Hoverson v. Hoverson

• Decision Date: 14 May 2013
• Docket Number: No. 20120281.,20120281.
• Parties: Carl Michael HOVERSON, Plaintiff, Appellee and Cross–Appellant v. Sandra Morten HOVERSON, Defendant, Appellant and Cross–Appellee.
• Court: North Dakota Supreme Court

828 N.W.2d 510

2013 ND 48

Carl Michael HOVERSON, Plaintiff, Appellee and Cross–Appellant

v.Sandra Morten HOVERSON, Defendant, Appellant and Cross–Appellee.

No. 20120281.

Supreme Court of North Dakota.

April 4, 2013.

Rehearing Denied May 14, 2013.

Scott D. Jensen, Grand Forks, N.D., for plaintiff, appellee and cross-appellant.

Robert J. Schultz (argued) and Anna K. Schultz (appeared), Fargo, N.D., for defendant, appellant and cross-appellee.

MARING, Justice.

[¶ 1] Sandra Hoverson appeals and Carl Hoverson cross-appeals from a divorce judgment distributing the parties' marital estate and ordering Carl Hoverson to pay Sandra Hoverson $3,000 per month for spousal support for two years, $3,002 per month for child support, and attorney's fees. The parties' arguments raise issues about the property distribution, the duration and amount of spousal support, the propriety and the amount of an upward deviation for child support, and the award of attorney's fees. We affirm.

I

[¶ 2] Carl and Sandra Hoverson met in February 2004, when he was 49 years old and she was 42 years old. They were married in May 2004, and had one child together in 2005. Their marriage was his second, see Hoverson v. Hoverson, 2001 ND 124, 629 N.W.2d 573, and her fourth.

[¶ 3] When the parties met, Sandra Hoverson was living in Florida, where she owned a home. She graduated from high school in Larimore and received subsequent training as a radiologic technician, working as a trauma CT scan technician and as a mobile MRI technician for about three years before becoming employed at a Florida hospital in 1991. In 2003, she earned about $57,000. She earned about $31,000 during the first six months of 2004, before she quit her job shortly after the parties' marriage. According to her, she had maintained her license, but the technology had advanced after she quit work in 2004 and she was not interested in going back to work as a radiologic technician.

[¶ 4] Carl Hoverson was raised near Grand Forks. He graduated from high school in 1973 and attended college for about one year before beginning farming with his father in 1975. After his father died, Carl Hoverson started his own farming operation in 1976. In 1994, he and Ron Offut established Hoverson Farms LLP as an equal partnership with Carl Hoverson in charge of the day-to-day operations of the partnership. Hoverson Farms has become a successful potato farming operation, and the district court valued Carl Hoverson's share of the partnership at $9,530,017. In 2008, Carl Hoverson formed land holding companies, CHF Huntsville LLC, CMC Farms LLC, and CHF Union Lake LLC, with two sons from his prior marriage. Two of those companies, CHF Huntsville and CMC Farms, lease farmland to Hoverson Farms, and CHF Union Lake owns lake property. The district court valued Carl Hoverson's interest in CHF Huntsville at $963,540, his interest in CMC Farms at $2,999,360, and his interest in CHF Union Lake at $134,000. Carl Hoverson earns a substantial income from his farming ventures, and the district court found his averageyearly income from 2004 through 2010 was $1,635,307.

[¶ 5] During periods of their marriage, the parties lived separately, with Sandra Hoverson maintaining her residence in Florida and Carl Hoverson engaging in the farming operation near Larimore. In January 2010, Carl Hoverson sued Sandra Hoverson for divorce, but the action was dismissed when the parties reconciled. Sandra Hoverson thereafter lived predominately in North Dakota, and in August 2010, Carl Hoverson brought this divorce action against her.

[¶ 6] In May 2011, the district court entered an interim order granting Sandra Hoverson temporary, primary residential responsibility of the parties' minor child and ordering Carl Hoverson to pay her $2,102 per month in temporary child support, $4,648 per month in temporary spousal support, and $25,000 for attorney's fees. The parties thereafter stipulated that Sandra Hoverson would have primary residential responsibility of their child. After a December 2011 trial, the district court granted the parties a divorce, distributed the parties' marital estate, which the court valued at about $14.5 million, with approximately 20 percent of the marital property, $2,832,393, going to Sandra Hoverson and 80 percent of the marital property, $11,639,267, going to Carl Hoverson, and ordered Carl Hoverson to pay Sandra Hoverson spousal support of $3,000 per month for two years, and to pay her $3,002 per month for child support. The court also ordered Carl Hoverson to pay Sandra Hoverson's attorney's fees.

