Heslop v. Heslop, WD

• Decision Date: 24 March 1998
• Docket Number: No. WD,WD
• Parties: Alice F. HESLOP, Respondent, v. Ronald V. HESLOP, Appellant. 53933.
• Court: Missouri Court of Appeals

Page 249

967 S.W.2d 249

Alice F. HESLOP, Respondent, v. Ronald V. HESLOP, Appellant.

No. WD 53933.

Missouri Court of Appeals,

Western District.

Submitted Dec. 4, 1997.

Decided March 24, 1998.

Motion for Rehearing and/or Transfer to

Supreme Court Denied April 28, 1998.

Application for Transfer Denied

June 16, 1998.

James F. Ralls, Jr., Liberty, for appellant.

John J. Hager, Kansas City, for respondent.

Before ULRICH, C.J., P.J., SMART, J., and TURNAGE, Senior Judge.

PER CURIAM.

Ronald V. Heslop ("Ronald") appeals the trial court's judgment in this dissolution of marriage case. Ronald challenges the finding that the entire settlement he received from the Union Pacific Railroad for a claim under the Federal Employer's Liability Act ("FELA"), 45 U.S.C. § 51 et seq., was marital property. Ronald also argues that the trial court erred in awarding one-half of the FELA settlement to Alice because the evidence at trial showed that only $24,000.00 of the $52,000.00 award remained at the time the marriage was dissolved. Because we find that Ronald failed to show that any part of the award was compensation for loss of future earnings, and because there was evidence to support a finding that Ronald had secreted and squandered part of the settlement monies, we affirm the judgment.

Background Facts

Alice and Ronald were married on March 6, 1971. Three children were born of the marriage. In October 1991, Ronald was injured on his job with Union Pacific Railroad. ¹ He missed over two years of work because of injuries to a disc in his neck. Despite surgery, Ronald continues to experience pain in his neck. He returned to work as a clerical worker around the end of 1993 and continues to perform clerical duties for the railroad. The parties separated on October 11, 1994. Alice filed a petition for dissolution of the marriage on April 27, 1995. In November 1994, the month after Alice and Ronald had separated, Ronald received a net settlement of approximately $52,000.00 on his FELA claim against the railroad. Ronald did not tell Alice about the settlement until four or five months later. Ronald testified at trial that he had spent $28,000.00 of the sum. He claims that he spent the money paying off one son's wrecked car and buying a car for the parties' daughter. He also spent $4,200.00 on facial surgery. Ronald also claims that part of the money was spent for house payments and part for utilities. Ronald admitted that during a period of depression he had gambled away $4,000.00 or $5,000.00 of the money.

In the first set of interrogatories Alice sent to Ronald, Ronald's response, executed August 23, 1995, stated that he had not transferred any real or personal property in the previous twenty-four months. In his answers to the second set, executed August 28, 1995, he indicated that, in addition to having approximately $20,000.00 in an account in his and his son's name, he had created two other accounts in the names of his sons. He acknowledged he deposited $6,500.00 on May 5, 1995, in a separate account at the Missouri Pacific Credit Union bearing the name of his son, Ronald V. Heslop, II. Ronald further admitted that on April 7, 1995, he deposited $9,800.00 in a separate account at the Missouri Pacific Credit Union bearing the name of his other son, Jason S. Heslop.

After Ronald was injured, he did not work for all of 1993 and most of 1994. In 1994, Alice made $35,370.00 and Ronald made $8,000.00. During the time that Ronald was off work, Alice used $16,000.00 from a retirement account to pay marital bills. Ronald drew money under a wage continuation plan and from railroad unemployment; however, this money was reimbursed to the providers under his FELA settlement, leaving Ronald a net of approximately $52,000.00. Alice continued making second mortgage payments on the family home even after she had left, but ceased making these payments upon learning of the FELA settlement. At the time of trial, Ronald was making regular union scale.

The Decree

The trial court divided the marital property and made the following findings:

The Court finds that the FELA award to the Respondent in the amount of $52,135.54 was marital property. Respondent has spent a portion thereof, given a portion to the children of the marriage and retains the balance. No portion thereof has been received by Petitioner.

* * * *

Petitioner should be awarded the following items as her sole and absolute property, subject to any liens or encumbrances on any of said items which said liens or encumbrances should be paid by her and Respondent held harmless therefrom:

1991 Lincoln Town Car

Any accounts in any bank, credit union or other financial institution which are held in her name as of the date of the trial of this case.

