Schmieding v. Schmieding, 99-579.

• Decision Date: 29 August 2000
• Docket Number: No. 99-579.,99-579.
• Parties: In re the Marriage of, Jennifer L. SCHMIEDING, Petitioner/Respondent, v. Peter SCHMIEDING, Respondent/Appellant.
• Court: Montana Supreme Court

9 P.3d 52

2000 MT 237

301 Mont. 336

In re the Marriage of, Jennifer L. SCHMIEDING, Petitioner/Respondent, v. Peter SCHMIEDING, Respondent/Appellant.

No. 99-579.

Supreme Court of Montana.

Submitted on Briefs February 24, 2000.

Decided August 29, 2000.

Mark L. Guenther, Nash, Guenther & Zimmer, Bozeman, Montana, For Appellant.

Edmund P. Sedivy, Jr., Sedivy, White & White, Bozeman, Montana, For Respondent.

Justice WILLIAM E. HUNT, Sr. delivered the Opinion of the Court.

¶ 1 On May 28, 1997, Respondent, Jennifer Schmieding (Jennifer), petitioned the Eighteenth Judicial District Court, Gallatin County, for dissolution of her marriage to Appellant, Peter Schmieding (Peter). This matter proceeded to a four-day trial held from October 1, 1998, until October 8, 1998. On April 6, 1999, the District Court issued its Findings of Fact and Conclusions of Law equitably distributing the marital assets and liabilities, determining child support and maintenance, and awarding Jennifer her attorney fees and costs. Following a hearing, the District Court ordered Peter to reimburse Jennifer's attorney fees and costs totaling $26,561.88. On August 25, 1999, the District Court entered its Decree of Dissolution incorporating the amount of attorney fees and costs. Peter now appeals the award of attorney fees to Jennifer. We Affirm.

¶ 2 The only issue on appeal is:

Did the District Court abuse its discretion in awarding petitioner her attorney fees and costs.

FACTUAL BACKGROUND

¶ 3 At the time of trial, October 1, 1998, Jennifer and Peter had been married eighteen years. The parties' three teenage sons were ages 16, 16, and 12, Michael and Matthew being twins. Peter was age 42 and Jennifer was age 41.

¶ 4 During the marriage, Jennifer worked primarily as a homemaker, caring for and raising the parties' children and performing the many tasks of managing the household. In the initial months of the parties' marriage, before the twins were born, she assisted Peter in his dental practice as a receptionist and dental assistant. Other than that, she was not employed outside of the home until the winter of 1997-98, when she took seasonal employment at Big Sky as a ski patroller, where she earned $7.80 per hour. She earned $1,527.81 of gross pay in 1997, and earned $286.42 in 1998 before being injured. She will be earning $8.25 per hour for the winter season of 1998-99. The possibility exists for her to do summer work for Boyne USA at Big Sky.

¶ 5 Jennifer obtained a degree in Psychology from Michigan State University in 1980. She has never used the degree for any employment. She is also a certified emergency medical technician. She expects to be able to initially earn only minimum wages. She has no clerical skills. She has moderate opportunity in the future to acquire assets by her earnings and income. Her standard of living during the eighteen years of marriage was high.

¶ 6 Peter obtained a degree in Natural Science from John Hopkins University in 1978, and a D.M.D. (Dental) degree from the University of Florida in 1981. He operated a dental practice in Naples, Florida, from 1982-1996. From 1990 through 1995, Peter earned net profits between $220,000.00 and $257,576.00 per year. In addition to his dentistry profession, Peter also has construction skills and is a licensed contractor in the State of Florida. He has been a co-owner in a construction business in Florida, known as "Hardwood Building, Inc." He owns 50% of its outstanding stock.

¶ 7 In June 1996, he sold his dental practice in Florida, and the family moved to Big Sky, Montana. In 1996 he had gross receipts of $310,835.00, and a net profit of $177,862.00 from the Florida practice. He started a dental practice at Big Sky, Montana in September 1996, working part-time and had $17,538.00 of gross receipts, but claimed a net loss of $27,633.00, due to start up expenses and depreciation. In 1997, he again worked part-time and had gross receipts of $77,559.31.

¶ 8 At the time of trial, Peter worked approximately two days per week at Big Sky. He anticipated expanding to Belgrade, so that he will have a full week of work. Considering the statistics of the earnings of dental practices in Montana, his age, working full-time as a median, Peter can reasonably be expected to earn at least $91,500.00 per year and this level of earnings can be expected up through age 65. He has the ability to acquire substantial assets by his earnings and income. His standard of living during the eighteen years of marriage was high.

