Bennett v. Bennett

• Citation: 8 Haw.App. 415,807 P.2d 597
• Decision Date: 12 March 1991
• Docket Number: No. 14389,14389
• Parties: Barbara J. BENNETT, Plaintiff-Appellant, v. Donald R. BENNETT, Defendant-Appellee.
• Court: Hawaii Court of Appeals

Page 597

807 P.2d 597

8 Haw.App. 415

Barbara J. BENNETT, Plaintiff-Appellant, v. Donald R. BENNETT, Defendant-Appellee.

No. 14389.

Intermediate Court of Appeals of Hawai'i.

March 12, 1991.

Syllabus by the Court

1. Hawaii Revised Statutes § 580-47(a) (Supp.1990) does not in any way restrict or preclude the Hawaii appellate courts, in the exercise of their supervisory and review functions, from narrowing the discretion available to the various family courts by establishing and mandating adherence to uniform categories, uniform starting points, uniform limits on the range of choice, and uniform procedures.

2. The abuse of discretion standard of review applicable to family court decisions dividing and distributing property in divorce cases is of judicial, not legislative, origin. It is the "range of choice" allowed to the trial court by the appellate court. As the principles and policies of the law are developed, the trial court's range of choice is correspondingly narrowed. The law often progresses to the point where the trial court's range of choice becomes so precise 3. The uniform process that the family court must use when deciding how to divide and distribute property in divorce cases is only a process. Subject to a few limits, the family court currently has, and must knowledgeably exercise, a wide range of choice and equitable discretion when deciding how to divide and distribute property in divorce cases.

that the applicable standard of appellate review progresses from abuse of discretion to de novo or right/wrong.

4. Under the abuse of discretion standard of appellate review, the appellate court is not authorized to disturb the family court's decision unless (1) the family court disregarded rules or principles of law or practice to the substantial detriment of a party litigant; (2) the family court failed to exercise its equitable discretion; or (3) the family court's decision clearly exceeds the bounds of reason. Except in those rare situations where the appellate court can conclude, as a matter of law, that the family court had only one choice, its only authorized courses of action are to affirm or to vacate and remand.

Karen M. Radius (Radius & Lau, on the briefs), Honolulu, for plaintiff-appellant.

William E.H. Tagupa, on the brief, Honolulu, for defendant-appellee.

Before BURNS, C.J., and HEEN and TANAKA, JJ.

BURNS, Chief Judge.

In this divorce case commenced by plaintiff Barbara J. Bennett (Barbara) against defendant Donald R. Bennett (Donald), Barbara appeals the family court's January 30, 1990 Divorce Decree (Divorce Decree). Specifically, Barbara appeals the division and distribution of the marital residence ($215,000.00 gross market value).

Barbara contends that the family court abused its discretion when it conditioned her being awarded the residence subject to two debts ($25,721.12 owed by Barbara to her father and the $57,956.54 mortgage) upon a $65,639.44 payment to Donald on or before July 30, 1990. We note, in passing, that the family court thought that $65,639.44 was one-half of the value after subtraction of the two debts. In fact, one-half was $65,661.17.

On the ground that the family court failed to comply with the mandates of relevant statutory and case law, we vacate the family court's order requiring Barbara to pay Donald $65,682.90 on or before July 30, 1990 and remand the case.

FACTS

The relevant dates are as follows:

March 8, 1984 ¹ Date of marriage (DOM)

May 8, 1989 Date of complaint (DOC)

May 25, 1989 Date of final separation in contemplation of divorce (DOFSICOD)

December 15, 1989 Date of the conclusion of the evidentiary part of the trial (DOCOEPOT)

January 30, 1990 Date of divorce (DOD)

May 29, 1990 Filing date of Findings of Fact and Conclusions of Law (FOF & COL)

Barbara has four children from a prior marriage. They were born, respectively, in 1970, 1973, 1975, 1977. Barbara exited her prior marriage with custody of her children and title to 59-526 Aukauka Road, Haleiwa, Hawaii. On December 16, 1983, prior to the DOM, Barbara sold 59-526 Aukauka Road by way of an agreement of sale. The purchaser assumed Barbara's mortgage, paid Barbara $27,129.67 in net cash, and promised to pay Barbara the $66,103.96 balance due, plus interest at eleven percent per year, on or before October 16, 1985. Monthly payments of $1,174.31 commenced on January 16, 1984.

On February 20, 1984, prior to the DOM, Barbara and Donald contracted to purchase 59-003 Holawa Place, Haleiwa, Hawaii. Closing occurred on July 13, 1984, after the DOM. Apparently, title was conveyed to On October 26, 1989, the gross market value of 59-003 Holawa Place was $215,000.00. On December 7, 1989, the balance due on the mortgage was $57,956.54. The $25,721.12 Barbara borrowed from her father during the course of the marriage to pay for marital expenses remained unsecured and due on the DOCOEPOT.

