Landewee v. Landewee

• Decision Date: 25 April 2017
• Docket Number: No. SC 95918,SC 95918
• Citation: 515 S.W.3d 691
• Parties: Kathryn J. LANDEWEE, Appellant, v. John E. LANDEWEE, Respondent.
• Court: Missouri Supreme Court

515 S.W.3d 691

Kathryn J. LANDEWEE, Appellant,

v.John E. LANDEWEE, Respondent.

No. SC 95918

Supreme Court of Missouri, en banc .

April 25, 2017

Laura Clubb, The Clubb Law Firm LLC, Cape Girardeau, for Kathryn J. Landewee

John P. Heisserer, Rice, Spaeth, Summers and Heisserer LC, Cape Girardeau, for John E. Landewee.

George W. Draper III, Judge

Kathryn J. Landewee (hereinafter, "Wife") appeals the trial court's judgment dissolving her marriage to John E. Landewee (hereinafter, "Husband"). Wife claims the trial court erred in: (1) failing to equitably divide the marital assets and debts in a manner that is definite and capable of enforcement; (2) assigning no present value to Husband's defined benefit pension plan through the Missouri Local Government Employees Retirement Benefit Plan (hereinafter, "LAGERS"); and (3) not considering the factors in section 452.330, RSMo 2000,¹ which resulted in an unfair, unjust, and unconscionable property division ordering Wife to pay Husband an equalization share. This Court has jurisdiction over this appeal under article V, section 10, of the Missouri Constitution, because it granted transfer after opinion by the court of appeals. The trial court's judgment is affirmed.

Factual and Procedural Background

Wife and Husband were married in 1991. During their marriage, Wife and Husband had two children.² Wife and Husband acquired the property and debts of Knaup Floral, Inc. (hereinafter, "Knaup Floral"), Wife's family's business. Additionally, Knaup Floral was connected by a breezeway to their marital home. At the time of their divorce, Wife owned and worked at Knaup Floral, and Husband worked for the city of Cape Girardeau.

The trial court divided the marital debts and assets, awarding Wife: Knaup Floral, along with the real estate, vehicles, and the bank account associated with Knaup Floral; the marital home connected to Knaup Floral; her retirement account; two life insurance policies; her personal bank account; and the debt on two credit cards. The trial court awarded Husband: Husband's LAGERS pension, a vehicle, Husband's retirement account, four life insurance policies, and Husband's bank account. In order to equalize the awards, the trial court ordered Wife to pay Husband $196,496.50.

Further, the trial court found a portion of Husband's LAGERS pension was marital property. Yet, any pension benefit could not be accessed until Husband retired, and if Husband were to die prior to retirement, there would be no pension benefit payable to either Wife or Husband. The trial court noted LAGERS is exempt from the terms of ERISA and cannot be divided by a qualified domestic relations order (hereinafter, "QDRO"). Accordingly, the trial court determined the LAGERS pension had no value at the time of the dissolution, and it ordered: "[Husband] shall pay to [Wife] the sum of $687.00 (half of the accrued marital benefit of $1,374.00 per month) less applicable income taxes per month beginning on the first day of the first month that [Husband] both becomes eligible to receive such benefits and does, in fact, receive such benefits from LAGERS."

Wife appealed, challenging the trial court's distribution of marital property. Following opinion by the Missouri Court of Appeals, Eastern District, this Court granted transfer.

Standard of Review

This Court must sustain the trial court's judgment in a dissolution case "unless there is no substantial evidence to support it, unless it is against the weight of the evidence, unless it erroneously declares the law, or unless it erroneously applies the law." Murphy v. Carron , 536 S.W.2d 30, 32 (Mo. banc 1976) ; see also Simpson v. Simpson , 352 S.W.3d 362, 363 (Mo. banc 2011). This Court accepts as true the evidence and reasonable inferences therefrom in the light most favorable to the trial court's judgment, and disregards all evidence and inferences to the contrary. In re Marriage of Hillis , 313 S.W.3d 643, 644 (Mo. banc 2010). "The burden of demonstrating error is on the party challenging the divorce decree." Hernandez v. Hernandez , 249 S.W.3d 885, 888 (Mo. App. W.D. 2008).

"The trial court has broad discretion in identifying, valuing, and dividing marital property." Alabach v. Alabach , 478 S.W.3d 511, 513 (Mo. App. E.D. 2015). This Court will interfere with the trial court's distribution of marital property only if the division is so heavily weighted in favor of one party as to amount to an abuse of discretion. Rallo v. Rallo , 477 S.W.3d 29, 38 (Mo. App. E.D. 2015).

