In Re: Marriage of Pahlow v. Pahlow

• Decision Date: 20 March 2001
• Docket Number: No. 23424,23424
• Citation: 39 S.W.3d 87
• Parties: (Mo.App. S.D. 2001) In Re: The Marriage of John Digby Pahlow, Jr,. and Linda Faye Pahlow, John Digby Pahlow, Jr., Appellant, v. Linda Faye Pahlow, Respondent 0
• Court: Missouri Court of Appeals

39 S.W.3d 87 (Mo.App. S.D. 2001)

In Re: The Marriage of John Digby Pahlow, Jr,. and Linda Faye Pahlow, John Digby Pahlow, Jr., Appellant, v. Linda Faye Pahlow, Respondent

No. 23424

Missouri Court of Appeals Southern District

03/20/2001

Appeal From: Circuit Court of Barton County, Hon. Joseph B. Phillips, Judge

Counsel for Appellant: Wm. G. McCaffree

Counsel for Respondent: C. Ronald Baird & Dana L. Kollar

Opinion Summary: None

Prewitt and Garrison, JJ., concur.

Robert S. Barney, Chief Judge

John Digby Pahlow, Jr. ("Husband") appeals from an Amended Judgment of Dissolution ("judgment") which dissolved his marriage to Linda Faye Pahlow ("Wife"). In its judgment the trial court, inter alia, set off to Husband non-marital assets valued at $210,574.00, and set off to Wife non-marital assets valued at $19,785.00. In its division of marital property, the trial court awarded Wife $335,455.35 in marital assets, including $45,000.00 in cash for purposes of equalizing the division of marital assets, subject to debts of $145,261.00. The trial court noted that save for the $45,000.00, the marital assets awarded Wife were not "income producing property," and that Wife was obligated to pay her own attorney's fees and litigation expenses out of the cash awarded her. The trial court awarded Husband marital assets worth $453,134.89, subject to debts of $386,589.85. The trial court also ordered Husband to pay Wife $2,750.00 per month as modifiable maintenance until the death of either of the parties.

Husband posits two major points of trial court error on appeal. First, Husband claims the trial court erred in "classifying the Trim Fast debt and funds as marital and in awarding them to Wife." Second, Husband claims the trial court erred in "ordering Husband to pay maintenance in the amount of $2,750 monthly . . . ." Both points are discussed below.

"On appeal of a dissolution of marriage proceeding, we review the evidence in the light most favorable to the trial court's decision." Taylor v. Taylor, 12 S.W.3d 340, 344 (Mo.App. 2000). "The party challenging the dissolution decree has the burden of demonstrating error." Id. "We will affirm the trial court's decree unless there is no substantial evidence to support the decision, the decision is against the weight of the evidence, or the decision erroneously declares or misapplies the law." Id. "A trial court is 'free to believe or disbelieve all, part or none of the testimony of any witness.'" In re Marriage of Thompson, 24 S.W.3d 751, 755 (Mo.App. 2000)(quoting In re Marriage of Stephens, 954 S.W.2d 672, 675 (Mo.App. 1997)).

The record shows that Husband and Wife were married November 4, 1966, and separated on October 11, 1997. Husband's family are longtime, influential residents of Barton County. Husband began working full time in his family's abstract title business--Pahlow and Pahlow--in 1972. For the past 27 years, he has worked in the family business primarily providing abstracts, title insurance, loans, and escrow and closing services. Husband also holds a realtor license and a license to sell title insurance and annuities. He has also been employed as a branch manager with Team Bank and makes money from other business ventures. Wife forwent college at the urging of Husband and has been primarily occupied throughout the marriage as a full time mother and homemaker. Husband was completely in charge of the parties' finances.

The record also reveals that Husband has suffered from alcoholism but sought treatment in 1993 and claims his drinking is now controlled. Wife presented evidence that Husband physically and verbally abused her at times during the marriage, the frequency of the abuse increasing due to Husband's heavy use of alcohol. Further, Wife presented evidence that Husband had a number of affairs during the marriage. It was undisputed that Husband began an affair with Marsha Hardin, an old girlfriend, prior to filing for dissolution of his marriage.

The parties have two emancipated children and are also the appointed joint guardians of their grandson.¹

I.

In his first point on appeal, Husband claims the trial court erred in classifying the "Trim Fast debt and funds as marital . . . ." Husband posits that the debt and funds where his separately because "the lender intended to and had the right to look only to the Husband for collection, Husband's non-marital property provided security, the proceeds (both stock and liquidation check) were titled in Husband's separate name, and the source of repayment and intent to repay was solely that of Husband."

