In re Jeanne T. Rysdahl, petitioner, Respondent, vs. Dennis A. Rysdahl, Appellant.
Annotate this CaseThis opinion will be unpublished and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
A04-1253
In re Jeanne T. Rysdahl, petitioner,
Respondent,
vs.
Dennis A. Rysdahl,
Appellant.
Filed May 10, 2005
Affirmed
Dietzen, Judge
Cook County District Court
File No. F0-03-000159
Jack E. Setterlund, 825 Alworth Building, 306 West Superior Street, Duluth, MN 55802 (for respondent)
Larry M. Nord, Melanie P. Persellin, Orman, Nord & Spott, 1301 Miller Trunk Highway Suite 400, Duluth, MN 55811 (for appellant)
Considered and decided by Shumaker, Presiding Judge; Dietzen, Judge; and Poritsky, Judge.*
U N P U B L I S H E D O P I N I O N
DIETZEN, Judge
In this dissolution proceeding, appellant contends that the district court abused its discretion in its division of the marital property and its award of spousal maintenance to respondent. Respondent also seeks review, asserting that the amount of spousal maintenance is inadequate and that the district court abused its discretion in awarding the parties joint physical custody of their minor children. Because the district court's findings of fact are supported by the record and the district court did not otherwise abuse its discretion or misapply the law, we affirm.
FACTS
In November 2002, respondent Jeanne Rysdahl filed for dissolution of her 22-year marriage to appellant Dennis Rysdahl. The parties have three children, two of whom, A.R. and B.R., were minors at the time of the dissolution. Shortly after their marriage, the Rysdahls moved to Tofte, Minnesota, and entered into a business relationship with a developer to build Bluefin Bay Resort, a business on Lake Superior.
Over the years, the Rysdahls were very successful in the development and operation of the Bluefin Bay Resort business. Two management corporations were created for the resort business, the Temperance Company (the T Company), and the Tofte Management Corporation (TMC). The T Company was a holding company for the real estate assets and TMC was an operating entity for the services provided at Bluefin Bay Resort. TMC's primary source of revenue was derived from the fees it collected by renting condominiums located at the Bluefin Bay Resort. It also owned and furnished the restaurants and gift shop at the Bluefin Bay Resort. Later, Rysdahl-Buntz, Inc. (RBI), was formed as a development entity to build a second development at Bluefin Bay. RBI also owned a vacant parcel of property (buffer property) located adjacent to the Rysdahl family homestead. Prior to that undertaking, an agreement was arrived at between the parties and the developer entered into an agreement, in which voting control in the various corporations remained equally divided, but the equity and share of profit positions were modified more favorably to the Rysdahls.
None of the corporations had buy-sell agreements, and the lack of such agreements caused some disputes involving the amount of operating profits the developer was withdrawing and the developer's involvement in management issues. For example, the developer sold condominium units within the resort complex for which he received a brokerage commission. But the developer did not pay one-third of the commissions received, as agreed, to TMC. Over time, it was estimated that the developer owed TMC $133,000, which was carried as an "unbooked asset."
At the time of the dissolution, appellant was employed as the chief executive officer of Bluefin Bay Resort. Respondent operated WatersEdge Trading Company, Inc. (WatersEdge), a gift shop that was owned by the parties. The building in which WatersEdge was located was owned by the T Company, and WatersEdge paid annual rent to the T Company for the use of the space.
The marital assets at the time of the dissolution were significant. At the commencement of the dissolution proceeding, the parties' lawyers conferred concerning the various assets of the marriage and agreed that expert witnesses would be jointly retained by the parties. One expert witness, Tim Peterson, was retained to value the parties' interests in TMC and WatersEdge. Mr. Peterson completed a business valuation appraisal, which valued TMC at $830,000 and WatersEdge at $310,000. The vast majority of the real estate was appraised by William Clements, who had significant experience in performing appraisal services for numerous lending institutions, government agencies, and private corporations. He appraised the properties utilizing the three traditional approaches to valuecost, sales comparison and income capitalizationbut relied primarily on the income capitalization approach.
Appellant presented an exhibit at trial indicating that he received approximately $200,000 per year in gross income. But respondent introduced 2001 and 2002 tax returns that she contended showed that the parties' total income for those years ranged between $285,000 and $367,000. Respondent received income of $3,000 per month from WatersEdge and $3,000 per month from TMC. Appellant testified that after the dissolution, respondent would no longer receive $3,000 per month from TMC because her shareholder interest would be transferred to appellant. Respondent presented average monthly living expenses of $8,000, and appellant presented expenses of $4,200 per month.
