Karamanoglu v. Gourlaouen, Docket No. Cum–15–459.

• Decision Date: 07 June 2016
• Docket Number: Docket No. Cum–15–459.
• Citation: 140 A.3d 1249,2016 ME 86
• Parties: Selcuk KARAMANOGLU v. Catherine (Karamanoglu) GOURLAOUEN.
• Court: Maine Supreme Court

140 A.3d 1249

2016 ME 86

Selcuk KARAMANOGLU

v.Catherine (Karamanoglu) GOURLAOUEN.

Docket No. Cum–15–459.

Supreme Judicial Court of Maine.

Argued: March 3, 2016.

Decided: June 7, 2016.

Brianne M. Martin, Esq., and Jonathan Davis, Esq. (orally), Powers & French, P.A., Freeport, for appellant Catherine Karamanoglu.

Gene R. Libby, Esq., and Paige B. Streeter, Esq. (orally), Libby O'Brien Kingsley & Champion, LLC, Kennebunk, for cross-appellant Selcuk Karamanoglu.

Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.

HJELM, J.

[¶ 1] Catherine Gourlaouen appeals, and Selcuk Karamanoglu cross-appeals, from a divorce judgment entered in the District Court (Portland, Eggert, J. ) after it accepted and adopted the reports of a referee. Gourlaouen challenges aspects of the judgment relating to parental rights and responsibilities, and to the determination of the parties' interests in properties located in Yarmouth and France. In his cross-appeal, Karamanoglu alleges that he was not given proper credit for contributions he made toward the purchase of the France property. We affirm in part, vacate in part, and remand for further proceedings.

I. BACKGROUND

[¶ 2] After Karamanoglu filed a complaint for divorce in February 2014 and with the agreement of the parties, the court (Cadwallader, M. ) appointed a referee to address all contested issues. See 19–A M.R.S. § 252(1)(A) (2015) ; M.R. Civ. P. 53, 119. The referee held bifurcated hearings on the parenting and financial issues, and then issued separate reports containing his findings of fact and recommended disposition of the contested issues. The reports included the following facts, which bear on the issues on appeal, are based on competent evidence in the record, and were adopted by the court (Eggert, J. ) in its divorce judgment.

[¶ 3] The parties were married in Brest, France, in 2006. They have one minor child, who was born in 2008.

[¶ 4] In January 2014, Gourlaouen filed a complaint for protection from abuse against Karamanoglu. After a contested hearing, the District Court (Portland, Moskowitz, J. ) issued a protection order based on findings that Karamanoglu had abused Gourlaouen and the child. Under the terms of the protection order, Karamanoglu was limited to supervised contact with the child. The child's therapist and the guardian ad litem, who was appointed during the divorce proceeding to represent the child's best interest, later agreed that it was in the child's best interest to have unsupervised visitation with Karamanoglu. Karamanoglu became engaged in counseling to learn to maintain a “strong and healthy relationship” with his son, and, as the referee found, was “strongly motivated to have a good and loving relationship with” him. Based on evidence that included the opinions of the child's therapist and the guardian ad litem, the referee found that Karamanoglu does not pose a risk of harm to the child and recommended shared parental rights and responsibilities, including shared primary residence and care.

[¶ 5] The referee recommended that the parties be required “to participate in co-parenting counseling with a provider in private practice,” who would engage “with the parents individually and, if she or he thinks appropriate, together.” The referee also recommended a requirement that the child continue counseling with a therapist but “shall not participate in mental health counseling with multiple providers simultaneously without the express [ ] knowledge and consent of [the child's therapist] and the co-parenting provider.” Additionally, the referee recommended a provision in the judgment requiring the parties to mediate any dispute regarding parenting issues before they could seek judicial recourse.

[¶ 6] In a separate report, the referee addressed property issues. The parties jointly own properties in Primelin, France; Freeport; and Yarmouth. Two days before the parties married, they entered into a standard French marriage contract, which the parties agree is valid and enforceable, and provides that the division of property is governed by French law. The contract includes a “separation-of-assets regime,” which is commonly used in France. Under the regime, each spouse's property rights are determined by his or her respective contributions to the acquisition of the property rather than by title. Based on the contract and French law, the referee determined that there were several principles that were relevant to contested property division issues: that a spouse's initial payment to acquire real property is treated as a capital contribution and is recoverable by the payor spouse, even if the asset decreases in value; that loan payments made over the course of time, in contrast, are deemed to be “contribution[s] to ordinary marital expenses,” and the equity resulting from those payments is presumptively divided equally between the spouses; and that any appreciation in the value of real property, which is called the profit subsistant, is allocated between the spouses in proportion to their financial interests as determined by their respective capital contributions and contributions to ordinary marital expenses.

