In re the Marriage of: Michelle E. Li-Kuehne, petitioner, Respondent,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA
IN COURT OF APPEALS
A17-1462

In re the Marriage of:
Michelle E. Li-Kuehne,
petitioner,
Respondent,

vs.

Stephen E. Kuehne,
Appellant

Filed June 18, 2018
Affirmed
Worke, Judge

Stearns County District Court
File No. 73-F9-01-002106

James J. Vedder, Brittney M. Miller, Moss & Barnett, Minneapolis, Minnesota (for
respondent)

John E. Mack, Mack & Daby, P.A., New London, Minnesota (for appellant)

Considered and decided by Connolly, Presiding Judge; Worke, Judge; and Smith,
John, Judge.*

* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.

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U N P U B L I S H E D O P I N I O N
WORKE, Judge
In this spousal-maintenance dispute, appellant argues that the district court abused
its discretion by (1) declining to modify appellant’s spou sal-maintenance obligation,
(2) requiring appellant to secure his maintenance obligation by maintaining a life-insurance
policy naming respondent as the beneficiary , and (3) awarding res pondent conduct-based
attorney fees. We affirm.
FACTS
Appellant-husband, Stephen E. Kuehne , and respondent -wife, Michelle E. Li -
Kuehne, married in 1988. The district court dissolved their marriage in 2003. At the time
of the dissolution, wife was unemployed while husband was employed as a radiologist. As
part of the spousal-maintenance order, husband and wife agreed that their monthly living
expenses were $15,000 per month each and agreed to the following maintenance step-
downs: husband would pay wife $12,500 per month from March 2003 through August
2006, and $10,000 per month from September 2006 through August 2009. Afterwards,
there would be a de novo review of spousal maintenance. Husband also agreed to obtain a
$1 million life-insurance policy naming wife as the beneficiary to secure his maintenance
obligations.
In August 2009, the district court held a hearing on the spousal-maintenance award.
Wife was then employed as a tenure-track accounting instructor earning $56,953 in gross
income per year. Husband’s income varied, ranging from a high of $798,740 in 2003 to a
low of $542,817 in 2008. The district court ordered permanent spousal maintenance to

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wife of $6,000 per month, subject to biannual cost -of-living adjustments. The court also
ordered Husband to continue maintaining the life-insurance policy.
In March 2017, wife submitted notice for her biannual cost-of-living adjustment.1
In response, husband moved to modify his maintenanc e obligations. In his motion,
husband requested that the district court deny wife’s cost-of-living adjustment, terminate
or substantially reduce his maintenance obligation, and terminate the requirement that he
maintain the life -insurance policy. Husband also filed an unti mely amended motion on
June 14 and an untimely affidavit on June 23. The court accepted these filings over wife’s
objections.
At the time of the hearing on husband’s modification motion, husband and wife
were both 54 years old. Husband was earning $640,787 in gross income per year. Wife
was now a tenured profes sor earning $72,157 in gross annual income. At the hearing,
husband argued that wife’s increased income should relieve him of his maintenance
obligations. He also expressed an interest in “eventual retirement,” which he argued would
constitute a change in circumstances that should affect his future maintenance obligations.
The district court denied husband’s requests. The court determined that husband’s
general intention to retire at some unspecified time in the future did not constitute a
substantial change in circumstances requiring modification of his current maintenance
obligation. The district court also determined that wife would be unable to meet her
monthly living expenses without a continuing award of spousal maintenance and the

1 Wife was already receiving $6,542.80 in maintenance per month due to previous cost-of-
living adjustments.

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circumstances justified keeping the life-insurance policy in place. Additionally, the district
court concluded that h usband’s requests were likely retaliatory in response to wife’s
“routine request for a cost -of-living adjustment,” husband increased the legal costs of the
proceeding by failing to respond to discovery requests and untimely filing his pleadings in
a timely manner , and husband’s motion had “no basis in law or fact.” Because of this
behavior, the district court awarded wife $8,000 in conduct-based attorney fees. Husband
appeals.
D E C I S I O N
On appeal, husband argues that the district court abused its discretion by declining
to modify his spousal-maintenance obligation, by continuing to require him to maintain the
life-insurance policy, and by awarding wife conduct-based attorney fees.
Spousal maintenance
We review decisions concerning modifications of spousal-maintenance for an abuse
of discretion. Hecker v. Hecker, 568 N.W.2d 705, 709-10 (Minn. 1997). A district court
abuses its discretion if its findings of fact are unsupported by the record or if it improperly
applies the law. Dobrin v. Dobrin , 569 N.W.2d 199, 202 (Minn. 1997). An award for
spousal maintenance may be modified based on a substantial change in circumstances if
the change makes the existing award unfair and unreasonable. Minn. Stat. § 518A.39,
subd. 2(a), (b) (2016). Circumstances that may warrant modification include “substantially
increased or decreased gross income of an obligor or obligee” and “substantially increased
or decreased need of an obligor or obligee.” Id., subd. 2(a)(1), (2). T he party moving to
modify a spousal-maintenance award bears the burden of demonstrating a substantial

