Kraft v. KraftKraft v. Kraft
CHARACTER OF PROCEEDING: Appeal from the Fairfield County Court of Common Pleas, Domestic Relations Division, Case No. 04-DR-38
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: October 7, 2009
APPEARANCES:
For Plaintiff-Appellee
VINCENT J. DUGAN, JR. 500 S. Fourth Street Columbus, Ohio 43206
For Defendant-Appellant
RANDY L. HAPPENEY Dagger, Johnston, Miller Ogilive & Hampson 144 E. Main Street, P.O. Box 667 Lancaster, Ohio 43130
{¶1} Defendant-appellant David A. Kraft (“Husband“) appeals the May 7, 2008 Judgment Entry/Decree of Divorce entered by the Fairfield County Court of Common Pleas, Domestic Relations Division, which inter alia ordered Husband to pay plaintiff-appellee Cynda K. Kraft (“Wife“) spousal support in the amount of $1500/month.
STATEMENT OF THE CASE AND FACTS
{¶2} Husband and Wife were married on August 11, 1984. Two children were born as issue of the marriage, to wit: Micole (D.O.B. 2/8/87) and Bryan (D.O.B. 10/9/88). The parties separated in September, 2003. Wife filed an action for Legal Separation on January 27, 2004. Husband filed a Counterclaim for Divorce on February 6, 2004. Both children were emancipated by the time the trial court resolved all the issues in the matter.
{¶3} On November 14, 2005, the parties advised the trial court they had reached an agreement regarding property settlement. The agreement was reduced to writing in a Memorandum Agreement, which was filed on the same date. The trial court conducted a final hearing on the remaining issues of spousal support and attorney fees on May 31, 2006.
{¶4} The evidence adduced at trial revealed Husband is a butcher by training and works for CJ Kraft Enterprises, which is owned by his family and was not an asset at issue. CJ Kraft operates a slaughter house and grocery store. Husband‘s W-2 indicated he earned $20,352, from his employment with CJ Kraft. Husband and Wife jointly owned “Castaways, LTD“, a restaurant located in Lancaster, Ohio. As a result of the property settlement reached in November, 2005, this asset was allocated to
{¶5} The parties acquired sixteen rental properties during the course of the marriage. The properties had a total of twenty-three rental units. Husband was allocated fifteen of these properties as part of the property settlement. Husband also retained the marital residence. Wife was allocated one rental property which contained two rental units. Subsequent to the filing of the Complaint, Husband became the record owner of one-half interest in three rental properties which he inherited from his mother. The other one-half interest in these properties was owned by Husband‘s brother.
{¶6} The parties had a significant disagreement as to the actual income realized from the rental properties. Wife‘s expert, Dana Lavelle, a certified public accountant, prepared a schedule of potential income from the various rental properties allocated to Husband. In preparing the schedule, Lavelle made a number of assumptions, including one hundred percent occupancy of the rental properties and the real estate taxes had been paid in previous years. Lavelle calculated Husband‘s net rental income to be $101,938/year. Lavelle did not deduct any mortgage expenses from his calculations. He also included all of the income earned by the properties Husband inherited from his mother although Husband only owned a one-half interest in these properties. Lavelle acknowledged he based his calculations on the 2004 and 2005 tax returns which did not include deductions for real estate taxes, which he conceded would and should be included as an income deduction item.
{¶8} The rental property Wife received in the property settlement was a double unit, with the lower unit occupied by Wife‘s mother. Wife‘s mother paid $6600/year as rent. The monthly mortgage payment on the property was $325, or $3900/annually. The real estate taxes on the property were approximately $1100/year.
{¶9} The parties also disputed Wife‘s ability to work. Wife was a high school graduate and obtained her LPN in 1980. She worked on a part-time basis as an LPN from 1980, until 1997. In 1997, Wife left her job after being diagnosed with breast cancer. Wife‘s license expired in 1998. From 1998 to 2006, Wife worked five to ten hours/week at the parties’ restaurant. Wife opened the restaurant, conducted the banking, ordered inventory, and ran any necessary business errands. Wife was not
{¶10} Husband presented the testimony of Barbara Millisor, a vocation evaluator, who performed a vocational assessment on Wife. Millisor testified, based upon the history Wife provided, Wife was employable in the food service industry as a manager, with an earning ability of $35,300/year.
