Opinion
Aug. 1, 1972.
Editorial Note:
This case has been marked 'not for publication' by the court.
Page 1209
Carl Feldhamer, Gerash & Kaiser, Denver, for plaintiff-appellant.
Henry, Cockrell, Quinn & Creighton, Michael H. Jackson, John A. Ramsey, Denver, for defendant-appellee.
COYTE, Judge.
Plaintiff wife filed an action for divorce, which was granted in a non-contested proceeding on August 26, 1969. The parties had been married on February 14, 1949. Two children were born as the issue of this marriage. At the time of the marriage defendant was a partner in a business known as J. T. McDowell & Sons, which owned a ranch in Park County, Colorado, known at that time as the J. T. McDowell & Sons Ranch. The original purchase price was $50,000 and there had been $34,569 expended on improvements to the ranch prior to the marriage of the parties. During their marriage the parties lived on the McDowell Ranch, where defendant was the managing partner. At the time of the marriage, defendant owned a one-fourth interest in the partnership, which was increased to a one-third interest on the retirement of the father from the business.
Subsequently the defendant acquired an interest in an adjoining ranch which was purchased by the Santa Maria Cattle Co. in 1964, in which corporation defendant held a 47.5% Interest at the time of trial. Items of personal property had been acquired by the parties during the term of their marriage.
Plaintiff was given custody of the minor children. The support payments are not in issue. The court determined that this was not a proper case in which to award alimony. The court further found that there had been a great appreciation in the property owned by the defendant at the time of the marriage, that plaintiff was instrumental in preserving and appreciating the value of the J. T. McDowell & Sons Ranch, and that an equitable division of the property would result from dividing all property owned by the parties equally between them. Each party was dissatisfied with the manner and method used by the court in making the division of property and each has elected to appeal.
PERSONAL PROPERTY
There were several hearings held in relation to division of personal property. Inventoried lists were supplied to the court. The court in its final order on the division of personal property ordered that each party keep the property he or she had in his or her possession at that time. This order included the provision that plaintiff retain the Chrysler automobile which she had in her possession and that the plaintiff return to the defendant the desk which she had taken when she moved from the ranch. We find no abuse of discretion and affirm the order of the court on the division of personal property.
VALUE OF DEFENDANT'S INTEREST IN THE RANCHES
Defendant testified as to his opinion of the value of the ranches, and plaintiff and defendant both presented testimony of qualified experts as to the value of the ranches. At the conclusion of the hearing the trial court considered that both appraisers were well qualified and, in order to find the value of the respective ranches, took as a figure the everage of the values of the two appraisers.
On this premise, the court found that the value of the J. T. McDowell & Sons Ranch as of the date of the decree was $421,841; that there were debts of $30,000 owed by the partnership; and that the net value of this partnership property was $391,841; that the defendant had a one-third interest in the partnership and that the value of his interest was therefore $130,613.66. Since the court was dividing the property equally, it made an award to plaintiff in the amount of $65,306.83 as her interest in the McDowell Ranch.
However, the court misapprehended the effect of the capital account of defendant in computing his equity in the partnership. It considered that the capital account was taken into account by the appraisers in determining the value of the ranch; however, the evidence does not disclose that this was done. In any event, the capital accounts would have no bearing on the value of the partnership property. Rather, in considering the interest of defendant, the court should have considered the capital accounts as separate items, either as a debt owed by or to the partnership as the case may be. C.R.S.1963, 104--1--40. Defendant's capital account in the partnership was $52,054.65 and the capital account of one of the other partners was $13,622.52, and the third partner had a debit balance of $9,646.78 in his capital account. The total value of these three capital accounts ($56,030.39) must be subtracted from the net value of the partnership property (the ranch) of $391,841, which leaves $335,810.61 net equity of the partners in the partnership property. One-third of this amount is $111,936.87. The resulting figure of $111,936.87 is defendant's equity in the partnership. One-half of this amount is $55,968.43. Under the findings and order of the trial court, plaintiff was also entitled to one-half of defendant's capital account, which is $26,027.32, for a total award from the McDowell Ranch of $81,991.75.
The value of Santa Maria Cattle Co., taking the average between the two appraisers, was found by the court to be $352,049. There was $233,256.27 in legitimate obligations of the corporation, which left a net equity of $118,792.73. The value of defendant's 47.5% Interest was $56,426.55 and one-half of this interest is $28,213.27.
In considering defendant's interest in the Santa Maria Cattle Co. the court neglected to consider $16,688 which the corporation owed defendant. Plaintiff would have been entitled to one-half of this amount, or $8,344, which should be added to the $28,213.27, making a total of $36,557.27.
