Murphy v. Murphy, 07ca35 (12-9-2008)Murphy v. Murphy, 07ca35 (12-9-2008)
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DECISION AND JUDGMENT ENTRY
{¶ 1} Sherri Murphy (“Wife“) appeals the final divorce decree entered by the Lawrence County Court of Common Pleas, terminating her marriage with Ted Murphy, Jr. (“Husband“). On appeal, Wife contends that the trial court erred when it failed to consider the amount certain separate property (home and car) of the Husband appreciated during the marriage. Because the trial court never made any determination of whether such property appreciated during the marriage, the amount of appreciation or whether such appreciation was martial or separate property, we agree as to the home and remand this cause to the trial court to determine the same. However, because no the evidence showed the
I.
{¶ 2} Wife and Husband married in 1996. Wife filed for divorce in 2005, and Husband counterclaimed for the same. A magistrate presided over the contested hearing.
{¶ 3} The couple testified regarding several assets, including two homes and a car. Husband owned a home on Eighth Street in Ironton and an El Camino when he married Wife. The couple purchased another home on Mill Street in Ironton during the marriage.
{¶ 4} After their marriage, the couple mortgaged the Husband‘s home for about $35,000 to pay Wife‘s credit card debt. They remodeled the Eight Street home by spending another $35,000. Wife testified, and Husband agreed, that she contributed $5,000 for the remodeling. She stated that she earned most of that $5,000 during the marriage. She further testified that the house increased in value during the marriage from about $60,000 to a current value of $145,000.
{¶ 5} The couple purchased the Mill Street home during the marriage from Husband‘s brother for Wife‘s daughter. Wife‘s daughter could not purchase the home on her own credit. Husband and Wife refinanced the Eighth Street home for $85,000 and used that money to (1) pay off the prior mortgage on the Eighth Street property and (2) purchase and fix-up the Mill Street property.
{¶ 6} Husband and Wife disagreed about the agreement with Wife‘s daughter regarding the Mill Street property. Husband testified that Wife‘s daughter “was supposed to get a loan within a year and pay me back the whole loan. Which she has not done cause she [has] not got[ten] her credit straightened out.”
{¶ 7} Husband further testified that he had to pay the bank about five or six payments because Wife‘s daughter failed to make those payments. Apparently, Wife‘s daughter made the payments to Wife, and Wife used the money for her
{¶ 8} Wife testified that the couple agreed to give her daughter “five years to get her finances straightened up” and to obtain her won financing. However, Wife claimed that Husband did not provide the proper information to her daughter so that she could obtain her own financing.
{¶ 9} Husband testified that he had done nothing to frustrate Wife‘s daughter‘s ability to obtain financing, but he did refuse to sign the deed to the Mill Street property to Wife‘s daughter until he received the $55,000 owed to him for the property.
{¶ 10} With regard to the El Camino, there is no dispute that Husband owned the car prior to the marriage, and that it was restored during the marriage. The parties, however, disagree about who paid for the restoration. Neither party presented any evidence of the El Camino‘s current value or its value before the marriage.
{¶ 11} Finally, Husband testified that he had two pre-marital certificates of deposit and two individual retirement accounts. He stated that during the marriage he cashed in all of these accounts, which totaled between $70,000 and $80,000 and used the funds for their marital needs. Wife disputed the total amount, arguing that the Husband counted one individual retirement account twice.
{¶ 12} Following the hearing, the magistrate made several recommendations to the court. First, that it grant the parties a divorce. Second, that it award the El
{¶ 13} Third, the magistrate recommended that Husband should recover the $80,000 of his separate property expended during the marriage on the couple‘s living expenses. However, the magistrate stated that because the parties had very little martial assets, Husband could not practically recover that amount. As a result, the court found that Husband‘s loss of the $80,000 benefited Wife, and recommended that Wife not receive spousal support because she (1) has health insurance, (2) received a disproportionate amount of martial assets, (3) is not responsible for paying any of the $18,000 martial debt, and (4) received the benefit of Husband‘s $80,000 in separate property spent during the marriage.
