*1 652 135, (and (1985)
Evidence 140 numerous §§ therein); McCormick,
cases cited Evidence Ed.1984)); Waltz, (Cleary 190 The New
§ Evidence, p. (1972
Federal Rules of 2nd
Ed.) words, prose- other in this case the prohibited proving
cution was given was of a character defendant having excess,
drive after drank again allow the inference that he did so night question. prosecution
did not here. used the prove
defendant’s convictions to
motive to story. concoct fantastic
the rule allows. case, would hold that the
possible grounds inadmissibility 19-12-3,
be SDCL which must be consulted
after SDCL 19-12-5 been satisfied. Pedde, 41, (S.D.
State v.
1983); 652, Johnson, v. State (S.D.1981). KELLEY,
Donald H. Appellee, KIRK, Formerly Penelope M. Kelley,
M. Appellant. Defendant and
No. 14881.
Supreme Court of South Dakota.
Argued Oct. July
Decided
$6,093.50 reimbursement to De- fendant.
33. quit working That because Defendant & Palm- Palmer of Gunderson J. Crisman profession, in her she has suffered a er, plaintiff appellee. Rapid City, for depreciation capital, according in human McCullen, Clabaugh Bangs, Ronald evidence, $50,218 to her when consid- Butler, Simmons, City, for Rapid Foye & ering wages upon she would earn appellant. defendant and reentry job op- market into the now posed she earned to what would have MORGAN, Justice. teaching profes- in the had she continued offsetting then her sion and a decree of di- appeal arises from present net said sum of worth. That marriage between terminating the vorce $50,218 to Defendant as resti- is awarded (Donald) Penelope M. H. Donald alimony. tutional Penelope appeals from Kelley (Penelope). awarding alimo- portion of the decree proper- portion ny appеals and also 34. in and reverse
ty We affirm division. working That had Defendant continued part. teaching profession salary her to- Penelope were married on $24,000 Donald and day approximately per would be 23, At the time of the mar- 1963. June she is to rehabili- annum. That entitled completed had his freshman riage, $24,000 years for three tative had year $72,000 medical school as rehabilita- or a total sum Degree edu- received her Bachelor’s alimony. tion During course of Donald’s cation. residency program,
medical education and employed as a teacher and alimony award from That the total family’s income. earned the bulk to Defendant is the sum 1972, Rapid Penelope moved to Donald and $128,311.50. considering the That when Dakota, Donald became City, South where present living needs of De- reasonable partnership employed in a fendant, earning present depressed her 1982, couple practicing pathology. she can earn on ability and the interest 1984, each separated and on December liquid net worth a her accumulated from the other. granted а divorce $12,831.15per years ten at ment term of Penelope’s contention We examine $1,070 enable per month should or in its award of alimo- trial court erred reasonably support herself with- her to award made ny. We first examine the accumulated net worth. expending court, we find to be rather is woe Penelope complains that the award court’s calculations were unique. grounds. Cit inadequate on several following findings in the succinctly set out v. Guin Guindon found in ing the factors of fact: don, setting alimony, she ar consideration court based its аward gues that the trial through 1970 the dif- That from 1963 earnings of projected earnings solely upon Donald’s of Plaintiff ference between $18,000 demon $12,- rather than his per annum approximately and Defendant was $145,000 per capacity of earning 000, $6,000 strated of which the court’s annum, citing part of the trial us to support herself and would have used to earning ca 18: “That his $6,000 Finding of Fact earnings were of Defendant’s will be immediate future Plaintiff, resulting pacity support used to plus per year travel event approximately Plaintiff should his mind in expenses.” years. a few That Plaintiff is entitled to lead own life and his profes- picture, we If this were the entire sion for the life balance as he sees agree undoubtedly inclined with Pene- subject fit obligations to his reasonable lope. although to Defendant. That the Plain- that at the time of The record reflects *3 tiff will continue work a physician to trial that it was his inten- Donald testified practice and it for medicine will be pathology tion forsake to drastically reduced annual income. engaged he been in and that had to enter a of he intended field medicine Furthermоre, contrary to Pene directly primary patient more involved with lope’s suggestion, trial court considered underdeveloped care in a third world coun- the Guindon factors as more all of try. very trial carefully con- following set in findings out of fact: situation, noting Finding this in of sidered Fact 15: listening intently to That Plaintiffs considering That when alimony, the testimony