In Re the Marriage of: John S. Dawson, petitioner, Respondent, vs. Stacy J. Dawson, Appellant.

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480 A. 08, subd. 3 (1998).

In Re the Marriage of:
 
Michelle Lorinda Perman,
n/k/a Michelle Lorinda Kruse, petitioner,
Respondent,
 
vs.
 
Craig Allen Perman,
Appellant.

Washington County District Court
File No. F9965952

Robert Q. Dickie, P.O. Box 25525, Woodbury, MN 55125 (for respondent)

Owen L. Sorenson, Stringer & Rohleder, Ltd., 1200 Norwest Center, 55 East Fifth St., St. Paul, MN 55101 (for appellant)

Considered and decided by Lansing, Presiding Judge, Davies, Judge, and Harten, Judge.

In this post-decree dispute over the division of marital property, appellant challenges the district court's: (1) award to respondent of additional money for her share from the sale of dining room furniture; (2) award to respondent of half the gross license fees received by appellant's business corporation; (3) order giving respondent access to documents of the business corporation; and (4) award of attorney fees. We affirm except for the license-fees award. We reverse that award and remand for findings on the issue.

Appellant Craig Allen Perman and respondent Michelle Lorinda Perman, k/n/a Michelle Lorinda Kruse, dissolved their marriage in 1997.

The dissolution judgment directed appellant to sell the parties' dining room furniture at a price the parties agreed on or, if they could not agree, at a price determined by an appraiser. The net proceeds were to be divided equally between the parties. Appellant sold the furniture for less than the agreed price and without using an appraiser.

The dissolution judgment also gave appellant the right to all the shares of stock in a company he owned, Aquatechnica. But, as part of the property award, he was also required to pay respondent "fifty percent (50%) of [license fees after taxes] for a water purification pill." The pill, developed by appellant during the parties' marriage, was Aquatechnica's sole asset at the time of the dissolution.

In responding to respondent's motion, the district court entered judgment against appellant in the sum of $17,900. This included an additional $900 for the dining room furniture, $16,000 for 50% of the license fees for the water purification pill ($8,000 for 1997 and $8,000 for 1998), and $1,000 in attorney fees.

Respondent told appellant that she would agree to sell the dining room furniture for nothing less than $4,000. But appellant sold the furniture for $2,200 and sent respondent a photocopy of the check received, along with his check for $1,100, and a note that stated, "I am enclosing a check for the sale of the dining room furniture and a copy of the check from the purchaser." Appellant claims that respondent, by cashing the check, completed an accord and satisfaction.

An "accord and satisfaction" is a method to discharge a contract or cause of action. Weed v. Commissioner of Revenue, 550 N.W.2d 285, 288 (Minn. 1996). A cause of action will be discharged by accord and satisfaction only if

the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.

Minn. Stat. § 336.3-311(b) (1998) (emphasis added).

The note accepting the check does not state that the check was tendered as full satisfaction of the claim. Accord and satisfaction, therefore, does not apply and the district court's $900 award was proper.

Appellant next argues that the district court abused its discretion in awarding respondent half the license fees for the pill, before taxes, expenses, and other distributions.

Fifty percent of Aquatechnica's stock is in appellant's father's name. Therefore, when appellant received the royalties in 1997, he distributed $8,000 to his father. He used the remaining $8,000 to pay costs allegedly incurred developing the pill and for what he alleged were ongoing business expenses. These alleged expenses resulted in an $839 loss for the company that year.

The district court found that appellant's distribution to his father was a sham for the purpose of hiding a marital asset from respondent. The court also concluded that, "Aquatechnica has very little, if any, legitimate operating expenses." The district court's determination that the distributions to appellant's father were a sham and that Aquatechnica had little operating expenses has support in the record and is not clearly erroneous. See Rogers v. Moore, 603 N.W.2d 650, 658 (Minn. 1999) (on appeal we do not weigh evidence, but rather, we "look to the record for evidence that could reasonably support the findings of the district court").

Although the district court did not abuse its discretion in its factual determinations, the $16,000 award was in excess of what was called for under the decree. Respondent was to receive 50% of the after-tax compensation received. The award of $8,000 to respondent for 1997 must be remanded to deduct income taxes.

As to the $8,000 awarded respondent for 1998, that award appears to have been premature, for no royalty tax returns for 1998 or other evidence demonstrated that the fees had been received by Aquatechnica that year. Therefore, the district court's award for 1998 was, on this record, an abuse of discretion. See Rouland v. Thorson, 542 N.W.2d 681, 685 (Minn. App. 1996) (trial court's determination of net income must have a reasonable basis in fact). We reverse that award and remand for additional findings and for modification consistent with this opinion.

Appellant's final two arguments challenge the district court's order to release business records and award of attorney fees. Both the order to release records and the attorney-fee award are based on the district court's finding that appellant's business-expense claim was a sham. On this issue, the district court's credibility determination was not clearly erroneous. See Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988) (stating appellate courts defer to district court credibility determinations). Therefore, the district court did not abuse its discretion in these fact determinations and in ordering release of records and awarding attorney fees.

Affirmed in part, reversed in part, and remanded.