LaBuda v. LaBuda

• Court: Pennsylvania Superior Court
• Writing for the Court: Before SPAETH; HOFFMAN
• Citation: LaBuda v. LaBuda, 503 A.2d 971, 349 Pa.Super. 524 (Pa. Super. Ct. 1986)
• Decision Date: 28 January 1986
• Parties: Dorothy M. LaBUDA v. Joseph L. LaBUDA, Appellant. 00729 Phl 85

Page 971

503 A.2d 971

349 Pa.Super. 524

Dorothy M. LaBUDA v. Joseph L. LaBUDA, Appellant.

00729 Phl 85

Superior Court of Pennsylvania.

Argued Sept. 10, 1985.

Filed Jan. 28, 1986.

Mark Malkames, Allentown, for appellant.

Raymond J. DeRaymond, Easton, for appellee.

Before SPAETH, President Judge, and HOFFMAN and HESTER, JJ.

HOFFMAN, Judge:

This is an appeal from the judgment of the lower court entered in accordance with the court's order and accompanying memorandum opinion of February 25, 1985. The order provided, inter alia, for the equitable distribution of the parties' marital property. For the following reasons, we vacate the judgment, affirm in part and reverse in part the court's order, and remand for further proceedings consistent with this opinion.

The parties married on February 1, 1947, (Master's Report at 3), and separated on July 4, 1980, (id. at 14). On November 5, 1981, appellee wife filed a complaint in divorce. Appellant husband answered, and, on December 22, 1981, the lower court appointed a special master to hear testimony and file a report with recommendations concerning the following claims: marital dissolution, equitable apportionment of marital property, permanent alimony, and counsel fees and costs. See Pa.R.Civ.P. 1920.51(a)(1). Hearings were scheduled and held from June 4, 1982, to January 19, 1984. On September 14, 1984, the master filed his report. See generally id. 1920.53, 1920.54. On September 24, 1984, both parties filed exceptions to the master's report. See id. 1920.55(a). After making several corrections to the master's report based on the parties' exceptions, the lower court decreased the total value of the marital estate from $233,758.10 to $204,758.10. The court did not, however, disturb the master's recommended division of the marital property; appellee was awarded a fifty-five percent share of the marital estate, and, to the extent each party's pension was marital property, each party was to share equally in the other's pension. This appeal followed.

Appellant raises four issues ¹ challenging the lower court's award. We will not upset the trial court's equitable distribution award absent a clear abuse of discretion. Ruth v. Ruth, 316 Pa.Superior Ct. 282, 286, 462 A.2d 1351, 1353 (1983). Under this standard, we do not usurp the trial court's duty as fact finder. ² Id. at 287, 462 A.2d at 1353. We do, however, "carefully scrutinize" each of the Divorce Code, 23 P.S. §§ 101-801, factors to be considered by a court when equitably distributing marital property, see id. § 401(d), in determining whether the court below abused its discretion. ³ Ruth v. Ruth, supra at 287, 462 A.2d at 1353. Furthermore, "an abuse of discretion will be found by this court if the trial court failed to follow proper legal procedures or misapplied the law." Braderman v. Braderman, 339 Pa.Superior Ct. 185, 191, 488 A.2d 613, 615 (1985). With this standard of review in mind, we turn to appellant's contentions.

I. The 50/50 "Starting Point"

Appellant first contends that the master, relying on Paul W. v. Margaret W., 130 P.L.J. 6 (Ct.C.P. Allegheny County 1981), erred in stating that, in equitably distributing the marital property, "the starting point for considering all relevant factors should be an equal division of [the] marital property." (Master's Report at 6). Appellant cites Ruth v. Ruth, supra, for the proposition that, in view of the factors set forth in 23 P.S. § 401(d), there is no need to resort to a "presumptive starting point." We find that the master's use of a 50/50 starting point was proper.

In Paul W. v. Margaret W., the court held that an equal division of the marital property was the "only appropriate starting point" for equitably distributing the marital property. Paul W. v. Margaret W., supra at 8. We are persuaded by the court's rationale in adopting such a starting point. The court first noted that "there is no way to weigh the [§ 401(d) ] factors against each other without a starting point at which to begin the weighing process." Id. In choosing an equal division of the marital property to be that starting point, the court noted the following: (1) if the § 401(d) factors favor neither party, any other distribution would not "insure a fair and just determination and settlement of [the parties'] property rights," 23 P.S. § 102(a)(6); (2) because historically property jointly owned by the parties was divided equally and the Divorce Code gives each party an interest in property acquired during the marriage, see id. § 401(f), the Legislature must have intended that the martial property be divided equally when consideration of the § 401(d) factors did not result in a distribution in favor of one of the parties; and (3) this starting point is consistent with the notion of marriage "as a shared enterprise or joint undertaking in which both parties contribute to the acquisition and preservation of marital assets" and where "full recognition is to be given to non-economic contributions." Paul W. v. Margaret W., supra at 8-9.

