Marriage of Box, In re, 21796

• Decision Date: 07 April 1998
• Docket Number: No. 21796,21796
• Citation: 968 S.W.2d 161
• Parties: In re the MARRIAGE OF Robert James BOX and Virginia Lehe Box. Robert James BOX, Appellant, v. Virginia Lehe BOX, Respondent.
• Court: Missouri Court of Appeals

Page 161

968 S.W.2d 161

In re the MARRIAGE OF Robert James BOX and Virginia Lehe Box.

Robert James BOX, Appellant, v. Virginia Lehe BOX, Respondent.

No. 21796.

Missouri Court of Appeals,

Southern District,

Division One.

April 7, 1998.

Motion for Rehearing and/or transfer to

Supreme Court Denied April 28, 1998.

Application for Transfer Denied

June 16, 1998.

Daniel A. Parmele, Reynolds, Parmele & Gold, P.C., Springfield, for Appellant.

Scott B. Stinson, Mountain Grove, for Respondent.

CROW, Judge.

This is an appeal from a judgment dissolving the marriage of Robert James Box and Virginia Lehe Box. The issues this court must resolve concern a checking account into which Robert ¹--throughout the marriage--deposited his monthly Social Security check, his monthly pension check, and income from rental property he owned prior to the marriage.

The trial court awarded Virginia "$29,565.00 out of said account." Robert presents three claims of error attacking that award.

The parties married October 22, 1988. Robert was a widower, Virginia a divorcee. Their marriage was the third for each. At time of trial (January 14, 1997), Robert was 73, Virginia 70.

Robert had worked for John Deere Company from 1948 until 1977, when he retired. The pension mentioned in the first paragraph of this opinion vested upon his retirement.

At the time he married Virginia, Robert owned a duplex, debt-free. He and she resided in one unit throughout the marriage, until the separation. Robert rented the other unit to a tenant.

At the time of the marriage, Robert had a checking account--the one mentioned in the first paragraph of this opinion. A bank statement showed that on October 20, 1988 (two days before the marriage), the balance was $57,567.60.

Before the marriage, the parties signed an antenuptial agreement providing, inter alia:

" ... each party shall retain the real estate and personal property they now own in their own names with full power to convey or bequeath said property to their respective children or others without the other party having any rights thereto, and it is agreed that neither party shall upon or subsequent to said marriage acquire any interest, right, or claim in or to said real property or personal property described in the Schedules attached to this agreement."

The schedule of Robert's property attached to the agreement included, among other assets, the duplex and the checking account.

Robert never added Virginia's name to his checking account. Virginia maintained her own checking account during the marriage; Robert's name was never on it. Virginia deposited her Social Security checks into her account.

The parties separated September 11, 1996. A bank statement showed that on September 3, 1996 (eight days before the separation), the balance in Robert's checking account was $146,261.08--an increase of $88,693.48 during the marriage.

The trial court, in a perspicuous understatement, declared the parties led "a very frugal lifestyle during the course of the marriage," enabling Robert's checking account to grow by $88,694.28 between the date of the wedding and the date of separation. ² The trial court ruled that the increase, in its entirety, was marital property. As reported in the second paragraph of this opinion, the trial court awarded Virginia $29,565 (one-third of the increase). ³

The trial court held that $57,567.60 in Robert's account at the time of the separation was Robert's separate property. That sum, as we have seen, was the amount in the account two days before the parties married. The trial court awarded Robert all of the account except the $29,565 awarded Virginia.

The first of Robert's three points relied on avers the trial court erred in treating Robert's checking account as marital property ⁴ in that (a) it was one of the assets covered by the antenuptial agreement, and (b) the conduct of the parties during the marriage demonstrated they intended the account to be Robert's separate property, not marital property.

As reported in the first paragraph of this opinion, Robert deposited his monthly Social Security benefit, his monthly pension benefit, and the rental income from his duplex into his account. Those three sources, however, did not supply all of the money in the account.

Robert's account earned interest throughout the marriage. As this court comprehends the bank statements, the account earned $255.56 interest in October 1988, the month the parties married; the account earned $237.67 interest in the month preceding the separation. ⁵

Another, albeit negligible, source of funds for Robert's account was the gain he realized from buying, restoring, and selling five automobiles during the marriage. Robert testified, without contradiction, that he did not make a profit on every vehicle, and never made more than $1,000 on any.