At the time of the dissolution, the parties were the parents of two minor children, A.R., who was 17 years of age, and B.R., who was 14 years of age. Testimony revealed that respondent was the primary parent but appellant was also actively involved with the children. Since the parties' separation in July 2002, the children have been with respondent for approximately ten days and with appellant for four days in a normal two-week period.
In its decision, the district court awarded to appellant the parties' interests in the T Company and TMC, and awarded respondent the parties' interests in WatersEdge, the family homestead, and the buffer property. The district court also added a $28,000 receivabledue from the Bluefin Bay condominium associationto the assets of the T Company, and credited appellant's personal account an additional $10,500, from a personal loan due to appellant from Paul Haugen. In summary, the district court awarded property in the value of $1,168,400 to respondent and $1,957,600 to appellant, with an equalization payment to respondent in the amount of $394,600. Additionally, the district court provided appellant with the option of transferring ownership of the WatersEdge building free of encumbrances to respondent, instead of making the equalization payment.
The district court awarded permanent spousal maintenance in the amount of $1,500 per month to respondent and granted the parties joint legal and physical custody of the minor children. After the district court made post-trial modifications related to child support, this appeal followed.
D E C I S I O N
I.
Property Division
Appellant first asserts that the district court abused its discretion in its division of the marital property. District courts have broad discretion over the division of marital property, and appellate courts will not alter a district court's property division absent a clear abuse of discretion. Chamberlain v. Chamberlain, 615 N.W.2d 405, 412 (Minn. App. 2000). A district court abuses its discretion regarding a property division if the findings of fact are "against logic and the facts on [the] record." Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984).
When dividing marital property, the district court is required to "make a just and equitable division." Minn. Stat. § 518.58, subd. 1 (2004). An equal division of marital property is presumptively equitable upon dissolution of a long-term marriage. Miller v. Miller, 352 N.W.2d 738, 742 (Minn. 1984). Because the parties here were married 22 years, their marriage can be deemed "long-term." See Gales v. Gales, 553 N.W.2d 416, 421 (Minn. 1996) (stating, in appeal of maintenance dispute, that supreme court would not "quibble" with district court's finding of fact that 11-year marriage was "long term"). We now turn to an analysis of five instances that appellant alleges the district court abused its discretion.
A. The Buffer Property
The district court found that the parties stipulated to a $66,000 value for the buffer property. It then awarded that property to respondent and credited appellant with $33,000 in the property division. Appellant claims that the district court understated respondent's award by $33,000 and overstated his award by the same amount. Respondent asserts that the district court's evaluation of the property was based on a typographical error. While the district court mentions a $66,000 stipulated value, the district court's memorandum, which it incorporated into the judgment, values the property at $33,000. Thus, assuming the reference of the $66,000 stipulation is a finding of fact, the judgment contains inconsistent findings regarding the value of the buffer property. See Minn. R. Civ. P. 52.01 (stating findings of fact may be included in memorandum). Review of the record shows that not only does the record lack a stipulation by the parties to a $66,000 value for the buffer property, but also that Clements valued the property at $33,000. We therefore conclude that the record supports the $33,000 valuation and the resulting $33,000 credit to appellant.
B. $28,000 Account Receivable
Appellant contends that the district court erred by increasing the value of the T Company to include a $28,000 account receivable that was owed to it by the Bluefin Bay condominium association. Appellant asserts that the receivable was owed to TMC and was considered by Peterson in his valuation. Therefore, appellant argues that the district court overvalued the T Company by that amount.
The testimony presented was conflicting on this issue. In its analysis, the district court rejected appellant's arguments and found the overall valuation conclusions of Peterson regarding TMC and the T Company to be accurate and persuasive. On evidentiary issues, we defer to the district court. See id. ("[D]ue regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses."). Based on this record, the district court did not clearly err in valuing TMC or the T Company.
C. Haugen Loan
Next, appellant argues that the district court erred when it included the $10,500 "Haugen Loan" in its property division because it was an advance on his prospective year-end bonus from TMC and not a personal loan payable to appellant. Respondent argues that it was a personal loan from appellant to Haugen, and appellant testified that in the past he has co-signed approximately 25 personal loans on behalf of employees. The district court found that the money was a personal loan payable to appellant and credited his account by $10,500. We defer to the district court on credibility determinations. See Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988) (observing that appellate courts defer to district court judgments).