¶ 9 Upon moving the family to Montana, in 1996, Peter sold his dental practice in Florida for $350,00.00 with $100,000.00 in cash and $250,000.00 on contract. The monthly payments of principal and interest on this contract total $3,896.55, and the contract balance as of the date of trial was $184,273.40. The parties sold their Florida home in 1996 for over $1.2 million, receiving net proceeds of $800,190.00.

¶ 10 On January 30, 1998, Peter sold his dental office building in Florida for $180,00.00, with $20,000.00 down and the balance of $160,000.00 plus interest at 8% per annum to be paid in monthly payments of $1,529.04, with a balloon payment of $126,710.57 to be paid on December 20, 2002. The balance owing on September 30, 1998, was $156,213.54. Peter purchased an office condominium for his dentistry office at Big Sky, on September 9, 1996, for $100,000.00, and acquired furniture and dental equipment for $31,000.00.

¶ 11 At the time of trial, the parties owned a house in Big Sky, Montana. This home listed for sale at $690,000.00 and is subject to a $197,188.45 mortgage. The monthly mortgage payment is $1,385.00. The house is currently rented for $1,300.00 a month. They also own a home in Bozeman, Montana. This house was purchased after the parties separated and is the primary residence of Jennifer and the three children. The house was purchased for $280,000.00. The balance owed as of September 1998, was $178,206.38, with a monthly payment of $1,243.22. Peter also purchased a lot at 390 Hayrake Lane, Bozeman, Montana, for $200,000.00. At the time of trial he was building a home on this lot, and he had expended as of June 15, 1998, the sum of $700,000.00 with the total expenditure expected to be $835,000.00.

¶ 12 Peter has a Keogh profit-sharing plan invested with Fidelity Investments, and as of January 31, 1998, the fund was valued at $411,006.00. At the time of trial it was valued at $179,363.76. Peter also has an IRA invested with Fidelity Investments and as of January 28, 1998, it had a value of $26,212.00. At trial its value was $26,313.14.

¶ 13 Jennifer also has a Keogh account and as of January 1, 1998, it was valued at $17,116.85. At trial its value was $18,694.23. Jennifer has an IRA invested with Fidelity, and as of January 28, 1998, its value was $22,832.14. At trial its value was $22,358.61.

¶ 14 The parties have an investment account with Brown & Company which has been invested by Peter in oil drilling sector stocks. On December 31, 1997, it was valued at $596,412.50. By February 27, 1998, the account had dropped to $442,378.00. In June Peter sold all of the stock except Varco International, Inc., and as of June 26, 1998, it was valued at $102,593.00. At trial its value was only $77,490.00.

¶ 15 The District Court thus found that on October 30, 1997, shortly after Jennifer filed for divorce, and prior to the purchase of the Hayrake lot, the parties had net assets of $2,675,979.00 with $1,247,552.00 being liquid. As a result of Peter's decision to build the Hayrake house, a huge drop in the market for oil exploration companies' stock, and substantial living expenses for two households, the parties' liquid assets had dropped to $77,490.00 at trial.

¶ 16 The parties also had an investment brokerage cash account valued at $160,193.44 as of January 8, 1998, the date of the pre-trial order. Its value as of September 1, 1998, one month before trial was only $356.78. Peter had withdrawn the balance and deposited it into his personal bank account.

¶ 17 After the parties separated, Peter withdrew all the funds from their joint checking account and set up his own account. He deposited all of his incomes into his account. From these co-mingled funds, he paid his business expenses, personal expenses, mortgage payment for the Big Sky home, expenses for building the Hayrake home, and made monthly payments of $5,000.00 to Jennifer. As Peter claims that he has made no profits from his dentistry business at Big Sky, the monies paid to Jennifer were nothing more than a payment to her from her marital assets. As of July 31, 1998, Peter had $50,994.28 in his personal account. Peter testified at trial that he now had only $4,000.00 in the account. Jennifer also has her own account which had $3,000.00 in it at trial.

¶ 18 The District Court distributed the assets as it found them in October 1998, awarding Jennifer her home, Peter his office, and giving each of them one-half of the interest in the two homes, so that each was sharing in the risks of gains or losses if and when they sold. The District Court divided the Hardwood Building, Inc., the Brown & Company account, and Peter's Keogh account. The District Court was aware of Peter's intention to spend an additional $135,000.00 to finish the Hayrake house, and that by the date of the court's findings of facts and conclusions of law, there would likely be no money or liquid assets left. The only income producing property left was the Florida note from the sale of the office building awarded to Jennifer, and the Florida note for sale of the practice awarded to Peter. This would create $1,529.04 per month to Jennifer and $3,896.55 per month to Peter.

¶ 19 After distributing the marital assets, the District Court then looked at the issue of maintenance and child support. The court concluded that Jennifer required $8,836.25 per month for her and the children to maintain their standard of living. It then found that...