Baron v. Baron

• Decision Date: 23 September 1947
• Docket Number: 8923.
• Parties: BARON v. BARON.
• Court: South Dakota Supreme Court

28 N.W.2d 836

71 S.D. 641

BARON v. BARON.

No. 8923.

Supreme Court of South Dakota

September 23, 1947

Meyer M. Willner and Jerry Giesler, both of Los Angeles, Cal., and Tom Kirby, of Sioux Falls, for defendant and appellant.

Morgan & Fuller, of Mitchell, and Bailey, Voorhees, Woods &amp Fuller and Davenport, Evans & Hurwitz, all of Sioux Falls, for plaintiff and respondent.

SMITH, Judge.

The decree grants a divorce to the plaintiff husband on the ground of extreme cruelty, and divides the property of the parties. The principal complaint of the defendant wife on appeal is that the property division is inequitable.

In granting a divorce for the fault of a husband a court has power under SDC 14.0726 to make an allowance to the wife in lieu of the common-law duty of the husband to support her. Cf. Tuttle v. Tuttle, 26 S.D. 545, 128 N.W. 695. Because the divorce was granted for the fault of the wife, that power is not invoked. The decree below must be tested under a separate provision of SDC 14.0726 reading as follows:

'Where a divorce is granted for an offense of either husband or wife the courts shall in such action have full power to make an equitable division of the property belonging to either or both, whether the title to such property is in the name of the husband or the wife. In making such division of the property the court shall have regard for equity and the circumstances of the parties.'

This statute does not clothe a court with arbitrary power to award the property of one of the parties to a divorce to the other. It was adopted in recognition of the fact that one spouse often holds title to property of the other, that property possessed by either party to a marriage is frequently the result of their joint efforts and that many factors must be taken into consideration if complete justice is to be done in dissolving a marital partnership. It invests a court with a broad underlying power to enforce the equitable claims to property of both of the parties to a divorce. In considering this power in a case where the wife was granted a divorce for the fault of the husband, in Caldwell v. Caldwell, 58 S.D. 472, 237 N.W. 568 569, it was written:

'This statute is comprehensive in its terms. It does not prescribe the proportion to be allotted to each of the parties, but provides that there shall be an 'equitable division.' What may constitute such a division is necessarily dependent upon the facts, circumstances, and conditions in each particular action, and no fixed rule for an 'equitable division' can be stated. Among the matters to be considered in making a division of property under this statute is the value of the estate; the manner in which the property was acquired; the ages of the parties, their health and competency to earn; and the cause for which the divorce was granted.'

In broad outline the record discloses the following facts and circumstances. At the time of the marriage of these parties in 1921, the husband was associated with two of his brothers in three mercantile businesses in South Dakota. This interest in these stores, his home at Mitchell, and some miscellaneous property was then of a value of approxmiately $111,000. The wife had been a saleslady in one of these stores and was without property at the time of the marriage. During the course of the marriage the husband and his brothers prospered. Shortly after 1921 they disposed of two of the South Dakota stores and acquired one of the principal mercantile establishments in Madison, Wisconsin. They also organized a corporation which acquired several valuable business buildings in Mitchell, the largest office building in Sioux Falls, a well-stocked cattle ranch, and other property. At an early date the Mitchell store and the real estate corporation were placed in charge of a manager, and a fourth man was associated in the Madison store and charged with its management. Prior to 1930 the brothers had moved to California. During that year the husband completed a twenty-room home in an exclusive district of Los Angeles at a cost of about $65,000. In an attempt to improve their income tax position, the husband transferred one-half of his interest in the Mitchell and Madison stores to the wife. This was done by accepting her notes for the book value of the interest she received in each store. These notes have since been discharged by profits from the stores. Other profits from the stores have been transferred to the real estate corporation and have there accumulated in a credit to the wife of $22,000. A share in the profits of these stores was never actually paid to the wife. The court found that, subject to a contingent tax liability to the federal government of about $47,000, the net worth of the property standing in the name of both parties at the time of trial was approximately $436,000. Before taxes the family income for 1945 was about $73,000. Based principally on income tax returns for a series of years before the trial, the wife asserts the net worth of their property to be about one million dollars.

In addition to the above described property, the brothers owned a cosmetic business in California...