McGrew v. McGrew
2017 Ohio 7854
| Ohio Ct. App. | 2017Background
- David M. McGrew filed for divorce from Sharon McGrew after years of married life involving his operation of MCS Marketing, Inc., where Sharon was the sole shareholder. Trial occurred in 2015; decree entered June 27, 2016; appeal by David.
- In 2010 David purchased a certificate of deposit (CD) with separate funds and pledged it as collateral for a business loan from Cuyahoga Falls Bank; loan balance at trial ~ $50,970 and CD balance ~ $53,719.
- From 2011–2013 company records showed reductions in shareholder loans benefitting David (repayment to him rather than to the bank); David also collected interest income from loans to the company.
- The trial court treated the bank debt as marital debt, held the CD was transmuted to marital property to the extent of the loan payoff and the remainder separate, allocated certain medical testing bills solely to David, denied modification of the parenting plan, and awarded $25,000 in attorney fees to Sharon.
- On appeal David raised five assignments of error; he withdrew one at argument. The appellate court affirmed most rulings but reversed the CD transmutation holding and remanded for further factual/traceability analysis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the CD purchased with David’s separate funds was transmuted (converted) to marital property | David: CD remained separate property; trial court gave no proper legal/traceability analysis for splitting it | Sharon/Trial Court: David’s business decisions and use of company income to repay his loans make CD effectively marital to the extent of the bank loan payoff | Reversed as to transmutation: trial court failed to analyze commingling/traceability under R.C. 3105.171(A)(6)(b); remand for proper factual findings |
| Whether David shared responsibility for certain tax debts (assignment withdrawn) | David: issue resolved/withdrawn | — | Moot/withdrawn |
| Allocation of medical testing bills for the parties’ special-needs daughter | David: bills were for child’s care and thus marital debt to be shared equally; alleged restraining-order violation doesn’t convert marital debt to personal debt | Sharon/Trial Court: David incurred bills without her consent and in violation of restraining orders; allocate to him | Affirmed: trial court did not abuse discretion in assigning bills to David based on its credibility findings and equitable allocation |
| Whether the trial court erred in refusing to modify the parenting plan (summer/Christmas time) | David: court failed to base denial on changed circumstances or statutory analysis | Sharon: opposed modification; prior parenting plan already addressed vacations to prevent scheduling problems | Affirmed: no abuse of discretion; court’s refusal supported by evidence and no required specific findings when denying modification |
| Whether awarding $25,000 in attorney fees to Sharon was erroneous | David: court improperly focused on Sharon’s counsel’s fees, ignored his expenditures, award appears arbitrary | Sharon/Trial Court: evidence showed substantial unpaid attorney fees; award equitable under R.C. 3105.73 | Affirmed: trial court acted within broad discretion; award was supported by affidavit showing unpaid fees |
Key Cases Cited
- Eastley v. Volkman, 132 Ohio St.3d 328 (Ohio 2012) (standard for manifest-weight review of civil factual findings)
- Kuehn v. Kuehn, 55 Ohio App.3d 245 (Ohio Ct. App. 1988) (doctrine and factors to consider when separate property may be converted to marital property)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (abuse-of-discretion standard defined)
- Pons v. Ohio State Medical Board, 66 Ohio St.3d 619 (Ohio 1993) (appellate court may not substitute its judgment for the trial court when reviewing abuse of discretion)
- Peck v. Peck, 96 Ohio App.3d 731 (Ohio Ct. App. 1994) (discussion of transmutation/commingling principles pre- and post-R.C. amendments)
- Guziak v. Guziak, 80 Ohio App.3d 805 (Ohio Ct. App. 1992) (trial court has broad discretion in awarding attorney fees in divorce)