Bertholet v. Bertholet

• Decision Date: 27 March 2000
• Docket Number: No. 64A03-9907-CV-280.,64A03-9907-CV-280.
• Citation: 725 N.E.2d 487
• Parties: Edward R. BERTHOLET, Appellant-Respondent, v. Linda BERTHOLET, Appellee-Petitioner.
• Court: Indiana Appellate Court

725 N.E.2d 487

Edward R. BERTHOLET, Appellant-Respondent, v. Linda BERTHOLET, Appellee-Petitioner.

No. 64A03-9907-CV-280.

Court of Appeals of Indiana.

March 27, 2000.

Duane W. Hartman, Blachly Tabor Bozik & Hartman, Valparaiso, Indiana, Attorney for Appellant.

JoAnne Lohmeyer, Valparaiso, Indiana, Attorney for Appellee.

OPINION

BAILEY, Judge

Case Summary

Appellant-Respondent Edward Bertholet ("Husband") appeals the trial court's Judgment and Decree of Dissolution. We affirm in part, reverse in part, and remand with instructions.

Issues¹

Husband argues on appeal that the trial court abused its discretion when it divided the marital property. In support of this contention, Husband makes nine allegations of error, which we consolidate and restate as:

I. Whether the trial court properly divided the marital estate equally between Husband and Wife, notwithstanding the fact that Husband acquired numerous assets prior to his marriage to Wife;

II. Whether the trial court erroneously valued Husband's bail bond business;

III. Whether the trial court failed to find that Wife paid herself contrary to the provisions of the provisional order;

IV. Whether the trial court failed to find that Wife dissipated marital assets; and,

V. Whether the trial court erroneously awarded appellate attorney fees to Wife.

Facts/Procedural History

The facts most favorable to the judgment indicate that Husband and Wife began dating in September of 1977. At that time, Husband was self-employed as a Liable Agent in the bail bond business. Wife began accompanying Husband to jails and assisting Husband in his business. On October 15, 1981, Wife and her two minor children from a previous marriage began living in Husband's home. Over the years, Wife became more involved with Husband's business, and by 1987, Wife worked full-time in the business. Upon Husband's retirement in December of 1993, Wife became President and Liable Agent for the bail bond business.

Prior to being married, Husband and Wife held themselves out to the public as being married. On May 15, 1991, Husband and Wife were married; and, while Wife offered to sign a prenuptial agreement, Husband declined the offer.

Wife filed a Petition for Dissolution of Marriage on April 21, 1997. On June 2, 1997, the trial court entered an Agreed Provisional Order, which stated, among other things, "Wife shall receive a net of $1,000.00 per week as her salary from the business." (R. 8, 9.) On May 6, 1998, Wife filed her Motion for Special Findings and Conclusions. On June 2, 1999, the trial court entered its Judgement and Decree of Dissolution. In so doing, the trial court made numerous findings of fact and conclusions of law pertinent to its property division, including the following:

FINDINGS OF FACT

1. In 1977, the parties began dating.

2. At the time Husband was self-employed, working out of the basement of his home as a liable agent in the bail bond business. Previously, he had been a sub-agent for another agency on a part-time basis.

3. In 1977, while on dates, Wife accompanied Husband to jails to write bonds and otherwise assisted Husband in his business.

4. After working in a law office, [W]ife was employed full time at Pfizer as an executive secretary from 1977 to 1984.

5. Beginning in 1979, Wife began typing correspondence for Husband at this [sic] place of business in his home and drove Husband to different jails for his business purposes.

6. On October 15, 1981, Wife and her two (2) minor children from a previous marriage began living in Husband's home.

7. Wife's employment at Pfizer ended in 1984 when the company closed its Valparaiso operation.

8. Wife qualified for grants to pay her re-training expenses and obtained an associate's degree in computers in 1987.

9. While she learned computer systems, she computerized Husband's bail bond business[.]

10. In addition to computerizing the business, Wife intensified her involvement by going to court and doing paperwork, and in 1985 she obtained her own bail bond license for Husband's business.

11. In 1987 Wife worked full time in the business and received a check of Two Hundred Fifty Dollars ($250.00) per week to enable Wife to have her own spending money without asking Husband for cash.

12. Husband and Wife held themselves out to be married at bond conventions and Shriner's activities although they were not yet married. Husband did not correct anyone as to their marital status and encouraged the representations of their marital status.

13. Husband added Wife to his checking account as joint owner before the marriage and she used the account.

14. Husband assisted financially in raising Wife's two (2) children.

15. For the tax years of 1986, 1987, and 1988[,] Husband was audited by the Internal Revenue Service concerning treatment of BUF (Build Up Fund) accounts. Wife and the accountant did the preparation and presentation of the audit. Husband did not become actively involved.

