Krage v. Krage

• Decision Date: 17 May 1982
• Docket Number: No. 13554,13554
• Citation: 329 N.W.2d 878
• Parties: Violet V. KRAGE, Plaintiff and Appellant, v. Leroy KRAGE, Defendant and Appellee. . Considered on Briefs
• Court: South Dakota Supreme Court

Page 878

329 N.W.2d 878

Violet V. KRAGE, Plaintiff and Appellant, v. Leroy KRAGE, Defendant and Appellee.

No. 13554.

Supreme Court of South Dakota.

Considered on Briefs May 17, 1982.

Decided Feb. 9, 1983.

Daniel R. Fritz of Maloney, Kolker, Fritz, Hogan & Johnson, Aberdeen, for plaintiff and appellant.

Joe L. Maynes of Maynes, Tonner, Maynes & Tobin, Aberdeen, for defendant and appellee.

MORGAN, Justice.

This appeal arises from a decree of divorce that terminated a marriage of some twenty-eight years. Appellant, Violet Krage (wife), appeals from the trial court's division of property, refusal to grant alimony, and award of attorney fees in the decree. We affirm.

Wife instituted a suit for divorce against appellee, Leroy Krage (husband), on the grounds of extreme cruelty. Husband cross-claimed against wife on the same grounds. Five children had been born of the marriage but all were physically and mentally competent and over the age of twenty-one years at the time of the divorce. After hearing the evidence, the trial court found that each party had inflicted extreme mental cruelty upon the other and thus granted each a divorce. The balance of the findings of fact, conclusions of law and decree will be discussed where pertinent.

We first examine the allegations that the trial court inequitably divided the property and failed to award alimony. The trial court is granted broad discretion in making an equitable property division and granting alimony, but, must rest its decision upon several factors as they appear material to the facts and circumstances of each specific case. Wallahan v. Wallahan, 284 N.W.2d 21 (S.D.1979); Lien v. Lien, 278 N.W.2d 436 (S.D.1979); Hanson v. Hanson, 252 N.W.2d 907 (S.D.1977); SDCL 25-4-41, 44. Although the trial court is not bound by mathematical formula in making a property division, the factors considered in this division are: " '[t]he duration of the marriage, the value of the property of each, their ages, their health and competency to earn, the contribution of each to the accumulation of the property[.]' " Hanson, supra at 908. While SDCL 25-4-45.1 removed fault from consideration of a property division, fault is still considered in awarding alimony to either of the parties. Hanks v. Hanks, 296 N.W.2d 523 (S.D.1980). In addition to the factors considered in making a property division, an alimony award is also based upon the respective financial conditions of the parties after the property division and their standard of living. Hanks, supra; Kittelson v. Kittelson, 272 N.W.2d 86 (S.D.1978); Guindon v. Guindon, 256 N.W.2d 894 (S.D.1977). The trial court's award of alimony and the division of property are considered together on appeal to determine whether the trial court abused its discretion. Wallahan, supra; Lien, supra.

The trial court's findings set out an exhaustive accounting of the property. For the sake of brevity, at this point, we note that the trial court found the fair market value of the marital assets consisting largely of ranch real estate and personal property to be $1,518,215.00, and the existing indebtedness to be $754,961.07. It further found that husband had contributed premarital assets and inheritance of a value of $48,450.00, and wife had contributed premarital assets of $1,000.00 value. After deducting the premarital assets, the court determined the net worth to be $713,803.93.

As to specific valuations, wife claims that the court undervalued the cattle and the land. We note that this court's review of the valuation is limited to determining whether there was an equitable division of the property except for assets overlooked or minimized by mortgages, which may or may not be legitimate liens against marital property. Kittelson, supra. Moreover, we do not require exactitude in valuation. The valuation need only be within a reasonable range. Hanks, supra. Wife's expert placed a valuation on the land of $1,247,500.00. Husband's expert valued it at $953,250.00. The trial court fixed the land valuation at $1,000,000.00. As to the livestock, wife's expert had valued it at $562,930.00 and husband's expert had valued it at $350,963.00. The trial court valued the livestock at $400,000.00. We find both these valuations by the trial court reasonably within the range of the evidence.

We then turn to the division of the property between wife and husband which amounted to approximately a forty/sixty split respectively. The trial court found that an in-kind distribution of property would destroy the ranch as an economic unit and create undue tax liability. As in Hanson, supra, the trial court here determined that the farm/ranch business was best kept as an economic unit. Husband received all of the real estate, buildings, equipment, machinery, motor vehicles, tools and livestock, and his personal effects. The trial court made this award subject to husband paying wife a cash award. Should the husband fail to obtain funds or financing to meet the payments, all the property, both real and personal, would be sold and the proceeds used to fulfill husband's obligation to wife. Wife received a $272,700.00 cash award, plus her original contribution of $1,000.00 to the marriage. This amount is payable over a nine-year period, with an immediate payment of $61,000.00 and the balance at ten percent interest per annum, amounting to a total principal and interest of $332,400.06. Wife also received a 1977 Cadillac valued at $7,500.00, plus $5,000.00 of home furnishings. The result of this forty/sixty split is that even though the indebtedness represented 49.73% of the parties' marital assets, the wife received everything free and clear of indebtedness. ¹

Based on the variances of husband's income, the restricted cash flow in a ranch operation, and the substantial property awarded wife, the trial court did not award alimony to wife. The trial court apparently had a pattern according to which it distributed the marital property. Similarly, we noted a pattern of distribution in Wallahan in which we stated, "[i]t is clear from the decree in this case that the trial court attempted to create a scheme of distribution which would take into account as fully as possible any immediate tax consequences without indulging in speculation as to possible tax liabilities which might theoretically arise." 284 N.W.2d at 26. We are hesitant to modify a judgment that follows a well-considered pattern of distribution. ² Moreover, as to the trial court's balancing of the factors to be considered in awarding alimony, we have examined the findings of fact and find that the trial court has considered all of these factors. Noting additionally that the trial court found both parties at fault, we cannot say from the record that the trial court was clearly erroneous in failing to award alimony.

Wife urges that the trial court erroneously considered conjectural, not necessary or probable, tax consequences of the property distribution. As this court said in Wallahan, 284...