Neither party was employed during the marriage, hence no wages went into either party's checking account.

Virginia testified that a year after she married Robert, her Social Security benefit increased to $350 per month. She avowed she spent all of it each month on food, automobile expenses, clothing, personal needs and household items.

Robert, from his account, paid the property taxes, insurance, utilities, trash disposal, and maintenance on the duplex. His health care insurance through John Deere covered the parties' medical expenses. Additionally, Robert testified he bought some of the groceries.

The version of § 452.330 in effect when the trial court entered judgment in the instant case was the version in RSMo 1994. It read, in pertinent part:

"2 .... 'marital property' means all property acquired by either spouse subsequent to the marriage except:

...

(4) Property excluded by valid written agreement of the parties; ...

...

3. All property acquired by either spouse subsequent to the marriage and prior to a decree of ... dissolution of marriage is presumed to be marital property regardless of whether title is held individually or by the spouses in some form of co-ownership such as joint tenancy, tenancy in common, tenancy by the entirety, and community property...."

It is well settled that where, during a marriage, a spouse receives interest earned by his or her non-marital property, the interest is marital property. Coleberd v. Coleberd, 933 S.W.2d 863, 869-70 (Mo.App. S.D.1996); Williams v. Williams, 716 S.W.2d 13, 15 (Mo.App. W.D.1986); Bizzell v. Bizzell, 697 S.W.2d 559, 562-63 (Mo.App. E.D.1985). Consequently, the interest earned by Robert's account after the wedding was marital property. Furthermore, to the extent that this postnuptial interest itself earned interest by remaining in Robert's account, the interest earned by the postnuptial interest was interest earned by marital property.

Where a spouse receives rental income from non-marital property during a marriage, the income is marital property. Coleberd, 933 S.W.2d at 868. Cf. In re Marriage of Schatz, 768 S.W.2d 607, 611 (Mo.App. S.D.1989). Consequently, Robert's rental income from his duplex during the marriage was marital property.

Additionally, the modest income Robert generated by buying, restoring, and selling five automobiles during the marriage was unquestionably marital property. § 452.330.2, supra.

All of the marital income identified in the three preceding paragraphs went into Robert's checking account, hence Virginia had a plausible claim that the $88,693.48 increase in the account during the marriage included marital property.

Endeavoring to defeat Virginia's claim, Robert's first point asserts the claim is barred by the antenuptial agreement or, alternatively, that the parties' conduct demonstrated they intended Robert's account to remain his separate property.

Among the cases cited by Robert in support of his first point, only one, Fuqua v. Fuqua, 765 S.W.2d 640 (Mo.App. W.D.1989), has facts resembling those in the instant case. In Fuqua, a husband and wife sold marital property, then divided the proceeds. Id. at 644. The wife put her share of the proceeds into an account in her sole name; the husband put his share of the proceeds into an account in his sole name. Id. Both parties testified they considered their respective accounts as their separate property. Id.

The trial court in Fuqua held each party's account was the separate property of that party. Id. Affirming that ruling, the appellate court held marital property can be transmuted into separate property if there is clear and convincing evidence that both parties intended that such property be excluded from their marital property. Id. at . The appellate court further held the parties' testimony constituted clear and convincing evidence that each party intended that each party's account be that party's separate property. Id.

Obviously, Fuqua is like the instant case in that each spouse maintained an account to which the other had no access. However, as explained in the next paragraph, there are significant differences between Fuqua and the instant case.

Virginia, reminded at trial about the antenuptial agreement, testified she asserted no claim to the amount Robert had in his checking account at the time she wed him. However, unlike the wife in Fuqua, who testified she intended all of the funds in the husband's account to be his separate property, Virginia never testified she intended the increase in Robert's account after she became his wife to be his separate property. Furthermore, to the extent that the increase in Robert's account constituted marital property, Virginia, unlike the wife in Fuqua, had no opportunity to participate with Robert in a transaction whereby the increase was transmuted from marital property into Robert's separate property. For those two reasons, this court holds Fuqua does not govern the instant case.

The trial court, in awarding Virginia $29,565 from Robert's checking account, implicitly held the antenuptial agreement did not bar Virginia from claiming that the increase in...