MARGARET A. JONES v. WILLIAM G. JONES
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RENDERED: August 29, 2003; 2:00 p.m.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2001-CA-002742-MR
MARGARET A. JONES
APPELLANT
APPEAL FROM HARDIN CIRCUIT COURT
HONORABLE JANET COLEMAN, JUDGE
ACTION NO. 98-CI-00365
v.
WILLIAM G. JONES
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
JOHNSON AND KNOPF, JUDGES; AND MILLER, SENIOR JUDGE.1
JOHNSON, JUDGE:
Margaret A. Jones has appealed from a judgment
and decree entered by the Hardin Circuit Court on November 26,
2001, which adopted the Domestic Relations Commissioner’s
findings of fact and conclusions of law.
Having concluded that
the trial court’s findings of fact were not clearly erroneous
and that it did not abuse its discretion in dividing the marital
1
Senior Judge John D. Miller sitting as Special Judge by assignment of the
Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution and
KRS 21.580.
property and debts and by denying Margaret’s maintenance claim,
we affirm.
William G. Jones and Margaret A. Jones have been
married and divorced twice; no children were born of either
marriage.
The parties were first married on October 19, 1974.
The first marriage was dissolved pursuant to a separation and
property settlement agreement dated January 26, 1987, and a
decree of dissolution of marriage entered on April 6, 1987.
The
couple divided their interest in various personal and real
property pursuant to the property settlement agreement.
Margaret received inter alia, a duplex, a house, a farm, and a
parcel of real estate, all of which were located in Kentucky; a
parcel of real estate in Florida; two automobiles; her personal
property; and $200.00 per month from William’s military
retirement pension, as well as 20% of any increase in his
military retirement pension as of January 26, 1987.
Margaret
assumed all indebtedness on the real property she received,
except William assumed a second mortgage on Margaret’s duplex.
William received, inter alia, $1,000.00 of Margaret’s savings; a
duplex in Kentucky; a farm in Kentucky; a condominium in
Florida; a parcel of real estate in Florida; a pickup truck; all
of the parties’ interest in Panda Petes Corporation; his
personal property; and his military retirement, with the
exception of that portion awarded to Margaret.
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William assumed
all indebtedness on the real property he received.
The property
settlement agreement finally provided that “[i]t is understood
and agreed between the parties that any property or indebtedness
not specifically mentioned herein shall be shared equally by the
parties.”
On October 19, 1987, about six months after their
divorce was final, the parties remarried.
On March 4, 1998,
William filed a petition for legal separation.
Over the next
two years, the parties then filed various pendente lite motions,
and on January 21, 2000, William moved the trial court to
convert the petition for legal separation to a petition for
dissolution of marriage.2
The parties then filed various
financial disclosure documents, and after numerous continuances,
a three-hour evidentiary hearing was held before the Domestic
Relations Commissioner on July 16, 2001.
On September 28, 2001, the Commissioner filed his
report, which recommended a division of the parties’ property
and debts and a denial of Margaret’s request for maintenance.
Margaret filed objections to the Commissioner’s recommendations,
which were denied by an order entered on November 26, 2001.
The
trial court adopted the Commissioner’s recommended findings of
2
On September 1, 1998, the Larue Circuit Court entered an agreed order in the
previous divorce action, 87-CI-016, which directed William to pay Margaret
her portion of his military retirement pay in the amount of $251.53 per
month, beginning immediately. This sum included 20% of the increase William
had received since 1987.
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fact and conclusions of law in the judgment and decree entered
on November 26, 2001.
This appeal followed.
Margaret has raised five issues on appeal.
Four of
these issues involve the division of marital property and debts
and the fifth issue concerns her claim for maintenance.
Our
standard of review on all these issues is limited to first
determining whether the findings of fact relied upon by the
trial court for its ruling were clearly erroneous, and second to
determining based on those factual findings whether the trial
court abused its discretion in dividing the property and debts
and by denying the maintenance claim.3
Margaret first argues that the trial court erred by
dividing the equity in the marital residence as of the date of
the divorce instead of the date of the parties’ separation.
