Chattree v. Chattree
2014 Ohio 489
Ohio Ct. App.
2014

Background

  • Arun and Mona Chattree were married in 1961; divorce filed by Mona in 2008 after ~48 years of marriage. Trial spanned 27 days over seven months; magistrate decision issued April 2012; trial court adopted/modifed in Nov. 2012. Appeal and cross-appeal followed.
  • Arun founded Community Behavioral Health Center, Inc. (CBHC) in 1995; valuation and division of his interest in CBHC were heavily contested. Expert valuation issues arose after discovery delays and limited access to management.
  • During the marriage Arun advanced >$550,000 toward daughter Ritu’s purchase/renovation of a cooperative at 61 Jane Street (NY). Disputes produced federal and state judgments; federal court ordered title as tenants-in-common; state cognovit judgment awarded Arun $254,399.09.
  • Major contested items: CBHC valuation; classification/value of the Jane Street interest and cognovit judgment; retirement/pension division; temporary and permanent spousal support; attorney fees; contempt for failure to pay temporary support.
  • Trial court awarded spousal support (temporary reduced to $7,000/month; permanent $7,000/month commencing 11/26/2012, plus $500/month toward arrearage), divided retirement benefits (one-half of CBHC pension to Mona), ordered Arun to pay substantial attorney fees, and found him in contempt; appellate court affirmed in part, reversed in part, and remanded on valuation and several allocation errors.

Issues

Issue | Plaintiff's Argument (Mona) | Defendant's Argument (Arun) | Held ---|---:|---:|--- Valuation of CBHC | Court should adopt plaintiff’s expert value ($1,919,000) and divide accordingly | Trial court erred admitting plaintiff’s late expert, and valuation should be lower or zero because liabilities exceed assets | Trial court erred in adopting $1,500,000; remanded to determine whether $1,919,000 is appropriate (cross-appeal sustained) Admissibility & timeliness of expert reports | Ranallo’s late report was justified by defendant’s discovery obstruction; should be admitted | Ranallo’s report was untimely; defendant’s expert was excluded unfairly | Trial court did not abuse discretion admitting Ranallo (delay caused by Arun); defendant’s expert properly limited for untimeliness Cooperative apartment / separate property | Interest and cognovit judgment are marital (funds came from marital accounts); Mona entitled to share | Arun claims federal judgment awarded his separate property as personal damages | Interest and cognovit judgment are marital; not separate under R.C. definitions Use of cognovit judgment to reduce arrearage | Cognovit judgment is marital asset and may be used in division/reduction of arrearage | Opposes use to offset arrearage | Court properly treated cognovit judgment as marital and used it to reduce arrearage Division of retirement/pensions | Mona should receive equitable share; court’s allocation appropriate | Court erred by guaranteeing Mona a minimum and not dividing equally | Division affirmed; trial court’s unequal division was within discretion given misconduct findings and consideration of Social Security Temporary spousal support (pendente lite) | Temporary support was appropriate and properly adjusted | Should have been reduced to zero after Arun stopped salary due to retirement/medical leave; Civ.R. 75(N) hearing required | No abuse — trial litigated issues (invited error), reduction to $7,000 supported by income evidence Permanent spousal support & “double-dip” | Award appropriate given ages, earning potential, length of marriage, conduct | Award unreasonable; double-dipping where Mona receives pension share then support | Award affirmed; court avoided double-dipping by terminating support when QDRO effectuates pension transfer; factors were considered Attorney fees & contempt | Fees and sanctions appropriate due to Arun’s discovery misconduct and failure to pay temporary support | Fees and contempt improper due to procedural defects in temporary order | Fees and sanctions affirmed; contempt finding and purge conditions not an abuse of discretion Shareholder loan & lines of credit (cross-appeal) | Shareholder loan (CBHC→Arun $405,071) is marital and must be allocated; KeyBank paid-off LOC should not be treated as outstanding marital debt | Trial court treated some debts as marital and failed to allocate shareholder loan | Appellate court sustained cross-appeals: remanded to allocate shareholder loan and to recalculate marital debt (KeyBank LOC paid off; only National City LOC should be considered)

Key Cases Cited

  • Booth v. Booth, 44 Ohio St.3d 142 (Ohio 1989) (abuse-of-discretion standard in domestic-relations matters)
  • Cherry v. Cherry, 66 Ohio St.2d 348 (Ohio 1981) (trial court discretion in equitable divisions)
  • Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (definition of abuse of discretion)
  • Martin v. Martin, 18 Ohio St.3d 292 (Ohio 1985) (standard for reviewing domestic relations orders)
  • Neville v. Neville, 99 Ohio St.3d 275 (Ohio 2003) (equal division presumption and equitable division when unequal)
  • Miller v. Bike Athletic Co., 80 Ohio St.3d 607 (Ohio 1998) (trial court’s broad discretion on expert testimony)
  • Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (U.S. 1993) (reliability of expert methodology governs admissibility)
  • James v. James, 101 Ohio App.3d 668 (Ohio Ct. App.) (trial court may choose valuation method; appellate review for competent, credible evidence)
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