In re Cathy A. Van Ert, petitioner, Respondent, vs. Bradley K. Van Ert, Appellant.

In re Cathy A. Van Ert, petitioner, Respondent, vs. Bradley K. Van Ert, Appellant. A04-872, Court of Appeals Unpublished, March 22, 2005.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2004).

 

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A04-872

 

In re Cathy A. Van Ert, petitioner,

Respondent,

 

vs.

 

Bradley K. Van Ert,

Appellant.

 

Filed March 22, 2005

Affirmed in part, reversed in part and remanded Poritsky, Judge*

 

Ramsey County District Court

File No. F8-01-1455

 

Kelley R. Lorix, Mackall, Crounse & Moore, PLC, 1400 AT&T Tower, 901 Marquette Avenue, Minneapolis, MN 55402 (for respondent)

 

Jonathan J. Fogel, Erica B. Klein, Fogel Law Office, 5402 Parkdale Drive, Suite 203, Minneapolis,  MN 55416 (for appellant)

 

            Considered and decided by Toussaint, Chief Judge; Halbrooks, Judge; and Poritsky, Judge.

U N P U B L I S H E D   O P I N I O N

PORITSKY, Judge

            On appeal from a judgment dissolving the parties' marriage, appellant-father argues that the district court (a) made findings regarding father's monthly expenses that were not supported by the record; (b) abused its discretion by awarding permanent spousal maintenance; (c) abused its discretion by requiring father to make an accelerated payoff of the balance of a debt assumed in the property settlement; (d) abused its discretion by awarding mother past maintenance and child-support; and (e) erred by characterizing four bank accounts as mother's nonmarital property.  We affirm on all issues except the amount of the award of monthly maintenance.  We reverse the maintenance award and remand for either a new award or additional findings in support of the current award. 

FACTS

The parties married in 1988 and have three children, born in 1989, 1992, and 1997 (ages 6, 11, and 13 at the time of trial).  Appellant, Bradley K. Van Ert (father), is employed full-time by the St. Paul Companies as a senior analyst.  Respondent, Cathy A. Van Ert (mother), was employed as an accounting representative until 1989, when her position was terminated due to a staff reduction.  Since that time, mother has not been employed outside the home, has raised the children, and has not sought additional education.  The parties separated in March 2001.  Mother petitioned to dissolve the marriage in October 2001. 

In February 2002, the district court entered its temporary order (a) setting father's temporary support and maintenance obligations, and (b) awarding mother primary physical custody of the children and awarding the parties joint legal custody.  Following a custody evaluation by the county domestic relations department, the parties largely stipulated to the custody evaluation report's recommendations and agreed that mother would continue to have sole physical custody and that the parties would share joint legal custody.  

The parties appeared for trial on the remaining maintenance and support issues before a referee of the district court in December 2002, March 2003, and April 2003.  In August 2003, the district court approved the referee's proposed dissolution judgment.  In relevant part, the judgment (a) found that father's itemized monthly expenses at trial were excessive and reduced those expenses; (b) found mother not capable of providing for her own support and set father's spousal maintenance obligation at $1,000 per month;  (c) ordered father to pay off the balance on the home equity loan within 30 days of the judgment; (d) awarded mother $2,587.32 in past child support and maintenance for the month of December 2001; and (e) found that four accounts were mother's nonmarital property.  Father moved for amended findings of fact and/or a new trial.  The  motion was heard by the same referee who presided over the trial.  The referee denied father's motion in relevant part, and the district court adopted the referee's proposed order.  The district court entered an amended dissolution judgment in April 2004.  Father appeals from this judgment.  

D E C I S I O N

I.

 

Father first challenges the district court's calculation of his monthly expenses.  Findings concerning expenses will not be set aside unless clearly erroneous.  McCulloch v. McCulloch, 435 N.W.2d 564, 566 (Minn. App. 1989).  Although the record might support findings other than those made by the district court, that fact alone does not render the findings clearly erroneous.  Vangsness v. Vangsness, 607 N.W.2d 468, 474 (Minn. App. 2000).  Rather, this court views the evidence in the record in the light most favorable to the district court's findings.  Id.  Here, the district court rejected father's itemized list of monthly expenses, totaling $4,255, as "excessive" and found instead that father's reasonable monthly expenses were not more than $2,600. 

