Knapp v. Knapp, WD

• Decision Date: 15 March 1994
• Docket Number: No. WD,WD
• Citation: 874 S.W.2d 520
• Parties: Patty C. KNAPP, Respondent, v. Donald Lee KNAPP, Sr., Appellant. 47739.
• Court: Missouri Court of Appeals

Page 520

874 S.W.2d 520

Patty C. KNAPP, Respondent, v. Donald Lee KNAPP, Sr., Appellant.

No. WD 47739.

Missouri Court of Appeals,

Western District.

March 15, 1994.

Motion for Rehearing and/or Transfer to

Supreme Court Denied May 3, 1994.

Stanley I. Dale, St. Joseph, for appellant.

Ralph W. Hicks, St. Joseph, for respondent.

Before ULRICH, P.J., and BRECKENRIDGE and SPINDEN, JJ.

SPINDEN, Judge.

Donald Lee Knapp, Sr., appeals the trial court's decree dissolving his marriage to Patty C. Knapp. He alleges that the court erred in dividing marital property and in designating debts and property as marital and nonmarital. We disagree and affirm the trial court's judgment.

The Knapps married on November 23, 1978, and separated on March 25, 1992. No children were born to the marriage. Donald Knapp was co-owner of a general construction business, Sun General, Inc., until 1982 when he sold out to his brother and became a self-employed carpenter. Patty Knapp was a public school teacher and served in the Air National Guard.

Before 1983, the Knapps resided at 204 South 31st Street in St. Joseph. Patty Knapp purchased the house in 1977 for $27,000 before marrying Donald Knapp. She was living there with her two children from a previous marriage when she married Donald Knapp. The property title listed Patty Knapp as the sole owner, and she did not change the title after marrying Donald Knapp. The property's mortgage balance was $20,000 when the couple divorced. Although the Knapps moved to another house in 1983, Patty Knapp retained ownership of the house.

In 1983, the parties purchased land at 2913 Cronkite, and the property title listed Donald and Patty Knapp as owners. Donald Knapp and his son built a house on the land. The land had originally been five separate lots. The Knapps devoted four of the lots to the house. The house was the family residence when the couple divorced. Donald Knapp built a workshop and a tool shed on the remaining fifth lot behind the house. The land devoted to the workshop and tool shed was landlocked without access to a public street. Donald Knapp used these buildings in his carpentry business.

In 1988, the Knapps refinanced their mortgage on the house at 2913 Cronkite. The mortgage balance was $45,000, and the Knapps borrowed $28,000 to pay business debts incurred by Donald Knapp. The new mortgage totaled approximately $72,000. The mortgage balance when the couple divorced was approximately $69,000. Patty Knapp testified that the value of the property, including the workshop and tool shed, was $120,000 to $125,000. Donald Knapp valued the property at $130,000.

In its decree dissolving the Knapp's marriage, the trial court found:

The business interests of [Donald Knapp] have caused a substantial decrease in the amount of marital property subject to division by the Court; [Donald Knapp] squandered in excess of $7000.00 of [Patty Knapp's] earnings while she was in Saudi Arabia involved in the Gulf War; [Donald Knapp] has conveyed property in which [Patty Knapp] had a marital interest in excess of $42,000.00 to third parties without adequate consideration and without the consent of [Patty Knapp]; and further [Patty Knapp] has made significant contributions to the marital estate from her earnings and accumulation of assets and reduction of debts all such that a disproportionate division of the marital assets of the parties is justified.

The trial court awarded Patty Knapp $122,470.28 in marital assets and designated $130,966.66 of the couple's debt to her. It awarded $70,930.62 in marital assets to Donald Knapp and designated $57,587.33 of the couple's debt to him.

I.

Donald Knapp contends the trial court erred in making a disproportionate division of marital property in favor of Patty Knapp. He argues that the trial court's findings were not supported by substantial evidence, or at least were against the greater weight of the evidence. He is correct, in part, but we fail to understand how he has been prejudiced. He also contends that the trial court's division of marital property was not justified under § 452.330, RSMo Cum.Supp.1993. ¹ We disagree.

A.

The trial court awarded Patty Knapp $51,539.66 more assets than it awarded to Donald Knapp, but, on the liability side, it designated $73,379.33 more debt to Patty Knapp than to Donald Knapp. The net effect favors Donald Knapp. Assuming that the trial court did give a disproportionate share of the marital property to Patty Knapp as it suggests that it did, we fail to discern how Donald Knapp was prejudiced.