Margaret claims that since she made all the mortgage payments
after the parties separated that she should “at the very least,
be awarded the equity in the house from the time the parties
separated on February 22, 1998[,] up and until the date of the
final hearing on July 16, 2001.”
Margaret claims that she made monthly payments of
$515.00 from funds she received from disability insurance,
social security disability, and rents from her non-marital
property.
The trial court valued the residence at $78,000.00,
3
Kentucky Rules of Civil Procedure (CR) 52.01; Drake v. Drake, Ky.App., 721
S.W.2d 728, 730 (1986).
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with a mortgage on the date of dissolution of $8,130.00, and
ordered that the equity of $69,870.00 be divided equally between
the parties.
Margaret states in her brief that she “wants all
of the equity accumulated in the marital property from the date
she and William separated[;]” but when she calculates the amount
of the trial court’s alleged error, she only asks that her
payment to William for his equity in the house be decreased by
$7,435.00.4
Marital property is all property acquired by either
spouse subsequent to the marriage.5
William and Margaret
purchased their marital residence in 1998 after they remarried,
and it is clearly marital property.
KRS 403.190(1) provides
four factors to be considered in distributing marital property:
(a)
Contribution of each spouse to
acquisition of the marital property,
including contribution of a spouse as
homemaker;
(b)
Value of the property set apart to each
spouse;
(c)
Duration of the marriage; and
4
Margaret claims that instead of the mortgage payoff of $8,130.00 that was
used by the trial court that it should have used $23,000.00, the amount owed
in June 1998. Thus, Margaret claims that with the payments she made during
the parties’ separation she reduced the debt by $14,870.00. Her calculation
divides $14,870.00 by two to arrive at her claimed error of $7,435.00. We
fail to understand the reason for dividing the $14,870.00 by two, since her
argument is that her payments alone produced the entire increase in equity of
$14,870.00.
5
KRS 403.190(2).
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(d)
Economic circumstances of each spouse
when the division of property is to
become effective, including the
desirability of awarding the family
home or the right to live therein for
reasonable periods to the spouse having
custody of any children.
Margaret argues that, in contravention of KRS
403.190(1)(a), the “Commissioner failed to consider [her] sole
contribution to the acquisition of the marital residence from
the time the parties separated.”6
She relies upon Stallings v.
Stallings,7 in support of her contention, but we conclude that
Stallings actually supports William’s position.
In Stallings,
our Supreme Court noted that property acquired after separation
but before entry of the decree is presumed to be marital
property.8
The major flaw in Margaret’s argument is that all the
funds that she used in making the payments on the mortgage
during the period of separation were marital property.
As the
Supreme Court noted in Stallings, supra, the exclusions from the
definition of marital property are limited to those at KRS
403.190(2).
None of the funds used by Margaret to pay the
mortgage come within the statutory exclusion.
The trial court’s
6
At all times relevant to this appeal, Margaret resided in the marital home.
7
Ky., 606 S.W.2d 163 (1980).
8
Stallings, supra at 164; see also Neidlinger v. Neidlinger, Ky., 52 S.W.3d
513, 522 n.5 (2001) (citing KRS 403.190(2); and Stallings, supra).
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findings of fact were not clearly erroneous, and it did not
abuse its wide discretion in dividing this marital property.9
Margaret also claims that the trial court erred by
finding that she and William entered into an oral agreement
whereby William would pay various bills on behalf of Margaret in
lieu of paying her a portion of his monthly military retirement
benefits.10
Pursuant to the parties’ 1987 divorce decree and the
subsequent agreed order entered on September 1, 1998, William
was to pay Margaret, as her portion of his military retirement
benefits, $251.53 per month.
The trial court found that William
and Margaret had entered into an oral agreement whereby in lieu
of the payment of $251.53 per month, William paid Margaret’s car
insurance, health insurance, and life insurance.