            Father argues that the record does not support the district court's calculation because the district court improperly excluded projected future expenses and, consequently, left him in a precarious financial situation.  We disagree.  The record shows that father's estimated monthly expenses included line items for a larger apartment, car payments on a vehicle he had not yet purchased, a cell phone he did not own, and monthly entertainment expenses of $500.  While father testified that these projected future expenses were necessary to provide for his children during his parenting time, the decision whether to credit that testimony was within the sound discretion of the district court.  See Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988) (noting that appellate courts defer to district court's credibility determinations).  Father did not testify that these line items represented current monthly expenses and did not provide any precedential authority for his contention that the district court must factor in projected expenses in its expenses calculation.  Accordingly, the district court did not clearly err in finding that father's anticipatory expenses were excessive.

In addition, father argues that the district court's finding of his monthly expenses is clearly erroneous because it does not include a $300 monthly payment toward a home equity loan that appellant assumed in the property settlement.  The district court found that the home equity loan was not properly included as a personal debt on father's expenses because the court apportioned the loan to father as part of the property/debt division.  To find otherwise would allow father to benefit twice from the same debt and defeat the property settlement.  Cf. Kruschel v. Kruschel, 419 N.W.2d 119, 122 (Minn. App. 1988) (basing a maintenance obligation on a property award inappropriately redistributes the property as income); Justis v. Justis, 384 N.W.2d 885, 891 (Minn. App. 1986) (holding that debt apportioned to the appellant in a property settlement could not be used to reduce his net income for purposes of calculating child support because it would defeat the property settlement), review denied (Minn. May 29, 1986).  Therefore, the district court's calculation of monthly expenses was not clearly erroneous.  But, because we are remanding on the issue of the amount of maintenance, we leave to the district court the discretion to reopen the record and receive additional evidence on the issue of father's monthly expenses. 

II.

Father next challenges the district court's award of spousal maintenance, arguing that (a) mother is capable of contributing to her own support and (b) father does not have the means to pay monthly maintenance.  This court will not set aside an award of maintenance absent an abuse of the district court's "wide discretion."  Erlandson v. Erlandson, 318 N.W.2d 36, 38 (Minn. 1982).  Before an appellate court will find that the district court abused its discretion, "[t]here must be a clearly erroneous conclusion that is against logic and the facts on record."  Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984). 

A district court may award maintenance if it finds that the spouse seeking maintenance lacks sufficient property to provide for her reasonable needs, especially during a period of training or education, or is unable to provide adequate self-support through appropriate employment.  Minn. Stat. § 518.552, subd. 1 (2004).  When determining the amount and duration of a maintenance award, the district court must consider the factors listed in Minn. Stat. § 518.552, subd. 2 (2004).  While no single factor is dispositive, ultimately the district court must weigh "the financial need of the spouse receiving maintenance, and the ability to meet that need" against "the financial condition of the spouse providing the maintenance."  Novick v. Novick, 366 N.W.2d 330, 334 (Minn. App. 1985).  

The district court's conclusion that mother is not currently capable of supporting herself is not clearly erroneous.  Mother received marital assets totaling roughly $117,000 in the property division and assumed roughly $25,000 in debt.  The record shows that mother was not employed, had not worked outside the home since 1989, had received a two-year community-college degree, and was inhibited by a myriad of medical conditions including fibromyalgia, fatigue, exhaustion, headaches and allergies.  Mother testified that her ailments affect her ability to be gainfully employed outside the home because, when afflicted, she cannot physically function and must lie down to rest.  According to mother's treating physician, mother "experiences day to day fluctuation in her abilities" and is "limited by her pain and her energy level with regard to her ability to work."  Additionally, without factoring in mother's health, mother's vocational expert testified that, at a minimum, mother would require six to twelve months of vocational retraining and an additional undetermined period of part-time employment.  Accordingly, there is a reasonable basis in the record supporting the district court's finding that mother is in need of monthly maintenance. 

Moreover, given that mother's health may preclude her from ever entering the work force, the district court did not err in awarding mother permanent maintenance subject to future modification.  See Minn. Stat. § 518.552, subd. 3 (2004); Nardini v. Nardini, 414 N.W.2d 184, 198 (Minn. 1987) (noting that uncertainty about a maintenance recipient's ability to become self-supporting requires an award of permanent maintenance).  If a change in circumstances occurs, warranting a reduction or elimination of the maintenance award, father may move the court for a modification at that time.

             But we conclude that a remand is required because the district court, in setting the amount of maintenance at $1,000 a month, failed to made sufficient findings concerning father's ability to meet the maintenance award while covering his own expenses.  Father is currently employed full-time earning a net monthly income of roughly $4,370.  The district court found that father's reasonable monthly expenses were not more than $2,600 (after having reduced the amount from $4,255).  The court determined that father's child support obligation was $1,530 a month.  Using the district court's figures, father has approximately $240 a month remaining after meeting his expenses and child-support obligation.  Thus, father will have a $760 deficit each month after paying spousal maintenance.  The district court did not address father's monthly deficit in its order, finding only that "[t]he court's temporary order setting $1,000 per month for spousal maintenance is minimally reasonable and is found by this court to be within the capability of respondent to pay."  Consequently, we must reverse the district court's award of $1000 for monthly maintenance, and we remand for either a new award or additional findings in support of the current award.  As we have noted, the district court may in its discretion open the record and receive additional evidence on this issue.

