Johnson v. Johnson, 75-427
| Decision Date | 01 June 1977 |
| Docket Number | No. 75-427,75-427 |
| Citation | 78 Wis.2d 137,254 N.W.2d 198 |
| Parties | Jeanne Priebe JOHNSON, Plaintiff-Appellant, v. Kenneth O. JOHNSON, Defendant-Respondent. |
| Court | Wisconsin Supreme Court |
This is an action for divorce. The judgment, entered on August 6, 1975, granted the divorce to the plaintiff-appellant, Jeanne Priebe Johnson, upon the ground of adultery. The plaintiff appeals from those parts of the judgment that deal with the division of estate, alimony and support money for the minor children.
Leonard L. Loeb, S. C., Milwaukee, submitted brief for appellant.
Warren L. Kreunen, William E. Taibl and von Briesen, Redmond, Schilling & Kreunen, Milwaukee, submitted brief for respondent.
The plaintiff-appellant, Jeanne Priebe Johnson, and the defendant-respondent, Dr. Kenneth O. Johnson, were married on September 10, 1955. At the time of trial both parties were forty-two years old. They had been married twenty years. They had three daughters who were fifteen, thirteen and twelve years of age at the time the divorce was granted. The second oldest daughter was born without her lower left arm.
The parties met when they were freshmen at DePauw University. They saw each other frequently throughout college and were married after Dr. Johnson completed his first year of medical school. The appellant received a degree in home economics and during the first four years of marriage she worked full time and provided a substantial portion of their support. Money was given to the parties by both of their parents and Dr. Johnson's parents paid his tuition. Dr. Johnson supplemented their income by working during vacations.
In 1962 to 1963 the defendant started his medical practice, with a specialty in pediatrics, and earned approximately $20,000. His earnings steadily increased until 1966 when they reached between $28,000 to $29,000. In 1967 he affiliated with the Milwaukee Medical Clinic, a corporation, and for the next three years suffered a lesser income. However by 1972 his gross earnings were $33,194; in 1973, $39,846; and in 1974, $39,679. The corporation provides health, life and disability insurance for the clinic members and their families.
The defendant is also one of several partners of the Good Hope Properties. This partnership owns the real estate in which the Milwaukee Medical Clinic is located.
The court found that the parties' estate had been accumulated during the marriage. It found the value of the estate was as follows:
(1) Equity in the homestead and
adjoining lot $40,270
(2) Securities
Presently held in plaintiff's
name 14,646
Presently held in defendant's
name 7,745
(3) Cash savings and checking accounts Nominal
(4) Business Interest
Good Hope Properties 43,720
Shares in Milwaukee Medical
Clinic, S.C. 2,830
--------
Total $109,211
As a member of the clinic the defendant received a salary of $36,000 per year. This amount was set at the beginning of the year to provide the doctor with a drawing account. His final annual earnings were dependent upon a formula determined by the clinic members and depended, to a substantial degree, upon the bills to the patients by each member. There were five or six pediatricians in the clinic membership and the defendant's billings were about mid-point among the pediatricians.
The trial court did not include the value of defendant's share of the clinic's accounts receivable in the value of the estate. It noted that there was a dispute as to the disposition of these accounts between him and the clinic. The dispute centered around their value if Dr. Johnson severed his relationship with the clinic. If there was no severance Dr. Johnson would take the receivables as part of his compensation. The court found that if he did sever his relationship with the clinic the value of the receivables would be a substitute for income as he established a new practice. The value of the receivables was $44,700.90 less the cost of collection.
There was also a dispute over the value of the household furnishings. The plaintiff valued the furnishings at $3,000, while Dr. Johnson argued they were worth $15,000. The court made no finding as to the exact value of the furnishings. It found the plaintiff "grossly undervalued" the furnishings and that the defendant included items that were not furnishings.