The trial
court also found that during the period from September 1, 1998,
to July 31, 2001, that William was obligated to pay Margaret for
her share of the military retirement benefits the sum of
$5,785.19; and that pursuant to their agreement, he had made
various expense payments on her behalf totaling $5,284.40;
leaving a balance owed by William to Margaret of $500.79.
9
Johnson v. Johnson, Ky.App., 564 S.W.2d 221, 222 (1978).
10
The trial court recognized that any dispute over payments that had been
ordered by the Larue Circuit Court in the first divorce action (87-CI-016)
might better be addressed by that court, but at the request of the parties
and in the interest of judicial economy it decided the issue as a part of
this litigation.
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Margaret claims not only that the factual finding by
the trial court that the parties entered into an oral agreement
was clearly erroneous, but also that the trial court’s finding
of fact as to the amount actually paid by William was clearly
erroneous.
Since an alleged oral agreement is at issue, the
first factual finding centers on which party the trial court
chose to believe.
The trial court “had the opportunity to hear
the evidence and observe the witnesses, so as to judge their
credibility, and therefore, is in the best position to make
findings of fact.”11
Obviously, when the trial court accepted
William’s testimony that there was an oral agreement over
Margaret’s denial of such an agreement, William’s testimony
constituted substantial evidence of the oral agreement.
Thus,
we cannot hold the trial court’s finding to be clearly
erroneous.
As to the amount actually paid by William for
Margaret’s expenses, once again the trial court considered the
parties’ disputed testimony and the documentation submitted in
support of their positions.
While Margaret reargues her
contentions in her brief, our review is limited to determining
whether there was substantial evidence to support the trial
court’s finding.
Since the trial court chose to accept
William’s testimony and his supporting documentation in arriving
11
Bealert v. Mitchell, Ky.App., 585 S.W.2d 417, 418 (1979)(citing 7 W. Clay,
Kentucky Practice, CR 52.01).
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at the total paid of $5,284.40, we cannot hold that finding to
be clearly erroneous.
Margaret also claims the trial court erred in dividing
the parties’ retirement accounts.
separate accounts:
The decree refers to three
(1) Margaret’s IRA valued at $22,000.00; (2)
William’s retirement benefits accrued at his former employer,
New York Life Insurance Company, from 1983 to 1998; and (3)
William’s 401(k) account with New York Life, which he cashed out
for $8,200.00.
The trial court determined that the first
divorce decree only addressed this particular property in a
general manner by providing “that any property or indebtedness
not specifically mentioned herein shall be shared equally by the
parties.”
The trial court then found that all retirement
benefits accumulated by the parties during their marriage
constituted marital property, which it determined should be
divided equally.
Thus, the trial court ordered that a Qualified
Domestic Relations Order should be entered on William’s and
Margaret’s retirement plans whereby each party would receive
their one-half share of any such benefits which had accrued
during both of the two marriages.
The trial court also
determined that William’s 401(k) account had been cashed out for
$8,200.00 and that the funds had been used to pay off two credit
card debts.
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Margaret first argues that the trial court’s findings
of fact concerning William’s 401(k) account were clearly
erroneous.
Once again, we are presented with an issue of fact
which the trial court found favorably to William.
While there
was conflicting testimony concerning the value of William’s
401(k) account on different dates, the trial court’s factual
finding was supported by William’s testimony.
Likewise, the
trial court’s finding that William used the $8,200.00 to pay off
two credit card debts was also supported by his testimony.
Margaret further claims that William dissipated his
401(k) account.
While this concept is recognized by Robinette
v. Robinette,12 and other Kentucky case law, Margaret failed to
produce evidence of dissipation which would allow this Court to
hold that the trial court was clearly erroneous by not finding
that there had been a clear showing of William’s intent to
deprive Margaret of her proportionate share of this marital
property.13
Margaret also asserts in regard to the division of the
retirement accounts that the trial court erred by not assigning
her IRA to her as non-marital property.
We believe the trial
court correctly relied upon the parties’ separation agreement
from the first divorce in determining that all of the retirement
12
Ky.App., 736 S.W.2d 351 (1987).