In a dissolution of marriage proceeding, the court awards each spouse his or her non-marital property and then the court divides the remaining marital property and debts in a just manner after considering all the relevant factors. Section 452.330.1.² "The trial court is vested with great flexibility and discretion in its division of property pursuant to section 452.330." Rivers v. Rivers, 21 S.W.3d 117, 123 (Mo.App. 2000). Likewise, "[i]n dividing marital debt, the trial court is vested with broad discretion in determining how and in what manner the debts should be divided, and this court will not disturb its division absent a clear showing of abuse of discretion." Id. at 122.

The law does not require an equal division of marital property, but the division must be fair and equitable after taking into consideration the factors enumerated in section 452.330.1. Wright v. Wright, 1 S.W.3d 52, 60 (Mo.App. 1999); Ray v. Ray, 877 S.W.2d 648, 651 (Mo.App. W.D.1994). A reviewing court must defer to the trial court's marital property division unless it is improper under the principles of Murphy v. Carron, 536 S.W.2d at 32, or is an abuse of discretion. Ray, 877 S.W.2d at 651. The division of property is presumed to be correct, and the party challenging the division bears the burden of overcoming the presumption. Id. The fact that the trial court awarded one party a considerably higher percentage of the marital property than it awarded the other is not per se an abuse of discretion. Id.

Rivers, 21 S.W.3d at 123.

Following the parties' separation, Husband borrowed $55,000.00 from Vernon and Viola Ring, late in the month of April 1999. Husband used $10,000.00 of the money to pay some of Wife's attorney's fees and used the other $45,000.00 to purchase 10,000 shares of stock in "TrimFast Group, Inc."³ The loan was secured by a deed of trust on a family farm, of which Husband retains a 1/5 interest as his separate property. Early in the trial, and in his exhibits, Husband represented that he had sold the 10,000 shares of TrimFast stock on July 30, 1999, for $6.80 a share and that he was waiting for a check for between $65,000.00 and $68,000.00, depending on what the brokerage fees would be. Later in the trial, Husband informed the court that he evidently had not sold the stock and that he had been notified that he only had $45,000.00 worth of stock. He subsequently deposited a check with the court for that amount from "Millennium Health Care Products, Inc."-evidently a company connected with TrimFast Group, Inc.⁴ The trial court found that the $55,000.00 debt to the Vernon and Viola Ring was a marital debt, and that the TrimFast stock was a marital asset and was worth $68,000.00.⁵

Under section 452.330.2-.4:

2. For purposes of sections 452.300 to 452.415 only, "marital property" means all property acquired by either spouse subsequent to the marriage except:

(1) Property acquired by gift, bequest, devise, or descent;

(2) Property acquired in exchange for property acquired prior to the marriage or in exchange for property acquired by gift, bequest, devise, or descent;

(3) Property acquired by a spouse after a decree of legal separation;

(4) Property excluded by valid written agreement of the parties; and

(5) The increase in value of property acquired prior to the marriage or pursuant to subdivisions (1) to (4) of this subsection, unless marital assets including labor, have contributed to such increases and then only to the extent of such contributions.

3. All property acquired by either spouse subsequent to the marriage and prior to a decree of legal separation or dissolution of marriage is presumed to be marital property regardless of whether title is held individually or by the spouses in some form of co-ownership such as joint tenancy, tenancy in common, tenancy by the entirety, and community property. The presumption of marital property is overcome by a showing that the property was acquired by a method listed in subsection 2 of this section.

4. Property which would otherwise be nonmarital property shall not become marital property solely because it may have become commingled with marital property.

Section 452.330.2-.4. "[I]t is presumed that all property acquired by either spouse subsequent to the separation of the parties but prior to the dissolution decree is marital property . . . ." Bullard v. Bullard, 929 S.W.2d 942, 946 (Mo.App. 1996). "The party questioning the presumption of marital property has the burden of rebutting the presumption by clear and convincing evidence." Randolph v. Randolph, 8 S.W.3d 160, 167 (Mo.App. 1999).

Husband is correct in pointing out that the debt was secured by his separate property and that Wife was unaware of the loan transaction or the subsequent purchase of stock. However, "[t]he phrase 'marital debts' encompasses all debts incurred during the marriage, either jointly or separately," Hughes v. Hughes, 994 S.W.2d 103, 107 (Mo.App. 1999), and "[t]he fact that a spouse does not control or participate in the decision to make a particular debt does not preclude allocation of that debt to the non-participating spouse." Id.; see also Rivers, 21 S.W.3d at 123. Here, Husband borrowed money from the Rings partly to pay some of Wife's attorney fees for the dissolution of marriage action. Further, the court expressly found that Husband's testimony was not credible. Although...