Opinion
No. 3-053 / 02-1018.
Filed April 30, 2003.
Appeal from the Iowa District Court for Webster County, WILLIAM C. OSTLUND, Judge.
Kelly Reis appeals from the spousal support and property division provisions of the decree dissolving the parties' marriage. MODIFIED IN PART AND REVERSED IN PART.
William H. Habhab, Fort Dodge, for appellant.
Dan T. McGrevey, Fort Dodge, for appellee.
Heard by ZIMMER, P.J., and HECHT and EISENHAUER, JJ.
Kelly Reis appeals from the decree dissolving his marriage to RaeAnne Reis, arguing that RaeAnne's rehabilitative alimony award was unwarranted, and that the property division was inequitable. We modify the decree to equalize the property division, and eliminate RaeAnne's spousal support award.
I. Background Facts and Proceedings .
Kelly and RaeAnne Reis were married in 1990. At the time of the dissolution hearing in May 2002, RaeAnne was forty-one years old and Kelly was thirty-three.
Both parties were employed throughout the marriage. RaeAnne is currently employed as a florist, earning $8.60 an hour. Kelly is employed as a mechanic with Frigidaire/Electrolux. He earns $18.50 an hour.
Although no children were born to this marriage, RaeAnne has two children from a previous marriage. Her son, nineteen years old and emancipated, lived with Kelly and RaeAnne for approximately six years. RaeAnne's daughter is sixteen years old, but does not reside with her mother. Beginning in 1997, RaeAnne had a $200 monthly foster care support obligation for her daughter, which was ongoing at the time of the dissolution.
Kelly also has a child or children from a prior relationship. Although his parental rights have been terminated, Kelly had a $12,000 to $13,000 accrued child support obligation that predated the marriage. When the parties married, RaeAnne was aware of this obligation, and the fact Kelly would need to make payments towards the debt during the marriage. The obligation was satisfied prior to the dissolution, through automatic deductions from Kelly's paycheck.
In its dissolution decree the district court determined RaeAnne was entitled to $400 a month in rehabilitative alimony for a period of forty-eight months. The court divided the parties' assets to award $41,674 to Kelly, and $56,462 to RaeAnne. The parties had no marital debt. In explaining the nearly $15,000 disparity in its distribution, the court noted it was essentially charging Kelly with a portion of the martial property that had been used to satisfy his child support obligation. It set off roughly half of the obligation, rather than the entire amount, because Kelly had helped to support RaeAnne's children. The court acknowledged the remaining $9,000 disparity in RaeAnne's favor, but found the distribution to be equitable in light of the parties' circumstances. Kelly appeals.
The actual distribution chart listed a $34,419 award to Kelly, and a $49,207 award to RaeAnne. However, these figures were arrived at by simply dividing Kelly's pension and the parties' stock equally, without assigning value to either item. Under the record it appears the stock was worth $1,309, and Kelly's pension approximately $13,200.
II. Scope of Review .
Our review of this equitable proceeding is de novo. Iowa R.App.P. 6.4. We give weight to the district court's findings of fact, but we are not bound by them. Iowa R.App.P. 6.14(6)( g).
III. Property Division.
Kelly first contends the property division was inequitable to him. We begin by addressing the district court's decision to setoff a portion of the child support obligation Kelly satisfied during the marriage. Rather than simply charging a debt to the party incurring the obligation, a court should look to see whether "payment of the obligation was a reasonable and expected aspect of the particular marriage." In re Marriage of Burgess, 568 N.W.2d 827, 829 (Iowa Ct.App. 1997). Where a spouse knows of the obligation before the marriage, knows payment of the obligation will be a part of the marriage, and acquiesces to the payments during the marriage, a specific setoff for that debt as part of the property distribution is inappropriate. Id.
Here, RaeAnne clearly knew of Kelly's debt and the need for payment at the time of the parties' marriage, and there is no evidence she ever objected to Kelly meeting his obligation. Under the circumstances, we agree with Kelly that a formal setoff was inappropriate. We therefore address the issue of whether the district court's unequal distribution of property was nevertheless equitable.
An equitable division of property must be made according to the criteria set forth in Iowa Code section 598.21(1) (2001). Iowa courts do not require an equal or percentage distribution. In re Marriage of Russell, 473 N.W.2d 244, 246 (Iowa Ct.App. 1991). However, assets acquired during a marriage are generally "nearly equally divided." In re Marriage of Van Regenmorter, 587 N.W.2d 493, 496 (Iowa Ct.App. 1998). The question before this court is whether the nearly $15,000 disparity between the property distributions was equitable, in light of the particular facts and circumstances of the case. See In re Marriage of Dean, 642 N.W.2d 321, 323 (Iowa Ct.App. 2002).
RaeAnne contends that equity supports the unequal distribution, given the parties' relative ages, earning capacities and ability to save for retirement. We cannot agree. In reviewing the factors set forth in section 598.21(1), including the length of the marriage and the contribution each party made to the marriage and towards the obligations and debts of the other, as well as each party's overall financial position, we find no compelling reason for such a substantial disparity in distribution. To the contrary, we conclude that an approximately equal distribution is just and equitable. Van Regenmorter, 587 N.W.2d at 496.
The parties accumulated their property through their joint efforts during their approximately twelve-year marriage. They have no debt. RaeAnne is forty-one years old, healthy, and gainfully employed. She has health insurance available through her employer. Although the district court found that it would be difficult for RaeAnne to make an equalization payment, she has been awarded debt-free assets from which she can obtain, or against which she can borrow, the funds necessary for such a payment. Upon our de novo review of the record, we modify the district court's property distribution to require RaeAnne to make a $7,000 equalization payment to Kelly. Such payment shall be made within six months from the date procedendo is issued in this matter.
IV. Alimony .
Kelly claims the district court should not have awarded RaeAnne rehabilitative alimony. The purpose of rehabilitative alimony is to support an economically dependent spouse during a limited period of education and retraining. In re Marriage of O'Rourke, 547 N.W.2d 864, 866-67 (Iowa Ct.App. 1996). The primary goal of rehabilitative alimony is self-sufficiency. Id. An award of such alimony "reflects the disparity in the parties' relative needs and earning capacities upon the dissolution of their marriage." In re Marriage of Smith, 573 N.W.2d 924, 927 (Iowa 1998).
We find the district court's estimate of the parties' net monthly incomes to be accurate, and conclude Kelly would be able to meet the spousal support obligation with his monthly salary. We question, however, RaeAnne's need for the support. She is receiving the parties' residence and a vehicle, as well as the greater portion of the parties' existing retirement savings. Taking into account RaeAnne's legitimate monthly expenses, and assuming both a monthly medical insurance payment and out-of-pocket medical expenses, her net income is sufficient to meet her monthly needs.
This is not a situation where a wife has been removed from the work force during the marriage, and has little or outdated skills and training. Cf. In re Marriage of Bevers, 326 N.W.2d 896, 900 (Iowa 1982). RaeAnne has a high school diploma, one year of college, and vocational training in the floral business. She has worked consistently during the marriage, primarily doing the type of work she most enjoys. The evidence simply does not demonstrate her economic dependence on Kelly. Cf. In re Marriage of Erickson, 553 N.W.2d 905, 907 (Iowa Ct.App. 1996) (denying rehabilitative alimony where parties were economically dependent on each other). While RaeAnne did express a desire to take more computer classes and become a computer technician, she offered no evidence or testimony that her income would increase in such a position, or what the cost of additional training might be. We conclude the award of alimony was inappropriate, under the facts of this case, and reverse that portion of the district court's decision.