In re the MARRIAGE OF John Digby PAHLOW, Jr. and Linda Faye Pahlow. John Digby Pahlow, Jr., Appellant, v. Linda Faye Pahlow, Respondent.
No. 23424.
Missouri Court of Appeals, Southern District, Division Two.
March 20, 2001.
39 S.W.3d 87
ORDER
PER CURIAM.
Emily Thomas appeals the trial court‘s Findings of Fact; Conclusions of Law; Judgment and Decree (judgment) entered after a non-jury trial in this action to quiet title in approximately 58 acres of landlocked farmland in Ste. Genevieve County, Missouri, referred to as the donut hole.
We have reviewed the briefs of the parties, the legal file, and the record on appeal, and find the claims of error to be without merit. The trial court‘s judgment is supported by substantial evidence and is not against the weight of the evidence. No error of law appears. An extended opinion reciting the detailed facts and restating the principles of law would have no precedential value. Judgment affirmed in accordance with
The parties have been furnished with a memorandum for their information only, setting forth the reasons for the order affirming the judgment pursuant to
C. Ronald Baird & Dana L. Kollar, Baird, Lightner & Millsap, Springfield, for Respondent.
BARNEY, Chief Judge.
John Digby Pahlow, Jr. (“Husband“) appeals from an Amended Judgment of Dissolution (“judgment“) which dissolved his marriage to Linda Faye Pahlow (“Wife“). In its judgment the trial court, inter alia, set off to Husband non-marital assets valued at $210,574.00, and set off to Wife non-marital assets valued at $19,785.00. In its division of marital property, the trial court
Husband posits two major points of trial court error on appeal. First, Husband claims the trial court erred in “classifying the Trim Fast debt and funds as marital and in awarding them to Wife.” Second, Husband claims the trial court erred in “ordering Husband to pay maintenance in the amount of $2,750 monthly....” Both points are discussed below.
“On appeal of a dissolution of marriage proceeding, we review the evidence in the light most favorable to the trial court‘s decision.” Taylor v. Taylor, 12 S.W.3d 340, 344 (Mo.App.2000). “The party challenging the dissolution decree has the burden of demonstrating error.” Id. “We will affirm the trial court‘s decree unless there is no substantial evidence to support the decision, the decision is against the weight of the evidence, or the decision erroneously declares or misapplies the law.” Id. “A trial court is ‘free to believe or disbelieve all, part or none of the testimony of any witness.‘” In re Marriage of Thompson, 24 S.W.3d 751, 755 (Mo.App.2000) (quoting In re Marriage of Stephens, 954 S.W.2d 672, 675 (Mo.App.1997)).
The record shows that Husband and Wife were married November 4, 1966, and separated on October 11, 1997. Husband‘s family are longtime, influential residents of Barton County. Husband began working full time in his family‘s abstract title business—Pahlow and Pahlow—in 1972. For the past 27 years, he has worked in the family business primarily providing abstracts, title insurance, loans, and escrow and closing services. Husband also holds a realtor license and a license to sell title insurance and annuities. He has also been employed as a branch manager with Team Bank and makes money from other business ventures. Wife forwent college at the urging of Husband and has been primarily occupied throughout the marriage as a full time mother and homemaker. Husband was completely in charge of the parties’ finances.
The record also reveals that Husband has suffered from alcoholism but sought treatment in 1993 and claims his drinking is now controlled. Wife presented evidence that Husband physically and verbally abused her at times during the marriage, the frequency of the abuse increasing due to Husband‘s heavy use of alcohol. Further, Wife presented evidence that Husband had a number of affairs during the marriage. It was undisputed that Husband began an affair with Marsha Hardin, an old girlfriend, prior to filing for dissolution of his marriage.
The parties have two emancipated children and are also the appointed joint guardians of their grandson.1
I.
In his first point on appeal, Husband claims the trial court erred in classifying the “Trim Fast debt and funds as
In a dissolution of marriage proceeding, the court awards each spouse his or her non-marital property and then the court divides the remaining marital property and debts in a just manner after considering all the relevant factors.