{¶ 14} Wife objected to the magistrate‘s recommendations. However, the court adopted the magistrate‘s recommendations as set forth above.
{¶ 15} Wife appeals, asserting the following six assignments of error: (I) THE PROPERTY DIVISION ORDERED BY THE TRIAL COURT CONSTITUTED AN ABUSE OF DISCRETION AND WAS AGAINST THE MANIFEST WEIGHT OF THE EVIDENCE AND CONTRARY TO LAW BY NOT DETERMINING THE VALUE OF THE MARITAL PROPERTY THAT IS SUBJECT TO DIVISION AS REQUIRED BY OHIO REVISED CODE 3105.17.1(G); (II) THE TRIAL COURT
II.
{¶ 16} In her first and second assignments of error, Wife contends that the trial court abused its discretion by failing to consider the appreciation of a home and a car in determining the value of the martial property.
{¶ 17} We review the overall appropriateness of the trial court‘s property division in a divorce proceeding under an abuse of discretion standard. Cherry v. Cherry (1981), 66 Ohio St.2d 348. However, the characterization of property as separate or marital is a mixed question of law and fact, not a discretionary matter. Barkley v. Barkley (1997), 119 Ohio App.3d 155, 159. As such, we review the determination regarding the proper characterization of property under the manifest weight of the evidence standard. Id., citing Wylie v. Wylie (May 30, 1996), Lawrence App. No. 95CA18; Miller v. Miller (Dec. 1, 1993), Washington App. No. 93CA7. We will not reverse the trial court‘s judgment as being against the manifest weight of the evidence if some competent, credible evidence supports the court‘s judgment. Sec. Pacific Natl. Bank v. Roulette (1986), 24 Ohio St.3d 17, 20; C.E. Morris Co. v. Foley Constr. Co. (1978), 54 Ohio St.2d 279, syllabus.
{¶ 18} Once the court makes the determination of whether property is marital or separate property, we review the actual distribution of the asset under the more deferential abuse of discretion standard. Kelly v. Kelly (1996), 111 Ohio App.3d 641, 642-643, citing
{¶ 19} Pursuant to
{¶ 20} The court shall disburse a spouse‘s separate property to that spouse, unless: (1) the court finds that the property is subject to one of the statutory exceptions outlined in
{¶ 21} “`Marital property’ includes all real or personal property acquired by either or both of the spouses during the marriage.” Grosnickle v. Grosnickle, Warren App. No. CA2006-03-037, 2007-Ohio-3613, ¶ 7, citing
A. Eighth Street House
{¶ 22} Here, the trial court determined, and the Wife does not dispute, that the home on Eighth Street was Husband‘s separate property because he owned that home before the marriage. However, Wife contends that she is entitled to a portion of the appreciation of the marital home as a result of renovations made during the marriage.
{¶ 23} Husband testified regarding the renovations as follows: [Wife] put $5,000.00 in the house. We put over $35,000.00 on the back of the house, building a big room onto the back of the house. I got the loan and I‘m paying the loan on it right now. Plus I borrowed money off my dad. I paid him back.
{¶ 24} The renovations to the back of the house included a large bedroom, dining room and bathroom. The $5,000 Wife put in the house was money saved before and during the marriage. Further, Husband purchased a greenhouse for Wife that was placed on the property.
{¶ 25} Wife provided the only testimony about the home‘s value, stating that the home was worth approximately $60,000 at the time they married, and was
{¶ 26} Some courts hold that “a party who fails to provide adequate evidence as to the amount of passive appreciation fails to meet his burden of tracing the appreciation as separate property, because [courts] are unwilling to speculate when the evidence is devoid of a cause for the increase.” Scott v. Scott, Trumbull App. No. 2007-T-0059, 2008-Ohio-530, at ¶ 32, citing Bizjack v. Bizjack, 11th Dist. No. 2004-L-083, 2005-Ohio-7047; see, also, Kreilick v. Kreilick, 161 Ohio App.3d 682, 2005-Ohio-3041 (finding that husband “failed to meet his burden by a preponderance of the evidence” to show that appreciation of his premarital home was separate property). Such a view is premised on the well-settled rule that “[t]he party seeking to have a particular asset classified as separate property has the burden of proof, by a preponderance of the evidence, to trace the asset to separate property.” Id., citing Peck v. Peck (1994), 96 Ohio App.3d 731, 734. Other courts, however, have found that absent proof that the labor, monetary or in-kind contribution of one spouse or the couple combined caused the appreciation of one spouse‘s premarital property, the appreciation is
{¶ 27} Here, the trial court never determined the value of the Eighth Street property at the time of the marriage or at the end of the marriage. As a result, there was no finding that any appreciation existed or whether any appreciation was martial or separate property. Without these determinations by the trial court, we cannot properly review this issue.