{¶11} Wife presented the testimony of Dr. Mark Carroll, D.O., her family physician, and Dr. John Mason, Ph.D., a clinical psychologist. Dr. Carroll detailed the medical issues Wife had experienced since 1985. Wife‘s health history included breast cancer, vertigo, left bundle branch block (cardiomyopathy), an abnormal MRI of the brain in December, 2004, major depression, and anhedonia. Dr. Carroll opined Wife was unable to work due to her various medical and emotional issues. On cross-examination, Dr. Carroll acknowledged Wife‘s cancer was in remission; the cause of her vertigo was undiagnosed, but resolved on its own; her depression, which had originally been diagnosed in 1991, had been successfully treated; and the abnormal MRI was followed by a clean bill of health by doctors at the Cleveland Clinic. Dr. Carroll further stated all of Wife‘s medical issues had been successfully treated except for some cardiomyopathy as a result of the left bundle branch block. As a result of this condition, Wife might experience some fatigue. In 2004, Wife informed her doctor at the Cleveland Clinic her depression had been successfully treated with Prozac. Dr. Carroll also acknowledged many individuals with depression are able to work forty hour work weeks.
{¶13} Dr. Lee Howard, Ph.D. a clinical psychologist, conducted an independent medical examination of Wife at Husband‘s request. Dr. Howard specialized in disability claims and, in particular, disability claims for workers’ compensation, social security, and the Bureau of Vocational Rehabilitation. Dr. Howard conducts approximately 1500 disability evaluations each year, and over his twenty-five years of practice, had performed 30,000 to 35,000 disability assessments. Dr. Howard performed the Shipley
{¶14} Dr. David Randolph, who is board certified in occupational medicine, evaluated Wife‘s medical issues, by taking a history from Wife and conducting a thorough medical examination. The medical examination revealed no abnormalities. Dr. Randolph noted, in 2004, Wife had an EKG, which revealed a bundle branch block. This block resulted in cardiomyopathy, which could cause Wife to feel winded after climbing stairs or possibly fatigued. Dr. Randolph believed Wife was capable of work activity, specifically sedentary or light work activities with lifting limited to twenty-five pounds and no repetitive motions. The doctor also stated Wife has convinced herself that she is disabled, but had the capabilities of sustained remunerative employment.
{¶15} The magistrate issued a decision on May 21, 2007. The magistrate found Wife was not disabled and not unable to work; therefore, imputed income to her in the amount of $14,248/year. The magistrate further found Wife has interest income from the property settlement in the amount of $11,769 as well as rental property income in
{¶16} Both parties filed objections to the magistrate‘s decision. Via Entry filed January 9, 2008, the trial court approved the magistrate‘s decision, finding the parties’ objections not well taken. The trial court ordered Husband‘s counsel to draft a judgment entry/decree of divorce incorporating the terms of the property settlement as well as the magistrate‘s decision. After some dispute concerning the wording, the trial court journalized its Judgment Entry/Decree of Divorce on May 7, 2008.
{¶17} Husband filed a timely Notice of Appeal. Husband also filed a
{¶18} It is from the May 7, 2008 Judgment Entry/Decree of Divorce Husband appeals, raising the following assignments of error:
{¶19} “I. THE DECISION OF THE TRIAL COURT REQUIRING APPELLANT TO PAY SPOUSAL SUPPORT IN THE SUM OF $1,500.00 PER MONTH UNTIL April 1,
{¶20} “II. THE DECISION OF THE TRIAL COURT THAT APPELLEE HAD ANNUAL EARNING ABILITY OF $14,248.00 WAS UNSUPPORTED BY ANY COMPETENT, CREDIBLE EVIDENCE AND WAS AN ABUSE OF DISCRETION.
{¶21} “III. THE MAGISTRATE ERRED IN REFUSING TO STRIKE FROM THE RECORD THE OPINION OF APPELLEE‘S FORENSIC ACCOUNTANT FOR THE REASON THAT SAID OPINION DID NOT MEET THE REQUIREMENTS OF EVID.R. 702.”
I, II
{¶22} Because Husband‘s first and second assignments of error both relate to the trial court‘s spousal support order, we shall address these assignments of error together. In his first assignment of error, Husband contends the trial court‘s decision ordering him to pay spousal support in the amount of $1500/month until April 1, 2017, was an abuse of discretion. In his second assignment of error, Husband asserts the trial court‘s decision to impute an annual earning ability of $14,248 to Wife was unsupported by the evidence; therefore, was an abuse of discretion. Husband challenges the trial court‘s spousal support order on three grounds: 1) the amount of spousal support; 2) the duration of the spousal support order; and 3) the trial court‘s retention of jurisdiction over the issue.
