IN RE THE MARRIAGE OF SUSAN MICHELLE THATCHER AND RONALD DEAN THATCHER
No. 13-2044
IN THE SUPREME COURT OF IOWA
Filed June 5, 2015
Upon the Petition of SUSAN MICHELLE THATCHER, Petitioner, ANNA CARSON as Executor for the ESTATE OF SUSAN MICHELLE THATCHER, Appellee, And Concerning RONALD DEAN THATCHER, Appellant. On review from the Iowa Court of Appeals. Appeal from the Iowa District Court for Linn County, Marsha M. Beckelman, Judge.
Appellant seeks further review of court of appeals decision dismissing his appeal of district court order granting bifurcated decree of dissolution of marriage without division of property. DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT DECREE REVERSED; PROCEEDINGS ABATED; CASE REMANDED FOR DISMISSAL.
Sherry L. Schulte of Bradley & Riley, P.C., Cedar Rapids, for appellee.
WATERMAN, Justice.
This appeal presents a question of first impression in Iowa: whether the district court has discretion to end a marriage through a decree of dissolution without dividing the marital property until a later judgment. This two-step process is known as a “bifurcated divorce” and is expressly allowed by statute in other states.
In this case, a terminal cancer patient whose death was imminent filed a motion to bifurcate her dissolution proceeding. Her husband resisted. The day before her death, the district court entered an order granting the motion to bifurcate and dissolving the marriage, with the division of property to “be determined at a later date.” The husband appealed, and the decedent‘s estate, as the substituted appellee, moved to dismiss the appeal as premature. We transferred the case to the court of appeals, which held the bifurcation order and decree of dissolution was not an appealable final judgment and did not meet the conditions for interlocutory appeal. We granted further review.
We now determine that the decree of dissolution is an appealable final judgment. For the reasons explained below, we hold
I. Background Facts and Proceedings.
Susan and Ronald Thatcher were married on November 10, 1984. They had one daughter, Lillian, born in 1993. In January 2013, Susan was diagnosed with cervical
In November, each party filed an affidavit of financial status. These disclosed Susan had several life insurance policies, an inherited farm valued at $100,819, and inherited securities. Ronald cosigned Lillian‘s student loan of $41,000. Ronald and Susan each listed retirement accounts and bank accounts, and each listed securities owned jointly worth $76,352. Susan listed medical bills of $75,150, with insurance claims pending for $37,575. The homestead was valued at $105,000. The record is silent whether Susan had a last will and testament.
On November 22, Susan filed a motion to bifurcate dissolution. She “request[ed] that the Court dissolve the marriage of the parties at this time and that the issue of the property and debts of the parties be litigated at a later date.” As grounds, she noted her terminal cancer and that her physicians told her “at this time” her experimental treatments were not working. She alleged “it is highly unlikely that she will survive her condition for a trial.” She noted efforts to schedule a settlement conference, but that Ronald said “he was not available on the dates given and the next available dates were February of 2014, which is not a realistic date for [her].” She stated “she would like to have their marriage dissolved prior to her passing.” Her motion cited no financial reasons or legal authority to bifurcate the marital dissolution from the property division.
The motion was set for hearing on November 26. The day before the unreported hearing, Susan supplemented her motion with correspondence from her treating physicians stating her life expectancy was “limited from days to possibly weeks.” Ronald resisted the motion, arguing there is no legal basis to bifurcate the marital dissolution from a contemporaneous property division. As an alternative to bifurcation, he offered to participate in an expedited settlement conference and trial within two weeks. He stipulated to the breakdown in the marriage and waived the ninety-day waiting period. He argued bifurcation would prejudice his rights and complicate resolution of the property issues. In particular, he argued he would be forced to litigate the property division in probate court without the opportunity to depose or cross-examine Susan, lose health insurance and his status as beneficiary on her life insurance, and lose the right to file a joint tax return for 2013.
On November 27, the district court filed a two-page “Order Granting Motion to Bifurcate and Decree of Dissolution of Marriage.” The court granted the motion to bifurcate “for the reasons stated in [Susan‘s] motion.” The court also “granted a dissolution of marriage” and decreed that Ronald and Susan “are returned to their status of single persons.” The order allowed the parties to transfer one bank account of approximately $10,000 to their daughter. The order otherwise provided
On December 20, Ronald filed a notice of appeal. We granted an unresisted motion to substitute Susan‘s estate as appellee. On February 5, 2014, Susan‘s estate filed a motion to dismiss the appeal as interlocutory. Ronald resisted, arguing the decree of dissolution is a final order appealable as a matter of right. Alternatively, he sought interlocutory review. We ordered the motion to dismiss to be submitted with the appeal and transferred the case to the court of appeals.