{¶ 28} This court has held that “the trial court must place a value on each item of property.” Rinehart v. Rinehart (May 18, 1998), Gallia App. No. 96CA10. “[T]he provisions of
{¶ 29} Therefore, we find that the trial court abused its discretion when it distributed the Eighth Street house without making all of the necessary findings.
B. El Camino
{¶ 30} With regard to the El Camino, Wife contends that the trial court erred when it failed to consider appreciation of Husband‘s El Camino, which the court determined was separate property. Wife again does not dispute that the El Camino is Husband‘s separate property. Instead, she contends that she
{¶ 31} Ohio courts have found that where there is no evidence of the value of the allegedly appreciated property either before or after improvements, it is “impossible for the court either to value or divide the appreciation[.]” Scott, supra, at ¶ 22. “A trial court does not need to equitably divide an asset if the record does not provide sufficient evidence for the trial court to value and equitably divide that asset.” Id., citing Spier v. Spier, 7th Dist. No. 05 MA 26, 2006-Ohio-1289. Because there is no evidence from which the court could value the appreciation of the El Camino, which is undisputedly Husband‘s separate property, the court did not abuse its discretion by failing to award wife appreciation of the El Camino.
{¶ 32} Accordingly, we sustain, in part, and overrule, in part, Wife‘s first and second assignments of error.
III.
{¶ 33} In her third assignment of error, Wife contends that the trial court erred when it refused to award her spousal support. Because we are remanding this cause to the trial court for the court‘s determination regarding the valuation and distribution of any appreciation on the Eighth Street property, and because the trial court‘s findings may have an impact on spousal support, the trial court should also revisit this issue on remand. See Hurte v. Hurte, Washington App. No. 04CA33, 2005-Ohio-5967, ¶ 35.
{¶ 34} Accordingly, we do not consider Wife‘s third assignment of error because it is not ripe for consideration.
IV.
{¶ 35} In her fourth assignment of error, Wife contends that the trial court erred in determining that the effective end of the marriage was September 2005.
{¶ 36} This court reviews a trial court‘s determination of the duration of the marriage under an abuse of discretion standard. Green v. Green (Jun. 30, 1998), Ross App. No. 97CA2333.
{¶ 37} Pursuant to
{¶ 38} This court has noted that trial courts generally “use a de facto termination of marriage date when the parties separate, make no attempt at reconciliation, and continually maintain separate residences, separate business activities and/or separate bank accounts.” Soulsby v. Soulsby, Meigs App. No. 07CA1, 2008-Ohio-1019, ¶ 29, citing Eddy v. Eddy, Washington App. No. 01CA20, 2002-Ohio-4345, ¶ 24; Gullia v. Gullia (1994), 93 Ohio App.3d 653. The “trial court may use a de facto termination of marriage date when the evidence clearly and bilaterally shows that it is appropriate based upon the totality of the circumstances.” Id.
{¶ 39} Here, Wife claims that the court‘s finding contradicts this court‘s opinion in the previous appeal. See Murphy v. Murphy, Lawrence App. No. 06CA11, 2006-Ohio-4876. However, in that decision, this court merely affirmed the trial court‘s grant of Civ. R. 60(B) relief in favor of Husband and made no finding with regard to the effective end date of the marriage.
{¶ 40} Wife presents no argument as to why the September 2005 date is inequitable and provides no argument whatsoever as to how the court‘s determination of the duration of the marriage has prejudiced her in any way. Therefore, we find that the trial court did not abuse its discretion.
