Opinion
No. C3-98-805.
Filed December 8, 1998.
Appeal from the District Court, Clay County, File No. F2-98-33.
Randall Gordon Knutson, (for appellant).
Deann Marie Pladson, (for respondent).
Considered and decided by Crippen, Presiding Judge, Willis, Judge, and Foley, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
Appellant Orvin G. Hilde seeks review of the trial court's judgment in a marital dissolution action. Appellant challenges the court's distribution of marital property, valuation of the marital homestead, and the award of spousal maintenance to respondent. Respondent Arla M. Hilde, in her notice of review, challenges the trial court's denial of her request for attorney fees. Respondent also requests attorney fees on appeal. We affirm the trial court and deny the motion for fees.
FACTS
The parties were married in 1962 and lived together continuously until 1983. At some point in 1983 respondent was hospitalized for depression. She spent one month in the hospital and, while she has not been hospitalized since, she has had continuing problems with depression and is currently taking medication to address those problems.
Between 1983 and 1991, respondent spent some time living in the marital home and some time living with their oldest son, Scott. Respondent lived out of the home for five continuous years from 1991 to 1996. Respondent's testimony is that her total time out of the home from 1983 through the time of dissolution was 10 years. Appellant testified that it was 12 years. The parties reconciled in the fall of 1996 and lived together until November 16, 1997.
Throughout the parties' marriage, appellant controlled the marital assets. During the periods respondent lived outside of the home, she did not contribute to the maintenance of the marital property and did not depend upon appellant or the marital assets for support.
The parties stipulated that appellant's net monthly income is $1,964 and his monthly expenses are $816. Appellant works full time plus overtime for a construction company. Respondent testified that her net monthly income is $307, which she derives from two part-time cleaning jobs, and her monthly expenses are $1,340. Respondent included $300 in her monthly expenses for "retirement, savings, emergency." Appellant's expense statement did not include a similar item.
The parties stipulated that appellant would be awarded the marital homestead, appraised at $78,000. Appellant testified that the actual value of the property is approximately $55,000 after taking deductions for capital gains taxes on the farmland and outbuildings, realtor fees, and improvements necessary to sell the property. Appellant testified that he did not have plans to sell the property.
The parties stipulated to the division and value of personal property. The evidence shows that the marital assets in bank accounts and investments total $351,749.
Respondent brought this action for marital dissolution on January 6, 1998. Both parties moved for attorney fees. Following a trial, the court dissolved the parties' marriage by judgment and decree of dissolution dated April 22, 1998. The court valued the homestead at $78,000 and awarded it to appellant pursuant to the parties' stipulation, divided marital assets equally, ordered appellant to pay spousal maintenance of $800 per month for a minimum of one year, and denied the parties' motions for attorney fees. This appeal followed.
DECISION
1. Valuation of the Marital Home
Property valuation is a finding of fact. Hertz v. Hertz , 304 Minn. 144, 145, 229 N.W.2d 42, 44 (1975). "Findings of fact * * * shall not be set aside unless clearly erroneous." Minn.R.Civ.P. 52.01. "[T]he market valuation * * * should be sustained if it falls within the limits of credible estimates made by competent witnesses." Hertz at 145, 229 N.W.2d at 44.
Appellant argues the value of the marital home is between $55,000 and $57,000, rather than $78,000 as the trial court found. In support of his argument, appellant claims that he would incur numerous costs if he sold the property, including capital gains taxes, realtor fees, necessary improvements, and county fees. But appellant testified that he did not plan to sell the property. "[S]peculative or contingent liabilities should not be considered in determining the net marital estate." Nolan v. Nolan , 354 N.W.2d 509, 513 (Minn.App. 1984), review denied (Minn. Dec. 20, 1984); see also Aaron v. Aaron , 281 N.W.2d 150, 153 (Minn. 1979); Salstrom v. Salstrom , 404 N.W.2d 848, 853 (Minn.App. 1987) (requiring trial courts to look only at tax consequences of distribution, not any future transactions). Here the trial court had evidence in the form of a professional appraisal that set the value of the marital home at $78,000. The trial court's finding was not clearly erroneous.
2. Property Distribution
A trial court has broad discretion in dividing property. Rutten v. Rutten , 347 N.W.2d 47, 50 (Minn. 1984).
There must be a clearly erroneous conclusion that is against logic and the facts on record before this court will find that the trial court abused its discretion.
Id .