D. Developer Receivable
Appellant argues that the district court erred in treating the $133,000 receivable from the developer as an asset for property division purposes. Instead, appellant contends that the receivable was due to TMC. Appellant testified at trial that the developer owed TMC $133,000 for commissions regarding the sale of condominium units. But the record contains testimony indicating that appellant and the developer had set up portions of their financial relationship to be outside of TMC and the T Company. The district court did not accept appellant's testimony. We defer to that credibility determination. See id.
E. WatersEdge Property
The district court ordered appellant to either (1) pay respondent $394,600 to equalize the property division or (2) transfer legal title to the WatersEdge building to respondent free and clear of any encumbrances. The parties were also ordered to negotiate a long-term lease for the WatersEdge building so that respondent's business could continue. Appellant argues that the district court erred by creating a property award that so favored respondent that appellant would be left with little recourse but to attempt to force a transfer of the WatersEdge building to respondent. We disagree.
The district court considered conflicting opinions offered by various experts and the parties as to the value of the real estate and the businesses. Giving consideration to all the testimony, the district court concluded that without ownership of the WatersEdge building, respondent would need an equalization payment in order for the property division to be fair and equitable. We have carefully reviewed the record and find no abuse of discretion.
II.
Spousal Maintenance
Both parties challenge the determination of the district court ordering appellant to pay respondent permanent spousal maintenance of $1,500 per month. Appellant contends that respondent failed to establish her need for spousal maintenance. Respondent counters that the spousal maintenance award is insufficient and should be increased.
We review a district court's maintenance award under an abuse-of-discretion standard. Dobrin v. Dobrin, 569 N.W.2d 199, 202 (Minn. 1997). A district court abuses discretion regarding maintenance if the findings of fact are unsupported by the record or if the law is improperly applied. Id. "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). A district court abuses discretion regarding maintenance if the findings of fact are "against logic and the facts on [the] record." Rutten, 347 N.W.2d at 50.
The district court may award spousal maintenance to respondent if (1) she lacks sufficient property to provide for her reasonable needs, or if (2) she is unable to support herself through appropriate employment. Minn. Stat. § 518.552, subd. 1 (2004). The factors to be considered when awarding maintenance include, among others: the financial resources of the party seeking maintenance, the time necessary for the party seeking maintenance to acquire sufficient education leading to appropriate employment, the length of absence from employment, the age and physical condition of the party seeking maintenance, and the ability of the payor spouse to contribute maintenance payments. Id., subd. 2 (2004). We are not required to make findings on each factor considered. Justis v. Justis, 384 N.W.2d 885, 891 (Minn. App. 1986), review denied (Minn. May 29, 1986).
A. Appellant's Claim
Appellant makes three arguments in support of his contention that the district court abused its discretion in awarding spousal maintenance. First, appellant argues that respondent has not established need. We disagree. In determining whether to award spousal maintenance, the district court must consider a standard of living that approximates the marital standard of living as closely as is equitable under the circumstances. See Minn. Stat. § 518.552, subds. 1(a)-(b), 2(c) (requiring district court to determine recipient's need for maintenance as well as amount of maintenance in light of parties' marital standard of living); Chamberlain, 615 N.W.2d at 409-12 (discussing importance of marital standard of living in addressing maintenance recipient's need); cf. Prange v. Prange, 437 N.W.2d 69, 71 (Minn. App. 1989) (stating maintenance award was meant to "supplement [recipient's] other income so that she can continue to live in close approximation to the standard of living she had in the marriage"), review denied (Minn. May 12, 1989). Thus, the need for maintenance must be determined in light of the parties' standard of living during the marriage.
Here the district court considered respondent's budget of $8,000 per month for respondent and the two minor children. The district court found that the parties enjoyed a very high standard of living with an expensive home on the shores of Lake Superior, as well as significant businesses and real estate assets which generated substantial income. Based on its review of the parties' finances, the district court found that respondent's need to maintain the marital standard of living was $5,800 per month.
The district court found appellant's monthly income to be $12,000 per month, and his expenses, excluding child support, were $4,200 per month. Consequently, the district court found that respondent had the ability to pay spousal maintenance. On this record, the district court's findings on respondent's financial need and appellant's ability to pay are not clearly erroneous.
Second, appellant argues that the district court abused its discretion in finding that respondent's monthly income was $4,000. We disagree. Calculation of respondent's net monthly income after the dissolution required that the district court determine the income that WatersEdge would generate. Based on its review of the Peterson valuation and the testimony of the parties, the district court found that $4,000 per month was a reasonable estimate. The record supports this finding.