observing demeanor, and his amount thereof and the duration the the Court finds that Plaintiff is sincere parties Court finds as follows: That the change and truthful his desire his to twenty-one have been years; married professional lifеstyle approach and to his they intelligent productive both indi- medicine. viduals, the Plaintiff’s fault was some- Finding The trial court also found in of Defendant’s; what more they than both Fact 16: education; good have the Defendant is earnings Plaintiff’s in- That have been entitled to maintain a life- reasonable degree flated some because of his style; earning ability the Plaintiff’s engaged work ethic. That he has been greater Defendant’s; than the the De- profession a stressful and become fendant is not entitled to sit back in burned out and somewhat disillusioned idleness fоr the of rest her life at the by profession practice. and his That expense Plaintiff; and servitude of the change his decision to foregoing property that after the settle- although lifestyle, voluntary, a reason- ment the position Defendant’s financial to infer able one from the circumstances will be such that she will be able to justified continuing for his own men- reasonably good lifestyle by maintain a tal physical well-being. health and prudent management of her assets and pro- this because That entertaining. less fessionally gain pursue monetаry but to pursue approach a ‘hands-on’ to medicine amongst poor privileged peo- and less in reaching alimony That determi- ple of the world there will a drastic past nation the Court considered the change earnings profes- in his from his earning ability, present earning ability sion. potential earning and future Finally, pertinent portion we note the capacity parties and each Finding Fact 18: the present equity contribution to [sic] That the decision on the of Plain- position parties. tiff professional lifestyle complains further purposes
was him for made court, affecting by failing legal trial apply outcome of rate this case or to intentionally monthly payments, of interest reduce Defendant’s future spousal $128,000 support. year period That a ten effect reduced the award to monthly $75,000 for neighborhood present will installments value. sufficiently protect authority proposi- no cites argument spousal support period tion. deem the We therefore that if Pe- Matheson, 335 Corbly waived. N.W.2d nelope spend desires thousands of dol- (S.D.1983). per lars her on wаrdrobe should be done out of her net accumulated worth not complains Penelope also that while the his future servitude. The trial court then court found over half ali- found that reasonably she needs sum mony rehabilitative based on a $2,063 month, per spread present that her earn- three-year period, payments ing period; ability, worth, ten-year over a thus it could not be interest on her net categorized alimony. as rehabilitative She the sum in spousal support will complains also inade- provide for needs. her quate based оn the facts of the case: That Reviewing findings of fact and con- the trial court failed to take into considera- whole, apparent clusions of as a it is law tion the tax very plan that this is well thought payments as deductible Donald and *4 trial of the court in an her; chargeable that the court ex- trial equitably divide the paying cluded consideration Donald suf- provide adequate and to support for Pene- alimony mortgage pay- ficient to cover lope is completely until she on her own. ments, on the taxes insurance resi- dence; payments and car for future car We conclude that the expenses. wardrobe entertainment adequate considering parties’ relative regard, finding of fact young health, age, relatively good their trial Penelope’s anticipa- court noted that ability both pursue a career. living $3,697 monthly ted needs of is unrea- importantly, Penelope ap More will receive sonably excessive. The court found trial $240,000 proximately under the respon- further should not say settlement. cannot reviewing We after satisfying mortgage sible for on the all the factors relevant home, $26,000 approximately a residential abused making its discretion mortgage on a home awarded to award. Penelope, when distribution was made that equity. basis of The trial court Penelope’s We now consider contention further found that Donald should not be considering the trial court erred in responsible making for automobile liqui- certain income support peri- ments duration pension profit-shar- dation of Donald’s od when two auto- awarded ing plan interest in and his mobiles. valuing when the assets of the parties for trial court
Finally,
distribution. The
the trial court noted that Donald
responsible
valued
estate
allowing
should not
her
and divided the marital
frequently
during
entertain her friends
follows:
Distribution
Property
Value
Plaintiff
Defendant
Family
$124,500.00
1.
residence
$124,500.00
profit
2.
