Opinion
No. C2-01-449.
Filed August 28, 2001.
Appeal from the District Court, Chisago County, File No. F2991703.
James C. Whelpley, Twin City Attorneys, P.A., (for appellant)
Kenneth J. Jacobs, Law Offices of Kenneth J. Jacobs, (for respondent)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
In a marital dissolution action, appellant Robert Ford challenges (1) the award to respondent of a premarital interest in the parties' boat, motor, and trailer; (2) the court's determination of and the division of certain marital property; (3) the directive that he compensate respondent for income she lost due to his transfer to her of inoperable karaoke equipment; (4) the award of attorney fees to respondent; and (5) the court's denial of a new trial. We affirm.
DECISION
1. Appellant challenges the district court's finding that respondent had a premarital interest in a boat, motor, and trailer that was purchased prior to the parties' marriage. The characterization of property as marital or nonmarital is a question of law, which this court independently reviews. Campion v. Campion, 385 N.W.2d 1, 4 (Minn.App. 1986). However, the district court's findings of fact underlying the determination will not be disturbed unless clearly erroneous. Minn.R.Civ.P. 52.01; Kornberg v. Kornberg, 542 N.W.2d 379, 386 (Minn. 1996).
Findings of fact are clearly erroneous only if the reviewing court is "left with the definite and firm conviction that a mistake has been made." Fletcher v. St. Paul Pioneer Press, 589 N.W.2d 96, 101 (Minn. 1999) (quotation omitted). When determining whether findings are clearly erroneous, an appellate court views the record in the light most favorable to the district court's findings. Frauenshuh v. Giese, 599 N.W.2d 153, 156 (Minn. 1999). In general, if the district court had reasonable evidence to support its findings, the reviewing court should not disturb those findings. Fletcher, 589 N.W.2d at 101.
The parties lived together prior to the marriage and maintained a joint bank account in which they routinely commingled their monies. The boat, motor, and trailer were purchased with funds drawn from the parties' joint bank account. Respondent testified that at the time of purchase, both parties' names were put on the title to the boat, indicating an intent to transmute the property into marital property upon their marriage. See Tucker v. Tucker, 368 N.W.2d 335, 337 (Minn.App. 1985) (affirming district court's conclusion that parties' commingling of assets indicated intent to transmute property into marital property), review denied (Minn. Aug. 20, 1985).
A spouse claiming that property is nonmarital must prove the necessary facts by a preponderance of the evidence. Olsen v. Olsen, 562 N.W.2d 797, 800 (Minn. 1997). Upon separation of the parties, appellant vacated the marital home with the parties' business records and assets while respondent was attending a funeral. Many of the records in appellant's possession were never produced during the trial to allow adequate tracing. Further, in response to questioning while appellant was a witness, the court found his testimony to be less than forthright. This court has consistently held that the district court is in the best position to determine witness credibility. See General v. General, 409 N.W.2d 511, 513 (Minn.App. 1987) (noting that evaluating credibility of witnesses and the weight given to their testimony rests within the province of the finder of fact).
Under such circumstances, we hold that the district court had reasonable evidence to support the conclusion that the boat, motor, and trailer were premarital jointly owned property, and that such determination was not clearly erroneous.
Appellant testified that he surreptitiously sold the boat, motor, and trailer to his sister for $4,500 and that he kept the funds himself. He testified that the sale of the property occurred during the parties' marriage while respondent testified that the boat, motor, and trailer remained in their possession until the parties separated. Appellant's testimony concerning the sale of the property was discounted by the district court's credibility determination.
Minn. Stat. § 518.58, subd. 1a (2000), reads in relevant part:
If the court finds that a party to a marriage, without consent of the other party, has in contemplation of commencing, or during the pendency of, the current dissolution, * * * transferred, encumbered, concealed, or disposed of marital assets except in the usual course of business or for the necessities of life, the court shall compensate the other party by placing both parties in the same position that they would have been in had the transfer, encumbrance, concealment, or disposal not occurred.
Id. (emphasis added).
Appellant sold the property without respondent's knowledge and the court applied the statute. We therefore hold that the district court's compensatory award of $2,250 to respondent, representing one-half of the proceeds, was not clearly erroneous.
2. Appellant contests the division of and determination that certain karaoke equipment was marital property. It is undisputed that appellant owned substantial karaoke equipment prior to the marriage. Evidence was submitted that both parties contributed monies into a joint bank account during the course of the marriage to purchase replacement parts and equipment for the karaoke business they jointly owned. The equipment was routinely interchanged from one karaoke show to another.
