Felis v. Felis

• Decision Date: 24 May 2013
• Docket Number: No. 12–077.,12–077.
• Court: Vermont Supreme Court
• Parties: Kenneth FELIS v. Vickie–Lee FELIS.

72 A.3d 874

2013 VT 32

Kenneth FELIS

v.Vickie–Lee FELIS.

No. 12–077.

Supreme Court of Vermont.

May 24, 2013.

Kenneth P. Felis, Pro Se, South Burlington, Plaintiff–Appellant.

Robert D. Rachlin of Downs Rachlin Martin PLLC, Burlington, for Defendant–Appellee.

Present: REIBER, C.J., DOOLEY, SKOGLUND and BURGESS, JJ., and ZIMMERMAN, Supr. J., Specially Assigned.

DOOLEY, J.

¶ 1. Husband appeals a final divorce order issued by the Lamoille Superior Court, Family Division, arguing that the court abused its discretion in setting parent-child contact, dividing the marital estate, and awarding wife nominal maintenance and attorney's fees. We affirm the parent-child contact order, the award of nominal maintenance, and the partial award of attorney's fees out of the marital estate to wife. As to the property award, we affirm in part and reverse in part.

¶ 2. At the time of the final divorce order, husband was fifty-eight years old, and wife was fifty-seven years old. The parties had married in 1978 and separated in 2006, almost six years before the final divorce order issued in December 2011. The parties had five children during the course of the marriage, only one of whom was a minor at the time of the divorce proceedings. Their youngest son was thirteen years old when the final divorce order issued.

¶ 3. During the marriage, wife did not work outside the house but rather was a full-time homemaker who provided the primary care for the parties' children. Husband was a successful businessman and entrepreneur who amassed at least fifteen million dollars in assets over the course of the marriage. The multi-year divorce proceedings centered on determining parental rights and responsibilities with respect to the parties' youngest son and on valuing and distributing a marital estate valued at approximately nine million dollars and consisting of two closely-held businesses and substantial real estate holdings, including a multi-million-dollar marital residence, land holdings, and commercial properties.

¶ 4. During several days of hearings held in October 2009 and January 2010, the parties presented expert testimony and submitted voluminous documents. In December 2011, the family court issued a sixty-four-page, single-spaced decision that included 144 detailed findings and ten pages of legal conclusions. Following the issuance of the final order, the court denied husband's motions for a new trial and to amend the findings and judgment. In relevant part, with respect to this appeal, the family court: (1) granted wife sole parental rights and responsibilities over the parties' youngest son, with husband having parent-child contact every other week from Thursday after school until Sunday afternoon; (2) awarded wife approximately fifty-seven percent and husband approximately forty-three percent of the nine-million-dollar marital estate; and (3) awarded wife one dollar per year in maintenance.

¶ 5. Husband first argues on appeal that the family court erred in reducing his parent-child contact below that which the parties had been following since a temporary order was issued in December 2007. According to husband, there is a “disconnect” between the family court's findings and conclusions on this issue. Husband points out that in its findings the court correctly describes the temporary order as allowing him parent-child contact every other weekend through Monday morning, but then in its conclusions mistakenly refers to the temporary order as allowing him contact every other weekend until only Sunday afternoon. Husband asserts that the court's failure to explain why it deviated from the temporary order demonstrates that the court intended to leave in place the schedule set forth in that order.

¶ 6. We disagree. At trial, wife proposed a schedule that would have the parties' son return to his primary home on Sunday afternoon rather than Monday morning to facilitate the transition to the school week. Husband asked for a fifty-fifty split in parent-child contact without setting forth any proposed schedule. In its decision, the court noted that wife's proposed schedule “generally” tracked the temporary order. In fact, wife's proposed schedule did “generally” track the schedule in the temporary order, except that she wanted the parties' son to return home on Sunday afternoon rather than Monday morning to ease his transition into the school week. The court specifically stated that it was adopting the schedule wife proposed at the final hearing, not the schedule set forth in the temporary order. We presume that the court knew the difference and the basis for that difference, as expressed by wife in her testimony at the final hearing. See Davis v. Davis, 128 Vt. 495, 498, 266 A.2d 466, 468 (1970) (“It will also be presumed on appeal, the contrary not appearing, that all the evidence was considered by the trial court with impartial patience and adequate reflection.”). Accordingly, we find no abuse of discretion with respect to the court's parent-child contact order. See Payrits v. Payrits, 171 Vt. 50, 52–53, 757 A.2d 469, 472 (2000) (“The family court has broad discretion in awarding custody, and its findings will not be overturned unless clearly erroneous.”).

