Albrecht v. Albrecht, 21018.

• Decision Date: 26 April 2000
• Docket Number: No. 21018.,21018.
• Parties: Todd H. ALBRECHT, Plaintiff and Appellee, v. Jill N. ALBRECHT, Defendant and Appellant.
• Court: South Dakota Supreme Court

609 N.W.2d 765

2000 SD 54

Todd H. ALBRECHT, Plaintiff and Appellee, v. Jill N. ALBRECHT, Defendant and Appellant.

No. 21018.

Supreme Court of South Dakota.

Considered on Briefs February 14, 2000.

Decided April 26, 2000.

Todd D. Wilkinson and Gary W. Schumacher of Wilkinson & Wilkinson, DeSmet, for plaintiff and appellee.

Richard J. Helsper and Victoria M. Duehr of Glover, Helsper & Rasmussen, P.C., Brookings, for defendant and appellant.

AMUNDSON, Justice.

[¶ 1.] Jill Albrecht (Jill) appealed the trial court's judgment and decree of divorce. We affirm in part, reverse and remand in part.

FACTS

[¶ 2.] Todd Albrecht (Todd) and Jill began dating while Jill was attending college at the University of Minnesota in Crookston, Minnesota; Jill later transferred to North Dakota State University. Todd and Jill were married on November 5, 1988. At the time of his marriage, Todd was working for his parents' farming and ranching corporation, H.T. Albrecht & Sons (Albrecht & Sons). In early 1990 or 1991, Todd terminated his employment with Albrecht & Sons to begin his own farming and ranching operation with Jill. Jill subsequently decided to postpone her education and be a co-producer with Todd on his new farming and ranching operation.

[¶ 3.] In 1991, Todd entered into a contract for deed to purchase a parcel of property called the "Kenny Albrecht property" from Kenneth and Beverly Albrecht. The contract was arranged and negotiated by Todd's father.¹ Only Todd was listed as a buyer and Jill's name was not mentioned on the contract or deeds. Jill raised concern about the absence of her name from the deeds and Todd assured her that the land was a marital asset. The down payment for the Kenny Albrecht property was paid by Albrecht & Sons. Under the contract for deed, annual payments of $10,254.32 were due on the property from 1991 to 1996. Todd and Jill earned the money to pay the annual payments by renting the property to Albrecht & Sons and performing services for Albrecht & Sons. Albrecht & Sons agreed to pay Todd and Jill $10,254.32 annually and the couple would then use this money to pay the annual payment under the contract for deed. The contract for deed was ultimately paid off in 1996. Between 1991 and 1996, Albrecht & Sons treated the $10,254.32 annual payment as a rent expense on its income tax return and Todd and Jill reported their payment as rental income on their joint income tax return.

[¶ 4.] On May 14, 1993, Todd and Jill entered into a contract for deed with Todd's parents, Henry and Leona Albrecht, to purchase a sixty acre parcel of property known as the "Marital Residence." Todd and Jill resided here throughout their marriage and expended considerable time and money in making major improvements to the property. Todd and Jill made an initial $2,000 down payment on the house.

[¶ 5.] In 1995, Todd and Jill started a road maintenance business. As the success of the road maintenance business grew, the farming operation was reduced and the livestock were sold in the spring of 1997.

[¶ 6.] On December 31, 1997, Todd sued Jill for divorce. On March 2, 1999, the circuit court granted a divorce to Todd on the grounds of irreconcilable differences and to Jill on grounds of extreme cruelty and adultery. In the property division, the court determined that only $19,700 of the value of the Kenny Albrecht property was a marital asset; the appraised value of $89,000 less the contract for deed purchase price of $69,300. The court awarded the Marital Residence property, which was where Jill was residing and operating her own livestock operation, to Todd because it had "been in the family for years" and "because it would work for whatever operation [he has] now or will have in the future." Todd and Jill had another parcel of real property in Miner County that was considered "poor land" and was rented to others. The court awarded Jill the Miner County property.

[¶ 7.] Jill also requested an award of rehabilitative alimony. Jill argued to the court that she had postponed her schooling to be a co-operator of the farming and ranching operation. At the time of her divorce, Jill was working forty hours per week as a loan processor at First National Bank in Brookings, South Dakota and earning $8.75 per hour. Jill argued that without a college degree, she is not able to advance in her current position. Jill also argued to the court that she planned to return to school or start a Pregnant Mare Urine (PMU) operation if she were awarded the Marital Residence property. Jill also requested some of the farming and livestock equipment to use in her own livestock operation. Jill's request for rehabilitative alimony was denied and all of the farming and livestock equipment assets were awarded to Todd. Finally, the trial court required Todd to pay Jill $23,185 to equalize the marital property division between the parties.