Appellant's reliance on Ruth v. Ruth, supra, is misplaced. There, in discussing our abuse of discretion standard of review in equitable distribution cases, we stated that

we [would] not choose to follow presumptions in the hope of achieving the legislature's goal of "economic justice." At oral argument ... a suggestion was made by counsel for the parties that this Court adopt "guidelines" or establish "presumptions" to be applied in deciding issues involving property rights under the [Divorce] Code. In view of the legislative guidelines [that] are set out [in 23 P.S. § 401(d) ], we [saw] no need for this Court to enumerate additional criteria.

Id. 316 Pa.Superior Ct. at 287, 462 A.2d at 1353. Here, appellant questions the master's use of a starting point; he is not questioning our use of such a point "in determining whether or not the lower court abused its discretion." Id. In any event, we are not establishing any presumptions or guidelines. As the Paul W. v. Margaret W. court put it: "Equality is not a formula for distribution but only a starting point at which the court will begin to weigh the factors presented in [a] particular case." Paul W. v. Margaret W., supra at 10. Thus the use of a 50/50 starting point is not an end to the matter of equitable distribution. A court must then apply the § 401(d) factors to reach an equitable distribution. That is exactly what was done in the instant case: in approving the master's division of the marital property, the lower court noted that "he also considered all the factors for equitable distribution set forth in Section 401(d) of the Divorce Code, thereby arriving at a 45/55 division of marital assets." (Lower Court Opinion at 4). ⁴ We wish to make clear, then, that "equitable does not automatically mean equal." N. Perlberger, Pennsylvania Divorce Code § 5.2 at 3 (1980); see also Semasek v. Semasek, 331 Pa.Superior Ct. 1, 11, 479 A.2d 1047, 1052 (1984) (concept of equitable distribution is not an equal division of the marital property). Accordingly, because we find no error in the master's use of a 50/50 starting point, we find this contention meritless. ⁵

II. When is Property Acquired After Separation Marital Property?

Appellant next contends that certain property that he received after he and appellee separated is not marital property. Specifically, appellant claims that "retirement incentives," a "lump-sum retirement incentive," and a portion of his Bethlehem Steel Savings Plan were improperly included in the marital estate by both the master and the lower court. ⁶

"Marital property" is defined generally as follows:

All property, whether real or personal, acquired by either party during the marriage is presumed to be marital property regardless of whether title is held individually or by the parties in some form of co-ownership such as joint tenancy, tenancy in common or tenancy by the entirety. The presumption of marital property is overcome by a showing that the property was acquired by a method listed in subsection (e).

23 P.S. § 401(f). However, "[p]roperty acquired after separation until the date of divorce" is not marital property. Id. § 401(e)(4). Reading these two provisions together, we find that the § 401(f) presumption merely begs the question here: when was the property acquired?

We agree with appellant that he received the above three items of property after he separated from appellee. But that is not an end to the question. This Court has noted: "It is acknowledged in jurisdictions requiring the distribution of marital property that a spouse has a right, co-extensive with that of a wage-earner spouse, to a portion of retirement benefits accrued during marriage." Flynn v. Flynn, 341 Pa.Superior Ct. 76, 82, 491 A.2d 156, 159 (1985) (emphasis added). We have also stated that to deny one spouse a share of the other's retirement benefits would deny the former something he or she "helped to achieve during the marriage." Braderman v. Braderman, supra at 194, 488 A.2d at 617. "Each spouse has a reasonable expectation of enjoying the monies received from an employee retirement fund." Id. at 194, 488 A.2d at 617. Accordingly, we have held:

Since a pension benefit is an economic resource acquired with funds that would otherwise have been utilized by the parties during their marriage to purchase other assets, it constitutes marital property. This determination is made without regard to the possibly contingent nature of the pension, whether or not it has vested or matured.

Flynn v. Flynn, supra at 83, 491 A.2d at 160. See generally Braderman v. Braderman, supra at 192, 488 A.2d at 616 (distinguishing among types of retirement or pension benefits). However, "only that portion of the pension attributable to the period commencing with the marriage and ending on the date of separation is marital property within the meaning of the Divorce Code." King v. King, 332 Pa.Superior Ct. 526, 530, 481...