The division of marital property is governed by Minn. Stat. § 518.58 (1996). Minn. Stat. § 518.58, subd. 1, provides as follows:
Upon a dissolution of a marriage * * * the court shall make a just and equitable division of the marital property of the parties without regard to marital misconduct, after making findings regarding the division of the property. The court shall base its findings on all relevant factors including the length of the marriage, any prior marriage of a party, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities, needs, opportunity for future acquisition of capital assets, and income of each party. The court shall also consider the contribution of each in the acquisition, preservation, depreciation or appreciation in the amount or value of the marital property, as well as the contribution of a spouse as a homemaker. It shall be conclusively presumed that each spouse made a substantial contribution to the acquisition of income and property while they were living together as husband and wife. * * *
Appellant argues that the statutory presumption of substantial contribution to the marital assets was effectively rebutted here by evidence that respondent did not contribute during the periods of separation. Appellant contends that the accumulated periods of separation comprised approximately one-third of the term of the marriage or 12 years. Appellant argues that under these circumstances the trial court should have found that the presumption of substantial contribution was rebutted and treated the assets accumulated during those periods as if they were non-marital. See March v. March , 435 N.W.2d 569, 571 (Minn.App. 1989); Batsell v. Batsell , 410 N.W.2d 14, 17 (Minn.App. 1987) (presumption only applies to period of time parties lived together), review denied (Minn. Sept. 30, 1987). But see Kitchar v. Kitchar , 553 N.W.2d 97, 103 (Minn.App. 1996) (distinguishing March and Batsell on their facts and refusing to hold that eight-year separation rebutted statutory presumption), review denied (Minn. Oct. 29, 1996).
What appellant fails to recognize here is that the trial court clearly did not apply the statutory presumption when it found that "[d]uring the time the parties lived separately, the [appellant] substantially contributed to the acquisition and preservation of marital assets, and [respondent's] contribution was minimal." Appellant does not contend that the property in question is not marital property, only that it should be treated as though it were nonmarital. Therefore, we assume the property in question is marital. The trial court made the following findings under Minn. Stat. § 518.58, subd. 1, in support of its equal division of assets:
Minn. Stat. § 518.54, subd. 5 (1996), defines marital property as property, real or personal * * * acquired by the parties, or either of them, to a dissolution * * * at any time during the existence of the marriage relation between them * * *.
[I]t is just and equitable to divide all to the marital assets equally between the parties. Although there were several years during which the parties lived separately, and during such time the acquisition of marital assets was due largely to the labors of the respondent, there are other factors that support an equal division of the marital estate. First, this was a lengthy marriage lasting 36 years. Second, the respondent receives a significantly larger salary than the petitioner, and he has greater marketable skills than the petitioner. Third, the petitioner has experienced difficulties with depression since 1983, whereas the respondent has no mental health problems. Fourth, the petitioner was never fully independent between the years of 1983 and 1997, and she never completely severed her ties from the respondent during that time. Therefore, considering all of the relevant factors, this would not be an appropriate case to treat property acquired during periods of separation as though it is non-marital property, and award all of it without division to the respondent.
The record supports each of the above findings. The statute requires the court to consider the contribution of each party to the marital assets along with the other relevant factors. Minn. Stat. § 518.58, subd. 1. The court considered the separation, but determined that the equities of the entire situation, in light of the relevant statutory factors, compelled an equal division of the property. That determination was not against logic and was supported by the record. Rutten, 347 N.W.2d at 50. Therefore, the court did not abuse its discretion.
3. Spousal Maintenance
The standard of review on appeal from a trial court's determination of a maintenance award is whether the trial court abused the wide discretion accorded to it. Erlandson v. Erlandson , 318 N.W.2d 36, 38 (Minn. 1982). This court will not find an abuse of discretion absent "a clearly erroneous conclusion that is against logic and the facts on record." Rutten , 347 N.W.2d at 50. "Findings of fact concerning spousal maintenance must be upheld unless they are clearly erroneous." Gessner v. Gessner , 487 N.W.2d 921, 923 (Minn.App. 1992).
Awards of spousal maintenance are governed by Minn. Stat. § 518.552 (1996). Minn. Stat. § 518.552, subd. 1, provides:
In a proceeding for dissolution of marriage * * * the court may grant a maintenance order for either spouse if it finds that the spouse seeking maintenance:
(a) lacks sufficient property, including marital property apportioned to the spouse, to provide for reasonable needs of the spouse considering the standard of living established during the marriage, especially, but not limited to, a period of training or education, or
(b) is unable to provide adequate self-support, after considering the standard of living established during the marriage and all relevant circumstances, through appropriate employment * * *.
The factors relevant to amount, duration, and designation as either temporary or permanent maintenance are listed in Minn. Stat. § 518.552, subd. 2. There is a statutory preference for permanent maintenance where justified under the relevant factors. Minn. Stat. § 518.552, subd. 3; Nardini v. Nardini , 414 N.W.2d 184, 196 (Minn. 1987).
Appellant argues that the trial court abused its discretion by awarding respondent spousal maintenance of $800 per month for a minimum of one year because respondent did not show any need for maintenance. In support of his argument, appellant asserts that respondent has adequate property under the property distribution to support herself, that respondent is voluntarily underemployed, and that respondent inflated her monthly expenses.