The law does not require an equal division of marital property, but the division must be fair and equitable after taking into consideration the factors enumerated in
Following the parties’ separation, Husband borrowed $55,000.00 from Vernon and Viola Ring, late in the month of April 1999. Husband used $10,000.00 of the money to pay some of Wife‘s attorney‘s fees and used the other $45,000.00 to purchase 10,000 shares of stock in “TrimFast Group, Inc.”3 The loan was secured by a deed of trust on a family farm, of which Husband retains a 1/5 interest as his separate property. Early in the trial, and in his exhibits, Husband represented that he had sold the 10,000 shares of TrimFast stock on July 30, 1999, for $6.80 a share and that he was waiting for a check for between $65,000.00 and $68,000.00, depending on what the brokerage fees would be. Later in the trial, Husband informed the court that he evidently had not sold the stock and that he had been notified that he only had $45,000.00 worth of stock. He subsequently deposited a check with the court for that amount from “Millennium Health Care Products, Inc.“—evidently a company connected with TrimFast Group, Inc.4 The trial court found that the $55,000.00 debt to the Vernon and Viola Ring was a marital debt, and that the TrimFast stock was a marital asset and was worth $68,000.00.5
Under
2. For purposes of sections 452.300 to 452.415 only, “marital property” means all property acquired by either spouse subsequent to the marriage except:
- Property acquired by gift, bequest, devise, or descent;
- Property acquired in exchange for property acquired prior to the marriage or in exchange for property acquired by gift, bequest, devise, or descent;
- Property acquired by a spouse after a decree of legal separation;
- Property excluded by valid written agreement of the parties; and
- The increase in value of property acquired prior to the marriage or pursuant to subdivisions (1) to (4) of this subsection, unless marital assets including labor, have contributed to such increases and then only to the extent of such contributions.
3. All property acquired by either spouse subsequent to the marriage and prior to a decree of legal separation or dissolution of marriage is presumed to be marital property regardless of whether title is held individually or by the spouses in some form of co-ownership such as joint tenancy, tenancy in common, tenancy by the entirety, and community property. The presumption of marital property is overcome by a showing that the property was acquired by a method listed in subsection 2 of this section.
4. Property which would otherwise be nonmarital property shall not become marital property solely because it may have become commingled with marital property.
Husband is correct in pointing out that the debt was secured by his separate property and that Wife was unaware of the loan transaction or the subsequent purchase of stock. However, “[t]he phrase ‘marital debts’ encompasses all debts incurred during the marriage, either jointly or separately,” Hughes v. Hughes, 994 S.W.2d 103, 107 (Mo.App.1999), and “[t]he fact that a spouse does not control or participate in the decision to make a particular debt does not preclude allocation of that debt to the non-participating spouse.” Id.; see also Rivers, 21 S.W.3d at 123. Here, Husband borrowed money from the Rings partly to pay some of Wife‘s attorney fees for the dissolution of marriage action. Further, the court expressly found that Husband‘s testimony was not credible. Although Husband borrowed the money in question and purchased the stock after the parties had commenced their preparations for divorce, we cannot say the trial court erred in not accepting Husband‘s contention that these were not marital transactions. The funds borrowed were borrowed after the parties separated but while they were still married and are presumed marital. Bullard, 929 S.W.2d at 946. The funds do not fit under any of the subcategories of
II.
In his second point on appeal, comprised of three sub-points, Husband essentially complains that the trial court erred in ordering him to pay $2,750.00 per month in maintenance because: (1) it improperly imputed $50,000.00 in annual earning capacity to Husband; (2) it failed
An appellate court must affirm the circuit court‘s award of maintenance unless there is no substantial evidence to support the award, it is against the weight of the evidence, or it erroneously declares or applies the law. Buckner v. Buckner, 912 S.W.2d 65, 68 (Mo.App. W.D.1995). We afford the circuit court a great deal of discretion in awarding maintenance. Id. In the absence of a finding that the amount is patently unwarranted and wholly beyond the means of the spouse who pays, this court will not interfere with the circuit court‘s award of maintenance. Petty v. Petty, 739 S.W.2d 738, 741 (Mo.App. E.D.1987). Husband, who contends the circuit court erred in awarding any maintenance to wife, bears the burden of proving the maintenance award “shocks” this court‘s sense of justice. Allen v. Allen, 927 S.W.2d 881, 885 (Mo.App. W.D.1996). Burnett v. Burnett, 18 S.W.3d 27, 29 (Mo.App.2000). The trial court‘s determination of the amount of maintenance to be awarded, if any, is governed by
- Lacks sufficient property, including marital property apportioned to him, to provide for his reasonable needs; and
- Is unable to support himself through appropriate employment or is the custodian of a child whose condition or circumstances make it appropriate that the custodian not be required to seek employment outside the home.
- The financial resources of the party seeking maintenance, including marital property apportioned to him, and his ability to meet his needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party as custodian;
- The time necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment;
- The comparative earning capacity of each spouse;
- The standard of living established during the marriage;
- The obligations and assets, including the marital property apportioned to him and the separate property of each party;
- The duration of the marriage;
- The age, and the physical and emotional condition of the spouse seeking maintenance;
- The ability of the spouse from whom maintenance is sought to meet his needs while meeting those of the spouse seeking maintenance;
- The conduct of the parties during the marriage; and
- Any other relevant factors.
