Marriage of Wallace, In re, 2-64799

• Decision Date: 24 November 1981
• Docket Number: No. 2-64799,2-64799
• Citation: 315 N.W.2d 827
• Parties: In re the MARRIAGE OF Henry B. Wallace and Betty J. WALLACE. Upon the Petition of Henry B. Wallace, Petitioner-Cross-Appellant, and concerning Betty J. Wallace, Respondent-Appellant.
• Court: Iowa Court of Appeals

Page 827

315 N.W.2d 827

In re the MARRIAGE OF Henry B. Wallace and Betty J. WALLACE Upon the Petition of Henry B. Wallace, Petitioner-Cross-Appellant and concerning Betty J. Wallace, Respondent-Appellant.

No. 2-64799.

Court of Appeals of Iowa.

Nov. 24, 1981.

Ross H. Sidney, Robert C. Thomson and John Warner of Grefe & Sidney, Des Moines, for respondent-appellant.

David W. Belin, Dennis W. Johnson and Roger T. Stetson of Belin, Harris, Helmick & Heartney, Des Moines, for petitioner-cross-appellant.

Heard by OXBERGER, C.J., and DONIELSON, SNELL, CARTER, and JOHNSON, JJ.

OXBERGER, Chief Judge.

The respondent wife appeals from the division of property in the trial court's decree of dissolution, and alleges that the trial court should have recused itself and that the trial court should have reopened the case for the receipt of additional evidence. The petitioner cross-appeals. We affirm.

The parties were married on November 6, 1963. This was the husband's second marriage, and the wife's fifth marriage and third husband. Both parties had children from their former marriages, but no children were born from this marriage. The wife was a secretary-receptionist prior to the marriage and lived very modestly with her children. The husband was an executive prior to the marriage, owned substantial property, and came from a prominent family. Prior to the marriage, the parties lived together, during which time the husband supported the wife and her children and paid off her debts. The wife stopped working in 1961 and has not worked during the marriage. The husband worked until 1974, and has not worked since then. At the time of the marriage, the husband's net worth was approximately $229,520, consisting of Pioneer stock. The net worth of the parties has increased dramatically during the marriage, not due to any effort on the part of either party, but due to inheritance of Pioneer stock from the husband's father, gifts of stock from his mother, and appreciation in value of the stock. The net worth of the husband at the time of trial was approximately $15,000,000. The wife's net worth was approximately $750,000, substantially all of which is due to gifts from the husband and the husband's mother. The husband has also made gifts to members of the wife's family. Income from investments received by each party is substantial, approximately $235,000 to $500,000 annually for the husband, and $43,000 annually for the wife. The parties have lived a life-style commensurate with their wealth.

In 1975 the wife underwent a double mastectomy, due to cancer. She has had several surgeries and will have to undergo more surgery in the future. The cost of the surgery, past and future, is primarily covered by insurance. This surgery has not shortened her life expectancy.

The trial court found that the wife needs a net income of a minimum of $6000 per month to continue the life-style to which she has become accustomed. The trial court also found that an equal division of the property would not be equitable and would not be supported by Iowa case law.

The trial court awarded the wife property worth $785,000, which she holds in her own name, the Ashworth Road house, worth $275,000, personal property in the home worth $50,000, the Silver Sands condominium worth $125,000, and her other personal property and three vehicles, with a total value of $1,300,000.00. The trial court awarded her an additional cash settlement of $1,000,000.00, and attorney fees of $25,000.00. Thus her total assets would be $2,300,000. Petitioner was awarded the balance of his assets, including certain personal property.

The trial court did not consider as a marital asset for division the possibility that the husband might eventually inherit a substantial sum from his elderly mother's estate of approximately $15,000,000.

I. Scope of Review

Our review is de novo. Iowa R.App.P. 4. The court gives weight to the fact findings of the trial court but is not bound by them. Iowa R.App.P. 14(f)(7).

II. Motion to Recuse

The wife argues that the trial court erred by not recusing himself after exhibiting bias. We disagree. Although certain words used by the court were inappropriate, they reveal no bias or prejudice in the context of the proceedings, and the motion for recusement was therefore properly denied.

III. Potential Inheritance of the Husband

The wife argues that the trial court erred by failing to consider the husband's future inheritance from his mother to be an asset which should be considered when making the property division.

