Lynnes v. Lynnes

• Decision Date: 17 April 2008
• Docket Number: No. 20070274.,20070274.
• Citation: 2008 ND 71,747 N.W.2d 93
• Parties: David E. LYNNES, Plaintiff and Appellee v. Carrie L. LYNNES, Defendant and Appellant.
• Court: North Dakota Supreme Court

747 N.W.2d 93

2008 ND 71

David E. LYNNES, Plaintiff and Appellee v. Carrie L. LYNNES, Defendant and Appellant.

No. 20070274.

Supreme Court of North Dakota.

April 17, 2008.

Tracy J. Lyson (argued) and Timothy M. O'Keeffe (on brief), Kennelly & O'Keeffe, Ltd., Fargo, ND, for plaintiff and appellee.

Mark R. Fraase (argued), Johnson, Ramstad & Mottinger, PLLP, Fargo, ND, for defendant and appellant.

KAPSNER, Justice.

[¶ 1] Carrie Lynnes appeals an amended judgment divorcing Carrie and David Lynnes, dividing the parties' marital estate, providing Carrie Lynnes rehabilitative spousal support for a period of two years, and awarding Carrie Lynnes $2,000 in attorney fees. We conclude the district court erred in failing to include all the marital debts and assets in calculating the total marital estate before analyzing the Ruff-Fischer guidelines to divide the marital estate. We affirm the divorce decree and award of attorney fees, but reverse and remand the amended judgment for further proceedings consistent with this opinion.

I

[¶ 2] David and Carrie Lynnes were married on June 23, 2001. There were no children born of the marriage, but David Lynnes adopted Carrie Lynnes's twin boys, Adam and Nathan, during the marriage. The boys were 19 years old at the time of trial and are no longer dependent upon David and Carrie Lynnes. The couple separated in July 2006, and an amended judgment awarded the couple a divorce in September 2007.

[¶ 3] Before marriage, David Lynnes graduated from high school and then attended a nine-month welding program at Moorhead Tech in 1991. He worked from 1991 through 1995 for Robert Gibb & Sons. From 1995 to 1996 he worked for Dakota Fence Company. He then returned to Robert Gibb & Sons, until he started a business in 2004. At the time of the divorce, David Lynnes's annual salary from his businesses was approximately $76,000, and he took draws from the businesses of approximately $26,000, totaling $103,000 per year.

[¶ 4] Carrie Lynnes worked at Dakota Fence at the time the parties began dating. She left Dakota Fence and went to work at Knight Printing. Both of these positions paid about $25,000 per year. After high school, Carrie Lynnes took some college classes in 1984. She later attended a cosmetology program, graduating in 1985. She continued her education and graduated from Northwest Technical College in 1990 or 1991 and attended additional college classes in 1991 or 1992. During the marriage, Carrie Lynnes decided to pursue a career in real estate. She obtained her license and began working for Coldwell Banker on July 18, 2006. The divorce was tried about nine months after she began her career at Coldwell Banker, and her realized commissions from sales of real estate grossed $11,597. The district court found that although Carrie Lynnes's present income was substantially less than David Lynnes's, her income would increase over time and she was capable of working and earning at least $25,000 per year.

[¶ 5] At the time of trial, David Lynnes was 37 years old, and Carrie Lynnes was 42. The district court found both David and Carrie Lynnes to be in relatively good health. The district court found the parties are both capable of working, though at present there exists a discrepancy in their respective earning capacities; David Lynnes's present earning capabilities are nearly four times that projected for Carrie Lynnes.

[¶ 6] Before marriage, David Lynnes owned some personal property and retirement and pension accounts. Carrie Lynnes owned some personal property, and she also had student loan debt. While married, the parties accumulated additional retirement funds, a life insurance policy, and various items of personal property. They also purchased a home, two vehicles, and began three businesses.

[¶ 7] During the marriage, David Lynnes started two businesses, Dave's Welding and Lynnes Welding and Training, and had a 45 percent interest in a third business, Lynnseth, Inc., which was started in July 2006. The district court found the businesses were started with funds from David Lynnes's 401(k) plan of approximately $31,000. A small portion of the 401(k) funds were accumulated during the parties' marriage. Carrie Lynnes worked at the business for a short period of time cleaning up the shop and working as a secretary or receptionist. Dave's Welding and Lynnes Welding and Training were valued by Special Master Leonard Sliwoski as having a total value of $59,000. Lynnseth, Inc. was given a zero value with a contingent asset or liability, which could not be quantified at the time of trial. The district court found the businesses are personal to David Lynnes, meaning he used premarital assets and skills to start up the businesses, and the businesses would cease to exist without him.