Plaintiff maintains that the water rights used in connection with these two ranches should have been appraised separately from the real estate. The water from an adjoining ranch had been sold to the City of Aurora, and until immediately prior to the commencement of this divorce proceeding, negotiations had been going on with the City of Aurora for the purchase of water on defendant's real estate holdings. The defendant's ranch operation had consisted of cattle, sheep and hay production and the water had always been used on the ranch in connection with said operation, and, if the water were sold, it would cause the operation to be changed. The court determined that to consider a separate value for the water would be pure speculation in that at the time of the hearing there were no prospects in sight for the sale of the water and the City of Aurora had advised defendant it was no longer interested in purchasing the water. The court concluded that the value of the ranches should be determined by the ordinary use of the land and water as it was used at the time the decree was entered. We agree with the decision of the trial court as to its determination of the value of the real estate and water at the time of the decree and that the real estate and water should not be appraised separately. Donnelly v. Donnelly, 167 Colo. 229, 449 P.2d 350; Menor v. Menor, 154 Colo. 475, 391 P.2d 473.
Defendant contends that the court erred in not deducting his equity in the partnership prior to the marriage of the parties and that plaintiff should share only in the appreciation in the value of the ranch since the marriage of the parties and cites Santilli v. Santilli, 169 Colo. 49, 453 P.2d 606, in support of this contention. We disagree. The trial court specifically found, based upon the length of the marriage and the personal labors of the plaintiff, that the plaintiff was instrumental in preserving and appreciating the value of the McDowell Ranch and that she was entitled to an equitable division of property, which division would include an undivided half interest in all property of the parties. The evidence supports this division and we approve the same.
INTEREST
The trial court determined that interest on the amount of money owed by defendant to plaintiff should be at the rate of 6% Per annum commencing one year from the date of the entry of judgment. Plaintiff claims that this was error. We disagree.
In the final property settlement order defendant is ordered to pay plaintiff the total amount due within two years from date of the judgment. To pay this amount will require some arranging by defendant. It is within the sound discretion of the trial court to defer the payment of interest for a time, as was done here. See Phillips v. Phillips, 171 Colo. 127, 464 P.2d 876. PROCEEDS FROM SALE OF STOCK
About the time this action was filed defendant sold securities and has accounted to the court for all but $13,687 received from the sale of the securities. There was much testimony, pro and con, as to charges and credits. After the trial was concluded the court took the matter under advisement and asked each party to supply a brief on the final disposition of the agreed $13,687. Referring to the testimony and briefs filed by the parties, the court found that the defendant had spent $11,241.04 of the $13,687 in direct support of the plaintiff and on the property which was before the court for division, and that without said payments by the defendant the property would not be before the court for division and that the payments made by the defendant were proper and inured to the benefit of the plaintiff herein. The court further found that the defendant had properly expended $11,241.04 of the aforesaid $13,687, and that plaintiff is entitled to one-half of the difference, i.e., one-half of $2,445.96, or $1,222.98. Plaintiff maintains that the court erred in its mathematical computation in that several of the items for which the court gave credit to defendant were items that had already been expended in arriving at the balance of $13,687. However the court received briefs and heard testimony of the parties, and its finding in this matter will not be disturbed where there is a conflict in the testimony and contentions of the parties, and there is evidence to support the finding. Accordingly, we approve the court's order in respect to this item.
PAYMENT WITHIN TWO-YEAR PERIOD
Defendant contends that the order of the trial court attempting to provide an equitable division of property works an unconscionable result. He maintains that he has minority interests in both the partnership and the corporate properties and that he will be required to liquidate his holdings in order to satisfy the order of the court and that such a forced liquidation is clearly an abuse of discretion and is contrary to the order of the court itself.
At the outset plaintiff stated that she did not desire to force a liquidation of the ranch holdings of defendant. Later, it was stipulated by the parties that they did not desire to force a liquidation and the court on the basis of plaintiff's request and the stipulation ordered:
'IT IS FURTHER ORDERED that the interest of the defendant in the J. T. McDowell & Sons partnership and the Santa Maria Cattle Company NOT be sold to satisfy the award herein.'
The court entered judgment as follows:
'That said judgment of $94,743.08 be paid by the Defendant to the Plaintiff in cash within a period of two years from this date, save and except that the Defendant be required to pay interest at the legal rate of 6% Per annum commencing one year from this date upon the unpaid balance, if any.'
And the court, considering the provision in the order that the property would not be sold, provided as follows:
'Considering the Stay of Execution granted upon the judgment issued herein and the stipulation of the parties to not require a forced sale of the Defendant's interests IT IS THEREFORE ORDERED that the Court retain jurisdiction of this matter to the extent that upon application of the parties, and either of them, the terms and manner of payment of the sum awarded to the Plaintiff may be modified or adjusted as the circumstances may warrant two years from this date.'
Since the court is not awarding alimony in this case, and the defendant is required to pay but nominal child support, the amount of which has not been contested on appeal before this court, the court could well have ordered that the ranch holdings be liquidated. However, in view of the stipulation of the parties, it entered the above order retaining jurisdiction for appropriate orders at the end of the two-year period. Since the court has retained jurisdiction, if defendant is unable to satisfy the judgment within two years, the court can, at that time, examine the order in relation to terms and manner of payment. In view of the desire of the parties, this should be a workable solution in furtherance of the aim of satisfying the judgment. We approve of the order entered.
Judgment is modified by increasing the amount of the judgment in accordance with this opinion and, as modified, the judgment is affirmed.
PIERCE and SMITH, JJ., concur.