II

[¶ 7] Sandra Hoverson argues the district court clearly erred in distributing the parties' marital property. She argues the court erred in finding Carl Hoverson was not guilty of non-economic fault because there was evidence he had an extra-marital affair, the court erred in not considering his dissipation of marital assets from the land holding companies to his sons from his prior marriage, the court erred in distributing marital property based on the ratio of the length of the parties' marriage and the years Carl Hoverson had been farming, the court erred in valuing the marital assets on October 31, 2010, rather than the date of trial in December 2011, and the court erred in relying on Carl Hoverson's expert's testimony to discount the value of his partnership share in Hoverson Farms. Carl Hoverson responds the court erred in awarding Sandra Hoverson approximately $2.8 million in marital property and claims she should have been awarded only half that amount.

[¶ 8] A district court's distribution of marital property is treated as a finding of fact, which we review under the clearly erroneous standard of review. Wold v. Wold, 2008 ND 14, ¶ 6, 744 N.W.2d 541. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, after reviewing all the evidence, we are left with a definite and firm conviction a mistake has been made. Lynnes v. Lynnes, 2008 ND 71, ¶ 12, 747 N.W.2d 93. We view the evidence in the light most favorable to the district court's findings, which are presumptively correct. Hitz v. Hitz, 2008 ND 58, ¶ 10, 746 N.W.2d 732. Our review under the clearly erroneous standard “does not allow us to reweigh the evidence, reassess the credibility of witnesses, or substitute our judgment for a district court's initial decision.” Martire v. Martire, 2012 ND 197, ¶ 6, 822 N.W.2d 450.

[¶ 9] A district court is required to make an equitable distribution of divorcing parties' marital property and debts. N.D.C.C. § 14–05–24(1). All property held by either party, whether held jointly or individually, is considered marital property, and the court must determine the total value of the marital property before making an equitable distribution. Ulsaker v. White, 2006 ND 133, ¶¶ 12–13, 717 N.W.2d 567. Marital property ordinarily is valued as of the date of trial. Id. at ¶ 13. After the court values the property, the court must then equitably divide the entire marital estate under the Ruff–Fischer guidelines, which require the court to consider the following factors in the division:

“The respective ages of the parties, their earning ability, the duration of the marriage and conduct of the parties during the marriage, their station in life, the circumstances and necessities of each, their health and physical condition, their financial circumstances as shown by the property owned at the time, its value at the time, its income-producing capacity, if any, whether accumulated before or after the marriage, and such other matters as may be material.”

Ulsaker, at ¶ 9 (quoting Horner v. Horner, 2004 ND 165, ¶ 9, 686 N.W.2d 131).See Ruff v. Ruff, 78 N.D. 775, 52 N.W.2d 107 (1952); Fischer v. Fischer, 139 N.W.2d 845 (N.D.1966).

[¶ 10] Our law does not require a set formula or method for dividing marital property; rather, the division is based on the particular circumstances of each case. Wagner v. Wagner, 2007 ND 101, ¶ 11, 733 N.W.2d 593. A property division need not be equal to be equitable, but a substantial disparity must be explained. Bladow v. Bladow, 2003 ND 123, ¶ 5, 665 N.W.2d 724. A lengthy marriage generally supports an equal division of all marital assets. Id. at ¶ 8. There is no bright-line rule to determine whether a marriage should be deemed a short-term or a long-term marriage. See Hitz, 2008 ND 58, ¶ 16, 746 N.W.2d 732 (stating not clear error to classify 10–year marriage as relatively short-term); Orgaard v. Orgaard, 1997 ND 34, ¶ 11, 559 N.W.2d 546 (sustaining finding that 11–year marriage is “relatively short-lived”); Ulsaker, 2006 ND 133, ¶ 14, 717 N.W.2d 567 (sustaining finding that 16–year marriage is long-term marriage). A court's finding of economic or non-economic fault is a finding of fact subject to the clearly erroneous rule. See Halvorson v. Halvorson, 482 N.W.2d 869, 871–72 (N.D.1992).

[¶ 11] The district court made findings under each of the factors in the Ruff–Fischer guidelines, including that the parties' “six (6) plus year marriage” was short-term and a “later in life marriage” and Sandra Hoverson did not significantly contribute to the marriage during her many absences from North Dakota. The court found the parties kept the majority of their assets separate and were separated for significant periods of time during their marriage. The court found Sandra Hoverson's choice to live in Florida for extended time periods “contributed to the decline of the marriage.” The court also said Carl Hoverson admitted having an extramarital affair after he started the January 2010 divorce action, which was ultimately dismissed when the parties reconciled. The court found “both parties [were] at fault for the breakdown of [their] marriage” and “[n]either party committed noneconomic fault.” The court also found Carl Hoverson committed economic fault to the extent that during the divorce proceeding, he transferred some assets in...