Child v. Child

• Citation: 787 N.E.2d 1121,58 Mass. App. Ct. 76
• Decision Date: 12 May 2003
• Docket Number: No. 01-P-71.,01-P-71.
• Parties: Susan F. CHILD v. Josiah H. CHILD, Jr.
• Court: Appeals Court of Massachusetts

Page 1121

787 N.E.2d 1121

58 Mass. App. Ct. 76

Susan F. CHILD v. Josiah H. CHILD, Jr.

No. 01-P-71.

Appeals Court of Massachusetts, Suffolk.

Argued September 11, 2002.

Decided May 12, 2003.

James S. Dittmar, Boston (Robert J. Rutecki with him) for Josiah H. Child, Jr.

Ellen S. Zack for Susan F. Child.

Present: GREENBERG, SMITH, & GELINAS, JJ.

GELINAS, J.

Josiah H. Child, Jr. (husband), appeals from a judgment of the Probate Court awarding certain property to Susan F. Child (wife), and from the denial of his motion to reopen the evidence. The husband does not appeal from the dissolution of the marriage, and, under Mass.R.Dom. Rel.P. 62(g) (1992), the parties' divorce became absolute on December 29, 2000. The property award, set out in sparse but appropriate findings, and partially based on a stipulation of the parties reveals again the complexities that arise in attempting to fairly allocate property when parties separate. The husband claims error in four aspects of the judge's decision: (a) in the valuation assigned by the judge to the wife's life estate in the marital residence; (b) in the value assigned by the judge to two discretionary trusts; (c) in the treatment given by the judge to the husband's and wife's property interests; and (d) in the allocation that the judge made of the marital estate between the husband and wife. The husband also claims that the trial judge abused his discretion in refusing to reopen the evidence in order to take additional testimony on the value of the marital residence.

We recite the facts generally, reserving details for our discussion of particular issues. The husband and wife had been married for forty-eight years when, in September of 1998, the wife filed a complaint for divorce in the Suffolk Probate and Family Court. Three children were born of the marriage, all adult at the time of these proceedings. The parties had accumulated considerable property, by work, skill, and inheritance. Some months after the trial, which concluded in January of 2000, the husband filed a motion to reopen the evidence, asking that he be allowed to offer additional evidence with regard to the marital home, a fourteen-room penthouse cooperative apartment on Beacon Street in Boston. In September of 2000, the Probate Court judge issued a judgment of divorce nisi, together with a memorandum of decision. He denied the husband's motion to reopen the evidence. In November of 2000, the court issued a corrected memorandum of decision, eliminating the double counting of one asset, nunc pro tunc to September 29, 2000. This appeal followed.

A probate judge has broad discretion in awarding alimony and making equitable property divisions, but must consider "the length of the marriage, the conduct of the parties during the marriage, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each of the parties and the opportunity of each for future acquisition of capital assets and income." G.L. c. 208, § 34, as appearing in St.1989, c. 287, § 59. In addition to these mandatory factors, "the judge may, in his or her discretion consider the contribution of each of the parties in the acquisition, preservation or appreciation in value of their respective estates and the contribution of each of the parties as a homemaker to the family unit.'" Drapek v. Drapek, 399 Mass. 240, 243, 503 N.E.2d 946 (1987), quoting from G.L. c. 208, § 34. The judge's findings must indicate that he or she has weighed all of the required statutory factors. Bianco v. Bianco, 371 Mass. 420, 423, 358 N.E.2d 243 (1976). Where there is a question of valuation concerning a marital asset, a trial judge, when faced with conflicting expert evidence, may accept or reject all or parts of the opinions offered. Fechtor v. Fechtor, 26 Mass.App.Ct. 859, 863, 534 N.E.2d 1 (1989), and cases cited. See Dewan v. Dewan, 30 Mass.App.Ct. 133, 135, 566 N.E.2d 1132 (1991). "[T]he judge may reject expert opinion altogether and arrive at a valuation on other evidence. Unless clearly erroneous, the trial judge's determination of value will stand." Fechtor v. Fechtor, supra at 863, 534 N.E.2d 1. (Citations omitted.) See Mass.R.Dom. Rel.P. 52(a) (1987). We consider the trial judge's findings and rulings with respect to valuation against this well rehearsed background.