{¶23} A review of a trial court‘s decision relative to spousal support is governed by an abuse of discretion standard. Cherry v. Cherry (1981), 66 Ohio St.2d 348, 421 N.E.2d 1293. We cannot substitute our judgment for that of the trial court unless, when
{¶24}
{¶25} “(a) The income of the parties, from all sources, including, but not limited to, income derived from property divided, disbursed, or distributed under section
{¶26} “(b) The relative earning abilities of the parties;
{¶27} “(c) The ages and the physical, mental, and emotional conditions of the parties;
{¶28} “(d) The retirement benefits of the parties;
{¶29} “(e) The duration of the marriage;
{¶30} “(f) The extent to which it would be inappropriate for a party, because that party will be custodian of a minor child of the marriage, to seek employment outside the home;
{¶31} “(g) The standard of living of the parties established during the marriage;
{¶32} “(h) The relative extent of education of the parties;
{¶34} “(j) The contribution of each party to the education, training, or earning ability of the other party, including, but not limited to, any party‘s contribution to the acquisition of a professional degree of the other party;
{¶35} “(k) The time and expense necessary for the spouse who is seeking spousal support to acquire education, training, or job experience so that the spouse will be qualified to obtain appropriate employment, provided the education, training, or job experience, and employment is, in fact, sought;
{¶36} “(l) The tax consequences, for each party, of an award of spousal support;
{¶37} “(m) The lost income production capacity of either party that resulted from that party‘s marital responsibilities;
{¶38} “(n) Any other factor that the court expressly finds to be relevant and equitable.” Id.
{¶39} A trial court need not acknowledge all evidence relative to each and every factor listed in
{¶41} In order to compute an obligor‘s spousal support obligations, a trial court must determine both parties’ annual incomes. See
{¶42} After conducting a vocational assessment of Wife, Barbara Millisor, a certified vocational evaluator, determined Wife was capable of earning $35,300/year as a restaurant manager. A review of Millisor‘s testimony reveals she conducted the assessment without reviewing Wife‘s medical records, and acknowledged Wife‘s employability could be negatively affected by her medical conditions. Wife‘s experts, her physician and her psychologist, both stated their beliefs Wife was disabled and unable to work at all.
{¶43} Dr. Lee Howard, a clinical psychologist, conducted an independent medical examination of Wife. Dr. Howard, who specializes in disability claims in workers’ compensation and social security matters, administered to Wife an IQ test, the MMPI-2, and the Structured Inventory Malingering Symptomatology (SIMS) test. The
{¶44} Dr. David Randolph, who described himself as an occupational physician, evaluated Wife‘s medical issues. Dr. Randolph‘s evaluation led him to the opinion Wife was capable of work activity with limitations on lifting. Dr. Randolph noted Wife had become comfortable in her “disabled lifestyle“, and needed help to overcome the situation.
{¶45} Upon review of the record, we find there was sufficient evidence upon which the trial court could determine Wife was capable of earning only minimum wage. Wife had been working in the parties’ restaurant only 5 to 10 hours/week, since 1998. Wife opened the restaurant, handled the banking, ordered inventory, and ran assorted errands. Wife was not paid for her services. Although the trial court found Wife was not disabled and could work, the trial court recognized Wife‘s limitations. Accordingly, we find the trial court did not abuse its discretion in imputing to Wife an annual income of $14,248.
{¶46} Next, Husband argues the trial court erred in including rental income in the amount of $55,765, as part of his annual income for spousal support purposes. Husband submits the rental income is the result of the agreed property settlement between the parties, and he must utilize the rental income to pay the cash property settlement he owes Wife; therefore, requiring him to pay spousal support calculated with
{¶47}
{¶48} As part of the parties’ settlement agreement, Husband received 16 rental properties. Wife received only one parcel of real property as part of the property division, and the remainder in a cash settlement. The parcels of real property have value based upon the land and structures, as well as the income producing abilities. The trial court included rental income in calculating both party‘s incomes for spousal support purposes. The trial court also included the interest income Wife earns from the
{¶49} We now turn to Husband‘s assertion the trial court erred in failing to reduce the rental income by the depreciation on the properties. Husband acknowledges depreciation is not deducted from an individual‘s income for child support purposes pursuant to
{¶50} In Helfrich v. Helfrich (Sept. 17, 1996), Franklin App. No. 95APF12-1599, unreported, the Tenth District Court of Appeals recognized the theory behind income for child support purposes is different from income for tax purposes. The Helfrich Court stated:
{¶51} “* * * the purposes underlying the Internal Revenue Code and the child support guidelines are vastly different. The tax code permits or denies deduction from gross income based on myriad economic and social policy concerns which have no bearing on child support. The child support guidelines in contrast are concerned solely with determining how much money is actually available for child support purposes. To this end,
{¶52} We find the same rationale applies in the spousal support context. Further, there is no logical reason the calculation of an individual‘s income for spousal
{¶53} Husband also takes issue with the duration of the spousal support order.