Pension and
sharing plan
*145,613.65
$145,613.65
of Donald
3. Donald’s interest
professional practice
*100,793.00
100,793.00
5,500.00
4.
Piano
5,500.00
5.
20,000.00
Investments
20,000.00
goods
7,500.00
6. Household
7,500.00
Art,
rugs,
21,800.00
7.
oriental
etc.
21,800.00
4,500.00
8.
1980 Subaru auto
4,500.00
7,500.00
9.
7,500.00
Datsun auto
22,500.00
10.
1976 Mercedes auto
22,500.00
11. Cash value of Conn.
Distribution
Property
Value
$2,687,404
8,504.00
8,504.00
Mutual Life Ins.
12. Cash value of Conn.
1,108.00
$3,838,108
1,108.00
Mutual Life Ins.
Stock-Minn. Power &
2,775.00
2,775.00
Light
2,000.00
2,000,00
Mutual Fund
Stoek-IDS
$474,593.65
$269,018.65 $205,575.00
TOTALS
63,443.65
-31,721.82
+31,721.83
Shortfall
+
$237,296.83 $237,296.83
NET
Herrboldt,
Items 2 and
3 abоve
after-tax
values.
claims that
consider
only time that this court will inter-
“[t]he
ing
the tax
fere with the valuations as
determined
of the assets
came to approximately
the trial court is when the trial court has
$50,790, the trial court erred and that she
clearly
made a
erroneous
find-
valuation
approximately
entitled
one-half of this
(Citation
ing[.r
omitted.)
agree.
value. We
The issue before us in this case is wheth-
This court has
stated that our
*5
er the trial
in using
court erred
after-tax
regard
standard of review with
to valuation
value of certain assets rather than before-
property
is whether the trial court
values,
$50,790.
tax
a difference of
This is
equitable
divided the assets in an
manner.
valuation,
purely question
a
not division.
standard,
Under this
we have
very
The trial court could
well
left
have
the
income-producing property,
considered
tax
computations
out of the
Stenberg
Stenberg,
v.
90 S.D.
240 and divided
sixty/forty
the total sum
or
(1976);
N.W.2d 100
assets overlooked or
fifty-five/forty-five and we would then
by mortgages
may may
minimized
which
or
probably
arguing
equity
the
of the divi-
legitimate
against
liens
the marital
sion.
repeatedly
We have
said that
trial
property,
Kittelson,
Kittelson
v.
272 courts
by any
are not bound
mathematical
(S.D.1978); necessity
N.W.2d 86
a
for inclu
formula and this court will not set aside or
present
sion of the
value of retirement modify a decision
it clearly appears
unless
accounts,
Hansen,
Hansen v.
that the trial court abused its discretion.
(S.D.1979);
assets, Guindon,
749
omitted
Hansen,
Kittelson,
supra;
supra.
In this
supra. We have further stated that the
instance,
attempted
the trial court
to make
trial
by
court is not bound
valuations testi
fifty/fifty
division down to the odd dol-
but,
by
parties;
fied to
the
where valua
lars and cents.
challenge
Donald did not
agreed upon,
tions are not
parties
the
review,
this formula
notice of
all
so for
prepared
proceed
should be
with hard
purposes
intents and
in this case it is
evidence
and the court need
find a
locked in.
solely
ques-
We then look
range.
value within a reasonable
Hanks
tion of
propriety
of the valuations.
