Cassiday v. Cassiday

• Decision Date: 24 May 1985
• Docket Number: No. 9598,9598
• Citation: 6 Haw.App. 207,716 P.2d 1145
• Parties: Barbara D. CASSIDAY, Plaintiff-Appellant, v. Benjamin B. CASSIDAY, Defendant-Appellee.
• Court: Hawaii Court of Appeals

Page 1145

716 P.2d 1145

6 Haw.App. 207

Barbara D. CASSIDAY, Plaintiff-Appellant, v. Benjamin B. CASSIDAY, Defendant-Appellee.

No. 9598.

Intermediate Court of Appeals of Hawai'i.

May 24, 1985.

Syllabus by the Court

1. As a general rule, it is equitable to award each divorcing party one-half of the after acquisition but during marriage real increase in the net value of property separately owned at the time of the marriage or acquired during the marriage by gift or inheritance and still separately owned at the time of the divorce.

2. The real increase in value is that increase which is not directly attributable to inflation.

3. As a general rule, when dividing a divorcing party's right to cash retirement benefits, it is equitable to award the other party a percent of the gross cash benefits and to make the award distributable as and when the cash benefits are received. As a general rule, the percent awarded should be one-half of the percent derived by dividing the number of years credited to retirement during the marriage by the total number of years credited to retirement. As a general rule, the award should be structured so that each divorcing party is solely liable for the income taxes due with respect to the gross cash benefits distributed to him or her.

4. When deciding in a divorce case whether one party must pay periodic spousal support to the other, for how long, and how much, the family court must consider all of the factors enumerated in Hawaii Revised Statutes (HRS) § 580-47(a) (Supp.1984). Generally, however, the most relevant factual questions are sequentially as follows:

1. Taking into account the property awarded in the divorce case to the party seeking spousal support, what amount, if any, does he or she need to maintain the standard of living established during the marriage? See HRS § 580-47(a) (Supp.1984). If there is no need for spousal support, then there is no obligation to pay.

2. Taking into account the income of the party seeking spousal support, or what it should be, and the income producing capability of the property awarded to him or her in the divorce action, what is his or her ability to meet his or her need independently? See HRS § 580-47(a) (Supp.1984). If the party seeking spousal support can satisfy his or her need independently, then there is no obligation to pay.

3. Taking into account the income of the party from whom spousal support is sought, or what it should be, and the income producing capability of the property awarded to him or her in the divorce action, what is his or her ability to meet his or her own need while meeting the need for spousal support of the party seeking spousal Charles R. Kozak, Honolulu, for plaintiff-appellant.

                support?   See HRS § 580-47(a)(11) (Supp.1984)
                

Daniel S. Ukishima (with him on brief: Jay T. Suemori, Ukishima & Matsubara, of counsel; and Wallace S. Fujiyama, Miles B. Furutani, and Steven J.T. Chow, Fujiyama, Duffy & Fujiyama, of counsel), Honolulu, for defendant-appellee.

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

BURNS, Chief Judge.

Defendant-appellant Benjamin B. Cassiday (Husband), then a graduate of West Point and a major in the United States Air Force, married plaintiff-appellee Barbara D. Cassiday (Wife) on May 14, 1949. They have two adult children. Husband retired from the United States Air Force in 1972 as a brigadier general. The parties separated on November 1, 1979, and Wife filed a complaint for divorce on December 27, 1979. At the time of filing, Wife was age 52 and Husband was age 56.

At trial, Wife sought the award of (1) property of a value equal to one-half of the value of the marital property ¹ and (2) spousal support of $5,000 per month until the further order of the court. In its decree issued on July 19, 1983, the family court awarded her less than she sought in both categories and she appealed. We reverse and remand for further proceedings consistent with this opinion.

DIVISION OF PROPERTY

At the time of the divorce (TOD), ² one or both of the parties had an interest in various properties as follows: Apartment 1613, Yacht Harbor Towers, Honolulu, Hawaii, was owned jointly by Husband and Wife. It was acquired in trade for a house that Husband had previously purchased with his nonmarital property and income therefrom. ³ The family court found the net value of the apartment at the TOD to be $185,000 ($225,000 minus a $40,000 mortgage). The apartment was awarded to Wife subject to the mortgage, but its net value was divided equally.

Unit 210, Lift One Condo, Aspen, Colorado, was owned by Husband. He acquired it in 1973 with $12,000 cash and a $40,000 mortgage. Part of its purchase price came from Husband's military pay. It was used for family purposes. Wife contended that its net value at the TOD was $360,000. The family court ordered it sold and the net proceeds divided equally.

