Marriage of Welch, In re, 16718

• Decision Date: 18 September 1990
• Docket Number: No. 16718,16718
• Citation: 795 S.W.2d 640
• Parties: In re MARRIAGE OF WELCH. Debra Alane WELCH, Petitioner-Respondent, v. Leroy Bruce WELCH, Respondent-Appellant.
• Court: Missouri Court of Appeals

Page 640

795 S.W.2d 640

In re MARRIAGE OF WELCH Debra Alane WELCH, Petitioner-Respondent, v. Leroy Bruce WELCH, Respondent-Appellant.

No. 16718.

Missouri Court of Appeals,

Southern District,

Division Two.

Sept. 18, 1990.

Max H. Glover, Glover & Miller, Webb City, for respondent-appellant.

No brief filed for petitioner-respondent.

SHRUM, Judge.

A decree of dissolution of the parties' marriage was entered September 19, 1989. Leroy Bruce Welch (Husband herein) appeals from that decree, presenting one point relied on. He contends that the trial court erred in its determination of marital indebtedness when the husband was ordered to assume a $22,000 liability to the wife's father. Husband contends the indebtedness was not marital because: (a) it was not incurred during marriage; (b) it was not a joint obligation of the parties; and (c) it was not a debt assumed by the husband.

The parties were initially divorced May 28, 1987. In the first decree, the wife was awarded the marital real estate at 1021 Poplar Street, Carthage, Missouri. At that time, there was a mortgage lien against the property. Soon after the May 28, 1987, divorce and before August 5, 1987, wife's father, Bob Lyttle, paid off the mortgage on 1021 Poplar Street. The record is less than clear as to exactly what was done.

Q. [To wife] ... Who had the loan on the house [1021 Poplar]? Who was responsible for paying the loan on the house?

A. Bob Lytle [sic].

Q. Was Bruce [husband] aware of that to your knowledge at the time that the deed was signed over to him?

A. Yes, he was.

* * * * * *

Q. [To wife] ... Now, you indicated that you made payments on 1021 Poplar up until October; is that correct?

A. That's correct.

Q. And where did you make those payments?

A. Southwest Missouri Bank.

Q. Was that on an obligation which you and Bruce owed to the bank on the property?

A. ... The payments that were made, that was made on a loan on that piece of property that was in my dad's name.

Q. All right. So that loan was not in your name or Bruce's name?

A. No.

Q. It was a loan that your father took out?

A. On 1021 Poplar.

* * * * * *

Q. Well, as a matter of fact, there was no mortgage taken out on 1021 was there, Mrs. Welch?

A. No. There was a promissory agreement.

Q. All right. Did Mr. Welch ever pay you anything on 1021?

A. Yes. There was one month when he helped me make that payment.

The parties remarried August 17, 1987. During the period between the initial divorce and the remarriage, husband and wife remained in constant contact. By the wife's recollection, ¹ she deeded the 1021 Poplar Street property to husband by deed dated August 5, 1987. ² Her version was that in the months preceding the August 17, 1987, marriage, she and husband talked daily about transfer of the 1021 Poplar Street real estate to the husband; she finally deeded the property to husband in anticipation of their marriage. The wife's testimony was that the conveyance of 1021 Poplar Street to husband was a condition of becoming married.

Q. [To wife] ... And what did Bruce say to you? [conveyance as condition of being married.]

A. That in order for the marriage to take place, that that property would have to have his name on the title. That that would be a way of showing trust. That he was to be the head of the household and that he would in turn take care of the loan on that house. And that no one would ever find out that that had been done because both of our names then, in turn, would be put on that piece of property.

* * * * * *

Q. ... When you signed over 1021 Poplar to him, what was the reason you did it?

A. The reason that I signed the deed over to LeRoy was on the promise of marriage. Also, it was also on the promise that he then, in turn, would go to Southwest Missouri Bank and would have my father's name taken off of the loan and that he would have his name put on that loan and that he would assume the responsibility for that piece of property....