5
change in circumstances that renders the existing order unfair and unreasonable. Hecker,
568 N.W.2d at 709.
Husband argues that wife’s recent income increase is a substantial change in
circumstances requiring modification. W ife was previously employed as a tenure -track
accounting instructor earning $56,953 per year. She recently acquired tenure and now
earns $72,157 per year—about a 27% increase in her income.
The district court determined that wife’s higher income did not warrant modification
because, although wife’s income increased by about 27%, husband’s income increased by
almost 41% in that same time. The district court found that husband now earns
approximately $640,787 per year —almost nine times higher than w ife—and that
husband’s increase in income “results in a significantly greater dollar amount than does the
27% increase in [wife]’s income.” The district court also found that wife has now “reached
the height of her career and earning capacity.” And even with this increase, wife still “does
not earn sufficient income to meet her living expenses, even though those expenses have
already been reduced below the marital standard of living.” 2
When reviewing a district court’s determination of income for mainte nance
purposes, this court will not set aside the district court’s finding s of fact unless they are
“clearly erroneous.” Peterka v. Peterka, 675 N.W.2d 353, 357 (Minn. App. 2004). Here,
although w ife’s income did increase, the district court correctly noted that husband’s

2 The district court found that w ife’s curre nt monthly living expenses were $12,382,
including $300 per month for the parties’ children. It also found that wife’s “expenses are
$2,161 less than her expenses were at th e time of the 2009 proceeding, and are less than
the agreed upon marital standard of living of $15,000 per month.”

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income rose even more in that same time. 3 Given that wife has now reached her maximum
earning potential along and that she still requires spousal maintenance to meet her living
expenses, it was not unreasonable and unfair to continue requiring h usband to provide
support.
Husband also argues that the district cou rt did not adequately account for his
intention to retire, which would be a substantial change in circumstances. The district court
rejected this argument because it found that husband was 54 years old, he continued to be
employed as a medical doctor, and he was arguably “a decade or more away from normal
retirement age.” While the district court stressed that it was not requiring husband to work
until a certain age, the court did stress that it was requiring husband to “actually show a
change in circumstances before he seeks modification of his spousal maintenance
obligation.” The court concluded that husband’s “thinking about retirement sometime in
the future” was a general aspiration but not a present change of circumstances.
In the child -support context, this court has noted that d etermining whether a
substantial change in circumstances has occurred requires “comparing the parties’
circumstances at the time support was last set or modified to their circumstances at the time
of the motion to modify .” Maschoff v. Leiding, 696 N.W.2d 834, 840 (Minn. App. 2005)

3 Husband argues that Minnesota law presumes that a 20% change in an obligee’s gross
income is considered a substantial change in circumstanc es. Husband is incorrect ; the
statute states that a 20% decrease in gross income triggers the presumption. Minn. Stat.
§ 518A.39, subd. 2(b)( 5) (2016). Husband presents additional statutory authority and
caselaw to support this argument, but these authorities are inapplicable because they
concern a presumption that exists only in the child-support context. Husband argues that
we should apply this same presumption in his spousal-maintenance case, but this is an issue
for the legislature, not the courts.

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(emphasis added). And any finding of change must be supported “upon clear proof of facts
. . . existing at the time” the award “was last modified.” Wiese v. Wiese, 295 N.W.2d 371,
372 (Minn. 1980).
Husband did not present any facts to the dis trict court showing that his retirement
was imminent. See Hemmingsen v. Hemmingsen , 767 N.W.2d 711 (Minn. App. 2009)
(addressing the intersection of retirement and modification of maintenance), review
granted (Minn. Sept. 9, 2009), appeal dismissed (Minn. Feb. 1, 2010). Husband complains
that he should not be forced “to retire first and then argue about a reduction or termination
of maintenance payments,” but the law does not require husband to retire first; the law only
requires a party to demonstrate “clear proof of facts” that exist at the time of the motion to
modify, illustrating his intent. Wiese, 295 N.W.2d at 372 . Husband’s general aspiration
to retire at some unspecified point in the future is too abstract to qualify as clear proof of
fact, and we conclude that the district court did not abuse its discretion in denying
husband’s motion to modify on this ground.
Lastly, husband claims that the district court did not analyze the required statutory
factors under Minn. Stat. § 518.552, subd. 2 (2016) when it decided to keep the
maintenance award intact. If a party seeking to modify a maintenance award fails to show
a substantial change in circumstances, the district court is not obligated to consider the
statutory factors in section 518.552. Tuthill v. Tuthill, 399 N.W.2d 230, 232 (Minn. App.
1987) (“The failure to show such a change [in circumstances] precludes a modification of
maintenance obligations under [the spousal-maintenance-modification statute]. Therefore,
it is not necessary for the [district] court to make findings regarding any other factors