In the late 1950s Husband's mother gave him a one-fourth interest in 5621 Kalanianaole Highway, Honolulu, Hawaii. We do not know its date of gift value. Husband and Wife used this property as their residence from 1973 until their separation in 1979. The value of the property in 1972 was $565,790. At the TOD its value was $860,000. Apparently, prior to 1973, Husband used only his nonmarital property and income therefrom to pay obligations relating to this property. It is not clear whether, or to what extent, Husband's activities during the marriage but prior to 1973 contributed to this property. Wife had no direct involvement with this property prior to 1973. In 1981 Husband inherited the remaining three-fourths interest. This property was awarded to Husband but he was required to pay Wife one-fourth ⁴ of its increase in value from 1973 through 1980, i.e., $73,500.

The property at 5699 Kalanianaole Highway was owned by Husband when he married The property at 5691 Kalanianaole Highway was owned by Husband when he married Wife. Its tax assessed value at the TOM was $8,455. In 1976 Husband gave two-thirds of this property to their two children. Wife claimed that the value of the property at the TOD was $444,000. The family court made no finding on that issue. Wife had no direct involvement with this property. It is not clear whether, or to what extent, Husband's activities during the marriage contributed to this property. Apparently, Husband used only his nonmarital property and income therefrom to pay obligations relating to the property. Husband was awarded his one-third interest.

Wife. Its tax assessed value ⁵ at the time of marriage (TOM) was $13,703. Wife claimed that its net value at the TOD was $777,500 minus a $50,000 mortgage or $727,500. The family court made no finding on that issue. Wife's only direct involvement with this property was her participation in its renovation and refurnishing in 1978. It is not clear whether, or to what extent, Husband's activities during the marriage contributed to this property. Apparently, Husband used only his nonmarital property and income therefrom to pay obligations relating to the property. It was awarded to Husband.

The property at 5687 Kalanianaole Highway was owned by Husband at the TOM. Its tax assessed value at the TOM was $6,589. Wife had no direct involvement with this property. It is not clear whether, or to what extent, Husband's activities during the marriage contributed to this property. Apparently, Husband used only his nonmarital property and income therefrom to pay obligations relating to the property. In 1973 Husband sold it on an agreement of sale. The balance due at the TOD was $70,000. This receivable was awarded to Husband.

The parties jointly owned a parcel of property in North Carolina. Wife valued it between $8,000 and $10,000. The family court made no finding as to its value. The family court ordered it sold and the net proceeds divided equally.

In 1961 Husband's mother gave him a 25% interest in Hawaii Loa Ridge. We do not know its date of gift value. Husband paid the $18,000 gift tax due with funds from the following sources: "loan/mil pay savings/rental returns from Niu Beach[.]" Apparently, Wife had no direct involvement with this property. It is not clear whether, or to what extent, Husband's activities during the marriage contributed to this property. Apparently, Husband used only his nonmarital property and income therefrom to pay obligations relating to the property. In the 1970s Husband sold his interest and the proceeds were "invested in Partners of Hawaii, Kaloko (Kona), Kapalua (Maui), plus refurbishing of the 5621 house[.]"

Partners of Hawaii XXII, XXIII, and XXIV together comprise of Husband's total limited partnership investment of $364,000. Husband testified that these investments were placed in joint ownership by mistake. The family court made no findings as to their values at the TOD. These interests were awarded one-half to Husband and one-half to Wife.

The Kaloko, Kona, property was purchased by Husband in his name for $18,000. We do not know whether, or to what extent, Wife's or Husband's activities during the marriage contributed to the increase in value of this property. Apparently, Husband used only his nonmarital property and income therefrom to pay obligations relating to the property. The family court made no finding as to its value at the TOD. It was awarded to Husband.

Husband purchased in his name a one-half interest in a condominium apartment in Kapalua, Maui. The cost of the apartment was $160,000, of which $128,000 was financed. We do not know whether, or to what extent, Wife's or Husband's activities during the marriage contributed to this On June 30, 1978 Husband entered into a partnership named Miralani Business Park Co. Husband's share is 19% of the profits and 20% of the losses. On July 1, 1978 the partnership leased property in San Diego, California, for a 75-year term from the Mary Lucas Pflueger Trust and the Charlotte Harriet Lucas Cassiday Trust. As of October 2, 1982 the leasehold was valued...