Property acquired by one spouse prior to marriage is nonmarital property. Minn. Stat. § 518.54, subd. 5(b) (2000). Property acquired during the marriage is presumed to be marital property. Id., subd. 5. However, if nonmarital property is commingled with marital property, it will lose its nonmarital character unless it can be traced. Olsen, 562 N.W.2d at 800.
Because appellant had possession of the parties' business records, he was in a unique position to trace the marital nature of the pieces of karaoke equipment. Again, appellant was not forthcoming with documentary evidence. The district court therefore found that appellant failed adequately to trace his nonmarital interest in the karaoke property. See Doering v. Doering, 385 N.W.2d 387, 390 (Minn.App. 1986) (deferring to district court's credibility determination regarding testimony on whether party could trace property to a nonmarital source). Nonetheless, the district court awarded two large karaoke sets and 90% of the music to appellant and a small karaoke set and 10% of the music to respondent. Having independently reviewed the record, we conclude there is adequate support for the district court's findings on this issue.
Appellant contests the distribution of certain household goods, furnishings, furniture, and other miscellaneous items of personal property. He contends that the court did not award him any share of such property shown by the record to be marital.
The district court is given broad discretion regarding the division of property: "[t]he court may * * * award to either spouse the household goods and furniture of the parties, whether or not acquired during the marriage." Minn. Stat. § 518.58, subd. 1 (2000). Such decisions by the district court will be reversed only for a clear abuse of discretion. Crosby v. Crosby, 587 N.W.2d 292, 296 (Minn.App. 1998) (citation omitted), review denied (Minn. Feb. 18, 1999). Reviewing courts affirm the district court's division of property if "it had an acceptable basis in fact and principle even though this court may have taken a different approach." Servin v. Servin, 345 N.W.2d 754, 758 (Minn. 1984).
Each of the parties submitted a list of personal property claimed to be his or her own. The court heard testimony concerning the marital versus nonmarital nature of many of the individual items. District courts need not divide marital property equally but are only required to make a "just and equitable" division. Minn. Stat. § 518.58, subd. 1. Based on the record before us, no clear abuse of discretion is evident in the district court's distribution of household goods, furnishings, furniture, and other personal property, and we therefore affirm.
3. Appellant argues that the district court had no lawful basis to award respondent $6,900 to compensate for lost revenues due to the inoperable nature of the karaoke equipment delivered to her by appellant under a temporary order.
The order was issued to allow respondent the opportunity to supplement her income during the pendency of the dissolution with use of the parties' karaoke assets. She was unable to do so because the karaoke set provided her was missing equipment and therefore inoperable. The transfer of inoperable marital property by a party can invoke Minn. Stat. § 518.58, which mandates a compensatory award under such circumstances.
Here, the property award of $6,900 is measured by the loss of supplemental income which, according to respondent's testimony, she could have earned had the small karaoke set been delivered in a serviceable condition.
While awarding the $6,900 as a property equalization sum, it nonetheless appears to have some character of an award of spousal maintenance, and the court mistakenly identified the award as spousal maintenance in its original order. However, the district court corrected the designation in its amended order and made it clear that it was a means of alloting a modest award of marital property.
4. Appellant also challenges the district court's award of $3,000 in attorney fees to respondent. An award of attorney fees under Minn. Stat. § 518.14 "rests almost entirely within the discretion of the [district] court and will not be disturbed absent a clear abuse of discretion." Jensen v. Jensen , 409 N.W.2d 60, 63 (Minn.App. 1987).
The court shall award attorney fees if (1) the fees are necessary for a good-faith assertion of the party's rights in the proceeding; (2) the party from whom fees are sought has the means to pay; and (3) the party who seeks an award of fees cannot afford to pay attorney fees. Minn. Stat. § 518.14, subd. 1 (2000).
The record supports the district court's conclusion that the fees are necessary for a good-faith assertion of respondent's rights, appellant is able to pay the fees, and respondent is unable to pay.
The district court has broad discretion in awarding attorney fees in such circumstances and it must be found to be a clear abuse of discretion before this court will set an award aside. We do not find it to be such an abuse of discretion and we affirm the award of attorney fees for respondent.
5. Appellant contends that the court should have granted him a new trial to afford him the opportunity to rebut respondent's unanticipated testimony.
Appellate courts defer to the district court's broad discretion in deciding whether to grant a new trial because the district court has "the feel of the trial." Vangsness v. Vangsness, 607 N.W.2d 468, 472 (Minn.App. 2000).
Here, appellant had a full and fair opportunity to present rebuttal testimony at trial. He chose not to do so, and did not request a continuance. Appellant's surprise at respondent's testimony could have been avoided had he conducted discovery prior to trial. Consequently, the district court acted within its discretion in denying appellants' new trial motion.
Affirmed.