Marriage of Spence, In re

• Decision Date: 04 March 1993
• Docket Number: No. 92-319,92-319
• Citation: 257 Mont. 188,849 P.2d 161
• Parties: In re the Marriage of James S. SPENCE, Petitioner and Appellant, and Barbara L. SPENCE, Respondent and Cross-Appellant.
• Court: Montana Supreme Court

Page 161

849 P.2d 161

257 Mont. 188

In re the Marriage of James S. SPENCE, Petitioner and Appellant,

and

Barbara L. SPENCE, Respondent and Cross-Appellant.

No. 92-319.

Supreme Court of Montana.

Submitted on Briefs Dec. 3, 1992.

Decided March 4, 1993.

Christopher Daly, Missoula, for petitioner and appellant.

Gail M. Haviland, Worden, Thane & Haines, Missoula, for respondent and cross-appellant.

HUNT, Justice.

Appellant James S. Spence appeals from an order of the Fourth Judicial District Court, Missoula County, distributing certain pension benefits, proceeds from out-of-state property, and an award of maintenance. Respondent Barbara L. Spence cross-appeals the order, alleging the court erred in its distribution of the marital estate and erred in failing to award her attorney fees and costs.

We affirm in part and remand.

James raises five issues on appeal while Barbara cross-appeals with four issues. Because the issues deal primarily with the distribution of the marital estate, we rephrase the issues as follows:

1. Did the District Court err in its distribution of the marital estate?

2. Did the District Court err in ordering $300 in temporary maintenance?

3. Did the District Court err in awarding Barbara $350 per month in maintenance for three years?

4. Did the District Court err in failing to award Barbara attorney fees and costs?

James and Barbara were married on May 20, 1977. At the time of the hearing, James was 65 years old and Barbara was 43 years old. James began working for Pacific Northwest Bell and its successor corporation, U.S. West Communications, in 1947 as a lineman, and continued working in that position for approximately 40 years until his retirement in 1988. Before taxes, James has a monthly income of approximately $1800 from social security and his U.S. West pension. During his employment, James participated in a savings plan and an Employee Stock Ownership Plan (ESOP). However, he did not have access to those funds until his retirement. James suffers from diabetes and high blood pressure, and because of his age and health problems, is unable to work.

Barbara worked as a nurses' aide at the Shriner's Hospital in Spokane prior to marrying James. During the marriage, Barbara earned an Associate of Arts degree in liberal arts and another Associate of Arts degree in hearing impaired services. Barbara worked as a deaf interpreter, and also obtained some computer skills at the University of Montana in Missoula. Throughout most of the marriage , Barbara maintained the household. From 1988 through 1990, Barbara earned between $3000 and $9000 a year. She currently lives in Spokane with her brother and is unemployed, with the exception of performing occasional odd jobs.

The parties separated on July 10, 1991. On July 29, 1991, Barbara filed a petition for dissolution in Spokane County, Washington. The summons and petition were served on James in Missoula on August 12, 1991. On August 7, 1991, James filed for dissolution in Missoula County. The Superior Court of Washington dismissed the pending action and changed jurisdiction to Missoula County.

On February 12, 1992, the District Court orally ordered James to pay $300 in a one time temporary maintenance award under the belief that the matter would be decided before the next maintenance check was due. On May 5, 1992, Barbara petitioned the court for clarification of the order. The court ordered James to pay maintenance until the final decree was issued. This resulted in James having to pay $1200 in back maintenance.

Trial was held on the matter on March 11 and 18, 1992. On May 29, 1992, the District Court issued its findings of fact, conclusions of law, and order. On June 19, 1992, James filed his notice of appeal from the court's decree and the order for temporary maintenance.

I.

Did the District Court err in its distribution of the marital estate?