"Debts of the spouses are not marital property, but the existence of the debts and who has the responsibility for paying them are factors the trial court should consider in a fair division of the marital property." Zimmer v. Zimmer, 862 S.W.2d 355, 359 (Mo.App.1993). Had the trial court divided the assets and debts evenly, Donald Knapp would have enjoyed a positive cash position of only $2423.45. As it stands, he has a positive cash position of $13,343.29. ²

Although we agree with Donald Knapp that the record does not support the trial court's conclusion that he squandered more than $7000 of the funds Patty Knapp earned fighting in the Gulf War or that she had a marital interest of more than $42,000 in property transferred by him without Patty Knapp's consent, we fail to descry prejudice to Donald Knapp for the same reason. The net effect of the trial court's division of assets and liability was favorable to Donald Knapp given the court's designation of $73,379.33 more debt to Patty Knapp than designated to Donald Knapp.

B.

Moreover, § 452.330.1(2) provides that the court may consider the contributions of each spouse to the acquisition of marital property. See In re Marriage of Gourley, 811 S.W.2d 13, 21 (Mo.App.1991). Although the court certainly may consider the nonmarital contributions made by a spouse, the source of the contributions does not have to stem solely from nonmarital assets or funds. The evidence supports a finding that Patty Knapp contributed significantly more to the acquisition of marital assets and to the reduction of debts than Donald Knapp did, and it was proper for the court to consider their relative contributions in apportioning marital assets. With regard to the reduction of debts, the record shows that Patty Knapp made all of the mortgage payments on the marital residence. Included in that mortgage is $28,000 of Donald Knapp's business debts and judgments. She also is responsible for the repayment of a $20,000 business debt incurred by her husband, and she must pay the Internal Revenue Service for delinquent taxes related to Donald Knapp's business dealings. In light of this, we fail to understand how the trial court abused its discretion merely by awarding a larger share of the marital estate to Patty Knapp.

Donald Knapp argues that the trial court placed undue emphasis on the relative earnings of each spouse during the marriage and the wife's larger contribution of marital income. In its decree, the trial court said that it had considered "all relevant factors, including those set forth in section 452.330.1." The contributions of each spouse is one of the factors to be considered by the court. We presume the court's decree to correctly divide marital property. Klein v. Klein, 837 S.W.2d 567, 569 (Mo.App.1992). We will not interfere with the trial court's findings without a clear showing that the property division so favors one spouse as to amount to an abuse of discretion. Gremaud v. Gremaud, 860 S.W.2d 354, 356 (Mo.App.1993). That one party receives a larger share of marital assets is not a per se abuse of discretion. Id. Substantial evidence supports the trial court's findings.

C.

Donald Knapp also claims that the property division was unjust because the court did not adequately consider the nonmarital property set aside to each party. In the decree, the court awarded to him the Green Street property ($8,000), an interest in the estate of his sister ($25,204.62), and a judgment in the amount of $3,400 along with miscellaneous cars, motorcycles, tools, guns and furniture. Donald Knapp complains that his wife was allowed to keep her entire interest in her teacher's pension valued at approximately $61,000. ³ However, the record also indicates that Patty Knapp did not acquire social security benefits through her employment as a teacher while Donald Knapp did acquire social security benefits through his employment. In any event, the trial court is not required to make an equal division of property. Duebelbeis v. Duebelbeis, 735 S.W.2d 106, 107 (Mo.App.1987). In considering all of the evidence in the record as well as the relevant factors set forth in § 452.330, we conclude that the court did not abuse its discretion in apportioning the marital assets in favor of Patty Knapp.

II.

Donald Knapp complains that the trial court erred in determining that the entire value of the property at 204 South 31st Street was Patty Knapp's nonmarital property. He argues that §§ 452.330.2(5) and 452.330.3 ⁴ entitle him and the marital estate to a share in the property's value because marital funds were used to acquire it, marital funds were used to make mortgage payments during the marriage, and his labor increased its value. We disagree.

The trial court has much discretion in determining such matters, and we will not disturb its decision without a clear showing that it abused its discretion. Klein, 837 S.W.2d at 569. We presume the trial court's order dividing marital property is correct, and the party challenging it has the burden of overcoming this presumption. Id.

Donald Knapp claims that he is entitled to a share of the property under the "source of funds" rule because marital funds were used to acquire it and because the value of the property increased as a result of his labor. Under the rule, property is classified as marital or nonmarital according to the source of the funds which financed the purchase. If...