Marriage of Denton, Matter of
| Citation | 930 P.2d 239,145 Or.App. 381 |
| Decision Date | 24 December 1996 |
| Docket Number | C-35739 |
| Parties | In the Matter of the MARRIAGE OF Samuel Jonathon DENTON, Appellant, and Edna Fleischmann Denton, Respondent. 93; CA A86943. . * |
| Court | Court of Appeals of Oregon |
Russell Lipetzky, Salem, argued the cause, for appellant. With him on the briefs was Saucy & Lipetzky, P.C.
William C. Crothers, Salem, argued the cause, for respondent. With him on the brief was Crothers & Hansen, P.C.
Husband appeals a dissolution judgment that awarded wife, among other things, $15,000 per year as payment for her contribution to his "enhanced earning capacity," $2,000 per month indefinite spousal support and a portion of the parties' real estate and other holdings. Husband assigns error to the enhanced earning capacity award, to the award of spousal support and to the valuation of his business, which was a predicate to the distribution of the marital property. On de novo review, ORS 19.125(3), we conclude that the facts of this case do not justify an award for enhanced earning capacity, that the trial court's award of indefinite spousal support is not warranted under the circumstances and that the valuation of husband's business was correct.
The parties were married for 14 years before they separated in 1990. They had lived together for a few years before they married. At the time of trial, both husband and wife were 45. They had no children.
At the beginning of the marriage, wife had a high school education and worked as a licensed practical nurse (LPN). Husband had a bachelor's degree in zoology and a master's degree in wildlife ecology. He continued his graduate studies and worked part time. In 1978, husband entered medical school. During medical school, husband received loans, grants and scholarships that more than paid for his educational expenses. During that same time, however, wife continued working as an LPN. Upon completion of medical school, husband took a one-year paid internship, during which time his income was comparable to that of wife's. The following year, he took a staff position at a local hospital, where his income doubled; wife, meanwhile, cut back on her hours of work.
In 1984, husband took a residency in dermatology in Iowa. His income was large enough that wife could afford to attend school, so she attended a community college during the three-year residency and did not work outside the home. At the conclusion of the residency, the parties moved to Salem, and husband began his practice as a dermatologist. Wife, meanwhile, continued going to school, first at a community college and later at Oregon State University. All educational expenses were paid out of the income from husband's practice. In 1988, husband became a shareholder in a dermatology clinic. Two years later, the parties separated. Wife continued her schooling, and in 1991, she graduated magna cum laude with a bachelor's degree in sociology. At the time of trial, in 1994, husband was earning $12,300 per month gross income from his salary and bonuses at the clinic. Wife was working only part time as a hospital clerk. By that time, the parties had accumulated substantial assets, including a home in Amity, a home in Salem, other real estate, a share of the dermatology clinic, cars, a boat, retirement accounts and personal property.
The trial court valued the assets and then divided them, awarding wife the Salem home free and clear of encumbrances, a car, $23,000 in cash, half of husband's retirement benefits and an equalizing judgment of approximately $121,000. The court awarded separately to wife an annual payment of $15,000 "on account of husband's enhanced earnings" for as long as husband continues to work. Finally, the court awarded wife indefinite spousal support of $2,000 per month.
Husband first assigns error to the trial court's award of an annual payment to wife to compensate her for her contributions to his enhanced earning capacity. According to husband, a court may order an award to compensate one spouse for contributions to the enhanced earning capacity of the other only upon proof that those contributions were "material," that is, were "to the education and training that resulted in the enhanced earning capacity" and were "substantial and of prolonged duration." ORS 107.105(1)(f). Husband argues that wife made no such contributions to his enhanced earning capacity. He already had acquired both a bachelor's degree and a master's degree before the parties married. Any enhancement of his earning capacity beyond that, he contends, resulted from his acquisition of a medical degree, to which wife made no material contributions. Husband points to the fact that he paid for his direct educational expenses by loans and substantial grants and scholarships. He further points to the fact that wife made no career sacrifices on his behalf of any sort and that she was able to pursue any educational and career choices that she wished throughout the marriage.
Wife concedes that she did not contribute to husband's direct educational expenses. She further concedes that she was able to pursue all of her professional and academic goals during the marriage, that she did not work for husband at any time and that she was not compelled to forgo any employment or educational opportunities during the marriage. She nevertheless contends that she made material contributions to husband's medical education by working outside the home to help defray living expenses while husband went to school, by allowing husband to borrow her car, by occasionally drawing from her savings for sundry family expenses and by performing various domestic chores such as maintaining the home and tending to the family bills.
To determine whether wife is entitled to an award to compensate her for contributions to husband's enhanced earning capacity we must ascertain the meaning of ORS 107.105(1)(f), which provides, in part:
In particular, we must determine whether the prior efforts on which wife relies constitute "material" contributions of a "substantial" nature and for a "prolonged duration."
We undertake that interpretive effort with the goal of ascertaining, if possible, the intention of the legislature by examining the text in context and, if necessary, the legislative history and other interpretive aids. PGE v. Bureau of Labor and Industries, 317 Or. 606, 610-12, 859 P.2d 1143 (1993). The "context" of the statute includes the pre-existing common law and statutory framework within which the law was enacted, Goodyear Tire & Rubber Co. v. Tualatin Tire & Auto, 322 Or. 406, 416-17, 908 P.2d 300 (1995), recons. allowed (July 23, 1996), including other statutes in pari materia, State v. Carr, 319 Or. 408, 412, 877 P.2d 1192 (1994), and prior versions of the statute, Krieger v. Just, 319 Or. 328, 336, 876 P.2d 754 (1994). We begin our examination of the statute by addressing each of those aspects of its context.
Oregon's current system of no-fault dissolution dates back to 1971. Since that time, the dissolution of any marriage has required the division of all "property" that the parties accumulated during their time together. When the parties accumulated real estate, personal property and other tangible assets, the division of marital property presented a straightforward question of valuation and equitable division in accordance with the statutory admonition to divide property in a manner that is "just and proper in all the circumstances." ORS 107.105(1)(e) (1971). Courts early on encountered difficulties, however, in fashioning "just and proper" divisions in two important respects.
First, there arose a question as to the basis on which to divide equitably the property accumulated during the marriage. With the advent of the no-fault divorce law, the courts focused not on the fault of one or the other of the parties but on the relative contributions to the marital partnership. Still, valuing the extent of the contributions of a homemaker spouse proved difficult to establish. In response to that difficulty, in 1977, the legislature declared that such efforts are to be considered contributions to the acquisition of marital assets and created a statutory presumption that both parties--whether or not either works outside the home--have contributed equally to the acquisition of property during the marriage. ORS 107.105(1)(e) (1977).
Second, when faced with less tangible assets, such as the value of a professional degree or license or, more generally, the enhanced earning capacity of a spouse, questions arose as to...
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