¶ 7. Next, husband raises several claims of error challenging the family court's property distribution. As husband acknowledges, he must overcome a deferential standard of review to prevail on these claims of error. See Cabot v. Cabot, 166 Vt. 485, 500, 697 A.2d 644, 654 (1997) (“[P]roperty division is not an exact science, and the trial court has broad discretion in considering the statutory factors and fashioning an appropriate order.”).

¶ 8. Husband first contends that the court abused its discretion by crediting wife for expenditures made by him even though those expenditures had already been accounted for in determining the size of the marital estate. The bulk of the expenditures to which husband refers are two loans and a $100,000 payment to his secretary made by husband during the pendency of the divorce action. The first loan was for $145,000 to a restaurant owner who became husband's girlfriend. The owner defaulted on the loan. The other loan was for $5000 to another woman.

¶ 9. These expenditures were among those cited by wife in her January 2009 motion to freeze the marital accounts to prevent husband's wasteful dissipation of the marital estate. Following an evidentiary hearing on the motion before a different judge than the one who presided at the final divorce hearing, the court in a March 2009 temporary order determined that wife had failed to establish that husband had (1) engaged in “money laundering” through his girlfriend or secretary or any other person or business or (2) “paid unexplained, unanticipated, and excessive compensation of his assistant when compared with her historical compensation.” In so ruling, the court noted the parties' agreement that the appropriate standard for determining whether husband's spending was excessive involved comparing his expenditures to the $3500 per week wife was receiving from husband under the temporary order. According to the court, it could not conclude that husband's expenditures were excessive or wasteful “if the standard of comparison is the one adopted by the parties and without further evidence of the marital standard of living.” Nonetheless, the court thereafter capped husband's use of marital funds for personal, household, and discretionary spending at $3500 per week, and further prohibited either party from incurring “a personal or business obligation in excess of $10,000.00 without first providing notice to the other party of the amount to be incurred, the purpose of the obligation, to whom it will be owed, and any security that will be provided for repayment.”

¶ 10. Wife raised the issue anew in the final divorce hearing, and the judge presiding at that hearing again addressed it. The court first noted that wife's new evidence on the subject related to expenditures before the temporary order imposed a cap on expenditures by both husband and wife, and, therefore, wife was trying to relitigate claims already decided against her. As to the personal notes, the court said “now to tag [husband] ... with those items as ‘disallowed’ expenditures” would arguably “be double counting.” The court declined to reopen the question of “unaccounted for expenditures” during the period before the expenditure cap order “for purposes of the final tally of marital assets actually available for allocation as of January 2010, and August 2, 2011.”

¶ 11. Despite the above analysis, the court, in distributing the parties' various assets, listed as husband's asset $275,891,¹ which no longer exists and consists primarily of money in the cash account that was expended for the two loans and payment to his secretary as discussed above. The court explained as follows:

By tagging [husband] with a total of $275,891 in unexplained, or disputable expenditures using marital funds ... the court has essentially acknowledged, and taken the sting out of [wife's] “wasteful expenditure” claims. Although those claims were never proven to the court's satisfaction, nonetheless there is here some equitable recognition that a lot of cash under [husband's] nominal control had been expended in a somewhat loose fashion with no formal accounting to [wife].

¶ 12. In response to husband's motion to amend the court's findings and judgment, the court dismissed husband's assertion that its rejection of the wasteful dissipation claims was inconsistent with its decision to treat the spent money as an asset available to husband. The court explained that while the expenditures at issue “may not have been ‘wasteful disposition,’ still there was beneficial use of, or expenditure of marital assets that had to be accounted for.”

¶ 13. On appeal, husband argues that the court abused its discretion by counting the disputed expenditures against him. According to...