[¶ 7] Karamanoglu and Gourlaouen supplemented the standard marriage contract with a clause stating that “the parties agree specifically that in the case of divorce, [Gourlaouen] will have to pay her husband a sum equivalent to half of the value of the buildings belonging to her at the time of divorce and acquired during the marriage.” Because the only property that could be covered by this clause is the property that is located in Primelin, which was acquired in Gourlaouen's name six days after the marriage, the clause has been described in this proceeding as “the Primelin clause.” Despite including it in the contract, both parties asserted to the referee that the Primelin clause was unenforceable because, as was explained by each party's expert witness on French matrimonial law, its meaning is unclear. Karamanoglu paid $815,144 for Gourlaouen to acquire the Primelin property in her name alone. Gourlaouen did not contribute toward its purchase. The referee found that at the time of the hearing, its value was $500,000. The referee recommended that the Primelin property be set aside to Gourlaouen but that in the overall property division Karamanoglu be credited with half of the amount he paid when Gourlaouen acquired it.

[¶ 8] During the marriage, the parties bought the Yarmouth property for $4.3 million. Both parties made initial contributions toward the purchase price, although Karamanoglu's contribution exceeded Gourlaouen's. The referee treated these initial payments as separate capital contributions of the parties. The parties financed the balance of the purchase price through a loan from Karamanoglu's brother. During the marriage, the parties made payments toward the loan, which the referee treated as equal contributions by the parties to ordinary marital expenses rather than as additional capital contributions. By the time of the hearing, the value of the property had increased to $5 million. The referee quantified the amounts of the parties' separate interests in the property based on their respective initial capital contributions, and an attribution of the loan payments that is equal between the parties, with the resulting shares increased proportionally by the profit subsistant. Based on the referee's recommendation, the judgment establishes Karamanoglu's and Gourlaouen's shares of the equity in the Yarmouth property to be approximately $3.1 million and $1.4 million respectively.

[¶ 9] The referee recommended that the Yarmouth and Freeport properties should be set aside to Karamanoglu; that Gourlaouen be awarded the Primelin property; and that as an “equalization payment,” Karamanoglu pay approximately $1 million to Gourlaouen. The referee also recommended that Karamanoglu be required to pay Gourlaouen spousal support of $3,800 per month for five years.

[¶ 10] Both parties filed objections to the referee's reports. After holding a hearing, the court denied all objections, and adopted and incorporated the provisions of the referee's reports into a divorce judgment entered on August 28, 2015. Gourlaouen's appeal and Karamanoglu's cross-appeal followed.

II. DISCUSSION

[¶ 11] When—as it did here—a court accepts a referee's report and incorporates its findings and conclusions into the judgment, the findings of the referee become the trial court's findings, and we review those findings directly for clear error. Wechsler v. Simpson, 2016 ME 21, ¶ 12, 131 A.3d 909. Those “findings are entitled to very substantial deference” because of the referee's opportunity to observe and assess the witnesses' testimony. Id. (quotation marks omitted). We review the referee's recommendations regarding parental rights and property division for an abuse of discretion. Id. Finally, we engage in a de novo review of the application of law to the facts. Warren v. Warren, 2005 ME 9, ¶ 20, 866 A.2d 97.

[¶ 12] We first address Gourlaouen's challenges to the portion of the judgment dealing with parental rights and responsibilities, and we then consider the parties' challenges to the property division.

A. Parental Rights and Responsibilities

[¶ 13] Gourlaouen asserts that the referee (1) erred by failing to impose conditions of contact between Karamanoglu and the child because of the history of abuse, see 19–A M.R.S. § 1653(6) (2015) ; (2) abused his discretion by requiring the parties to engage in joint counseling at the direction of a counselor, despite Karamanoglu's history of domestic abuse against Gourlaouen, see 19–A M.R.S. § 1653(6)(E) ; (3) abused his discretion by restricting the parties' right to make counseling decisions for their child; and (4) abused his discretion by requiring the parties to mediate future disputes about parenting issues before initiating legal proceedings.¹ We consider these contentions in turn.

1. Conditions of Contact Between...