IN RE THE MARRIAGE OF MARY C. VILLARREAL AND MARIO VILLARREAL Upon the Petition of MARY C. VILLARREAL, Petitioner-Appellee/Cross-Appellant, And Concerning MARIO VILLARREAL, Respondent-Appellan t/Cross-Appellee.
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IN THE COURT OF APPEALS OF IOWA
No. 7-242 / 06-1652
Filed May 23, 2007
IN RE THE MARRIAGE OF MARY C. VILLARREAL AND MARIO
VILLARREAL
Upon the Petition of
MARY C. VILLARREAL,
Petitioner-Appellee/Cross-Appellant,
And Concerning
MARIO VILLARREAL,
Respondent-Appellant/Cross-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Pottawattamie County, Charles L.
Smith, Judge.
Mario Villarreal appeals, and Mary Villarreal cross-appeals, challenging
various
economic
provisions
of
the
decree
dissolving
their
marriage.
AFFIRMED.
Jon E. Heisterkamp of Peters Law Firm, P.C., Council Bluffs, for
appellant/cross-appellee.
Suellen Overton, Council Bluffs, for appellee/cross-appellant.
Considered by Sackett, C.J., and Vogel and Miller, JJ.
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MILLER, J.
Mario Villerreal appeals, and Mary Villerreal cross-appeals, challenging
various economic provisions of the decree dissolving their marriage.
Mario
claims the district court erred in (1) awarding Mary permanent alimony of $2,000
per month, (2) ignoring a debt in dividing property, and (3) requiring him to pay
COBRA medical insurance premiums for Mary for eighteen months. Mary claims
the court erred in not awarding more property to her. Mary requests an award of
appellate attorney fees and costs. We affirm on both the appeal and crossappeal.
I.
BACKGROUND FACTS
The parties were married on April 2, 1988, when Mary was eighteen years
of age and Mario was twenty. Mario had graduated from high school. Mary quit
high school before her senior year to marry Mario. Mario has acquired no further
formal education. Mary acquired a GED in about 2003. The parties have three
children, seventeen-year-old Adrian, fifteen-year-old Javin, and three-year-old
Aaleah.
Mary was not employed outside the home until Adrian was about two
years of age. She then worked part-time in day care at a hospital for two to three
years. Mary next worked in housekeeping at the hospital for about eleven to
twelve years, ending with Aaleah’s birth in early 2003.
Mario had always
preferred that Mary not work outside the home, but Mary preferred to do so, for
social time with adults, until Aaleah’s birth. Mary’s earnings over time rose from
$9,903 in 1993 to $17,213 in 2001 and $17,100 in 2002. At the time she left
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employment following Aaleah’s birth, Mary was earning about eight dollars per
hour.
Mario has been consistently employed since the parties’ marriage. He
initially worked at IBP, but then became employed at Nebraska Beef, Ltd., where
he has worked for about the last seven years.
Mario is Nebraska Beef’s
operations manager. His salary has steadily increased over the years, resulting
in a salary of over $180,000 per year in 2003, 2004, and 2005.
II.
THE DISTRICT COURT DECISION
Certain portions of the district court’s decision are relevant to the issues
presented. The court placed the children in the parties’ joint legal custody and in
Mary’s physical care subject to reasonable rights of visitation in Mario. It found
Mario’s gross income to be $182,093.62 per year, and his net income to be
$10,054.80 per month. The court imputed gross income of $16,640 per year and
$1,386 per month to Mary, and ordered Mario to pay child support and to provide
health insurance for the children.
The district court made findings concerning the existence and values of
assets and the existence and amounts of debts. It divided the parties’ property in
a manner which, according to its findings, resulted in Mary receiving property
with a value of $116,240.01 and Mario receiving $130,596.93. The court ordered
Mario to pay $6,000 toward Mary’s attorney fees and to pay court costs.
The district court also ordered Mario to pay the COBRA health insurance
premiums for Mary for a period of eighteen months. It ordered him to pay Mary
alimony of $2,000 per month, to terminate “upon the death of either party or until
Mary remarries or cohabits with another for at least one year.”
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III.
SCOPE AND STANDARDS OF REVIEW
In this equity case our review is de novo. Iowa R. App. P. 6.4. We
examine the entire record and adjudicate rights anew on the issues properly
presented. In re Marriage of Smith, 573 N.W.2d 924, 926 (Iowa 1998). We give
weight to the fact-findings of the trial court, especially when considering the
credibility of witnesses, but are not bound by them. Iowa R. App. P. 6.14(6)(g).
This is because the trial court has a firsthand opportunity to hear the evidence
and view the witnesses. In re Marriage of Will, 489 N.W.2d 394, 397 (Iowa
1992).
IV.
MERITS
The following principles are of importance in dealing with the issues
concerning economic matters presented in this case.
