DUTY v. DUTY

DUTY v. DUTY
2007 OK CIV APP 43
162 P.3d 939
Case Number: 103095
Decided: 02/01/2007
Mandate Issued: 05/25/2007
DIVISION III
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION III

APPROVED FOR PUBLICATION BY THE SUPREME COURT.

POLLY RAE DUTY, Petitioner/Appellee,
v.
CLINTON NEAL DUTY, Respondent/Appellant.

APPEAL FROM THE DISTRICT COURT OF GARFIELD COUNTY, OKLAHOMA

HONORABLE NORMAN L. GREY, JUDGE

AFFIRMED

Larry Ehrman, Timothy J. Gungoll, GUNGOLL & EHRMAN, Enid, Oklahoma, for Petitioner/Appellee,
Katresa J. Riffel, MITCHEL, GASTON, RIFFEL & RIFFEL, P.L.L.C., Enid, Oklahoma, for Respondent/Appellant.

BAY MITCHELL, VICE-CHIEF JUDGE:

¶1 Respondent/Appellant Clinton Neal Duty (Husband) appeals from a trial court order finding his unvested stock options were marital property. The court further ordered that Petitioner/Appellee Polly Rae Duty (Wife) was entitled to one-third of the net difference between the market value and the purchase price of those stock options if he chose to exercise them. Husband contends the stock options were future income because they were not vested at the time the Decree of Dissolution of Marriage was filed, and the options had no value and could not be exercised unless several contingencies were satisfied. Thus, he asserts the options were not marital property and the trial court did not have the authority to order a division of his future income.

¶2 The trial court is vested with wide discretion in the division of marital estates, and the lower court's findings will not be disturbed on review unless they are clearly contrary to the weight of the evidence or an abuse of the trial's discretion. Carpenter v. Carpenter,

¶3 The division of marital property is governed by

As to such property, whether real or personal, which has been acquired by the parties jointly during their marriage, whether the title thereto be in either or both of said parties, the court shall, . . . make such division between the parties as may appear just and reasonable, by a division of the property in kind, or by setting the same apart to one of the parties, and requiring the other thereof to be paid such sum as may be just and proper to effect a fair and just division thereof.

Id.

¶4 The question of whether unvested or contingent stock options can be classified as marital property has not been addressed in Oklahoma. However, in Ettinger v. Ettinger,

¶5 In the similar area of pensions, the Oklahoma Supreme Court has stated that it is irrelevant whether the pension was unvested or contingent:

In addressing this issue, we do not deem it significant whether the pension is "vested" in the sense that it is now due and owing, whether it is conditional or contingent upon continued employment for a prescribed period or terminable upon the occurrence nor non-occurrence of some future event. In any of these events, it is a valuable right which has been purchased through joint efforts of the spouses to the extent that it has been acquired or enhanced during the marriage, and as such becomes jointly acquired property during the marriage.

Carpenter,

¶6 This conclusion is in accord with a majority of other jurisdictions that have considered whether unvested stock options are marital property. Bornemann v. Bornemann, 752 A.2d 978, 985-86 n.4 (Conn. 1998) (and cases cited therein) (comparing stock options to pension benefits to find unvested stock options were marital property subject to equitable division); Warner v. Warner, 46 S.W.3d 591 (Mo. App. 2001) (unvested stock options were marital property), Annot., 46 ALR 4th 640 (1986), Divorce & Separation: Treatment of Stock Options for Purposes of Dividing Marital Property.

¶7 Here, Husband's employer granted him the right to purchase 20,000 shares of stock at the price of $22.50 per unit by written agreement on February 10, 2005. These options would vest in one-third increments on that date for the next three years if Husband was still an employee.

¶8 The evidence was undisputed, however, that the options were granted during the marriage and Husband had a right to purchase them once they vested. Ken Maples testified that Husband was considered a key employee, and there was evidence that he was given the stock options partly because of his skill, education and experience. Husband gained these attributes during the marriage with Wife's assistance. Wife contributed to the marital estate by helping with the children and the house. She packed and moved the marital home at least nine times during the 19 years of the marriage while Husband moved ahead for his job. Wife put aside her career for Husband's career. See Warner, 46 S.W.3d at 602 (evidence showed husband's expertise was developed during marriage and contributed to indirectly by Wife; employer recognized that expertise as substantial factor in granting options, so options were marital property). The court found Husband was entitled to two-thirds of the stock options, and Wife was only entitled to one-third because Husband had to continue to work to make the options vest. The court order finding the stock options were marital property and dividing the options was based on the evidence and was not an abuse of discretion.

¶9 AFFIRMED.

ADAMS, J., and JOPLIN, P.J., concur.

FOOTNOTES

1 Employer granted the options to Husband on February 10, 2005. Wife filed for dissolution near the end of April 2005. Thereafter, the couple tried unsuccessfully to reconcile for a few months. Thus, the court properly found the options were granted during the marriage. They were also together for at least three to four months during the year Husband needed to work for the first set of options to vest.