  In that case, punitive contempt provides relief after the fact.[31]

[1] Mr. Martinson is a recent graduate of Emory University School of Law, where he received the Transactional Law Certificate.  A Colorado native, he now practices family law at the Highlands Ranch Law Center.  Mr. Martinson played lacrosse for the Colorado College Tigers and loves to snowboard in the Rockies.  He is fluent in Spanish.

[2] Colo. R. Civ. P. 107(a)(1) (defining contempt as “[d]isorderly or disruptive behavior, a breach of the peace, boisterous conduct or violent disturbance toward the court, or conduct that unreasonably interrupts the due course of judicial proceedings; behavior that obstructs the administration of justice; disobedience or resistance by any person to or interference with any lawful writ, process, or order of the court; or any other act or omission designated as contempt by the statutes or these rules”).

[3] Courts are hesitant to require Husband to pay off the mortgage because such an order would infringe on his right to invest his money. Also, the situation would potentially be more adversarial if the loan was in Wife’s name alone.

[4] Both parties’ credit scores suffered because the bills either slipped through the cracks, were disputed, or were intentionally and maliciously not paid.

[5] It may not be as severe as bankruptcy, but a foreclosure can impede future mortgages.

[6] See Colo. R. Civ. P. 107(a)(2)–(5).

[7] See In re Estate of Elliott, 993 P.2d 474, 474 (Colo. 2000), where the reviewing court construed the sanctions as remedial although the probate court was not explicit in the type of sanctions granted.

[8] Colo. R. Civ. P. 107(a)(2) (defining Direct Contempt as “[c]ontempt that the court has seen or heard and is so extreme that no warning is necessary or that has been repeated despite the court’s warning to desist” and Indirect Contempt as “[c]ontempt that occurs out of the direct sight or hearing of the court”).

[9] My Cousin Vinny (20th Century Fox 1992).

[10] Id.

[11] Id.

[12] Id.

[13] See Colo. R. Civ. P. 107(d)(1)-(2).

[14] Colo. R. Civ. P. 107(e) (“Remedial and punitive sanctions may be combined by the court”). It is rare that a court fails to combine actions that are filed in the same time period and regarding the same court order or subject matter. CITE

[15] Colo. R. Civ. P. 107(a)(4)-(5).

[16] Colo. R. Civ. P. 107(d)(1) (“At the first appearance, the person shall be advised of the right to be represented by an attorney and, if indigent and if a jail sentence is contemplated, the court will appoint counsel. The maximum jail sentence shall not exceed six months unless the person has been advised of the right to a jury trial. The person shall also be advised of the right to plead either guilty or not guilty to the charges, the presumption of innocence, the right to require proof of the charge beyond a reasonable doubt, the right to present witnesses and evidence, the right to cross-examine all adverse witnesses, the right to have subpoenas issued to compel attendance of witnesses at trial, the right to remain silent, the right to testify at trial, and the right to appeal any adverse decision. The court may impose a fine or imprisonment or both if the court expressly finds that the person's conduct was offensive to the authority and dignity of the court. The person shall have the right to make a statement in mitigation prior to the imposition of sentence.”). In family law proceedings a negative inference cannot be made by the use of the right to remain silent.

[17] Punitive sanctions can be imposed after the foreclosure sale.

[18] Unlikely contempt actions for punitive sanctions, Colo. R. Civ. Pro. 107(d)(2) requires the judge to describe the means by which the person may purge the contempt

[19] In re Estate of Elliott, 993 P.2d 474 (Colo. 2000).

[20] Id. at 475.

[21] Id. at 476.

[22] Id. at 477 (internal quotation marks omitted). The Supreme Court of Colorado found other procedural errors and improper judicial conduct, but the remedial contempt sanctions were reversed due to the clearly erroneous finding that contemnor had the present ability to comply.

[23] Id. at 482.

[24] See McVay v. Johnson, 727 P.2d 416, 418 (Colo. App. 1986).

[25] Elliot, 993 P.2d at 479–80.

[26] 993 P.2d 474 (Colo. 2000).

[27] Under the federal equivalent of Colorado’s remedial contempt, it is clear that inability to pay is a complete defense to the charge even if the inability is self-induced. See Falstaff Brewing Corp. v. Miller Brewing Co., 702 F.2d 770, 782 n.7 (9th Cir. 1983).

[28] Wife likely cannot prove that a bank would qualify Husband for a loan.

[29] See In re Marriage of Lamutt, 881 P.2d 445, 447 (Colo. App. 1994).

[30] Any contempt filings will likely be consolidated, so filing an action for remedial sanctions before punitive sanctions will not be honored as separate filings.

[31] This article is limited to Colo. R. Civ. Pro. 107 and does not address the availability of a stay or the possibility of Wife making voluntary payments, subject to repayment by Husband, on the loan to avoid foreclosure.