Property division and
alimony must be considered together in evaluating their individual sufficiency. In
re Marriage of Trickey, 589 N.W.2d 753, 756 (Iowa Ct. App. 1998). In marriages
of long duration, both alimony and a nearly equal property division may be
appropriate, especially where the disparity in earning capacity is great. In re
Marriage of Hettinga, 574 N.W.2d 920, 922 (Iowa Ct. App. 1997). Prior cases
have little precedential value concerning economic provisions of a decree, and
we must rest out decision primarily on the particular circumstances of the parties
before us. In re Marriage of Gaer, 476 N.W.2d 324, 326 (Iowa 1991).
A.
Property Issues
The partners to a marriage are entitled to a just share of the property
accumulated through their joint efforts. In re Marriage of Russell, 473 N.W.2d
244, 246 (Iowa Ct. App. 1991).
Iowa courts do not require an equal or
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percentage division. Id. The determining factor is what is fair and equitable in
each circumstance. Id.
Adjudicating property rights in a dissolution action inextricably involves a
division between the parties of both their marital assets and liabilities. In re
Marriage of Johnson, 299 N.W.2d 466, 467 (Iowa 1980).
The allocation of
marital debts between the parties is as integral a part of the property division as
is the apportionment of marital assets.
Id.
therefore inheres in the property division.
The allocation of marital debts
Id.; In re Marriage of Siglin, 555
N.W.2d 846, 849 (Iowa Ct. App. 1996). Accordingly, the term “property division”
incorporates both division of assets and assignment of responsibility for debts.
Some four to five years before trial Mario purchased an entity variously
identified at points in the record as “Super Fresh Meats,” “Omaha Super Fresh
Meats,” “Omaha Quality Meats,” and “Omaha Meats, LLC.” The purchase price
for the limited liability company (LLC) was about $8,000. The district court noted
Mario’s testimony that the business was not doing well and owed more than it
was worth, and that Mario had not filed sale tax reports since 2003 or income tax
returns since 2001. The court found it had little evidence of the actual value of
the business. In dividing property the court awarded it to Mario at a value of
zero.
Mario testified that Omaha Meats, LLC, owed its supplier some $127,000
and was losing money. He claims the district court erred in failing to recognize
the company’s negative value in the division of property. The evidence shows
that the business is a limited liability company. Iowa Code section 490A.601
(2005) provides that, subject to exceptions not shown to apply in this case, “No
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member or manager of a limited liability company is personally liable for . . .
debts of the limited liability company.” Nothing in the record shows or suggests
that either or both of the parties have individual liability for the debts of the
business. We affirm the award of Omaha Meats, LLC, to Mario at zero value.
Mary claims the district court erred by failing to consider $19,000 she
alleges Mario withdrew from the parties’ joint account at about the time they
separated (she acknowledges it appears the $19,000 included a 401(k) refund of
$11,541.09 received in about July 2005), 1 $8,601.55 in 401(k) refunds received
in the period of January through March 2006, and a more than $8,000 average
balance Mario maintained in an account in his name alone. She argues she
should therefore receive more in the property division than she in fact received.
Mary filed her petition for dissolution of marriage of October 12, 2005.
The evidence shows that on September 1, 2005, the parties’ joint savings
account contained $19,110.18, and on October 31, 2005, it had been reduced to
zero. Mary acknowledged withdrawing $3,000 to pay attorney fees, and Mario
testified that she actually withdrew much more than the $3,000, through several
withdrawals.
Mario acknowledged that he might have made a withdrawal of
$11,132.86 that occurred on October 24, 2005.
In related testimony he
explained that in the same general time frame the parties had spent
approximately $25,000 on their house, “rebuilding” a kitchen and building a three
and one-half car garage. He testified that a lot of the money that went into the
account had been used for those projects.
1
On July 1, 2005, an $11,000 deposit was made to the parties’ joint account.
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Mario received $8,601.55 in 401(k) refunds in January through March
2006. He points to a $4,000 deposit on April 6 as perhaps having been part of
the $8,601.55, but is otherwise unable to explain what happened to the
remainder of those refunds.
On his June 15, 2006 affidavit of financial status Mario listed the value of
his cash and bank accounts as “nominal.” Mary argues that he maintained an
average balance of $8,000 or more.
The district court noted Mary’s claim regarding the more than $19,000
withdrawn from the parties’ joint account in September and October 2005, the
$8,601.55 in 401(k) refunds, and the average balance in Mario’s separate
checking and savings account. It found a lack of credible evidence concerning
those amounts and what had been done with them, and therefore expressly
“limit[ed] its findings based on the amounts in their respective accounts.” It found
that Mario’s Centris checking and savings accounts had a combined value of
$8,722, the amounts contained in the accounts as of April 30, 2006, and charged
him with that amount in its property division.
Mary’s claim is that Mario has withdrawn and secreted certain monies,
and that she should as a result receive a larger property award. We agree with
the district court’s finding, implicit in its analysis and decision, that Mary has not
proved such a claim. We affirm the court’s property division.
B.