Barbara and Donald. The $142,500.00 purchase involved an assumption of a $63,935.63 mortgage and the payment of $78,564.37 in cash. The proceeds of Barbara's sale of 59-526 Aukauka Road ultimately funded $70,000.00 of the $78,564.37 cash payment. There is no evidence that Donald had any assets on the DOM. It appears that the remaining $8,564.34 of the cash payment was ultimately funded either from the proceeds of Barbara's sale of 59-526 Aukauka Road or from funds earned by Barbara and/or Donald after the DOM.

In his oral decision, the family court judge stated in relevant part as follows:

[THE COURT:] As to the division of the property. The Court did take into consideration the mandates of the Supreme Court in reference to HRS 580-47 and that the Court has to be just and equitable taking into consideration all of the factors involved in each individual case.

Court is going to accept the appraisal of Harlin Young of two hundred and fifteen thousand dollars.

Court is going to deduct from that right off the top the existing mortgage of fifty-eight thousand dollars.

Court is going to order repayment of the loans from [Barbara's] father of twenty-five thousand plus. I believe the figure was something like twenty-five thousand seven twenty-one twelve cents.

* * * * * *

THE COURT: And the remainder shall be divided fifty/fifty.

I had problems with this case primarily because it appeared at least to the Court that [Barbara] contributed at the very beginning one--sixth seventh of the down payment versus one seventh by [Donald].

However, in reviewing this case Court finds that any time cash is put into purchase of a residential home to be occupied by the married couple it becomes marital property.

If it's only for a short time loan, short time investment--no, long time investment--if it's short time then whoever puts in the money may be able to withdraw whatever sum he or she contributed. And after that any appreciation--showed appreciation could be split--as discussed yesterday--seventy-five/twenty five.

In this case this is a marriage of four years plus. The Court has no alternative but to rule that the division should be--shall be fifty/fifty.

Transcript, January 15, 1989, at 198-99.

Paragraph 4(b) of the Divorce Decree provides in relevant part as follows:

Real Property: [Barbara] and [Donald] are awarded the property at 59-003 Holawa, Haleiwa, Hawaii (hereinafter "property") as tenants in common. [Barbara] shall be solely responsible for all outstanding debt on the property and shall hold [Donald] harmless from liability therefore. [Barbara] shall have exclusive use and occupancy of the property and shall be entitled to all rents, if any, received therefrom.

Within six months of the entry of a Decree herein [Barbara] shall pay to [Donald] the sum of $65,639.44 for his interest in the property. Upon payment, [Donald] shall execute all documents necessary to convey his interest in said property to [Barbara]. [Barbara] shall thereafter hold the property as tenant in severalty.

* * * * * *

Conclusions of Law 7, 11, and 13 state as follows:

7. The cash that [Barbara] contributed towards the down payment for the purchase of the property is a gift to the marriage and is a marital asset.

* * * * * *

11. [Barbara] shall pay [Donald] the sum of $65,639.44 for his interest in the * * * * * *

property within six months of the entry of the Decree.

13. If [Barbara] does not pay [Donald] within six months, then the property shall be put up for sale within thirty days, and the parties shall divide equally the net proceeds.

DISCUSSION

In prior cases we have developed a process for all family courts to follow when dividing and distributing property in divorce cases. In Malek v. Malek, 7 Haw.App. 377, 768 P.2d 243 (1989), we defined five categories of net market values (NMVs). In Woodworth v. Woodworth, 7 Haw.App. 11, 740 P.2d 36 (1987), overruled in part, Myers v. Myers, 70 Haw. 143, 764 P.2d 1237 (1988), we established uniform starting points (USPs) for, and uniform maximum limits on, the division and distribution of the five categories of NMVs. In Muraoka v. Muraoka, 7 Haw.App. 432, 776 P.2d 418 (1989), we imposed upon family court judges a duty to explain all objected to deviations or nondeviations from the applicable USPs.

The process we have developed is designed to standardize and facilitate the factual analysis, facilitate settlements, identify the reasons for a particular decision, facilitate appellate review, facilitate the continued case-by-case development of express and uniform ranges of choice applicable statewide in similar fact situations, and bring as much statewide consistency, uniformity, and predictability as is possible to family court decisions dividing and distributing property in divorce cases. This process is designed and intended to replace the prior system where the family court decided and the appellate court reviewed each case on an ad hoc basis and without expressly identifying all the relevant facts and specific reasons for the decision.

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