No.
90-211
IN THE SUPREME COURT OF THE STATE OF MONTANA
1990
IN RE THE MARRIAGE OF DAVID L. OWEN,
Petitioner and Respondent,
and
LORI L. OWEN, n/k/a LORI BALLINGER,
SEP 4 1990
-
Respondent and Appellant,
and
Ed S nf
r i'
4
GLLRKOFSUPREP~~ECOURT
STATE OF MONTANA
LARRY OWEN and MARILYN OWEN,
Third Party Respondents.
APPEAL FROM:
District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable Edward McLean, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Paulette C. Ferguson, Missoula, Montana
Thomas W. Christie, Billings, Montana
For Respondent:
Dennis Lind; Datsopoulos, MacDonald &
Missoula, Montana (petitioner-respondent)
Lind;
Portia K. Brown; Morrill, Brown & Thomas; Rapid
City, South Dakota (third party respondents)
Submitted on Briefs:
Decided:
Filed:
I
Clerk
August 9, 1990
September 4, 1990
Justice John Conway Harrison delivered the Opinion of the Court.
This is an appeal from the District Court of the Fourth
Judicial District, Missoula County, Montana.
On August 10, 1989,
the District Court issued a decree dissolving the twelve-year
marriage of David Owen and Lori Owen Ballinger.
In addition to
approving the Family Maintenance Agreement, the District Court held
that the residence in which the parties lived during the latter
years of their marriage properly belonged to the parents of the
husband
and
denied
the wife's
request that she be
awarded
attorney's fees. From this judgment the wife appeals. We affirm.
Appellant presents the following issues:
1. Did the District Court err by failing to include the house
purchased by the husband's parents in the marital estate?
2.
Did the District Court abuse its discretion by refusing
to award the wife attorney's fees?
David Owen and Lori Owen Ballinger were married in 1977. One
daughter, now age 12, was born to the marriage.
When the couple
separated in 1987, they entered into a separation agreement which
provided child support and monthly maintenance payments to the wife
from that date until six months after she completed law school.
The husband assumed all debts of the marriage prior to the date of
the agreement.
The husband was required to pay the wife's
automobile insurance premiums until twelve months after the wife
graduated from law school.
He agreed to maintain the health
insurance policy on the wife and child available through his
employment.
If his wife became ineligible for such insurance
because of divorce, the husband agreed to pay for other health
insurance for her until twelve months after completion of law
school.
Payment of health insurance aided the wife in meeting expenses
incurred in treatment of a rare chronic disease, sarcoidosis, at
present controlled by extensive medications.
The disease could
eventually result in the wife's partial or total disability.
When the husband received custody of the child in December,
1988, he declined to pay further maintenance payments.
The wife
moved to enforce the terms of the Family Maintenance Agreement.
The District Court relieved the husband of child support payments
and held that otherwise the agreement was binding and enforceable.
The husband and the child reside in the home purchased by his
parents.
Duringthe twelve-year marriage the wife contributed primarily
as a homemaker.
Her financial contribution was not substantial.
She completed paralegal training, a B.A. in business, and her first
two years of law school by the time of the divorce in August, 1989.
In 1982, the husband's parents purchased a home in which the
couple resided until their separation.
The couple entered into a
written lease agreement with the husband's parents, but made only
sporadic payments.
By the time of the dissolution, the value of
the house had decreased by $15,000.
The couple had paid $1,000 of
the down payment, but otherwise had nothing invested in the house.
Other than personal property, the couple had no assets.
At
the time of the dissolution the husband earned a gross monthly
income of $2,954 as Executive Vice-President of the Missoula
Chamber of Commerce and an additional $2,000 per year as a parttime basketball referee.
The husband testified that his monthly
expenses totalled $2,696, an amount approximating his disposable
income.
The wife s income consisted of $490 per month maintenance
payments plus a variable amount from part-time employment.
Her
estimated liabilities for loans received in law school totalled
$25,000.
The ~istrictCourt found that while the wife's type of
legal employment and income were uncertain, her income-producing
ability would be greatly enhanced upon her graduation from law
school.
I.
Did the District Court err by failing to include the house
purchased by the husband's parents in the marital estate?
The wife urges that the District Court should have imposed a
constructive trust on her share of an ownership interest that she
claims she and her husband had in their residence, purchased by her
husband's parents. As evidence of an ownership interest, she cites
the facts that the couple selected the house and handled the
negotiations for its purchase.