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addressed in the statute. ”). Because the district court did not abuse its discretion in
determining that husband failed to show a substantial change in circumstances, it was not
required to examine the maintenance award in light of these statutory factors.
Life-insurance policy
Husband claims the district court’s decision to continue requiring him to maintain a
life-insurance policy benefiting wife was “unfair and irrational.” We initially note that the
standard for reviewing a district court’s decision regarding whether to modify a
maintenance-related obligation is whether the district court’s decision constituted an abuse
of its discretion. Hecker, 568 N.W.2d at 709-10. Here, husband concedes that Minnesota
courts often use life -insurance policies to secure payments . For instance, in Laumann v.
Laumann, this court wrote that district courts have “discretion to consider whether the
circumstances justifying an award of maintenance also justify sec uring it with life
insurance.” 400 N.W.2d 355, 360 (Minn. App. 1987), review denied (Minn. Nov. 24,
1987). And in Walker v. Walker , we determined that a district court did not abuse its
discretion by requiring a life -insurance policy at the conclusion of a 30 -year marriage
where the secured party was 60 years old. 553 N.W.2d 90, 96 (Minn. App. 199 6). Other
cases have echoed the conclusion that the use of life-insurance policies to secure spousal-
-maintenance awards is neither unfair nor irrational. See, e.g., Arundel v. Arundel , 281
N.W.2d 663, 667 (Minn. 1979) (“We have allowed provisions for life insurance to secure
permanent alimony. ”); Kampf v. Kampf , 732 N.W.2d 630, 635 (Minn. App. 2007)
(“Additionally, the circumstances in this case compel us to conclude that the district court

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abused its discretion by refusing to require Kampf to carry li fe insurance as security. ”),
review denied (Minn. Aug. 21, 2007).
The district court determined that husband should continue to maintain a life-
insurance policy benefitting wife. The district court wrote that it had previously
“determined that circumstances justified securing [wife]’s spousal maintenance award with
life insurance.” “Circumstances have not changed,” the court stated, as evidenced by
husband’s decision “not to convert the policy into a permanent policy,” despite his financial
advisor’s adv ice to do so, and the fact that w ife’s portion of the policy is “minimal in
comparison to [h usband]’s substantial income.” We agree with the district court’ s
reasoning, and because caselaw allows the use of life -insurance policies to secure
maintenance, we conclude that requiring husband to maintain life insurance was not an
abuse of its discretion.
Conduct-based attorney fees
Husband challenges the district court ’s decision to award wife conduct -based
attorney fees based on husband’s dilatory and retaliatory behavior in litigating this matter.
Courts may levy conduct -based attorney fees “against a party who unreasonably
contributes to the length or expense of the proceeding.” Minn. Stat. § 518.14, subd. 1
(2016). This court reviews an award of conduct-based attorney fees for an abuse of
discretion. Brodsky v. Brodsky, 733 N.W.2d 471, 476 (Minn. App. 2007).
The district court awarded wife conduct -based fees because it found that
(1) husband’s motion to modify maintenance was made in retaliation for wife’s “routine
request for a cost-of-living adjustment,” (2) husband increased the litigation costs of wife’s

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routine request by failing to respond to wife’s discovery requests, (3) husband failed to file
his pleadings in a timely manner, and (4) husband filed motions with “no basis in law or
fact.” In support of this last point , the district court wrote that h usband’s financial
circumstances had “undeniably improved” since the parties’ divorce and h usband’s own
cash-flow analysis showed that wife could not meet her living expenses without a
continued award of spousal maintenance.
We do not believe the district court abused its discretion by awarding wife attorney
fees. This dispute was initiated when wife sent a notice4 to husband of a routine, biannual
cost-of-living adjustment that she was entitled to under a previous spousal -maintenance
order. Husband then challenged the entire maintenance award. While husband is correct
that his state of mind should not matter if he raised meritorious arguments, additional
factors undermine his position. For instance, husband filed an untimely amended motion
and an untimely affidavit which delayed progression of the case . And the district court
correctly noted that husband’s own evidence showed that wife would have trouble meeting
her living expenses without spousal maintenance. We conclude that the decision to award
wife conduct-based attorney fees was not an abuse of the district court’s discretion.
Affirmed.

4 These cost-of-living adjustments do not require wife to formally move the court, they
only require her to send “notice of the intended adjustment” to husband. See Minn. Stat.
§ 518A.75, subd. 2 (2016).