Barner v. Barner, 96-3305
| Citation | 716 So.2d 795 |
| Decision Date | 01 July 1998 |
| Docket Number | No. 96-3305,96-3305 |
| Parties | 23 Fla. L. Weekly D1589 Freeman W. BARNER, Jr., Appellant/Cross-Appellee, v. Julia P. BARNER, Appellee/Cross-Appellant. |
| Court | Florida District Court of Appeals |
Frederick M. Dahlmeier and Freeman W. Barner, Jr. of Cromwell, Pfaffenberger, Dahlmeier, Barner & Griffin, North Palm Beach, and John Beranek of Ausley & McMullen, Tallahassee, for appellant/cross-appellee.
Matthew S. Nugent, West Palm Beach, for appellee/cross-appellant.
The appellant husband seeks review of the trial court's equitable distribution plan, rehabilitative alimony award to the appellee wife, denial of attorneys' fees, and allowance of the wife's petition for modification of said alimony. The wife cross-appeals, also seeking review of the equitable distribution plan and alleging that the trial court erred in failing to award permanent alimony to her. The main issue of contention is the court's determination that the husband's future income and the income from the wife's inherited property constitute marital assets. We hold they are not and reverse the equitable distribution plan.
The parties were married for twenty-four years and have four children who have all reached majority. The husband is a successful attorney while the wife has a teaching degree but has never consistently worked outside of the home. In addition to the husband's salary, the parties also relied on income from timber sales from the wife's inherited timberland in Virginia. Nevertheless, the parties consistently lived above their means and incurred significant debt.
The trial court determined that the parties had two marital assets which were subject to equitable distribution: the husband's ability to earn approximately $135,000 per year and the wife's future income from unharvested timberland which she had inherited prior to the marriage, an interest the trial court valued at $873,107.50. The trial court found that the parties had relied on these two sources of income throughout their marriage, and as such, characterized these "assets" as marital property. This was error.
The husband's future earning ability is not an "asset" for purposes of equitable distribution. See Hallman v. Hallman, 575 So.2d 738, 739 (Fla. 5th DCA 1991); Severs v. Severs, 426 So.2d 992, 994 (Fla. 5th DCA 1983). Pursuant to section 61.075(5)(a)(1), Florida Statutes (1991), "marital" assets are only those that are acquired "during the marriage." "[M]arital property rights cannot inure in property acquired after a judgment of dissolution of marriage." Reynolds v. Reynolds, 615 So.2d 243, 244 (Fla. 3d DCA 1993)(inclusion of post-dissolution income erroneous as a matter of law). Since the husband's future salary could not be characterized as accruing "during" the marriage, as a matter of law, the wife has no right to a portion of it in equitable distribution.
In evaluating the nature of the wife's inherited timberland and the value of future timber harvests and sales, the trial court bifurcated its analysis into two parts: the nature of the timberland itself and the characterization of the timber thereon. The wife had inherited some tracts individually and others in joint tenancy with her brother, who managed all of the timberland. The trial court found that the wife's interest in the timberland was nonmarital, while the future income stream from the sale of the timber was a marital asset.
Regarding the characterization of the timber income, the trial court classified this as a marital asset based on its belief that the parties' reliance on the income received during their marriage changed the nature of the income accruing in the future, after the marriage. Section 61.075(5)(b)3 states that nonmarital assets include "all income derived from nonmarital assets during the marriage unless the income was treated, used or relied upon by the parties as a marital asset." (emphasis added). See Boyett v. Boyett, 703 So.2d 451, 451 n. 1 (Fla.1997). Even if the use of the nonmarital income for marital purposes during the marriage converts it to marital income, the future stream of income from a nonmarital asset is not a marital asset after the marriage is dissolved. As we stated above, in regard to the husband's future salary, pursuant to section 61.075(5)(a)(1), the only assets subject to equitable distribution are those acquired "during the marriage." As such, the wife's future timber income is nonmarital, and the husband is not entitled to any portion of it. See also Cobb v. Cobb, 107 N.C.App. 382, 420 S.E.2d 212 (1992)(future timber income not vested property right).
The trial court characterized the timberland as nonmarital since the wife inherited the property prior to the marriage. See § 61.075(5)(b); Macaluso v. Macaluso, 523 So.2d 615, 617 (Fla. 2d DCA 1988)(property was nonmarital where family business established and transferred to husband prior to marriage). The parties expended no significant marital labor which might have contributed to the vast appreciation of the timberland over the course of the marriage. This case is analogous to our recent decision in Oxley v. Oxley, 695 So.2d 364, 368 (Fla. 4th DCA), rev. dismissed, 705 So.2d 9 (Fla.1997), in which we held that increased value in nonmarital assets, due to the efforts and independent decision making of third parties, constituted nonmarital property and was not subject to equitable distribution. In the present case, the trial court found that the wife's brother essentially managed the property and made all of the pertinent investment decisions, including when to harvest, sell and/or reseed the timberland. Thus, she expended no marital labor on the land.
The husband argues that even if the timberland was inherited, the fact that he contributed to the payment of property taxes and seedlings should change the nature of the asset for purposes of equitable distribution. The husband introduced a series of cancelled checks, written both from his personal account and from the parties' joint account, for real estate taxes, timber replanting, and seedlings. In all, these checks totalled approximately $16,790 for taxes, $500 for seedlings, and $821 for timber replanting. Other checks were written to the wife's brother, but they do not indicate the purpose for which they were written. However, the husband testified that over their twenty-four year marriage he paid $70,000 in real estate taxes.
Section 61.075(5)(a)2 includes as marital assets "[t]he enhancement in value and appreciation of nonmarital assets resulting either from the efforts of either party or from the contribution thereto or the expenditure thereon of marital funds ...." (emphasis added). "Absent a showing that either marital funds, assets, or the work efforts of one or both spouses contributed to the enhanced value of the asset, the appreciated value of one spouse's nonmarital asset occurring during the marriage is not subject to equitable distribution." Oldham v. Oldham, 683 So.2d 579, 580 (Fla. 4th DCA 1996)(emphasis added). Thus, it is not just the expenditure of marital funds in relation to the nonmarital asset but how those expenditures enhance the value of the asset. Routine maintenance expenses may or may not enhance the value of a nonmarital asset. A spouse may expend labor on a nonmarital asset by cutting the grass regularly, but that effort might not result in an enhancement in value. Therefore, the trial court should consider whether the marital funds or labor expended on a nonmarital asset resulted in its appreciation. It is only where appreciation occurs as a result of the marital effort or funds that the enhancement of nonmarital property may be considered a marital asset. Although payment of property taxes in connection with the payment of a mortgage or improvements to land may transform non-marital property to marital property, as in Oldham, in this case the trial court could in its discretion determine that the payment of property taxes alone did not turn the appreciation of the timberland into a marital asset.
This does not leave a spouse who has contributed to a non-marital property of the other spouse without recourse. Where one spouse has paid significant expenses on the property of another spouse, even if they do not enhance the value of the property, the trial court can consider those payments in determining that there is a justification for an unequal distribution of marital assets. See §...
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