In addition, she and her husband
believed that they would have been allowed to use the profits from
the sale of the house as a down payment on another house.
Section 72-33-219, MCA, defines constructive trust:
A constructive trust arises when a person
holding title to property is subject to an
equitable duty to convey it to another on the
ground that the person holding title would be
unjustly enriched if he were permitted to
retain it.
The courts impose constructive trusts because of "fraud, mistake,
undue influence, the violation of a trust, or other wrongful acts1'
to work an equitable result.
In re the Marriage of Malquist
(1988), 234 Mont. 419, 422, 763 P.2d 1116, 1118.
We need not
pursue the theory of a constructive trust, since the record is
silent as to any wrongful or fraudulent acts requiring such a
remedy.
Nor does the record support any ownership interest in the
residence by the husband and wife.
In a dissolution proceeding
courts must ''equitably apportion between the parties the property
and assets belonging to either or both, however and whenever
acquired and whether the title thereto is in the name of the
husband or wife or both.''
Section 40-4-202(1), MCA.
In this case, neither spouse had title to the property.
The
title was in the names of the husband's parents who assumed the
rights and responsibilities of ownership.
They paid the mortgage
and entered into a written agreement leasing the residence to their
son and his wife.
At one point the parents sent the couple an
eviction notice for failure to pay rent.
The parents had also
discussed selling the residence with a realtor.
The husband wrote the wife a note in which he expressed his
belief that the couple could have used the equity from a sale of
the property as a down payment on a new home.
However, his hope
or belief, in the absence of any other evidence of such an
5
agreement, does not impose any legal obligation upon his parents.
Although the husband and wife did contribute $1,000 of the
$15,000 down payment, the value of the house has decreased by
$15,000 wiping out any gain which could be attributed to their
investment. In short, little basis exists for the wife's claim of
an ownership interest in the property.
We find that the husband and wife had no ownership interest
in the house and that the District Court properly excluded the
residence from the marital estate.
11.
Did the District Court abuse its discretion by refusing to
award the wife attorney's fees?
The wife contends that the District Court should not have
considered her future earning capacity in denying her request for
attorney's
fees.
Award
of
attorney's
fees
in
dissolution
proceedings is provided for by 5 40-4-110, MCA:
The court from time to time, after considering
the financial resources of both parties, mav
order a party to pay a reasonable amount for
the cost to the other party of maintaining or
defending any proceeding under chapters 1 and
4 of this title and for attorney's fees . . .
(Emphasis added.)
Since the statute is permissive, the appropriate standard of review
is whether the court abused its discretion. In re the ~arriageof
Smith (Mont. 1990), 791 P.2d 1373, 1378, 47 St.Rep. 925, 931; In
re the Marriage of Anderson (1988), 230 Mont. 89, 95, 748 P.2d 469,
In evaluating the llfinancial
resources of both parties," this
Court has not required that the trial court need only consider the
partiest present financial status.
For instance, the court
properly took into account the husbandlsgreater earning potential,
as well as his larger salary, pension, and good health in Carr v.
Carr (1983), 205 Mont. 269, 273, 667 P.2d 425, 427.
Even though
one party is in a stronger financial position, the court does not
abuse its discretion if the other spouse has sufficient resources
to be responsible for his own fees.
In re the Marriage of J.J.C.
(1987), 227 Mont. 264, 271, 739 P.2d 465, 469.
Other factors
courts have examined include whether the spouse has custody of the
children, needs additional vocational training, or is under a
physician's care.
In re the Marriage of Manus (1987), 225 Mont.
457, 465, 733 P.2d 1275, 1279-80.
In this case, although the husband has a far larger income,
he testified that his expenses equalled his disposable income.
Besides maintenance payments, he has the burden of family medical
expenses exceeding the insurance coverage and the costs associated
with child rearing.
Although the wife's health may eventually
worsen, at this time she has successfully completed law school and
plans to seek full-time employment. The record indicates that the
trial court was well aware of the partiest relative financial
positions.
We hold that the District Court did not abuse its
discretion in considering the wife's earning potential as a factor
in refusing to award attorney's fees.
The wife asserts that an award of attorney's fees is proper
where the spouse receives maintenance.
did not order maintenance.
Here, the ~istrictCourt
In signing the Family Maintenance
Agreement in 1987, the parties themselves agreed that the husband
pay maintenance to the wife.
necessarily based
The maintenance agreement was not
on the wife's
financial need
and
has
connection to the District Court's award of attorney's fees.
The judgment of the District Court is affirmed.
We concur:
no