Discussion

Wife raises three allegations of error, each focused upon the trial court's division of marital property.

Equitable Distribution Capable of Enforcement

First, Wife argues the trial court failed to equitably divide the marital assets and debts in a manner that is definite and capable of enforcement as required by section 452.330. Wife asserts the trial court's judgment is inconsistent with the legislative intent of the Dissolution of Marriage Act. Specifically, Wife contends she should be awarded an immediate division of Husband's LAGERS pension.

Section 452.330.1 governs property division, and it provides the trial court "shall set apart to each spouse such spouse's nonmarital property and shall divide the marital property and marital debts in such proportions as the court deems just after considering all relevant factors." "Retirement benefits are considered marital property and are subject to division, unless they were accumulated prior to the marriage." Rallo , 477 S.W.3d at 39. Reaching a fair and equitable division of pension benefits requires careful consideration by the trial court of the unique circumstances of each case and the type of pension being divided. Kuchta v. Kuchta , 636 S.W.2d 663, 664 (Mo. banc 1982).

In Kuchta , this Court recognized three general periods of time when a dissolution could occur with the corresponding status of a pension plan: (1) before a plan vests; (2) after a plan vests, but before it matures; and (3) after a plan vests and matures. Id. at 665. It is clear a trial court may act with a reasonable amount of certainty in dividing a pension plan either before it vested or after it vested and matured. Id. Division of a pension that has vested but not matured, e.g., when there is no right to receive benefits until reaching a designated retirement age, presents the most difficulty. Id. "Because of the untold number of ‘pension plans' which appear to have their own singular and unique requirements for meeting ‘vesting’ and ‘maturing’ provisions, it is imperative that trial courts be authorized to apply a flexible approach to accommodate the particular facts of each case." Id.

In this case, Husband has no guarantee he will receive any LAGERS pension benefits because he could predecease the pension's maturation. Accordingly, the LAGERS pension has vested but not matured. The trial court assigned the LAGERS pension a present value of zero at the time of division because neither Husband nor Wife has any ability or right to access those funds and, therefore, receipt of any pension benefit still was contingent. However, the trial court ordered Husband to pay Wife a specific amount if and when he begins receiving his pension benefits. The trial court's future, as opposed to present, distribution of the vested, non-matured LAGERS pension contemplated the fact that Husband may never receive a distribution from his LAGERS pension. The trial court equally divided, between Wife and Husband, the risk the LAGERS pension will fail to mature.

Further, and in juxtaposition to Wife's assertion, the trial court's judgment is sufficiently clear and specific as to be capable of enforcement in a civil contempt proceeding. "Dissolution decrees, as well as the property agreements incorporated therein, are enforceable like any other judicial judgment." In re Marriage of Erickson , 419 S.W.3d 836, 840 (Mo. App. S.D. 2013) (quoting Booher v. Booher , 125 S.W.3d 354, 356 (Mo. App. E.D. 2004) ). "The purpose of civil contempt is to ‘benefit a party for whom an order, judgment, or decree was entered’ by coercing compliance with the relief granted." Davis v. Davis , 475 S.W.3d 177, 181 (Mo. App. W.D. 2015) (quoting In re Marriage of Crow and Gilmore , 103 S.W.3d 778, 780 (Mo. banc 2003) ).

Wife urges this Court to reverse the trial court's judgment, implementing the same analysis as in Joyner v. Joyner , 460 S.W.3d 467 (Mo. App. W.D. 2015). In Joyner , the trial court awarded the wife a larger portion of the husband's LAGERS pension account to offset an unequal division of marital property. Id. at 470. Further, the trial court found the wife was to be paid her portion of the pension "when and if" the husband received any benefit. Id. at 472. The trial court employed this division because the LAGERS pension account was not subject to a QDRO, which would allow the designation of an alternative payee when the husband started receiving his pension benefits. Id. at 471–72.

The Western District reversed the trial court's judgment, stating "Even if this ‘deferred distribution’ is considered on the order of a division of marital property in the form of an award of future, contingent maintenance ... such a disposition is wrong ...." Id. at 475. The Western District found the trial court's judgment did "not satisfy the court's obligation to equitably divide all of the couple's marital property and debts in a manner that is definite and capable of enforcement." Id.

The Western District remanded the case "with instructions to reallocate the overall division of property after setting aside the pension to" the husband. Id. at 476. While the Joyner judgment was incapable of being enforced, Joyner does not mandate that every case needs to be remanded to set aside a LAGERS pension to the party who earned it and reallocate the marital property division.

Further, Joyner is factually distinguishable from the instant case. In Joyner , the wife was ordered to receive benefits, but no specific person or entity...