Gerhard Klimeck v. Virginia Klimeck (mem. dec.)
79A02-1510-DR-1796
| Ind. Ct. App. | Aug 11, 2016Background
- Gerhard and Virginia Klimeck married in 1995, have two children; Gerhard is a tenured Purdue professor; Virginia has an engineering degree and an MBA but had not worked outside the home since 2002 to care for the children.
- Gerhard inherited property in Germany (2006, 2008), converted it to German investment accounts, and the parties used those accounts for family travel and reported them on joint tax returns.
- In early 2014, while dissolution was imminent, Gerhard made large withdrawals/transfers from joint Fidelity accounts (including ~$280,000 to the children’s 529 accounts), causing ~$66,000 in capital gains tax; he also moved large sums into accounts in his name. Virginia incurred attorney fees investigating transfers.
- Trial court entered dissolution decree (July 1, 2015) dividing the marital estate essentially equally (including the German accounts), ordered Gerhard to pay the $66,000 capital gains tax, awarded temporary spousal maintenance to Virginia through Dec. 25, 2015, and enjoined Gerhard from discussing Virginia’s medical condition except with limited persons.
- Both parties filed motions to correct error; the motions were deemed denied under Trial Rule 53.3 before the court later issued corrected findings; appeal proceeds based on the original July 1 order.
Issues
| Issue | Plaintiff's Argument (Gerhard) | Defendant's Argument (Virginia) | Held |
|---|---|---|---|
| Whether German investment accounts should be segregated as nonmarital | German accounts funded by inheritance and should be excluded or set aside | Accounts were used and managed jointly during marriage and reported on joint tax returns | Trial court did not abuse discretion; accounts included in marital estate and equally divided |
| Whether court double-counted value of Mitsubishi vehicle | Court double-counted vehicle value both as an asset and within the funding account | (conceded error) | Reversed in part — remand to correct double-counting |
| Whether Gerhard should bear capital gains tax from 2014 withdrawals | Tax burden should be shared; liquidation effects occurred before final hearing | Gerhard dissipated marital assets while able to support himself; tax and legal consequences flow from his actions | Affirmed — trial court may order Gerhard to pay ~$66,000; remand to account for tax in distribution chart if needed |
| Whether spousal maintenance award (payments through Dec 25, 2015) was proper | Maintenance unnecessary because Virginia can work; findings inconsistent | Virginia lacked recent workforce experience and needs temporary support to obtain employment | Affirmed — court did not abuse discretion in awarding temporary maintenance |
| Whether gag order (restraining Gerhard from discussing Wife’s medical condition) violated free speech | Order unsupported, overly broad, and infringes speech rights | Order protects privacy; parties had agreed to limits in prior proceedings | Affirmed — no relief; any error was invited by Gerhard when he did not seek modification |
Key Cases Cited
- Cavinder Elevators v. Hall, 726 N.E.2d 285 (Ind. 2001) (narrow exception for belatedly-granted motions to correct error)
- Mitchell v. Mitchell, 875 N.E.2d 320 (Ind. Ct. App. 2007) (standard of review for trial-court findings)
- Fobar v. Vonderahe, 771 N.E.2d 57 (Ind. 2002) (property division must be considered as a whole)
- Morgal-Henrich v. Henrich, 970 N.E.2d 207 (Ind. Ct. App. 2012) (just and reasonable division; abuse-of-discretion standard)
- Hyde v. Hyde, 751 N.E.2d 761 (Ind. Ct. App. 2001) (inclusion of inherited funds in marital pot but discretionary setover)
- Castaneda v. Castaneda, 615 N.E.2d 467 (Ind. Ct. App. 1993) (inherited funds segregation discussed)
- Banks v. Banks, 980 N.E.2d 423 (Ind. Ct. App. 2012) (standards for finding abuse of discretion in family-law decisions)