Byrne v. Byrne
| Decision Date | 21 March 2012 |
| Docket Number | No. 3D10–2323.,3D10–2323. |
| Citation | 128 So.3d 2 |
| Parties | Ava G. BYRNE, Appellant/Cross–Appellee, v. Daniel R. BYRNE, Appellee/Cross–Appellant. |
| Court | Florida District Court of Appeals |
OPINION TEXT STARTS HERE
Marks & West, P.A., and Evan R. Marks, and Carolyn W. West, Miami, for appellant/cross-appellee.
Ferdie and Lones, Chartered, and Stuart A. Lones, Coral Gables, for appellee/cross-appellant.
Before CORTIÑAS, ROTHENBERG and LAGOA, JJ.
On Motion for Rehearing and/or Clarification
We grant appellee/cross-appellant's motion for rehearing, withdraw our opinion filed on January 18, 2012, and substitute the following opinion in its stead.
Ava G. Byrne (“Ava”) appeals from a final judgment of dissolution of marriage and order denying her post-trial motions. Daniel R. Byrne (“Dan”) cross-appeals. Both parties challenge specific aspects of the trial court's equitable distribution and award of permanent alimony. We reverse and remand for proceedings consistent with this opinion.
The trial court erred by distributing the entirety of the negative value of the marital residence solely to Ava.
Ava and Dan purchased a condominium which is now underwater by approximately $76,000.1 The trial court classified the condominium as marital property. In its equitable distribution, the trial court assigned the marital residence and the negative value associated with it entirely to Ava, and awarded Dan half of the remaining valuable marital assets. Ava argues that by assigning to her the entirety of the condominium's negative value without offsetting it in the remainder of the equitable distribution, the trial court fashioned an unequal distribution without sufficient legal justification. We agree.
Section 61.075(1), Florida Statutes (2010), states, in pertinent part: “[I]n distributing the marital assets and liabilities between the parties, the court must begin with the premise that the distribution should be equal, unless there is a justification for an unequal distribution based on all relevant factors....” Any justification for fashioning an unequal distribution must be “legally sufficient.” Foley v. Foley, 19 So.3d 1031, 1032 (Fla. 5th DCA 2009). Relying on the “equity” factor articulated in section 61.075(1)(j), the trial court justified its decision not to assign half of the condominium's debt to Dan by stating that, although Ava wished to preserve her reputation by preventing foreclosure, “most homeowners in the circumstances of the parties would simply abandon the residence and/or return the keys to the banks holding the indebtedness.” The trial court therefore concluded that it would be inequitable to require Dan to pay half of the condominium's negative value solely because Ava desired to protect her own reputation.
The trial court's justification was not “legally sufficient” because it erroneouslyassumed that the negative value associated with the condominium would simply vanish if the parties were to “abandon the residence” or “return the keys to the banks holding the indebtedness.” It is well settled Florida law that, absent contractual agreement, debtors remain liable for the portion of their debt not satisfied in a foreclosure sale. See Webber v. Blanc, 39 Fla. 224, 22 So. 655, 656 (1897) (); see also Clements v. Leonard, 70 So.2d 840, 844 (Fla.1954). Consequently, even if Ava and Dan agreed to surrender the property to the bank, absent a contractual release, the $76,000 outstanding debt on the property would survive. Thus, the sole justification provided by the trial court in fashioning an unequal distribution was without merit, and, consequently, the trial court erred in failing to add the condominium's negative value to the marital liabilities.
We next turn to the trial court's alimony award. The trial court awarded Dan $1,500 per month as permanent periodic alimony based on the following factors: Dan and Ava's marriage lasted “nine” years, and therefore was of moderate duration; Dan became disabled from working during the course of the marriage; Ava earns approximately “$10,000” per month; and Dan, based on his Sprint and Social Security disability income, earns approximately $44,000 per year, and does not have sufficient money to pay for his living or medical expenses. The trial court, in its order regarding Ava's post-trial motions, awarded Dan an additional $18,000 in retroactive alimony. Ava challenges various aspects of the trial court's alimony award on the basis of section 61.08, Florida Statutes (2010), which governs alimony awards.
We reverse the trial court's award of $1,500 per month in permanent periodic alimony, and $18,000 in retroactive alimony, as we conclude that the trial court's financial analysis was tainted by its failure to properly consider all of the relevant factors pursuant to section 61.08. Specifically, the trial court did not properly consider: each spouse's pre-dissolution debts; the income Dan receives from his Fidelity Magellan Retirement account; and the $7,000 reduction to Ava's annual salary.
Section 61.08(2) provides:
2) In determining whether to award alimony or maintenance, the court shall first make a specific factual determination as to whether either party has an actual need for alimony or maintenance and whether either party has the ability to pay alimony or maintenance. If the court finds that a party has a need for alimony or maintenance and that the other party has the ability to pay alimony or maintenance, then in determining the proper type and amount of alimony or maintenance, the court shall consider all relevant factors, including, but not limited to:
(a) The standard of living established during the marriage.
(b) The duration of the marriage.
(c) The age and the physical and emotional condition of each party.
(d) The financial resources of each party, including the nonmarital and the marital assets and liabilities distributed to each.
(e) The earning capacities, educational levels, vocational skills, and employability of the parties and, when applicable,the time necessary for either party to acquire sufficient education or training to enable such party to find appropriate employment.
(f) The contribution of each party to the marriage, including, but not limited to, services rendered in homemaking, child care, education, and career building of the other party.
(g) The responsibilities each party will have with regard to any minor children they have in common.
(h) The tax treatment and consequences to both parties of any alimony award, including the designation of all or a portion of the payment as a nontaxable, nondeductible payment.
(i) All sources of income available to either party, including income available to either party through investments of any asset held by that party.
(j) Any other factor necessary to do equity and justice between the parties.
Failure to consider each spouse's pre-dissolution debts.
Section 61.08(2)(d) provides that in determining the proper type and amount of alimony, a trial court “shall” consider, among other things, “the financial resources of each party, including the non-marital and marital assets and liabilities distributed to each.” Despite this provision's clear mandate, the trial court did not make any findings regarding Ava's or Dan's pre-dissolution liabilities, and, therefore, erred. We note that, based on a review of the record, Ava's total debt was approximately $54,076, which she was paying off at a rate of $2,233 per month, while Dan's total debt was approximately $39,319, which he was paying off at a rate of $1,203 per month.
Failure to consider the income Dan receives from his Fidelity Magellan Retirement account.
The trial court additionally erred in failing to consider Dan's Fidelity Magellan Retirement account, a non-marital asset valued at $65,000, but encumbered by a $36,553 loan. Dan's Fidelity Magellan Retirement account was a “financial resource” meant to be drawn on during retirement. The trial court, therefore, erred in determining that Dan's only income was the $44,000 per year he received from Sprint and Social Security Disability payments, and this error necessarily affected the trial court's determination regarding whether Dan had a “need” for alimony.
Failure to reopen the evidence to consider a $7,000 salary reduction in Ava's salary.
Ava contends that the trial court erred in denying her unopposed motion to reopen the evidence to take into consideration a $7,000 reduction in salary that she incurred after the close of evidence but prior to dissolution. We agree. To begin with, we note that the trial court based its initial alimony calculations on the premise that Ava earned “$10,000” per month. As shown in Ava's financial affidavit, however, she earned only $9,059 per month. The trial court recognized its error, and, in its order on Ava's post-trial motions, noted that she earned “$9,000 instead of $10,000” per month.
Ava's annual salary was subsequently reduced on July 27, 2010 by $7,000, and the trial court entered its final judgment of dissolution...
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