Hanks,
(S.D.1980).
controlling making
in
the deduction
arise.” 284 N.W.2d
modify judg-
the court did. The tax
at 26. We
hesitant to
a
come taxes that
a
Kelley’s
pat-
in Dr.
ment
follows well-considered
consequences here were
(Footnote
so,
omitted.)
control;
tern of distribution.
complete
being
it is entire-
him
ly appropriate
allocate to
all of thе
pattern
There was a well-considered
of
potential
liability.
tax
distribution in this case. We should not
transmogrify
transmogrification
it. The
short, regardless
certainty
of the
of
quest
punish
should not result from a
liability,
proof
in the
of
the tax
absence
this doctor who wishes to
his life.
event has occurred
that the taxable
either
Yes, indeed,
Kelley’s
Dr.
decision was in
during
marriage or will occur in con-
complete
wrong
his
control.
Is it
to heal
property,
nection with the division of the
I
sick, help
naked,
poor,
clothe the
or
hold that it would
error and an
hungry?*
Kelley
feed the
If Dr.
wishes to
abuse of discretion
the trial court to
pursuit
buck,
leave the
so let it be
deduct such taxes from the total marital
upon
journey
and let him embark
in
new
estate
to division.
his,
life. This choice is
belong
and does not
system.
to his
or the
ex-wife
court
Are we
HENDERSON,
(concurring in
Justice
granted by
the framers of the Constitu
part, dissenting
part).
in
pursuit
happiness”?
tion “the
Tax con
apparently
This Court
holds that the trial
sequences
stripped
should not be
from the
good
made
court
decision on the division package
pattern
of distribution
propеrty
and the
award. How-
judge
which the trial
devised.
nec
ever, the
por-
Court wants to isolate one
essary
Kelley
liquidate
pro
for Dr.
tion,
consequence aspect,
the tax
pay
fessional interests to
the shortfall
trial court’s decision and call it error.
I
distribution which
disagree. Cleverly,
majority
does this Kelley
it,
desired. As I understand
by stating that it is an
error
valuation.
finding
court made a
that it would not be
$50,790; dividing
The tax difference is
after his
reasonable
from the
half,
we arrive at the
error in
pathology
him to leave
“valuation.” It is
obvious that the entire
investments in
оr for
colleagues
decision of
upon
profes
the trial court was based
former
to allow such
liquidation.
support
sional investments to continue.
It is
my position,
clear
believed,
found,
that the trial court
Krage Krage,
cite
necessity
(S.D.1983):
assets to
pattern
fulfill the
of distribution. When
The trial
apparently
pattern
had a
falls,
the hammer of
of assets
according to
which distributed the mar
resulting
consequence
triggered.
tax
property. Similarly,
pat
ital
we noted a
Here,
specu
the tax ramifications were not
tern of
distribution Wallahan Wаl
[v.
lative; rather, they were realistic and cer
lahan,
(S.D.1979)]
volve Appellee, No. Finding of Fact 20 should be set apprecia- in extenso for the forth readers’ McDOWELL, Edward Spiritually, factually, is tion. Appellant. against writing opinion majority No. 14590. special provides: concurrence. It finding That items two three of Supreme Court of South Dakota. nineteen are after tax above values Argued Nov. Court finds these items Plaintiff a cer- is definite July Decided tainty under the circumstances. Plain- tiff has effective end 1984.
After his it is not reasonable him leave the investments colleagues or his former to allow it. unlikely leaving
It is such an invest- in place practical espe-
ment would
cially considering to leave the
country. Also, in provide order to De-
fendant with distri- the shortfall
bution she is entitled to it is liquidated. funds to be The tax speculative they
ramifications are represent
realistic and a certain and dimi-
nution in asset valuation
occur if getting weren’t par-
divorce. The
tial distribution items two and three
paragraph nineteen above are unac-
ceptable in view of the fact
can receive un- favorable tax treatment long
der capítol gain provi- term [sic]
sions special pension profit and the
sharing provisions of the reve- internal
nue code. changes pattern Court now rests property.
distribution marital
upon holding, apparently, above
finding clearly is erroneous for lack be,
proof. however, clearly Can there finding
erroneous of fact of
valuation, half, nicely when it cleaved penny, required and Dr.
pay all liqui- of the tax Here,
dation? we see a conceptual end run
it should be tackled and knocked
ground for fallacy. its