922 N.W.2d 283
S.D.2019Background
- Kathryn (Kathy) and Scotty Green married in 2003, adopted two special-needs siblings and received monthly Iowa adoption subsidies payable until each child reaches majority.
- The couple invested in and personally guaranteed debt for an Old Chicago franchise through OCSC, LLC; Scotty later worked as an owner-operator, then was terminated and took lower-paying work.
- Parties separated in October 2016; Kathy sought divorce and temporary relief awarding her primary physical custody, possession of the marital home, and temporary support; parties later agreed to a joint legal custody/shared physical care parenting plan.
- Bench trial occurred November 2017; January 2018 decree awarded Kathy the divorce, $25,000 in attorney fees, both Iowa adoption subsidies (to Kathy), a roughly equal split of credit-card debt with Scotty ordered to pay a $40,183.10 cash settlement, and required either party to pay outstanding judgments against them within one year after sale proceeds of the marital home were applied.
- Scotty appealed, arguing the court abused its discretion on attorney fees, child support (and treatment/allocation of adoption subsidies), division of credit-card debt/cash settlement, and the one-year deadline to pay remaining judgments.
Issues
| Issue | Plaintiff's Argument (Kathy) | Defendant's Argument (Scotty) | Held |
|---|---|---|---|
| 1. Award of $25,000 attorney fees | Fees were reasonable and necessary given disparity in assets, litigation complexity, and Scotty’s conduct that increased costs | Award unnecessary because Kathy received near-equal property, had liquid assets, higher wage at trial, and Scotty’s future earning capacity was speculative | Affirmed — court properly analyzed reasonableness and necessity and did not abuse discretion |
| 2. Inclusion of Iowa adoption subsidies in Kathy’s income for child support and awarding both subsidies to Kathy | Subsidies are income and allocation to Kathy supported by overall financial picture and parenting plan; child-support obligations adjusted accordingly | Subsidies should not be counted as income or both awarded to Kathy, particularly given shared physical custody; court made no findings about historical payment of expenses | Affirmed — subsidies may be treated as monthly income and awarding both to Kathy was supported by findings |
| 3. Division of credit-card debt and $40,183.10 cash settlement to Kathy | Equal division justified by relative incomes, contributions, maintenance of house by Kathy, and Scotty’s failure to pay post-separation obligations leading Kathy to incur debt | Much of Kathy’s post-separation credit-card debt was nonmarital and should be her sole responsibility; pre-separation debt was small | Affirmed — court's classification and equal division were supported by record and not an abuse of discretion |
| 4. Requirement that Scotty pay outstanding judgments within one year (applying sale proceeds) | One-year deadline reasonable for both parties; sale proceeds reduced liabilities and Scotty’s earning capacity would increase after non-compete expired | Improper to rely on sale proceeds that had not yet closed; one year insufficient given Scotty’s current low income and remaining judgments | Affirmed — one-year deadline was within court’s discretion; findings about future earning capacity supported the order |
Key Cases Cited
- Osdoba v. Kelley-Osdoba, 913 N.W.2d 496 (S.D. 2018) (standard for reviewing factual findings and abuse of discretion in family law)
- Streier v. Pike, 886 N.W.2d 573 (S.D. 2016) (two-step analysis for attorney-fee awards in divorce under SDCL 15-17-18)
- Nickles v. Nickles, 865 N.W.2d 142 (S.D. 2015) (factors for reasonable attorney’s fees)
- Huston v. Martin, 919 N.W.2d 356 (S.D. 2018) (standards for review of legal conclusions and discretionary family-law determinations)
- Anderson v. Anderson, 864 N.W.2d 10 (S.D. 2015) (child support review standard)
- Hill v. Hill, 763 N.W.2d 818 (S.D. 2009) (child support review and principles)
- Crawford v. Schulte, 829 N.W.2d 155 (S.D. 2013) (SDCL 25-7-6.3 list of income is non-exhaustive; other income may be included)
- Ahrendt v. Chamberlain, 910 N.W.2d 913 (S.D. 2018) (equitable division of marital property and classification discretion)
- MacKaben v. MacKaben, 871 N.W.2d 617 (S.D. 2015) (property division need not be mathematically exact)
- Pellegrin v. Pellegrin, 574 N.W.2d 644 (S.D. 1998) (principles guiding property division)
- Terca v. Terca, 757 N.W.2d 319 (S.D. 2008) (abuse-of-discretion framing for family-law matters)
- Miller v. Jacobsen, 714 N.W.2d 69 (S.D. 2006) (clearly erroneous standard for factual findings)