13
Id. at 354.
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accounts were adjudged in the first decree as being jointly and
equally owned by the parties.
The final issue of the four issues related to division
of property concerns the trial court’s award of William’s 1990
Ford truck to him and Margaret’s 1988 Crown Victoria to her.
The trial court accepted William’s evaluations and assigned the
value of $2,850.00 to each of these vehicles.
Margaret claims
that William’s truck was worth $3,400.00, that her car was worth
only $1,550.00, and that William should be required to pay her
the difference of $1,850.00.
A property owner is allowed to
testify as to the value of his own property so long as there is
a basis for his opinion.14
We cannot conclude that the trial
court abused its discretion by accepting William’s testimony as
to the value of the two vehicles, that the values as found by
the trial court were clearly erroneous, or that its equal
division of these assets was an abuse of discretion.
The final issue for our review involves Margaret’s
argument that the trial court erred by denying her claim for
maintenance.
An award of maintenance is a matter within the
sound discretion of the trial court.15
KRS 403.200 provides
that, in a proceeding for dissolution of marriage or legal
14
Roberts v. Roberts, Ky.App., 587 S.W.2d 281, 283 (1979).
15
Browning v. Browning, Ky., 551 S.W.2d 823, 825 (1977)(citing Bell v. Bell,
Ky., 494 S.W.2d 517 (1973)).
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separation, the court may grant a maintenance order for either
spouse only if the spouse seeking maintenance (a) lacks
sufficient property, including marital property apportioned to
her, to provide for her reasonable needs, and (b) is unable to
support herself through appropriate employment.
If the court
finds that a maintenance award should be granted, then pursuant
to KRS 403.200(2) six factors must be considered, including
(a)
The financial resources of the party
seeking maintenance, including marital
property apportioned to him, and his
ability to meet his needs
independently, including the extent to
which a provision for support of a
child living with the party includes a
sum for that party as custodian;
(b)
The time necessary to acquire
sufficient education or training to
enable the party seeking maintenance to
find appropriate employment;
(c)
The standard of living established
during the marriage;
(d)
The duration of the marriage;
(e)
The age, and the physical and emotional
condition of the spouse seeking
maintenance; and
(f)
The ability of the spouse from whom
maintenance is sought to meet his needs
while meeting those of the spouse
seeking maintenance.
The trial court determined that Margaret’s net
disposable income was $3,281.53 per month, and that William’s
was $2,374.00 per month.
The trial court also determined that
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seven of Margaret’s drug prescriptions totaled $1,151.00 per
month.16
The trial court further found that William’s monthly
expenses were $1,931.00, and that although he suffered from some
medical problems, his medical expenses were covered under his
Tri-Care health insurance coverage.
The trial court then found
as follows:
Margaret wants this Court to impute an
income to William equal to the amount he was
earning in 1998. William was employed as
New York Life Insurance agent for 16 years
until September 1998. In 1998, he was
earning approximately $40,000. William was
terminated from that position when he failed
to meet his required quotas. William has
not applied for any other insurance agent
positions since 1998.
This Commissioner concludes that
William is unable to earn the same income
now as in 1998. His ability to earn income
has diminished. He is already working, but
at a much less paying job.
Thus, the trial court found that “Margaret has much
more income than William does, and she has assets valued over
$107,000.”
The trial court further found that although it was
unfortunate that Margaret’s medical expenses were so costly,
“there was insufficient evidence to support that Margaret is not
eligible for private insurance that covers prescriptions.”
The
trial court found “that this was an inappropriate case for the
award of maintenance.”
16
We cannot conclude that the trial
Margaret disputes this finding.
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court’s findings of fact were clearly erroneous or that it
abused its discretion when it applied those factual findings by
denying Margaret’s request for maintenance.
Based on the foregoing reasons, the judgment and
decree of the Hardin Circuit Court is affirmed.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Lyn Taylor Long
Elizabethtown, Kentucky
Barry Birdwhistell
Elizabethtown, Kentucky
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