Third, appellant argues that respondent's monthly income will dramatically increase with either the award of the WatersEdge building or the cash equalization payment. But the district court considered all of the assets of the parties and made a fair and equitable division of the property. The income generated from the WatersEdge building will provide some rental income to respondent. Alternatively, respondent will receive some potential income from the cash equalization award. However, appellant will likewise enjoy income from the income producing assets awarded to him, which include the T Company, TMC, and related real estate.
Based on our review of the record, the district court's award of spousal maintenance to respondent of $1,500 per month is not clearly erroneous. Respondent will receive monthly income of $4,000, spousal maintenance of $1,500, and child support of $870. Appellant will continue to enjoy a monthly net income of $7,800, subject to his obligations to pay child support and spousal maintenance. On this record, the district court's findings are not clearly erroneous.
B. Respondent's Claim
Respondent, on the other hand, argues that the district court abused its discretion by not awarding her $4,000 per month in permanent spousal maintenance. In support of her argument, respondent contends that, after the dissolution, it is unfair for appellant to continue to have a substantial monthly income while her monthly income is significantly diminished. But appellant's ability to pay maintenance does not obviate the statutory mandate that respondent must establish financial need in light of the parties' marital standard of living. Lyon v. Lyon, 439 N.W.2d 18, 22 (Minn. 1989). Here, the award of spousal maintenance meets respondent's financial need of $5,800 per month to maintain the marital lifestyle. Also, respondent will benefit from either ownership of the WatersEdge building or the payment of a cash equalizer. Respondent's monthly income will increase due to the rental income on the building or the interest income on the cash equalizer payment. Similarly, appellant's monthly income will decrease by the expense he will incur to accomplish the property division ordered by the district court. On this record, we find no abuse of discretion.
III.
Child Custody
Respondent contends the district court abused its discretion in awarding the parties joint physical custody. The district court has broad discretion in determining custody matters, and "this court's review is limited to determining whether the trial court abused its discretion by making unsupported findings or improperly applying the law." Wopata v. Wopata, 498 N.W.2d 478, 481 (Minn. App. 1993) (quotation omitted); see Durkin v. Hinich, 442 N.W.2d 148, 151 (Minn. 1989). The district court's findings will be sustained unless they are clearly erroneous. Pikula v. Pikula, 374 N.W.2d 705, 710 (Minn. 1985). When making a custody determination, the appellate court views the record in the light most favorable to the district court's findings and will only determine that a finding is clearly erroneous if the reviewing court is left with the definite and firm conviction that the district court has made a mistake. Vangsness v. Vangsness, 607 N.W.2d 468, 472 (Minn. App. 2000).
The controlling principle in child-custody determinations is the best interests of the child. Pikula, 374 N.W.2d at 711. But the district court must consider several factors in determining the best interests of the child, including the parents' wishes, the child's preference, the identification of the child's primary caretaker, the intimacy and interrelationship between the child and the parents, health issues of the child and parents, adjustment issues, the permanence of the proposed custodial home, cultural factors, and the abilities of the parents to provide love, guidance, and education for the child. Minn. Stat. § 518.17, subd. 1 (2004).
Here, the district court found it would be in the best interests of the children for the parties to have joint physical custody, because such an arrangement would "significantly limit possible disruption to the relationship between [appellant] and the children that the [respondent] might cause should her past behaviors continue." There was also evidence in the record, and the parties agree, that both appellant and respondent are good parents.
When contemplating joint legal or physical custody, the court must consider four additional factors: (1) the parents' ability to cooperate in the rearing of the child; (2) the existence and nature of dispute-resolution methods respecting major issues that concern the child and the parties' willingness to use these methods; (3) if it would be detrimental to the child for one parent to have sole authority over the child's upbringing; and (4) whether either parent has committed domestic abuse. Id., subd. 2 (2004).
Here, the district court made thorough findings of fact in support of joint physical custody and the ability of the parties to make "amicable and cooperative" decisions regarding the minor children. The district court did address many of the statutory factors contained in Minn. Stat. § 518.17, subd. 1. While it must consider all factors that pertain to the best interests of the children, the district court need not make a specific finding on each and every factor. Nazar v. Nazar, 505 N.W.2d 628, 633 (Minn. App. 1993), review denied (Minn. Oct. 28, 1993). Based on our review, the district court appropriately considered the statutory factors contained in Minn. Stat. § 518.17, subds. 1 and 2, and did not abuse its discretion in ordering joint physical custody of the parties' minor children to appellant and respondent.
Affirmed.
* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.
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