Any life insurance policy upon which she is listed as the owner by the insurance company issuing said policy.

Any interest which she has in any pension or retirement fund through any credit union or employer of hers.

All personal property which is currently in her possession including or in addition thereto the following: dining table and chairs, server, pictures of children, ceramics made by wife's mother, food processor, dresser made in Arkansas, computer.

In addition to the property hereinabove listed, the Petitioner shall be granted a judgment in the amount of $45,000.00 against the Respondent for the purpose of achieving an equitable distribution of the marital property awarded herein.

Respondent should be awarded the following items as his sole and absolute property, subject to any liens or encumbrances on any of said items which said liens or encumbrances should be paid by him and Petitioner held harmless therefrom:

The real estate and home located at 2405 Salem Court, Blue Springs, Missouri legally described as Lot 559 Kingsridge Subdivision Lot 463 through 517 and Lots 531 through 651, a subdivision in Jackson County, Missouri.

1993 Ford Van

Any accounts in any bank, credit union, savings and loan or other financial institution which are held in his name as of the date of trial.

Any life insurance polices on which he is carried as the owner by the issuing insurance company as of the date of trial.

Any interest he may have in any retirement or pension fund provided by a union or prior employer.

Any and all personal property currently in his possession with the exception of any specifically named items which are hereinabove set over to Petitioner.

Ronald points out that the amount awarded to Alice to equalize the distribution of property, $45,000.00, is approximately the sum of half of the equity in the house, $19,500.00, and half of the amount of the original FELA award, $26,000.00. The total of these two figures is $45,500.00.

Standard of Review

In this court-tried case, our review is governed by Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976). Thus, the judgment of the trial court will be affirmed unless it is against the weight of the evidence, is not supported by substantial evidence, or it erroneously declares or applies the law. Id. at 32. We give due regard to the trial court's opportunity to judge the credibility of the witnesses before it. Central States Christian Endeavors Ass'n v. Nelson, 898 S.W.2d 547, 548 (Mo. banc 1995). It is the trial court's job to resolve conflicts in the evidence. Hudson v. Hudson, 865 S.W.2d 405, 407 (Mo.App.1993). On appeal, this court considers only those facts and inferences favorable to the prevailing party. Id. The party challenging the decree has the burden of showing error. Browning v. Browning, 947 S.W.2d 106, 108 (Mo.App.1997). We will not set aside a judgment absent a firm belief that the judgment is wrong. DeCapo v. DeCapo, 915 S.W.2d 343, 346 (Mo.App.1996).

No Statutory Provision Protects FELA Awards From Inclusion

in Marital Property Estate

In his first point, Ronald argues that the trial court erred in finding the FELA award to be marital property and in ordering him to make a cash payment to Alice to equalize the property division. He maintains that the court should have determined that a portion of the award was for future lost wages and that such portion should have been determined to be nonmarital property.

The FELA statutes do not provide for exemption of FELA awards from the operation of state family laws relating to the division of property in dissolution actions. Missouri courts have determined that the Missouri statutes also provide no automatic exemption. See, e.g., Gonzalez v. Gonzalez, 689 S.W.2d 383, 385 (Mo.App.1985). The court in Gonzalez examined § 452.330, RSMo 1994, the statute defining marital property, and concluded that a FELA award is not a stated exception in the statute that would preclude it from being considered marital property. ² Id. In Gonzalez the husband argued that because his award was based on a federal FELA statute, the Supremacy Clause of the United States Constitution overrides state law and takes the award out of the marital estate. Id. at 385. The court rejected this argument noting that, unlike the Railroad Retirement Act of 1974, the FELA statutes do not demonstrate a federal intent that property rights created by the statute be exempt from the operation of state family laws. Id. at 385-86. ³

Missouri Courts Generally Apply the "Analytic Approach" In

Determining Whether Such Property Should Be

Classified As Marital

Having determined that the FELA award may be classified as marital property, we turn next to the question of whether the award should have been classified as marital property. Ronald suggests that use of the "analytic" approach would result in classification of the award as nonmarital. If the award is nonmarital, he reasons, the amount of marital property to be divided by the court would be reduced and Alice's share reduced accordingly. Alice argues that the analytic approach is inappropriate and that this court should follow the literal "mechanistic" approach adopted in Nixon v. Nixon, 525 S.W.2d 835 (Mo.App.1975)....