2018 Ohio 2039
Ohio Ct. App.2018Background
- Jay and Nancy Buckingham divorced; final decree (Nov. 25, 2013) awarded Nancy a $1.2 million property settlement (balance $976,358) payable in four annual installments with 3% simple interest and secured by a promissory note. Counsel for Jay was to prepare orders if qualified retirement funds were used.
- After the decree Jay’s counsel attempted various unilateral transfers: moved funds from Jay’s IRAs into Nancy’s IRA without her prior consent or proper paperwork, attempted to credit Nancy’s separate accounts and cash (and a $25,000 HSA) toward the property settlement, and presented a modified promissory note. Nancy contested and retained experts.
- Multiple post-decree contempt motions and hearings occurred (2015–2016). The trial court found Jay in willful contempt for including assets awarded to Nancy in his accounting of payments and ordered him to pay a purge amount; it rejected contempt claims against Nancy for contacting the IRS about excise penalties.
- The trial court denied use of Jay’s HSA to satisfy the settlement, awarded Nancy attorney and expert litigation expenses under R.C. 3105.73 (including fees for experts McNamee and Hochwalt), and declined to award one specific expert fee (Suich) due to lack of adequate documentation.
- On appeal, the court affirmed the contempt finding, affirmed denial of HSA use, upheld most fee awards as equitable under R.C. 3105.73, but reversed the $1,250 award for expert David Suich for lack of evidentiary support.
Issues
| Issue | Plaintiff's Argument (Buckingham) | Defendant's Argument (Buckingham) | Held |
|---|---|---|---|
| 1) Contempt for failure to pay first two years per decree | Jay conceded the principal but argued his payments/offers (including credits for accounts titled in Nancy’s name and HSA funds) exceeded what was due and he relied on the appellate opinion | Nancy argued Jay improperly credited assets awarded to her and failed to transfer funds as required; offers are not payments | Court: No abuse—clear and convincing evidence Jay willfully included assets awarded to Nancy and failed to effect required transfers; contempt affirmed |
| 2) Use of Jay’s HSA to pay property settlement | HSA is a tax-advantaged account and Jay argued it should count as a ‘‘qualified’’ source and experts said transfers have no tax consequence | Nancy argued HSA is not a retirement account contemplated by decree; accepting HSA could impose tax/usage restrictions disadvantaging her | Court: HSA is not a retirement account; decree did not authorize use of after-acquired qualified accounts that would create taxable consequences for Nancy; denial affirmed |
| 3) Award of fees for promissory-note expert McNamee ($10,000) | Jay: McNamee’s testimony was irrelevant because the note at issue was not used | Nancy: McNamee advised and testified on promissory-note issues; Jay’s unilateral actions over the note caused expense | Court: Fee award not an abuse—McNamee’s work was relevant to defending contempt claims and equitable under R.C. 3105.73(B) |
| 4) Award of $1,250 to expert David Suich | Jay: Suich’s fees were unsupported and unnecessary | Nancy: Suich assisted on ERISA/tax matters; trial court relied on billing | Held: Reversed—trial court erred in awarding $1,250 because the record lacked adequate, admitted documentation of that specific fee |
| 5) Whether Nancy was in contempt for refusing to accept offered funds (HSA, later-acquired retirement funds) | Jay: Nancy refused to accept funds he tendered or offered, so she was in contempt | Nancy: Funds were not the types contemplated by the decree or were after-acquired; she legitimately refused | Court: No abuse—trial court reasonably declined to find Nancy in contempt for refusing noncontemplated/after-acquired accounts |
| 6) Award of attorney fees to Nancy (appeal fees $15,000; post-decree fees $40,000) | Jay: Appeal was not frivolous; parties were financially similar at decree | Nancy: Income disparity and Jay’s conduct made awards equitable; fees were reasonably incurred to protect rights | Court: Upheld—trial court did not abuse discretion; considered income disparity, conduct, necessity, and reduced overall request |
| 7) Award of $11,000 to tax expert J.R. Hochwalt | Jay: Nancy caused these expenses by not accepting the December 2013 IRA transfers | Nancy: Jay’s unilateral transfers created excess-contribution/excise issues; Hochwalt’s work was necessary to protect her rights | Court: Upheld—trial court found Jay’s actions caused need for expert and award was equitable under R.C. 3105.73(B) |
Key Cases Cited
- State ex rel. Corn v. Russo, 90 Ohio St.3d 551 (civil contempt defined and purposes explained)
- Rousey v. Jacoway, 544 U.S. 320 (distinguishing IRAs from HSAs for retirement/substitute-for-wages purposes)
- In re Mooney, 812 F.3d 1276 (11th Cir.) (bankruptcy/federal analysis that HSAs differ from IRAs)
- Thompkins v. Ohio, 78 Ohio St.3d 380 (standard for manifest-weight review)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (abuse-of-discretion review standard)
- Martin v. Martin, 179 Ohio App.3d 805 (contumacious conduct and contempt evidentiary standard)