[¶ 8] The district court determined both parties were at fault for the breakdown of the marriage. David Lynnes engaged in an extramarital affair with an employee, who became pregnant with his child. Carrie Lynnes's misconduct during the marriage involved dishonesty and poor handling of the parties' finances.

[¶ 9] The district court issued findings of fact, conclusions of law, and order for judgment on June 6, 2007, setting forth the parties' marital estate and dividing the assets and debts between the parties. Carrie Lynnes subsequently moved the district court to amend the findings of fact on June 22, 2007. The district court issued amended findings of fact and order for amended judgment on August 22, 2007. The amended findings of fact awarded Carrie Lynnes additional property, awarded rehabilitative spousal support for two years in the amount of $1,500 per month, and provided David Lynnes would pay $2,000 of Carrie Lynnes's attorney fees. Under the amended judgment, the assets awarded to Carrie Lynnes totaled $165,689, and the debt assigned to her was $117,173, leaving a net award of $48,515, not including the student loan debt of $4,165. David Lynnes was awarded assets valued at $119,221 and debt in the amount of $19,590. The district court analyzed the Ruff-Fischer guidelines, but failed to include $4,165 of Carrie Lynnes's student loan debt i when calculating the marital estate. The district court failed to consider and assign two small debts, totaling $817 in the findings and judgments. The district court also failed to include a $1,500 asset, a TransAm owed by David Lynnes before the marriage, when calculating the total marital estate.

[¶ 10] The amended judgment was entered on September 6, 2007, and a second amended judgment was entered on September 24, 2007. Carrie Lynnes's notice of appeal, however, was filed after the notice of entry of amended judgment, but before the second amended judgment. Carrie Lynnes appeals the amended judgment, arguing the district court erred in valuing the businesses, calculating the marital estate, and awarding spousal support and attorney fees.

II

[¶ 11] "The right of appeal in North Dakota is governed by statute, and is a jurisdictional matter which the Supreme Court will consider sua sponte." Sabot v. Fargo Women's Health Org., Inc., 500 N.W.2d 889, 895 (N.D.1993) (citing Vorachek v. Citizens State Bank of Lankin, 421 N.W.2d 45, 49 (N.D.1988)). See also N.D. Const, art. VI, § 6. Appeals are authorized from final judgments. N.D.C.C. § 28-27-01; N.D.C.C. § 28-27-02. We note these appellate rules because we review the amended judgment in this case, rather than the second amended judgment entered by the district court after Carrie Lynnes filed her notice of appeal. We treat this as an appeal from the amended judgment only. In the absence of a remand, the trial court had no jurisdiction to further amend the judgment once the appeal was filed. E.g., Peters-Riemers v. Riemers, 2003 ND 96, ¶ 16, 663 N.W.2d 657 (citing Wilson v. Koppy, 2002 ND 179, ¶ 6, 653 N.W.2d 68) ("With some exceptions, a trial court loses its jurisdiction when a notice of appeal is filed."). Further, because the second amended judgment was filed after the notice of appeal, which specifies Carrie Lynnes appeals the amended judgment, the second amended judgment entered by the district court is not properly before this Court, and we do not consider the second amended judgment. Dvorak v. Dvorak, 2007 ND 79, ¶¶ 8-10, 732 N.W.2d 698 (citing N.D.R.App.P. 4(a)) (providing that when appellant fails to file an amended or separate notice of appeal for orders entered after a notice of appeal has been filed, the appellant's failure to do so precludes appellate review of those motions and related judgments or orders).

A. Valuing the Business, Calculating the Net Marital Estate, and Dividing the Marital Property

[¶ 12] A district court's decisions regarding the division of marital property are treated as findings of fact and may be reversed on appeal only if these findings are clearly erroneous. Heinz v. Heinz, 2001 ND 147, ¶ 6, 632 N.W.2d 443. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, after reviewing the entirety of the evidence, this Court is left with a definite and firm conviction a mistake has been made. Id. (citations omitted).

[¶ 13] Carrie Lynnes argues the district court erred in calculating the value of the marital estate, alleging the trial court erred in (1) valuing the parties' businesses; (2) failing to include the student loan debt as marital debt when calculating the net estate and characterizing it instead as premarital; (3) failing to include the debt to David and Carol Wood as marital debt in calculating the net estate; (4) failing to assign two small marital debts to either party; and (5) failing to specifically include the parties' attorney fees as marital debt in calculating the marital estate.

[¶ 14] Marital property must be distributed equitably between the parties. Heinz, at ¶ 5. Although the division does not have to be equal, a substantial disparity must be explained. Lorenz v. Lorenz, ...