POINT II(3)
For the purpose of clarity, we shall initially address the third sub-point in Husband‘s Point II, in which he claims that the trial court erred in ordering him to pay $2,750.00 per month in maintenance because:
It failed to properly consider the correct amount of assets and debt apportioned to Husband and the absence of income from those assets in that it erroneously charged Husband with assets previously expended on debt and erroneously omitted debt uncontroverted in the evidence.
This sub-point violates
(1) Where the appellate court reviews the decision of a trial court, each point shall:
- identify the trial court ruling or action that the appellant challenges;
- state concisely the legal reasons for the appellant‘s claim of reversible error; and
- explain in summary fashion why, in the context of the case, those legal reasons support the claim of reversible error.
The point shall be in substantially the following form: “The trial court erred in [identify the challenged ruling or action], because [state the legal reasons for the claim of reversible error], in that [explain why the legal reasons, in the context of the case, support the claim of reversible error].”
Further, as noted previously, Husband‘s second point is divided into three sub-points. However, the argument section of his brief following his second point is divided into five sections, each discussing one of following five “contested findings“:
- Income should be imputed—the amount was reasonably $50,000.
- Husband mismanaged his business and all financial affairs.
- Husband intentionally quit Team Bank to reduce income.
- Wife‘s reasonable needs were $59,784 annually.
- Husband was able to meet his needs and debt load while helping meet the needs of wife.9
As best we can discern, the first three “contested findings” relate to Husband‘s first sub-point, and the last two contested findings relate to Husband‘s second sub-point. However, as to Husband‘s third sub-point, we find references at a number
POINT II(1) and (2)
We now return to the first two sub-points in Husband‘s Point II, relative to the trial court‘s maintenance award to Wife. In these sub-points, Husband contends: (1) that the trial court erred in imputing $50,000.00 in annual earning capacity to Husband; and, essentially, (2) that the trial court failed to balance Wife‘s reasonable needs with Husband‘s present ability to meet those needs. These claims are closely related and will be discussed together. “We presume the trial court considered all of the evidence in making its determinations.” Halupa v. Halupa, 980 S.W.2d 325, 331 (Mo.App.1998). “The judgment of the trial court must be affirmed under any reasonable theory supported by the evidence.” Id. We defer to its findings as to maintenance, even though the evidence could support a different conclusion, due to its superior position to judge witness credibility, sincerity, and character and other intangibles not revealed in a transcript. Ansley v. Ansley, 15 S.W.3d 28, 32 (Mo.App.2000).
Regarding maintenance, the trial court found:
[Husband] contends that his earning capacity is extremely limited. [Husband] testified that he believes that he does not possess a future in the banking industry. [Husband] also testified that based upon the earnings of Pahlow and Pahlow Abstract Company in the past, and the competition in the area, he does not believe that his abstract business will be financially lucrative. However, it is clear from [Husband‘s] testimony that he has not actively worked in actively [sic] or managed his abstract business.
The trial court further found that although Husband claimed to have “a negative income of $351.00” the court believed that “[Husband] has mismanaged Pahlow and Pahlow and all of his financial affairs” and that he “has actively attempted to decrease his income during the dependency [sic] of this litigation in our [sic] to avoid paying [Wife] maintenance.” Additionally, the court found that “[Husband] has attempted to conceal assets as evidenced by the fact that his property and liability list has been drafted twenty-one (21) times, and by the time of trial assets were still being discovered ... or the values ... being changed....” “[T]he trial court is in the best position to judge the credibility of witnesses.” Burnett, 18 S.W.3d at 31. The court determined that Husband could “produce income sufficient to meet his needs while assisting [Wife] in meeting hers” and that “[Husband‘s] lack of diligence in this regard is directly related to the pending litigation and that if [Husband] put forth his full effort, he would have a significant potential earning capacity of approximately $50,000.00 per year.”