We do not decide whether the court may consider potential inheritance as a factor in making property distributions in dissolution cases since the husband's uncontradicted testimony is that he is to receive no inheritance from his mother. Under a codicil to his mother's will, such inheritance is to be given to charities he has designated.

IV. Applicability of Section 598.21, The Code 1981

It is not necessary for this court to determine whether Section 598.21, The Code 1981, which became effective on July 1, 1980, is procedural or substantive since it came into effect after the close of this case and after the decree of the trial court and therefore does not control the outcome of the matter before us. In re Marriage of Callenius, 309 N.W.2d 510 (Iowa 1981). In any event, the crucial issue before us is whether the distribution of property in the particular circumstances of this case was equitable, this being the ultimate test both before and after amendment of § 598.21(2) by the 1980 legislature. Schantz v. Schantz, 163 N.W.2d 398 (Iowa 1968).

V. The Property Division

In resolving the troublesome problems inherent in effecting a distribution of property in dissolution cases, many factors must be considered. Determination as to what is equitable is dependent upon the facts of each case, precedents having relatively little value as guides for the resolution of problems in a situation which may be quite unique. In re Marriage of Romig, 207 N.W.2d 780 (Iowa 1973).

A division of the parties' assets in dissolution of marriage proceedings based upon either a one-third share to one party or the other or an equal division, or any other mathematically precise formula is not statutorily sanctioned. That which is determinative is that which would constitute an equitable and just award under the circumstances. Locke v. Locke, 246 N.W.2d 246, 251 (Iowa 1976). Among the factors to be considered are the respective resources at the disposal of the parties, the length of time they have lived together, the contributions and sacrifices made by each of them toward the acquisition of the property during their marriage, the sources of the property, the needs of each of the parties, the social position and living standards of the parties both before and during the marriage, the earning capacity of each of them, their life expectancies at the time of the dissolution, the physical and mental health of each of them at the time of the dissolution, and such other factors as may reasonably enter into the calculation. With the general principles in mind, we now move to our specific problem in this case-gift and inherited property.

Ordinarily, if a marriage lasts a very short time, the claim of either party to the property owned by the other prior to the marriage or acquired by gift or inheritance during the brief duration of the marriage is minimal at best. See In re Marriage of Steenhoek, 305 N.W.2d 448 (Iowa 1981) (5-year marriage; court gave husband credit for property he brought into the marriage, some of which was inherited); In re Marriage of Winegard, 278 N.W.2d 505 (Iowa 1979) (court stated it would have made a larger award but for the brevity of the marriage); Arnold v. Arnold, 257 Iowa 429, 133 N.W.2d 53, 60 (1965) (where the court has made an approximately equal division of the marital property, there has usually been an accumulation of property due to the joint efforts of both parties for a considerable number of years); Buseman v. Buseman, 299 N.W.2d 807 (S.D.1980) (Henderson, J., concurring in part and dissenting in part); Morse v. Morse, 174 Mont. 571, 571 P.2d 1147 (1977) (Harrison, J., concurring in part and dissenting in part.) If there were wide disparities between the assets of the parties at the time of the marriage, or if one of the parties were the recipient of a substantial gift or inheritance, the length of the marriage is a major factor in determining what the respective rights of the parties with respect to such property are at the time of its dissolution. Our obligation to respect and give effect to the wishes of those who convey gifts and bequeath inheritances demands of us that those wishes not be rendered nugatory by the mere fact that the intended recipient happens to be married. See In re Marriage of Beeh, 214 N.W.2d 170 (Iowa 1974).

On the other hand, as time goes on, the benefits of such property are enjoyed by the married couple; it is both natural and proper for the expectations of the other spouse to rise accordingly. A sudden substantial rise in the couple's standard of living made possible by a gift or inheritance to the husband or the wife will naturally and reasonably lead the other spouse to anticipate that that standard of living will be maintained, particularly if it is sustained over a lengthy period of time. Changes in habit, in dress, in associates and friends, in manners, in leisure activities, in work or study aspirations-in short, in one's entire life-style-can be brought about by significant improvements in one's access to substantial financial resources. With time such changes become ever more deeply ingrained, and eventually it becomes virtually impossible to return to a world long since renounced and forgotten. See In re Marriage of Winegard, 278 N.W.2d 505 (Iowa 1979) (court considered life-style to which wife had become accustomed as a factor in making property division); Otis v. Otis, 299 N.W.2d...