Estate of Reed v. Reed
2017 Ohio 8350
| Ohio Ct. App. | 2017Background
- David Reed filed for divorce from Penny Reed in 2012; a 2013 decree resolved all issues except division of certain nonmarital property.
- David disavowed his interest in the disputed nonmarital property in Feb 2014; he died Feb 26, 2015.
- Probate proceedings were opened; matters were assigned to the domestic relations judge because the divorce action remained pending.
- Penny (Wife) participated as a putative surviving spouse, elected against the will, and alternatively claimed property per the divorce decree.
- In August 2016 the trial court entered a joint order (probate and domestic relations) incorporating the 2013 divorce decree, resolving remaining separate-property issues, and dismissing Wife’s election.
- Wife appealed, challenging (1) whether the divorce abated upon Husband’s death and (2–3) the trial court’s findings that Husband owned separate-property interests: $189,000 in the marital residence and $105,897.49 in a Merrill Lynch cash management account (CMA).
Issues
| Issue | Reed's Argument (Plaintiff) | Penny's Argument (Defendant) | Held |
|---|---|---|---|
| Did the divorce action abate on Husband’s death? | Divorce had been heard and remaining property matters could be resolved posthumously; action should continue. | Divorce should abate at Husband’s death and court lacked authority to journalize decree afterward. | Court: Action did not abate; domestic relations court may enter posthumous nunc pro tunc orders dividing property. |
| Was $189,000 of the marital residence separate property (loans from Husband’s father forgiven as inheritance)? | Husband traced two loans totaling $189,000 used to acquire/build the Fox Chase home; loans were forgiven at father’s death and thus became inheritance/separate property. | Wife argued no documentary proof loans were forgiven as inheritance and tracing to the residence was inadequate. | Court: Husband presented sufficient testimony and ledger evidence; holding that $189,000 is Husband’s separate property was not against manifest weight. |
| Did improvements and commingling defeat tracing of Husband’s separate interest in residence? | Passive appreciation and original loan funds trace to separate interest; improvements funded with marital funds produced no proven FMV increase. | Wife argued Husband failed to prove what portion of current value derived from original separate funds vs marital-funded improvements, so separate share cannot be valued. | Court: Trial court reasonably found improvements did not demonstrably raise FMV; Husband’s separate interest properly traced and valued. |
| Was $105,897.49 of Merrill Lynch CMA separate property? | Husband inherited investments from father’s Merrill Lynch account in 1994; records and testimony show $105,897.49 investment portion remained untouched and traceable. | Wife contended the CMA was commingled and not adequately traced to separate inheritance. | Court: Husband’s statements and account statements showed the investment portion traceable; $105,897.49 was separate property. |
Key Cases Cited
- State ex rel. Litty v. Leskovyansky, 77 Ohio St.3d 97 (Ohio 1996) (divorce actions may abate upon death in some circumstances)
- Caprita v. Caprita, 145 Ohio St. 5 (Ohio 1945) (decree may be journalized after a party’s death when action has been heard)
- Miller v. Trapp, 20 Ohio App.3d 191 (Ohio Ct. App. 1984) (domestic relations court has discretion to dismiss or enter nunc pro tunc property divisions after death)
- Eastley v. Volkman, 132 Ohio St.3d 328 (Ohio 2012) (standard for manifest-weight-of-the-evidence review)