1. Valuation of the cooperative apartment. The husband claims that the judge committed reversible error in three respects with regard to his valuation of the marital home: that he relied on a methodology that was speculative, that the valuation was without basis in the evidence, and that the valuation was inconsistent with a United States Treasury regulation on which the valuation was based. We address each, and conclude that there was no error.

In valuing the cooperative apartment, the judge essentially adopted the testimony of Edward Berger, the wife's expert. In arriving at his expert opinion of the value, Berger first accepted the estimate of the current fair market rental value of the parties' joint expert, Steven Elliot, who testified that the current rental value of the apartment was $7,500 per month. Berger then deducted the monthly charges of $3,403 that the wife was obligated to pay as a condition both of her retaining the life estate and the right to live in the apartment; the difference amounted to $4,097 per month. Berger then computed the present value of a single life annuity, paid to the wife for her lifetime, of $4,097 per month. The value of the wife's interest in the apartment thus achieved was $476,222. In his findings the judge accepted this method of valuation, but reduced the expenses, as he determined that the cost of heating the apartment had been double counted. The present value after this correction computed to $493,657.

The husband claims that this method of valuing the apartment is speculative, as the net income that might hypothetically flow to the wife from the rental of 81 Beacon Street for the rest of her life is at best contingent and there could well be changes in the rental value and the costs during her lifetime; and, further, that the wife was prohibited under her mother's will from renting the apartment for more than a period of two years, and the opinion and facts relied upon by Berger were devoid of evidentiary support, as he had no information as to future fair market rental value and future expenses. We think that the judge was correct, and that the husband's arguments ignore the fact that the value of the wife's life estate must be taken at the time of divorce (or the time that consideration is given to the property division). "The underpinning of any order for division of property under § 34 is ... the judge's consideration of the contributions, in the statutory terms, of each spouse, as well as other factors in existence at the dissolution of the partnership which have been traditionally applied in determining alimony." Davidson v. Davidson, 19 Mass.App.Ct. 364, 376, 474 N.E.2d 1137 (1985). The trial judge has a certain flexibility in determining the exact date at which assets must be considered and valued. However, with exceptions not applicable here, asset valuation must relate to the parties' status within the marriage, or at the outside, at a time that relates to the court's division of the assets. See, e.g., Savides v. Savides, 400 Mass. 250, 252-253, 508 N.E.2d 617 (1987) (assets valued as of the date of the parties' separation prior to the divorce; wife excluded from participation in the increase in value of the marital property where she made no contribution to the marriage after the date of separation and the increase in value was due solely to the husband's efforts); Pare v. Pare, 409 Mass. 292, 296 n. 4, 565 N.E.2d 1195 (1991) (where property division takes place after divorce is final, and postdivorce appreciation is not fairly attributable to one spouse alone, correct procedure is to value the divisible property as of the date of the order of division and Aportion postdivorce appreciation in the value of the property between the parties); Daugherty v. Daugherty, 50 Mass.App.Ct. 738, 741-742, 741 N.E.2d 92 (2001) (value of husband's pension to be taken as of date of parties' separation, some ten years prior to the property division trial, with wife entitled to appreciation on that share only). To insist, as does the husband here, that the valuation must take into account potential future increases (or decreases) in the rental value and expenses, is to vitiate the partnership principle upon which property division is predicated. Compare Davidson v. Davidson, 19 Mass.App.Ct. at 370, 474 N.E.2d 1137 ("To hold that property interests acquired after the dissolution of the marriage are subject to division under § 34 would be contrary to the marital partnership concept on which § 34 is founded"). Further, we find no merit in the husband's argument that the valuation was predicated on annuity tables established by the United States Treasury rather than on the table of values for life estates established in a similar Treasury regulation, as urged by the husband's expert.¹ Here, there were substantial limitations on the wife's life estate. In order to avail herself of the life estate, and the concomitant right to live in the unit, the wife was required to pay all of the monthly expenses associated with the apartment. Her ability to rent the apartment was limited to a term of less than two years. Her mother's estate retained the right to sell the apartment, and in the case of a sale, the wife would lose the use of the apartment and would be entitled, under the mother's will, to receive only the income from one-half of the net sale proceeds. While styled a life estate, the wife's actual opportunity here was more in the nature of a limited tenancy at will, as distinguished from a traditional life estate, defined by the husband's expert as the "right to the use,...