Alimony
Mario claims the district court erred by improperly awarding permanent
alimony rather than rehabilitative alimony. He further claims that if permanent
alimony is appropriate then the amount awarded is excessive and it should
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terminate upon his retirement. Mario cites several unpublished opinions of this
court in support of his arguments.
However, as our appellate courts have
frequently noted, prior cases have little precedential value with respect to
economic issues, and our decision must rest on the particular circumstances of
the parties in the case before us. See, e.g., Gaer, 476 N.W.2d at 326.
“Alimony is an allowance to the spouse in lieu of the legal obligation for
support.” In re Marriage of Sjulin, 431 N.W.2d 773, 775 (Iowa 1988). Spousal
support is not an absolute right; an award depends on the circumstances of the
particular case. In re Marriage of Dieger, 584 N.W.2d 567, 570 (Iowa Ct. App.
1998). The discretionary award of spousal support is made after considering the
factors listed in Iowa Code section 598.21A. Id. Even though our review is de
novo, we accord the district court considerable latitude in making alimony
determinations and will disturb its ruling only when there has been a failure to do
equity. In re Marriage of Kurtt, 561 N.W.2d 385, 388 (Iowa Ct. App. 1997).
Facts bearing on the factors listed in section 598.21A(1) are relevant to
the alimony issue.
At the time of trial the parties had been married almost
eighteen and one-half years. Mary was thirty-six years of age and Mario was
thirty-eight. Mario is apparently in good health. Mary has allergies and has
arthritis in a knee. More importantly with respect to her prospects for the future,
Mary suffers from dyslexia and had difficulties in school, her past employment
has been in relatively unskilled jobs such as day care and housekeeping, and by
agreement of the parties she was not employed outside the home the first
several years of the marriage and has not been employed outside the home the
three years since Aaleah’s birth. That is not to say Mary is unemployable, for we
9
assume that at some point, perhaps when Aaleah begins school, Mary will return
to the work force. Instead, we merely point out that she is not a strong candidate
for further education or technical training and is likely to hold relatively unskilled
and moderately compensated jobs when she does return to the work force.
The property division which we have affirmed divides the parties’ property
approximately equally. The parties are of limited education, as previously noted.
Mario quite apparently has greater employment skills, work experience, and
much higher earning capacity than Mary.
It is not feasible that Mary will be able to become self-supporting at a
standard of living reasonably comparable to that enjoyed during the marriage.
Mario’s alimony payments will be includable in Mary’s gross income and
deductible from his gross income. See I.R.C. §§ 61(a)(8), 71(a), 62(a)(10), and
215(a) (West 2002). Finally, based on the parties’ past employment earnings as
shown by the evidence, together with their reasonably anticipated future
prospects, it appears reasonable to assume that at their retirement ages Mario
will receive much greater social security benefits than Mary will.
After considering relevant factors we find an award of permanent alimony
proper. Further, based on the parties’ present circumstances and reasonably
anticipated changes such as Mary’s return to employment at an income similar to
what she has earned in the past, we find the amount and duration of alimony
ordered by the trial court to be fair and equitable.
C.
COBRA Insurance
The district court ordered Mario to pay the premiums for COBRA medical
insurance for Mary for a period of eighteen months. The evidence shows that
10
those premiums were $371 per month at the time of trial. Mario claims the
district court erred, arguing that the amount of alimony awarded incorporates an
expenditure for medical insurance.
We consider all economic aspects of a
decree as a whole. In re Marriage of Schepple, 524 N.W.2d 678, 679 (Iowa Ct.
App. 1994). We determine what is equitable under the specific facts of the case.
In re Marriage of Byall, 353 N.W.2d 103, 106 (Iowa Ct. App. 1984).
The amount and duration of permanent alimony is reasonable, given the
parties’ large difference in earning capacities. The award of COBRA premiums is
reasonably limited in time, continuing only until about the time Aaleah will begin
school and Mary will presumably return to the work force. The district court’s
decree awards Mario somewhat more property than it awards Mary, and Mario’s
payment of about $6,700 in COBRA premiums will have the effect of making the
property division more nearly equal. We determine the district court’s order that
Mario pay Mary’s COBRA premiums for a limited period of time to be fair and
equitable and affirm on this issue.
D.
Appellate Attorney Fees
Mary requests an award of appellate attorney fees. Such an award rests
in this court’s discretion. In re Marriage of Sullins, 715 N.W.2d 242, 255 (Iowa
2006). The factors to be considered include the needs of the party requesting
the award, the other party’s ability to pay, and the relative merits of the appeal.
Id.
Upon consideration of the foregoing factors, we award Mary $3,000 in
appellate attorney fees.
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V.
CONCLUSION
We have considered all of the parties’ contentions, whether or not
discussed in detail. We affirm the trial court on all issues presented on both the
appeal and the cross-appeal. We award Mary $3,000 in appellate attorney fees.
Costs on appeal are taxed three-fourths to Mario and one-fourth to Mary.
AFFIRMED.
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