The trial court found that Husband quit a job with Team Bank that paid him $24,500.00 per year and that he voluntarily relinquished 12 months of rental income from Team Bank at $1,250.00 per month. Husband claims that he quit because Team Bank “moved the business out of the abstract plant ... and adopted a course of demanding a full half day of time at their new location[,] together with exhaustive
According to Husband‘s evidence, the abstract business had a cash flow of $14,402.00 per year, which did not cover much more than the $10,159.00 per year loan payment on the building that the business was located in, and the $3,600.00 per year paid to Husband for his auto expense. However, as previously recited, Husband evidently relinquished a $24,500.00 per year job so the abstract business would not be damaged. Husband also was offered $40,000.00 per year to work for “Heritage Bank.” Husband complains that Wife had forbidden him to work for Heritage bank at the time. It is unclear whether the offer is still available or whether other similar offers would be available. Furthermore, evidence was presented that Husband had supplemented his income over the years with a number of activities. He is licensed both as a real estate broker and an insurance/annuities salesman. He earns rent on a pharmacy building he owns. He has earned fees for being on various boards, from being a court appointed guardian, and from brokering loans. He also has some minor farm income. Finally, Husband testified that he is capable of doing many things and that he hoped he could make $60,000.00 a year or better. He testified “I‘m just thinking about a lot of things at this point. I even thought about going back and going to school to be a chef. I just—There‘s a lot of things I‘m thinking about.” It is clear, then, that Husband is not lacking in skills or connections.12 “A trial court may impute income in considering a party‘s maintenance obligation.” Nelson v. Nelson, 14 S.W.3d 645, 650 (Mo.App.2000). We find no abuse of trial court discretion by its imputing an annual income of $50,000.00 to Husband.
As to the evidence supporting the trial court finding that Wife needed $2,750.00 per month in maintenance, Husband complains that the trial court erred in finding that her reasonable needs were “$4,982 monthly or $59,784 per year.” Husband contends “[t]his determination of [W]ife‘s individual reasonable needs irrationally exceeds the historical average annual income of both parties. Tax returns between 1994 and 1998 report a total of $296,479.00 over five years or an average of $59,296.00.”
it is uncontroverted that the parties’ health insurance was canceled because [Husband] failed to make timely insurance premiums. [Husband] was mailed overdue notices on August 9, 1999, August 16, 1999, and September 8, 1999.... [Wife] testified that as early as July, 1999, she personally told [Husband] that her health was deteriorating and she would be undergoing various test. [Wife] emphasized to [Husband] the importance of keeping the insurance coverage intact and paying the premiums. [Wife] even told [Husband] to let her know if he was not going to pay the premiums because she would find the funds to pay them. Despite the notifications from the insurance company, and [Wife] ... [Husband] let the insurance lapse. [Wife] testified that when she confronted [Husband] about the insurance cancellation, [Husband] merely relied, [sic] ‘I can get coverage through the Veteran‘s Administration’ and he did not seem remorseful or concerned. The Court finds that at best [Husband‘s] action[s] were in reckless disregard of [Wife‘s] well being and at worst were intentional and malicious.
Accordingly, there was sufficient evidence supporting the trial court‘s findings as to Wife‘s reasonable needs.
However, “[i]n determining the amount of maintenance, the trial court must balance the reasonable needs of the spouse seeking maintenance against the other spouse‘s ability to pay.” Griffin v. Griffin, 986 S.W.2d 534, 538 (Mo.App.1999). “An award of maintenance should not exceed the paying spouse‘s capacity to provide.” Id.
Here, as previously set out, the trial court imputed income to Husband and found that, if he were to work diligently, he could have a “significant potential earning capacity of approximately $50,000.00 per year.”13 Further, Husband claimed to have monthly expenses of $9,820.00 per month. This figure, however, is inflated by amounts that Husband claimed he was paying for Wife, which he would no longer be paying after the dissolution of the marriage. Additionally, Husband also included as expenses the monthly payments on
Nevertheless, given the fact that the trial court imputed to Husband earnings of $50,000.00 per year, the debt load carried by Husband, and the lack of significant income producing property as revealed by the record, we cannot calculate how Husband could afford, after taxes are considered, maintenance payments in the amount of $33,000.00 per year, even if he has modest monthly expenses. Accordingly, we reverse the award of maintenance in the amount of $33,000.00 per year as being against the weight of the evidence. See Griffin, 986 S.W.2d at 538. Furthermore, reviewing the fact that we have affirmed the imputation of $50,000.00 annual income to Husband, we remand the case to the trial court for entry of an award of maintenance, after considering all relevant factors as set out in
The judgment of the trial court is affirmed in part and reversed in part, and the cause is remanded for further action by the trial court in accordance with this opinion.
PREWITT, J., concurs in part, dissents in part.
GARRISON, J., concurs.
PREWITT, Judge, concurring in part and dissenting in part.
I would affirm without modification of the judgment. Under the circumstances present, I do not believe the trial court abused its discretion in setting the amount of maintenance payable to Respondent.