Andrus v. Andrus

• Decision Date: 07 September 2007
• Docket Number: No. 20060351-CA.,20060351-CA.
• Citation: Andrus v. Andrus, 2007 UT App 291, 169 P.3d 754 (Utah App. 2007)
• Parties: Elizabeth ANDRUS, Petitioner and Appellee, v. Daniel ANDRUS, Respondent and Appellant.
• Court: Utah Court of Appeals

169 P.3d 754

2007 UT App 291

Elizabeth ANDRUS, Petitioner and Appellee, v. Daniel ANDRUS, Respondent and Appellant.

No. 20060351-CA.

Court of Appeals of Utah.

September 7, 2007.

Rosemond G. Blakelock, Provo, for Appellant.

Brent D. Young, Provo, for Appellee.

Before BENCH, P.J., BILLINGS and DAVIS, JJ.

OPINION

BENCH, Presiding Judge:

¶ 1 Daniel Andrus (Husband) appeals the trial court's decision to award Elizabeth Andrus (Wife) the cash value of certain stocks, child support, alimony, and attorney fees following a bench trial conducted to resolve those issues in conjunction with the couple's divorce. Husband's claims that the trial court abused its discretion in awarding the cash value of stocks to Wife fail because the trial court has wide latitude in dividing marital property and there is evidence in the record to show that the parties contemplated a division of the pertinent stock in accordance with the trial court's rulings. We agree with Husband, however, that the trial court erred by not invalidating a provision from the parties' original stipulation that excluded Wife's income from child support determinations. Also, because the trial court's findings of fact are so insufficient concerning the calculation of Husband's disposable income, we remand for findings that adequately detail how or if the trial court considered Husband's tax obligations in setting his alimony payments and awarding attorney fees to Wife. We therefore affirm in part, reverse in part, and remand for further proceedings.

BACKGROUND

¶ 2 Husband and Wife were married in 1981. After separating in October 1997, the couple entered into a stipulation and property settlement (the Stipulation), which became the basis of their Decree of Divorce.

¶ 3 Subsequently, Husband requested that the trial court set aside the Decree of Divorce. Husband's motion to set aside was partially granted in April 1998, with the trial court stating that "justice would be furthered by relieving [Husband] from his stipulation on the provisions of alimony and child support." The trial court enumerated which provisions of the Stipulation would be set aside and stated that the other provisions of the Stipulation would remain in full effect. The provision that precluded consideration of Wife's income as a factor in setting Husband's alimony or child support obligations (Paragraph 6) was not expressly set aside.

¶ 4 In July of 2005, a trial was held to determine outstanding issues regarding the proper division of Husband's stock, child support, alimony, and the payment of attorney fees. In its Amended Memorandum Decision, the trial court resolved the parties' lengthy dispute regarding the division of stock options. The Stipulation called for Husband to give Wife twenty-five percent of the stock resulting from the exercise of his stock options. At the time the Stipulation was created, Husband was eligible to immediately exercise options on 9000 shares of stock in the business where he was employed, while options on approximately 46,000 additional shares remained under the employer's control for several more months. Husband would be able to, and did, exercise all of these options. Husband transferred twenty-five percent of the 9000 shares to Wife but never transferred any percentage of the remaining 46,000 shares, claiming that the Stipulation entitled Wife to an interest only in the 9000 shares he actually had rights to exercise at the time of the Stipulation. Based on Wife's testimony and some correspondence prior to the execution of the Stipulation, the trial court ruled that the Stipulation granted Wife a percentage in all of Husband's shares of stock obtained through his stock options, not just the 9000 shares.

¶ 5 Because Husband no longer owned any of the shares in dispute at the time of trial, the trial court ordered Husband to pay Wife the cash equivalent of the shares owed to her based, in part, on the profit Husband made in exercising and selling the shares. In calculating the value of the shares, the trial court averaged the price of the stock on the nine different instances when Wife requested her percentage.

¶ 6 The trial court relied on Paragraph 6 in refusing to consider Wife's income when calculating Husband's alimony and child support payments. The trial court calculated Husband's alimony payments, as well as his ability to pay Wife's attorney fees, from Husband's stipulated gross income of $10,000 per month. The trial court then subtracted certain expenses from Husband's gross monthly income, including child support, housing, food, and transportation costs, to arrive at Husband's monthly disposable income, half of which was awarded to Wife as alimony. The trial court also awarded Wife attorney fees because she was the prevailing party, finding that Husband had cash flow beyond his expenses and could better afford to pay the attorney fees than could Wife.