On October 21, the court of appeals dismissed the appeal, concluding the district court‘s order and decree was not final and appealable because it contemplated “some later act—namely, the distribution of the parties’ property” to finally decide the case. The court of appeals declined to allow interlocutory review, concluding Ronald “cannot show the bifurcation order will materially affect the final decision” and noted that he may appeal from the future ruling that divides the property. We granted Ronald‘s application for further review.
II. Standard of Review.
“An action for dissolution of marriage is an equitable proceeding and, consequently, this court‘s review is de novo.” In re Marriage of Winegard, 257 N.W.2d 609, 613 (Iowa 1977) (reviewing appeal from bifurcated proceeding); see also In re Marriage of Schenkelberg, 824 N.W.2d 481, 483 (Iowa 2012) (noting de novo standard of review for “[a]ppeals regarding the dissolution of marriage“). Our review of the district court‘s interpretation of a statute in an equitable proceeding is for correction of errors of law. In re Estate of Myers, 825 N.W.2d 1, 3-4 (Iowa 2012). “Our review of district court rulings on motions to bifurcate is usually for abuse of discretion,” but we may apply de novo review based on the nature of the appeal. In re Det. of Blaise, 830 N.W.2d 310, 315 (Iowa 2013). An abuse of discretion may be shown when the district court‘s ruling ” ‘is based on an erroneous application of the law.’ ” In re A.M., 856 N.W.2d 365, 370 (Iowa 2014) (quoting Office of Citizens’ Aide/Ombudsman v. Edwards, 825 N.W.2d 8, 14 (Iowa 2012)).
III. Analysis.
We first must decide whether the district court‘s bifurcation order and decree of dissolution is reviewable at this time. Because we determine the dissolution decree is reviewable, we then address whether the district court erred by bifurcating the dissolution of the Thatchers’ marriage from the division of property and the effect of Susan‘s intervening death.
A. Is the Bifurcated Decree of Dissolution a Reviewable Final Judgment?
Susan‘s estate argues there is no reviewable final judgment until the district court divides the marital property. Ronald argues the decree of dissolution itself is a final judgment. The court of appeals heldthat the dissolution was not a final order because it contemplated division of property at a future time.
“As repeatedly articulated by this court, a final judgment or decision is one that finally adjudicates the rights of the parties. It must put it beyond the power of the court which made it to place the parties in their original position. A ruling or order is interlocutory if it is not finally decisive of the case.”
In re Marriage of Denly, 590 N.W.2d 48, 50 (Iowa 1999) (quoting Mid-Continent Refrigerator Co. v. Harris, 248 N.W.2d 145, 146 (Iowa 1976)). The bifurcated decree in this case bears a key attribute of a final judgment; it ended the marriage of the parties. The court entered this decree while Susan‘s death was imminent; indeed, she died the next day. Thus, while district courts are generally free to revisit interlocutory orders to correct error, Susan‘s death deprived the court of the ability to place the parties back in the position of being married to each other while alive. This decree “put it beyond the power of the court which made it to place the parties in their original position.” Id.
We have long held that the death of a party ends his or her marriage and abates the dissolution proceeding. See In re Estate of Peck, 497 N.W.2d 889, 891 (Iowa 1993) (stating that dissolution is a purely personal action that abates upon the death of either party “even when the disposition of significant property rights will be determined by the entry of a decree, or lack thereof“); Oliver v. Oliver, 216 Iowa 57, 58, 248 N.W. 233, 234 (1933) (“If [an enforceable] decree of divorce has not been entered prior to the death of a party, none can ever be entered . . . .“); Barney v. Barney, 14 Iowa 189, 193 (1862) (holding death of party ended appeal of dissolution decree); see also Myers v. Myers, 580 A.2d 384, 385-86 (Pa. Super. Ct. 1990) (holding that the death of a party abates both a pending divorce action and all economic claims); cf. Maghee v.State, 773 N.W.2d 228, 233 (Iowa 2009) (addressing survival statutes to conclude death abates proceedings when the contested issue becomes moot in that a ruling on the underlying issue would no longer have force or effect). The death of a party in a dissolution proceeding obviates the need for a decree of dissolution because death ends the marriage. But, this case is not moot because resolution of the fighting issue—whether bifurcated divorces are allowed—will determine whether the marital property is divided in probate proceedings or under
Missing from the decree at issue is the final division of marital property, a matter the district court expressly reserved for a later determination. Does that unfinished business make the order interlocutory? In that respect, the bifurcated order did not finally determine the rights of the parties. The problem is that (for the reasons we explain below), the district court erred by failing to divide the property contemporaneously with its decree of dissolution as required by