16. In 1986, Wife's father deeded to her an interest in his residence on Harrison Boulevard. Later, she became sole owner.

17. Even though the parties were not married, they had a domestic relationship beginning on October 15, 1981 which lasted until [the] filing of the Petition for Dissolution of Marriage. Wife decorated, cooked, cleaned, attended social events, etc. for Husband, and was involved in his business.

18. In December, 1988, the business grew too large for the basement of the marital residence and moved to a separate business location near the Porter County Jail.

19. The number of sub-agents and gross sales of bonds continued to increase during this period.

20. On May 15, 1991, the parties married.

21. Although Wife offered to sign a pre-nuptial agreement, Husband declined the offer. Husband prepared a will to bequeath to Wife a life estate in his home on Sheffield and gave her ownership of all personal household furnishings. He discussed leaving the business to the Wife on his demise.

22. Husband incorporated the bail bond business as a sub-chapter S corporation in late 1991 and had 100% interest in the business. Wife held office in the corporation while Husband was president.

23. Wife and Husband began a newsletter for courts, attorneys, and other interested parties. This newsletter is the only one in Indiana. Husband turned over the writing of the newsletter to Wife. She also selected and trained agents for the business.

24. On December 31, 1993, Husband retired and turned the business operation entirely over to Wife. He signed off the corporate checking account and resigned his presidency of the corporation. He was not the liable agent any longer; Wife was.

25. Husband began spending more time at the parties' condo in Florida....

26. Wife became the president of the corporation and liable agent for all bonds upon Husband's retirement.

27. Husband's home on Sheffield is titled only in his name and has a mortgage lien on it in favor of Husband's daughter, Kelly. The home is paid for.

28. The Florida condo is titled jointly and has no mortgage on it.

29. The parties also own a home, which they rent out, in Monticello. This home is paid for.

30. Wife removed Forty Thousand Dollars ($40,000.00) from her BUF account, with Husband's permission, after filing the Petition for Dissolution.

31. Husband has removed One Hundred Thousand Dollars ($100,000.00) from his BUF account post-petition and without Wife's or this Court's permission in violation of the Restraining Order. He also took Ten Thousand Dollars ($10,000.00) out of a CD.

32. The corporation business account had a Sixty-Five Thousand Dollars [sic] ($65,000.00) balance upon filing, although the normal non-encumbered balance is Forty Thousand Dollars ($40,000.00).

33. Husband's name has recognized value in the bail bond business and therefore has substantial value in and of itself which influences competition.

34. At the time of filing the Petition for Dissolution, Ed Bertholet and Associates, Inc. had a value of One Million One Hundred Fifty [Thousand] Dollars ($1,150,0000.00) with Husband running the business.

35. The loss rate on bonds for the business is 1.5% of Seventeen Million Dollars ($17,000,000.00) in yearly sales, making it highly successful. By Husband's testimony, the business has earnings above the average for the bail bond industry.

....

37. At Husband's request, an audit of the business expenses for 1997 and 1998 by George S. Olive determined that Husband received "distributions" of Three Thousand Nine Hundred Sixty-Six Dollars and Twenty-Four Cents ($3,966.24) from the corporate accounts, which were not business expenses; and Wife received Nineteen Thousand Five Hundred Eighty-Three Dollars and Fifteen Cents ($19,583.15), which were reported on a 1099 as income to Wife. This satisfies both individual and corporate liabilities. By custom and agreement, the parties have paid non-business bills out of the business for years.

38. Wife turned over operation of the business to Husband on May 7, 1998, by agreement in open court.

39. Wife is receiving One Thousand Dollars ($1,000.00) per week against her portion of the marital property division.

....

CONCLUSIONS OF LAW

1. Division of marital property is presumed to be equal. Indiana Code Sections XX-XX-X-X and XX-XX-X-X.

2. Both parties contributed to the acquisition of the marital estate.

3. The parties co-habitated since October 15, 1981 and all property whether acquired before or during the marriage is included in the marital estate for division. See Larkins v. Larkins [,] 685 N.E.2d 88 (Ind.Ct.App.1997).

4. The Husband was found in contempt on February 27, 1998 for violating the Agreed Provisional Order by removing Wife as president of the corporation.

5. Wife incurred attorney fees of the contempt of One Thousand One Hundred Eighty-Five Dollars and Twenty-Five Cents ($1,185.25), which Husband shall pay within thirty (30) days.

6. The accounting of the business by George S....