III.

            Father next challenges the district court's order requiring him to pay, within 30 days of the judgment, the balance on the $20,000 home equity loan that he assumed in the property settlement.  Debt apportionment in a dissolution proceeding is treated as part of the property division.  Korf v. Korf, 553 N.W.2d 706, 712 (Minn. App. 1996).  Therefore, a district court is accorded broad discretion in the division of debt, and its decision will not be overturned absent a clear abuse of that discretion.  Id.  This court will affirm a district court's decision if it is has an acceptable basis in fact and principle, even though this court may have taken a different approach.  Bliss v. Bliss, 493 N.W.2d 583, 587 (Minn. App. 1992), review denied (Minn. Feb. 12, 1993).  

            We conclude that the district court acted within its discretion.  Mother's property settlement consisted primarily of the homestead.  The home equity loan encumbered the homestead, and mother would be dependent on father to make the monthly payments.  The district court found that an accelerated payoff of the loan would enable mother to refinance or sell the property.  Father's assets following the property distribution included a retirement package worth approximately $170,000.  Father testified that he had an unencumbered personal line of credit with Wells Fargo.  Thus, the record supports the district court's finding that it was appropriate to require father to exercise a 401(k) loan or use his personal line of credit to satisfy the home equity loan, and the district court's finding has an acceptable basis in law and principle. 

IV.

            Father also challenges the district court's award to mother of maintenance and child-support for December 2001.  This court reviews a trial court's past-support determinations under an abuse of discretion standard.  LaChapelle v. Mitten, 607 N.W.2d 151, 166 (Minn. App. 2000), review denied (Minn. May 16, 2000).  In deciding what amount of past support is just, a court must consider the earnings, needs, and resources of the obligor, the obligee, and the children.  Id.  A court must also consider the current and past income of the obligor, along with the past needs of the children.  Id.  (quotation omitted). 

            Father contends that the district court's award of December 2001 maintenance and child support improperly charges him twice for December expenses because even though both parties withdrew from the home equity loan, father alone assumed this debt in the property settlement.  We disagree.  Father introduced no evidence demonstrating that he paid child support or maintenance for December 2001.  Mother testified that she withdrew money from the home equity loan to pay for expenses incurred in September, October, and November 2001, but she did not withdraw from the account to cover December 2001 expenses.  Moreover, assuming that mother withdrew money from the home equity loan to cover December 2001 expenses, father did not demonstrate that the amount mother withdrew was sufficient to cover December expenses, or that mother withdrew from the account in lieu of receiving support and maintenance pursuant to an agreement with father.  The evidence does not support father's claim, and the district court did not abuse its discretion by awarding arrearages for December 2001. 

V.

            Finally, father challenges the district court's classification of four bank accounts as mother's nonmarital property.  The issue of whether property is marital or nonmarital is a question of law, and this court exercises independent judgment when reviewing the district court's classifications.  Van de Loo v. Van de Loo, 346 N.W.2d 173, 175 (Minn. App. 1984).  But this court defers to the district court's findings on underlying facts, such as the resources used to acquire property. Rosenberg v. Rosenberg, 379 N.W.2d 580, 583 (Minn. App. 1985), review denied (Minn. Feb. 19, 1986).  Nonmarital property is statutorily defined as:

property real or personal, acquired by either spouse before, during, or after the existence of their marriage, which

(a)       is acquired as a gift, bequest, devise or inheritance made by a third party to one but not to the other spouse; [or]

(b)       is acquired before the marriage[.] 

 

Minn. Stat. § 518.54, subd. 5(a)(e) (2004).

 

            We conclude that the district court did not err in its characterization of the accounts as nonmarital.  Mother testified that these accounts either predated the marriage or were made up of funds received as part of an inheritance, and thus she established the nonmarital character of these accounts.  Mother's testimony was corroborated by the testimony of her mother, Marvel Schwartz.  The district court found this testimony credible, and we defer to that determination.  See Sefkow, 427 N.W.2d at 210.  In addition, mother provided account statements demonstrating that father is not listed as an account beneficiary while several accounts were payable on death to Marvel Schwartz.  Because father produced no evidence that these accounts originated during the marriage or were commingled with marital property, we affirm the district court's classification of these accounts as nonmarital.

            Affirmed in part, reversed in part, and remanded. 

* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.