Divorce; Division of marital assets; Mutual mistake; Kaftan v Kaftan; Principle that a unilateral mistake is insufficient to modify a previously negotiated agreement; Hilley v Hilley; Attorney fees & costs; MCR 3.206(D)

The court held that the trial court did not err by affirming and adopting the referee’s recommendations, by finding the parties did not make a mutual mistake, or by awarding plaintiff-ex-wife attorney fees. As part of their divorce settlement, the parties agreed to the distribution of the funds in defendant-ex-husband’s work-related 401(k), a marital asset. A referee concluded they agreed plaintiff would receive $80,000 of after-tax monies from defendant’s 401(k) and found that she did not receive the full amount. The trial court denied defendant’s objections to the referee’s recommendation, affirmed and adopted it, and granted plaintiff’s request for the balance of the retirement funds owed. It later entered a stipulated order stating defendant satisfied his obligation. On appeal, the court rejected his argument that the trial court erred by affirming and adopting the referee’s recommendation and awarding plaintiff attorney fees. Plaintiff assented to the terms on the record and defendant affirmed them on the record with no objection. “No conditions precedent or reservations were stated on the record, nor did defense counsel or defendant state anything that made plaintiff’s receipt of $80,000 tax free contingent.” In addition, there were “no conflicting provisions and no confusion in the plain language of the judgment that plaintiff would receive $80,000 tax free.” The court also rejected defendant’s alternative argument that the parties suffered from a mutual mistake of fact which required plaintiff to bear the burden of taxation on the distribution of funds from the 401(k). “[A]t best, defendant made a unilateral mistake regarding the amount of after-tax money held in his 401(k). Moreover, [he] sat idly while negotiating the settlement and when his counsel repeatedly represented to the trial court that defendant would pay plaintiff $80,000 free from taxation. The record reflects that plaintiff relied on defendant’s and his counsel’s representations regarding the receipt of $80,000 tax free, which constituted a material term of the parties’ bargained-for exchange. Defendant apparently failed to inform himself of the true nature of the funds held in his 401(k), and he made an offer on the basis of his unilateral mistaken belief regarding those funds which plaintiff accepted.” Finally, it rejected his contention the trial court’s award of attorney fees to plaintiff should be reversed, noting that “under MCR 3.206(D), the trial court could also properly award plaintiff reasonable attorney fees incurred because defendant refused to comply with the judgment.” Affirmed.