{¶54} “Except in cases involving a marriage of long duration, parties of advanced age or a homemaker-spouse with little opportunity to develop meaningful employment outside the home, where a payee spouse has the resources, ability and potential to be self-supporting, an award of sustenance alimony should provide for the termination of the award, within a reasonable time and upon a date certain, in order to place a definitive limit upon the parties’ rights and responsibilities.” Kunkle v. Kunkle (1990), 51 Ohio St.3d 64, 67 at paragraph one of the syllabus.
{¶55} “[A] marriage of long duration ‘in and of itself would permit a trial court to award spousal support of indefinite duration without abusing its discretion or running afoul of the mandates of Kunkle.’ ” Vanke v. Vanke (1994), 93 Ohio App.3d 373, 377, quoting Corpac v. Corpac (Feb. 27, 1992), 10th Dist. No. 91AP-1036. “Generally, marriages lasting over 20 years have been found to be sufficient to justify spousal support of indefinite duration.” Hiscox v. Hiscox, Columbiana App. No. 07CO7, 2008-Ohio-5209, at ¶ 47. See, also, Bowen v. Bowen (1999), 132 Ohio App.3d 616, 627; Soley v. Soley (1995), 101 Ohio App.3d 540, 550; Vanke at 376-77; Taylor v. Taylor (Aug. 4, 1998), Scioto App. No. 97CA2537, unreported; Wolfe v. Wolfe (July 30, 1998), Scioto App. No. 97CA2526, unreported.
{¶56} The parties were married almost 20 years. As such, we find the trial court did not abuse its discretion in ordering Husband to pay Wife spousal support for a period of thirteen years, especially since the court retained jurisdiction over the issue.
{¶58} Here, the trial court imposed a definite period of spousal support of thirteen years. Husband contends the trial court erred in choosing to retain jurisdiction because he could be exposed to another trial relating to Wife‘s alleged disability, which would be expensive and time-consuming. The trial court specifically found Wife was not disabled. Wife did not appeal this finding. Any future attempt by Wife to relitigate the issue would be barred by the doctrine of res judicata absent a change of Wife‘s circumstances. Husband may find the trial court‘s retention of jurisdiction inures to his benefit in the future. Given the specific facts of this case, we cannot say the trial court abused its discretion.
{¶59} Husband‘s first and second assignments of error are overruled.
III
{¶60} In his third assignment of error, Husband argues the magistrate erred in refusing to strike the opinion of Wife‘s forensic accountant as such opinion did not meet the requirements of
{¶61} The admission or exclusion of evidence rests in the sound discretion of the trial court. Tate v. Tate, Richland App. No. 02-CA-86, 2004-Ohio-22, ¶ 63, citing State v. Sage (1987), 31 Ohio St.3d 173, 180, 510 N.E.2d 343. Nonetheless, error may
{¶62} Husband specifically objects to the methodology utilized by Wife‘s CPA, Dana Lavelle. Husband explains Lavelle did not use a recognized computer program for making his calculations and rendering his opinions. Rather, Lavelle used a computer program he designed and which was untested and not available to others. Husband adds Lavelle admitted he was not a computer programmer.
{¶63}
{¶64} “A witness may testify as an expert if all of the following apply:
{¶65} “(A) The witness’ testimony either relates to matters beyond the knowledge or experience possessed by lay persons or dispels a misconception common among lay persons;
{¶66} “(B) The witness is qualified as an expert by specialized knowledge, skill, experience, training, or education regarding the subject matter of the testimony;
{¶67} “(C) The witness’ testimony is based on reliable scientific, technical, or other specialized information. To the extent that the testimony reports the result of a procedure, test, or experiment, the testimony is reliable only if all of the following apply:
{¶68} “(1) The theory upon which the procedure, test, or experiment is based is objectively verifiable or is validly derived from widely accepted knowledge, facts, or principles;
{¶70} “(3) The particular procedure, test, or experiment was conducted in a way that will yield an accurate result.” Id.
{¶71} Assuming, arguendo, the trial court erred in failing to strike Lavelle‘s opinion testimony, we, nonetheless, find Husband has not shown he was prejudiced by such error.
{¶72} Husband‘s third assignment of error is overruled.
{¶73} The judgment of the Fairfield County Court of Common Pleas, Domestic Relations Divisions, is affirmed.
By: Hoffman, J.
Gwin, P.J. and
Edwards, J. concur
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ W. Scott Gwin_____________________
HON. W. SCOTT GWIN
s/ Julie A. Edwards___________________
HON. JULIE A. EDWARDS
For the reasons stated in our accompanying Memorandum-Opinion, the judgment of the Fairfield County Court of Common Pleas, Domestic Relations Divisions, is affirmed. Costs to Husband-Appellant.
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ W. Scott Gwin _____________________
HON. W. SCOTT GWIN
s/ Julie A. Edwards___________________
HON. JULIE A. EDWARDS