In the estate division the court awarded the plaintiff the homestead and adjoining lot, those securities in her name, and all furniture, furnishings, appliances and equipment except the defendant's books and papers and other items of personal property of personal interest to him. The value of these items was not established but it appears it was not substantial.
The plaintiff was divested of any interest in all other property owned by the defendant.
The court concluded that the award of alimony and the division of the estate were interrelated. The plaintiff was awarded $650 per month alimony until all the children reached majority or were otherwise emancipated. The alimony was to be terminated if the plaintiff remarried or if the defendant died.
Support money for the three teenage daughters was set at $450 per month. Additionally, the defendant was ordered to pay for all medical and dental expenses including prescription drugs. The responsibility of medical care was Dr. Johnson's and the plaintiff's authority was limited to "emergency and minor medical matters." He was also required to maintain at least $60,000 of life insurance to secure the support order.
The first contention of the plaintiff-appellant is that the trial court improperly calculated the value of the estate. The trial court did not include the Good Hope Properties' partnership earnings or the value of the accounts receivable in the clinic in valuing the estate. The partnership earnings of $1,958 were not included in the estate because it did not appear that they would be paid to Dr. Johnson. Partnership earnings had not been paid in the nine previous years. Although he did not receive these earnings they were reported as income. The defendant did receive $3,936 in 1974. This sum was his share of the amount two doctors paid to become partners in the Good Hope Properties. Both of these amounts were appropriately excluded from the estate. There was no indication that Dr. Johnson would receive the partnership earnings. The partnership earnings were one indication of the value of Dr. Johnson's interest in the partnership. The value of the partnership interest was also an indicator of Dr. Johnson's future income; it assisted the court in determining proper alimony and support awards.
The trial court set forth why it did not include the accounts receivable of the clinic as part of the gross estate. Dr. Johnson would only receive these accounts, less collection costs, if his association with the clinic terminated. If he remained with the clinic he would receive them as salary; if he left, this payment would be in lieu of salary.
This court has held that it is error not to include among the assets for division a pension fund vested in the husband. Pinkowski v. Pinkowski,67 Wis.2d 176, 178, 226 N.W.2d 518 (1975). It has also held that it is error to include a profit-sharing trust as an asset in making division of the estate and to include it as income in awarding alimony. Kronforst v. Kronforst, 21 Wis.2d 54, 63-64, 123 N.W.2d 528 (1963). The trial court considered the accounts receivable as the equivalent to salary. In considering the amount of alimony and support to be awarded, it looked to Dr. Johnson's salary and his ability to pay. It was not error to view the receivables as salary. If Dr. Johnson remained with the clinic the receivables would be paid as salary. If he left, they would take the place of salary while he established his new practice. Because the receivables were viewed as salary, it would have been error to include them in the assets available for distribution.
Next, the appellant makes a series of arguments that challenge the alimony award, the division of the estate, the support award and the custody award. Each one of these determinations is within the sound discretion of the trial court. 1 In the absence of some mistake or error respecting the facts upon which the award rests, the trial court's award must be upheld unless an abuse of discretion can be shown or, under all the circumstances, the amount of an award is clearly excessive or inadequate. 2
The alimony award was $650 per month until all the children of the parties reached their majority. The plaintiff-appellant does not contest the amount of the award but argues that the court abused its discretion by making an award limited in time, thereby terminating its ability to change the award if circumstances changed. Sec. 247.26, Stats., 3 explicitly states that the trial court may grant alimony for a limited period of time. Sec. 247.32 4 states that alimony for a limited period of time shall not thereafter be revised or altered. A review of the findings of fact demonstrates that the court considered these and other factors. The division of the estate and the alimony award were closely interrelated. The court noted that the appellant's health and education appeared to enable her to obtain gainful employment but believed she should not be required to be solely dependent on her earnings immediately or while the children were minors.
The trial court in its memorandum decision made the following statement concerning the alimony award:
"The plaintiff's health and education appear to enable her to obtain gainful employment. However the defendant's abilities are such that she should not be required to be dependent solely upon her own...
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