Appellant asserts that respondent's share of the property distribution, $214,875, is sufficient to support respondent at her customary standard of living. In support of the proposition that a property settlement can obviate maintenance, appellant cites Abuzzahab v. Abuzzahab, 359 N.W.2d 12, 14 (Minn. 1984). In Abuzzahab , the supreme court reversed and remanded the trial court's permanent spousal maintenance award of $4,000 per month due to the fact that the obligee spouse had the ability to earn $18,000-$22,000 per year and had received a property settlement of $300,863 in cash. Id. However, Abuzzahab was decided under Minn. Stat. § 518.552 (1982) (amended 1985). Id. That statute was amended to include subdivision 3. 1985 Minn. Laws ch. 266, § 2; s ee also Nardini , 414 N.W.2d at 195-99 (discussing legislative intent of inclusion of subdivision 3). Minn. Stat. § 518.552, subd. 3 (Supp. 1985) provided the preference for permanent over temporary maintenance. Nardini , 414 N.W.2d at 196. The current statute includes subdivision 3 as enacted in 1985. See Minn. Stat. § 518.552, subd. 3 (1996).
In Nardini , the supreme court reversed an order for temporary maintenance and remanded to the trial court to determine the proper amount of permanent maintenance. Id. , 414 N.W.2d at 199. The court focused on the equity as between the parties when it decided that permanent maintenance was appropriate despite a sizable property distribution. Id. at 198. The court also stressed that the marriage was a traditional one in which the wife was a homemaker and was out of the work force for nearly thirty years. Id. at 197.
Except for the periods of separation, the situation in the present case is similar to that in Nardini . The parties had a lengthy, traditional marriage. Without the maintenance award, appellant would be able to reinvest his investment gains and continue to invest out of income, while respondent would be dependent on investment interest for her basic living expenses and may need to deplete her resources in order to meet her needs. Id. at 198. The maintenance award should not be disturbed on the basis of the property distribution in this case. Fink v. Fink , 366 N.W.2d 340, 342 (Minn.App. 1985) (normally, courts do not expect parties to liquidate the principal of their property award to pay expenses).
Appellant also argues that respondent does not need spousal maintenance because she is voluntarily underemployed. In order to impute income to a party for the purpose of setting maintenance, the court must find that the party is voluntarily underemployed in bad faith. Carrick v. Carrick , 560 N.W.2d 407, 410-11 (Minn.App. 1997). Here there is no evidence of bad faith on the part of respondent. The trial court found that during the periods of separation, respondent never achieved financial independence and has made approximately the same monthly income of $300 that she testified she currently makes. The record supports the trial court's finding.
Finally, appellant argues that respondent inflated her monthly expenses. Respondent testified that her monthly expenses were $1,340. One of the items she included on her expense report was $300 for "retirement, savings and emergency." The trial court found that respondent's monthly expenses were $1,040, clearly eliminating the $300 item. The trial court's findings are supported by the record and are not clearly erroneous.
The trial court found that respondent (1) had fewer marketable skills than appellant; (2) is not likely to obtain skills that will make her more employable; (3) is 55 years old; (4) has experienced problems with depression and is currently taking medication; and (5) is not able to support herself through appropriate employment. The findings are supported by the record and address the factors relevant to maintenance awards under Minn. Stat. § 518.552. The award of maintenance is affirmed.
4. Attorney Fees at the Trial Court Level
The award or denial of attorney fees is a discretionary decision and it will not be upset absent an abuse of discretion. Katz v. Katz , 408 N.W.2d 835, 840 (Minn. 1987). Respondent sought attorney fees in the amount of $250 at trial under Minn. Stat. § 518.14, subd. 1 (1996), providing for fees based on need.
The failure to award attorney fees cannot be characterized * * * as an abuse of discretion where the property and income of the parties, following the reapportionment of the marital property and the award of permanent maintenance, should be relatively evenly balanced.
Nardini , 414 N.W.2d at 199. The trial court equitably distributed property and awarded maintenance so as to put the parties in very similar financial conditions. The trial court did not abuse its broad discretion in denying respondent's motion for fees.
5. Attorney Fees on Appeal
Respondent also requests attorney fees on appeal under both Minn. Stat. § 518.14 and Minn. Stat. § 549.211 (Supp. 1997). An award of attorney fees on appeal rests within the discretion of this court. Roehrdanz v. Roehrdanz , 438 N.W.2d 687, 691 (Minn.App. 1989), review denied (Minn. June 21, 1989). Respondent makes the request for fees in her brief without a separate motion as required by Minn. Stat. § 549.211, subd. 4(a). Furthermore, respondent has not demonstrated financial need as required by Minn. Stat. § 518.14, subd. 1. The motion for fees is therefore denied.