¶ 7 The trial court issued its Memorandum Decision on July 15, 2005. Due to mathematical errors irrelevant to the instant appeal, the trial court issued an Amended Memorandum Decision, with some corrections to dollar amounts, on December 6, 2005. Husband now appeals.

ISSUES AND STANDARD OF REVIEW

¶ 8 Husband has challenged the propriety of the trial court's division of marital property, namely the stock to which Husband was entitled to purchase through his employment. We "`will not disturb the trial court's decision [concerning property division] unless it is clearly unjust or a clear abuse of discretion.'" Shepherd v. Shepherd, 876 P.2d 429, 433 (Utah Ct.App.1994) (alteration in original) (quoting Walters v. Walters, 812 P.2d 64, 66 (Utah Ct.App.1991)).

¶ 9 Husband also claims that the trial court erred in calculating his child support and alimony obligations. We will review the trial court's decisions regarding child support and alimony under the abuse of discretion standard. See Jensen v. Bowcut, 892 P.2d 1053, 1055 (Utah Ct.App.1995) (applying the abuse of discretion standard of review for child support determinations); Howell v. Howell, 806 P.2d 1209, 1211 (Utah Ct.App. 1991) (applying the abuse of discretion standard of review for alimony determinations).

ANALYSIS

I. Division of Stock

A. Trial Court's Award of Stock

¶ 10 Husband claims that the trial court abused its discretion by finding that the Stipulation required him to transfer to Wife twenty-five percent of the approximately 55,000 shares of stock Husband obtained through his employment, and not just a percentage of the 9000 shares he actually had rights to exercise when the Stipulation was created. "`There is no fixed formula upon which to determine a division of properties in a divorce action[;] the trial court has considerable latitude in adjusting financial and property interests, and its actions are entitled to a presumption of validity.'" Shepherd v. Shepherd, 876 P.2d 429, 433 (Utah Ct.App.1994) (alteration in original) (quoting Naranjo v. Naranjo, 751 P.2d 1144, 1146 (Utah Ct.App.1988)).

¶ 11 Here, there is evidence in the record that Husband and Wife decided, a short time before their separation, to allow Husband's employer to continue holding the bulk of Husband's stock options for a longer time period so that they would be able to exercise the options at an improved rate. There is also documentary evidence that, at the time the Stipulation was created, both parties considered the stock options being held by Husband's employer to be marital property. Given this evidence, despite Husband's testimony to the contrary, it was reasonable for the trial court to award Wife twenty-five percent of the value of the stock that the parties had considered marital property, even if the bulk of the stock options were not exercisable at the time of the Stipulation.

B. Trial Court's Value of the Stock

¶ 12 Husband also claims that the trial court abused its discretion in calculating the cash value of the stock. "Generally, the marital estate is valued at the time of the divorce decree or trial." Shepherd, 876 P.2d at 432. "However, in the exercise of its equitable powers, a trial court has broad discretion to use a different date ... when circumstances warrant." Id. at 432-33; see also Peck v. Peck, 738 P.2d 1050, 1052 (Utah Ct.App.1987) (stating that the value of marital property may be viewed at a time other than the date of the divorce decree or trial when one party has dissipated the asset). "[I]f the trial court uses a date other than the date of the divorce decree, it must support its decision with sufficiently detailed findings of fact explaining its deviation from the general rule." Shepherd, 876 P.2d at 433; see also Rappleye v. Rappleye, 855 P.2d 260, 262 (Utah Ct.App.1993).

¶ 13 Here, the trial court noted multiple factors supporting its decision to calculate the stock's value based on the average price of the stock on the nine different dates Wife asked Husband for her twenty-five percent. First, the stock was no longer in Husband's possession, as he had sold his shares sometime prior to trial, so a simple transfer of the stock was impossible. Next, the court noted that Wife requested her share of the stock multiple times during an eighteen-month time period. Finally, the trial court found that the price of the stock "fluctuated substantially" during that eighteen-month period. Rather than using either the extreme high or low price during the relevant time period, the trial court simply calculated Wife's award based on the average of the stock's price on the days Wife requested her portion from Husband. This method of calculation, given the unusual factual circumstances of the instant case, is reasonable and shows the court's effort to avoid an inappropriate windfall for either party. The trial court therefore did not abuse its discretion in valuing the stock.

II. Child Support

¶ 14 Husband challenges the trial court's decision to adhere to Paragraph 6 in the Stipulation, which precludes consideration of...