{¶ 41} Accordingly, we overrule Wife‘s fourth assignment of error.
V.
{¶ 42} In her fifth assignment of error, Wife contends that the trial court erred when it failed to find that Husband engaged in financial misconduct. Wife contends that Husband committed financial misconduct by failing to provide loan information to Wife‘s daughter regarding the Mill Street property so that Wife‘s daughter could obtain her own financing for the purchase of that property.
{¶ 43} The trial court maintains discretion in determining whether to make an award under
{¶ 44} Pursuant to
{¶ 45} This court has held that “[t]he financial misconduct statute should apply only if the spouse engaged in some type of `wrongdoing.‘” Jacobs at ¶ 23, citing Rinehart, supra; Hammond v. Brown (Sep. 14, 1995), Cuyahoga App. No. 67268. “There must be a clear showing that the offending spouse either profited from the alleged misconduct or intentionally defeated the other spouse‘s distribution of assets.” Id., citing Wideman v. Wideman, Wood App. No. WD-02-30, 2003-Ohio-1858, ¶ 34; Detlef v. Detlef (Dec. 14, 2001), Lucas App. No. L-00-1137. “[T]he burden of proving financial misconduct for purposes of
{¶ 46} Here, the court apparently agreed with Husband‘s testimony regarding the deal made with Wife‘s daughter that involved the Mill Street property. As the
{¶ 47} Accordingly, we overrule Wife‘s fifth assignment of error.
VI.
{¶ 48} In her sixth assignment of error, Wife contends that the trial court erred when it awarded Husband $80,000, which was the amount of the Husband‘s separate funds that he expended during the marriage for marital needs. Further, Wife asserts that the trial court erred in determining the value of such monies spent during the course of the marriage.
{¶ 49} Wife cites the case of Wertz v. Wertz, Montgomery App. No. 19520, 2003-Ohio-3782 in support of her position that the court should not have taken the amount of separate property, i.e., cash, spent by Husband during the course of the marriage for marital needs. In fact, the court in Wertz held that where “property no longer exits, it cannot be divided as martial property or awarded as separate property.” Id. at ¶ 17.
{¶ 50} Here, Wife never argued in the trial court that the court improperly considered the money spent from Husband‘s separate funds during the marriage, and never objected to the magistrate‘s finding that Husband should recover the
{¶ 51} The wife, however, did object in the trial court to the amount of the award found by the magistrate.
{¶ 52} The magistrate made a factual finding, adopted by the trial court, that the amount of separate funds expended by the Husband during the marriage for marital needs was $80,000. An appellate court will not reverse a trial court‘s factual findings unless they are against the manifest weight of the evidence. C.E. Morris Co., supra, at syllabus. A factual finding is not against the manifest weight of the evidence when the record contains some competent, credible evidence supporting it. Id.
{¶ 53} Here, we find that competent, credible evidence supports the trial court‘s $80,000 factual finding. The Husband in his testimony described four separate premarital accounts that he had expended during the marriage, i.e., two certificates of deposit and two individual retirement accounts. Husband testified that the total amount withdrawn from the accounts “probably” totaled $70,000 to $80,000. The court, as is its province, valued the amount used by the couple during the marriage from Husband‘s separate funds at $80,000. Therefore, we find that competent, credible evidence (the Husband‘s testimony) supports the trial court‘s finding in the amount of $80,000. Consequently, we find that the trial
{¶ 54} Accordingly, we overrule the Wife‘s sixth assignment of error.
VII.
{¶ 55} In conclusion, we overrule, in part, Wife‘s first and second assignments of error. We do not address Wife‘s third assignment of error. We overrule Wife‘s fourth, fifth, and sixth assignments of error. However, we sustain, in part, Wife‘s first and second assignments of error. We affirm, in part, and reverse, in part, the judgment of the trial court and remand this cause to the trial court for further proceedings consistent with this opinion.
JUDGMENT AFFIRMED IN PART, REVERSED IN PART AND CAUSE REMANDED.