This Court has stated that our standard of review relating to factual findings of the district court with regard to the division of marital property is whether the district court's findings are clearly erroneous. In re Marriage of Danelson (1992), 253 Mont. 310, 315-16, 833 P.2d 215, 219. With regard to this Court's review of conclusions of law made by the district court, we have stated that " "[w]e are not bound by the lower court's conclusions and remain free to reach our own." " Danelson, 253 Mont. at 317, 833 P.2d at 219-20 (quoting Schaub v. Vita Rich Dairy (1989), 236 Mont. 389, 391, 770 P.2d 522, 523). In adopting these principles of review in division of the marital estate, we have stated that:

[T]his Court is not in any way discounting the considerable discretionary power that must be exercised by district courts in these cases. The courts are obligated to fashion a distribution which is equitable to each party under the circumstances. The courts, working in equity, must seek a fair distribution of the marital property using reasonable judgment and relying on common sense. Obtaining this equitable distribution will at times require the lower court to engage in discretionary action which cannot be accurately categorized as either a finding of fact or a conclusion of law. These discretionary judgments made by the trial court are presumed to be correct and will not be disturbed by this Court absent an abuse of discretion by the lower court. [Citation omitted.]

Danelson, 253 Mont. at 317, 833 P.2d at 220.

In this instance, James argues that the District Court erred in determining that the ESOP stock was part of the marital estate, that the court misstated the total value of the ESOP stock, and that it miscalculated when dividing the stock between the parties. Barbara argues that the court erred in distributing the ESOP stock proceeds which were calculated by a formula that measured the length of the stock option plan over 40 years, instead of from 1976. Barbara also contends that the court's valuation of the stock is erroneous.

We must first answer the question of whether the ESOP stock was properly included in the marital estate. Section 40-4-202(1), MCA, provides that when dividing a marital estate, the district court shall "equitably apportion between the parties the property and assets belonging to either or both, however and whenever acquired...." In addition, the statute requires that the district court consider contributions of the other spouse to the marriage when dividing the marital estate, which includes the nonmonetary contributions of a homemaker and the extent to which such contributions have facilitated the maintenance of the property. Section 40-4-202(1)(a) and (b), MCA. We have stated that retirement benefits are properly included within the marital estate and are subject to division. In re Marriage of Holston (1983), 205 Mont. 470, 474, 668 P.2d 1048, 1050.

In its findings of fact, the court ruled that during most of the parties' 14-year marriage Barbara maintained the home, her contributions as a homemaker contributed to the marital estate, and the stock was earned in a community property state. The domestic services provided by Barbara enabled James to continue working at his place of employment and contribute to his savings plans. Moreover, if James had passed away before receiving the stock, the benefits would have gone to Barbara. With the exception of the purchase of some lithographs, James used proceeds from the sale of stock to purchase jointly held marital property. Therefore, we conclude that the District Court properly included the stock as a marital asset.

Even though the stock was considered part of the marital estate, the District Court erred in the valuation and distribution of the stock. The court, in its conclusions, valued the total sale of the stock at $49,109. After the vesting of the retirement plans in 1988, James sold between $16,000 and $19,000 to purchase a pickup truck which was held jointly by the parties. In 1990, the parties sold additional stock for approximately $12,000 to $13,000 and used the proceeds to make a down payment on a home in Missoula and to purchase furniture for the home. After the date of separation, but prior to the dissolution, James sold the remaining stock for $30,109 and used $10,500 for the purchase of 35 lithographs. Although the total value of the stock was apparently not stated by the parties, testimony concerning the proceeds from the sale of the stock leads to the conclusion that the District Court failed to take into account stock sold for the down payment on the home and the furniture when valuing the estate. We remand to the District Court for reconsideration of the value and distribution of the stock. Any additional concerns the parties may have relating to the distribution of the stock may be raised with the District Court.

James also contends that the District Court should not have included the Idaho property in the marital estate. Both parties argue that the division of the proceeds resulting from the sale of the property is incorrect. James argues that the property was purchased on a ten-year contract in 1970, seven years prior to the marriage, the property was paid off within three years of the marriage, and only taxes were paid on the property from 1980 to 1991. James declares that...