In re Marriage of Horton, 03-474.

• Decision Date: 14 December 2004
• Docket Number: No. 03-474.,03-474.
• Court: Montana Supreme Court
• Parties: In re the MARRIAGE OF Tammy Lee HORTON, Petitioner and Respondent, and Robert D. Horton, Respondent and Appellant.

102 P.3d 1276

2004 MT 353

324 Mont. 382

In re the MARRIAGE OF Tammy Lee HORTON, Petitioner and Respondent, and

Robert D. Horton, Respondent and Appellant.

No. 03-474.

Supreme Court of Montana.

Submitted on Briefs March 30, 2004.

Decided December 14, 2004.

For Appellant: Dustin Chouinard, Datsopoulos MacDonald & Lind, Missoula, Montana.

For Respondent: Jean Adele Carter, Thompson Falls, Montana.

Justice PATRICIA O. COTTER delivered the Opinion of the Court.

¶ 1 Robert D. Horton (Robert) appeals various findings and conclusions included in the Dissolution Decree issued by the Montana Twentieth Judicial District Court on April 23, 2003. We affirm in part and reverse and remand in part.

ISSUE

¶ 2 The issue before the Court is whether the District Court erred in its distribution and valuation of the marital estate.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 3 Tammy Horton (Tammy) and Robert were married on August 21, 1993. They have lived in Montana since their marriage. The couple have two children, Garrett, born January 5, 1995, and Demi, born November 21, 1997. The parties separated in January 2002 and a Petition for Dissolution was filed on May 8, 2002. Tammy and Robert have entered into a court-approved Parenting Plan, the terms and conditions of which are not a part of this appeal. A trial was held on March 24, 2003. The District Court entered its Findings of Fact, Conclusions of Law, and Decree on April 23, 2003.

¶ 4 In the Decree, the court distributed the marital property in a manner that resulted in each party receiving a net distribution totaling $72,960.00. Robert's distribution consisted of a 1991 Ford Explorer, his guns, his retirement/IRA account and life insurance policy, a 1993 Ford pickup truck, his mounts, miscellaneous pre-marital property which also included guns, and personal property in his possession. Tammy was also required to make an equalization payment to Robert of $32,640.00.

¶ 5 Tammy's property distribution included six horses, her tack, her mounts, her "horse business," the horse trailer, the computer and accessories, her personal property in her possession, and specified pre-marital property. It also included the marital home, the value of which was agreed upon by Tammy and Robert to be $200,000. Tammy assumed a mortgage of $40,000, which reduced the value allocated to her to $160,000. The court then further reduced the value of the home allocated to Tammy by $80,000. This was done based upon the testimony of Tammy and her father that her father had gifted to her home building labor and materials valued at $80,000. Reduced by the mortgage and the gift, Tammy's allocated value of the marital home was therefore $80,000.

¶ 6 Robert challenges the $80,000 "gift" reduction from the home's value. He also maintains that the court erred by including the value of his guns under both the pre-marital property and marital property calculations, and by undervaluing Tammy's tack. Lastly, he argues that the court entered erroneous findings regarding the income of the parties and that because such erroneous income figures were used to support the court's property distribution, the property distribution was further flawed.

STANDARD OF REVIEW

¶ 7 We review a district court's findings of fact regarding a division of marital assets to determine whether the findings are clearly erroneous. Findings are clearly erroneous if: (1) they are not supported by substantial evidence; (2) the district court misapprehended the effect of the evidence; or (3) the district court made a mistake. We review a district court's conclusions of law to determine whether the conclusions are correct. We will affirm a district court's division of property, absent clearly erroneous findings, unless we identify an abuse of discretion. In re Marriage of Bartsch, 2004 MT 99, ¶ 13, 321 Mont. 28, ¶ 13, 88 P.3d 1263, ¶ 13 (internal citations omitted).

DISCUSSION

¶ 8 We first address Robert's claim that the court's reduction of the value of the marital home by $80,000 was arbitrary, prejudicial, and unsupported by the record. Robert maintains that Tammy failed to meet her burden of establishing that her father had actually "gifted" to her his contracting services and home building materials worth $80,000. He also asserts that the District Court erroneously neglected to consider his contribution to the marital residence when it decided how much of the gift to exclude from the marital estate and attribute to Tammy personally.