[¶ 8.] Jill appeals, raising the following issues:

1. Whether the trial court erred in the property division.

2. Whether the trial court erred in denying Jill rehabilitative alimony.

3. Whether the trial court erred in refusing the filing of defendant's proposed findings of fact and conclusions of law.

DECISION

[¶ 9.] 1. Whether the trial court erred in the property division.

[¶ 10.] In reviewing the trial court's property division, our standard of review is abuse of discretion. Priebe v. Priebe, 1996 SD 136, ¶ 9, 556 N.W.2d 78, 80 (citing Grode v. Grode, 1996 SD 15, ¶ 6, 543 N.W.2d 795, 799; Abrams v. Abrams, 516 N.W.2d 348, 352 (S.D.1994); Radigan v. Radigan, 465 N.W.2d 483, 487 (S.D.1991); Henrichs v. Henrichs, 426 N.W.2d 569, 572 (S.D.1988)). To reverse under this standard, we must find that the trial court exercised discretion "`to an end or purpose not justified by, and clearly against reason and evidence.'" Id. (quoting Paradeis v. Paradeis, 461 N.W.2d 135, 137 (S.D.1990) (quoting Bradeen v. Bradeen, 430 N.W.2d 87, 91 (S.D.1988))).

[¶ 11.] We have often noted that "[i]n making an equitable division of property, the trial court is not bound by any mathematical formula, but is to make an award on the basis of the material factors in the case, having due regard for equity and the circumstances of the parties." Garnos v. Garnos, 376 N.W.2d 571, 572-73 (S.D.1985). In making our review, "we do not determine whether we would have made an original like ruling, but whether a judicial mind, in view of the law and circumstances of the particular case, could reasonably have reached such a conclusion." Billion v. Billion, 1996 SD 101, ¶ 14, 553 N.W.2d 226, 230 (citing Nelson v. Nelson, 454 N.W.2d 533 (S.D.1990)).

[¶ 12.] Jill attacks the property division for four reasons. We address each separately.

Kenny Albrecht Property

[¶ 13.] The trial court found that Kenneth and Beverly Albrecht agreed to sell the Kenny Albrecht property to Todd on a contract for deed with a total purchase price of $69,300, with $23,300 down, and the balance to be paid in installments. The trial court also found that the terms of the contract for deed were entirely negotiated by Todd's father. Further, the trial court found that Todd's father arranged the payment of the down payment and categorized his payments to Todd for tax purposes as land rent and "the amount paid was grossly in excess of the going cash rent rate." The trial court ultimately held that "the usage and course of dealing between [Albrecht & Sons] and [Todd] ... indicated an arrangement other than a landlord/tenant arrangement and reflected the true intent of [Todd's] father, Henry Albrecht and [Todd], to gift the funds necessary for [Todd] to make Contract for Deed payments." The trial court held that the $69,300 purchase price is not marital property, but the increase in fair market value of $19,700 was marital property subject to division.

[¶ 14.] Jill contends that "[a]ll property of both parties is subject to an equitable division regardless of origin or title." Further, Jill claims that because the property was "clearly acquired during the marriage and [she] did contribute to the accumulation and maintenance of this property," the entire value of $89,000 should have been included as a marital asset. In support of her argument, Jill cites Garnos, 376 N.W.2d 571 and Prentice v. Prentice, 322 N.W.2d 880, 882 (S.D. 1982). Both cases cited by Jill involve a dispute as to whether the wife made any contribution to the disputed property.² In the present case, the issue in question is not whether Jill substantially contributed to the Kenny Albrecht property; rather, whether the property was a gift to Todd and partially excludable from the property division. Todd argues that considerable and extensive testimony was offered at trial that "Todd got the [Kenny Albrecht] land free from his dad" and therefore, it is a gift and should not be included as a marital asset. A review of the record does not support this contention. Todd utilized the rent payments of $10,254.32 received from Albrecht & Sons to make his annual contract for deed payment of $10,254.32 to Kenny Albrecht. There were no documents drafted which described this transaction as a gift, nor was there a gift tax paid. In fact, Albrecht & Sons included its payment to Todd as a "rent expense" for a tax deduction on their income tax form. Further, Todd treated the payment as "rental income" on Todd and Jill's joint income tax return.

[¶ 15.] We have often stated that the essential elements of a gift are: intent, delivery, and acceptance. Estate of Fiksdal, 388 N.W.2d 133, 135 (S.D.1986) (citing Owen v. Owen, 351 N.W.2d 139 (S.D.1984); Bunt v. Fairbanks, 81 S.D. 255, 258, 134 N.W.2d 1, 2 (1965)). Further, "[t]he donor's intent must be shown in order to determine that a gift has been made." Id. The record does not establish a bona fide intent by Todd's father to make a gift of the Kenny Albrecht property. In fact, testimony during the divorce proceeding from Todd's father provides:

Q: (Wilkinson): Henry, why...