¶ 9 Tammy and Robert bought property in Sanders County shortly after their marriage. It is undisputed that they paid $12,000 for the property. They began construction of their home in the mid-nineties. During construction, many friends and family members assisted in projects related to the home-building. Many of these people testified at trial that Tammy's father, an experienced log home builder, donated substantial time over one to two years working on the house. Also, Tammy testified that, while she was in high school, her father told all of his children that in lieu of a college education, he would build them each a house. She and her father viewed the effort, as well as the materials he donated to the project, as the gift he had previously promised Tammy. Robert maintains that he knew nothing of this "gift" until divorce proceedings were underway.

¶ 10 Section 40-4-202, MCA, describes how property should be divided upon a marriage's dissolution:

(1) In a proceeding for dissolution of a marriage, ... the court ... shall ... equitably apportion between the parties the property and assets belonging to either or both, however and whenever acquired and whether the title thereto is in the name of the husband or wife or both....

In dividing ... property acquired by gift ... the court shall consider those contributions of the other spouse to the marriage, including

(a) the nonmonetary contribution of a homemaker; [and](b) the extent to which such contributions have facilitated the maintenance of this property....

¶ 11 As we have indicated in the past, this statute vests the district court with broad discretion to apportion a marital estate in a manner which is equitable to each party under the specific circumstances. In re Marriage of Binsfield (1995), 269 Mont. 336, 888 P.2d 889. Furthermore, in non-jury cases, such as this one, the district court judge is charged with listening to and weighing the evidence presented. The judge must determine the credibility of each witness based upon his or her demeanor, temperament, attitude, and candor, among other things. For these reasons, this Court defers to the district court's discretion in matters of evidence weight and credibility, particularly when conflicting evidence is presented. In re Marriage of Grende, 2004 MT 36, ¶ 27, 320 Mont. 38, ¶ 27, 85 P.3d 788, ¶ 27.

¶ 12 Robert asserts that the record is void of "any evidence" that would tend to establish that Tammy's father gifted to her labor and materials valued at $80,000. This is incorrect. Rather, there was conflicting evidence. Some witnesses claimed they did not believe that such a gift was given, while others claimed they did not know whether such a gift was made. However, the fact that some witnesses did not know of the arrangement between Tammy and her father does not necessarily doom it to non-existence. Tammy and her father both testified that he had promised, years earlier, to build a home for Tammy and his other children. By the time he began working on Tammy's home, he had already fulfilled this promise for his oldest child. Tammy's father also testified that he would not have done this for Robert; he intended his gift of labor and materials for his daughter. The District Court concluded that, based on the totality of evidence, Tammy had met her burden and established that her father had given to her his time, labor and some materials in the building of her home.

¶ 13 Robert also argues that the "gift" is not traceable because Tammy's father kept no records of the value of the gift and thus it is commingled into the entire house and cannot be separated. Unlike in In re Marriage of Herron (1980), 186 Mont. 396, 608 P.2d 97, traceability in this case is not a complex notion. In Herron, the court had to trace an initial gift from 1962 to 1979 and across several residential home purchases, sales, and cross-country moves. Here, there is a single gift embedded into the total value of one home. Upon a finding of the existence of the gift from a non-marital source, i.e., Tammy's father, there is essentially nothing to "trace."

¶ 14 Robert also relies on In re Marriage of Steinbeisser, 2002 MT 309, 313 Mont. 74, 60 P.3d 441, which we conclude is distinguishable from the case at bar. In Steinbeisser, there was a protracted pattern of commingling and expenditure of inherited funds, making it impossible to trace the money and its eventual dissipation. Such is not the case here.

¶ 15 Lastly, we are unpersuaded by Robert's argument that the entire gift should be considered marital property because the value of the gift was commingled and cannot be separated from the value of the house as a whole. Commingling of a gift with jointly-owned marital property does not automatically preclude the gift from being considered separate property. See In re Marriage of Engen, 1998 MT 153, 289 Mont. 299, 961 P.2d 738

(Proceeds from the sale of a home given to husband by his mother, deposited into couple's joint checking account and used to purchase a condominium were held to be separate property of the husband upon dissolution of the marriage); Herron,

186 Mont. at 404,

608 P.2d at 102 (Property gifted to both parties by wife's father and held jointly as and commingled with marital property should not be distributed equally to the parties because the wife's father had given the properties to provide for his daughter). See also Siefke v. Siefke, 2000 MT 281, 302 Mont. 167, 13 P.3d 937. Upon determining an accurate value...