Q. ... Were any of them [sic] statements made to you that conditioned the transfer of property upon marriage?

A. Yes. If I did not deed the property to him, there would be no marriage.

The husband's version of why 1021 Poplar Street was deeded to him differs from wife's version. He testified the wife came to him and asked that he come up with the money which her father had paid on the existing loan; "She came to me and wanted me to produce monies to give to daddy." Husband said he gave wife $1,300 in cash before the deed was signed and before the second marriage. He accounted for the $1,300, in part, as coming from a roofing job. He had no recollection of the source of the balance of the $1,300 cash. Husband said he also gave the wife $17,651 in cash which came from a coin collection. He sold the coin collection on a Friday night to a coin collector from Kansas City, whose name the husband did not know. According to the husband, this sale took place at a house on Biers Street in Joplin, which the coin collector had rented. The $17,651 was in $100 bills which were put in a paper sack and hidden. Husband told wife that until she signed 1021 Poplar Street over into his name, he wasn't going to produce the money. According to the husband, the wife signed 1021 Poplar Street over to him, and he then gave her the $17,651; she, in turn, "supposedly gave them [the monies] to her father." After the deed was made and recorded, husband and wife remarried on August 17, 1987. Husband said that he gave wife an additional $1,450 six weeks after they married. The wife's version was that there was one month her husband helped her make a payment on the obligation owed her father, but that was the only payment he ever made on the debt.

In the debt oriented society now prevailing, the term "marital debts" is found in nearly every dissolution case filed. The term is found in the pleadings, separation agreements, court orders and judgments, and in the appellate court decisions. Yet, the term "marital debt" never appears in the "Dissolution of Marriage Act," § 452.300, et seq., and certainly is never defined. It appears to be settled that debts of the spouses are not marital property, Johnston v. Johnston, 778 S.W.2d 674, 677 (Mo.App.1989); Harper v. Harper, 764 S.W.2d 480, 483 (Mo.App.1989), and a trial court is not obligated to distribute debts and does not commit error when it fails to do so. Feinstein v. Feinstein, 778 S.W.2d 253, 259 (Mo.App.1989); Newman v. Newman, 717 S.W.2d 568, 570 (Mo.App.1986). Yet, allocation of marital debts is frequently said to be a commendable practice which serves to eliminate future dissention between the parties. Brisco v. Brisco, 713 S.W.2d 586, 592 (Mo.App.1986). The authority for allocating marital debts is derived, indirectly, from § 452.330 wherein the court is directed to "set apart to each spouse his nonmarital property and shall divide the marital property in such proportions as the court deems just...." From the statutory mandate that courts divide marital property, they have repeatedly held that the existence, extent and allocation of "marital debts" are factors to be considered by the trial court in establishing a fair division of marital property, Johnston v. Johnston, supra, at 677; Fornachon v. Fornachon, 748 S.W.2d 705, 709 (Mo.App.1988), but few, if any, cases specifically define "marital debt."

Since "marital debt" is used as an aid in establishing a fair division of marital property, a description of marital property is helpful. "Marital property" is "all property acquired by either spouse subsequent to the marriage...." (With exceptions not here pertinent.) Section 452.330.2 (emphasis added). It follows, therefore, that "marital debt" is ordinarily "debt incurred subsequent to the marriage." Indeed, such language is frequently found when allocation of "marital debts" is discussed.

The determination of who will be responsible for debts incurred during the marriage is a factor the trial court is to consider in seeking a fair division of marital property.

Levis v. Levis, 713 S.W.2d 561, 565 (Mo.App.1986) (emphasis added). See also Russo v. Russo, 760 S.W.2d 621, 624 (Mo.App.1988), and Golleher v. Golleher, 697 S.W.2d 547, 549 (Mo.App.1985), in which the phrase "debts incurred by the parties during the marriage" is used synonymously with the term "marital debts."

Peculiar factual situations have, on occasion, resulted in an expanded definition of "marital property" and "marital debt." In F.W.H. v. R.J.H., 666 S.W.2d 910 (Mo.App.1984), the husband and wife bought real estate on August 6, 1980. They were single when they bought the property. Title to the real estate was taken in the husband's name and the wife's maiden name as single persons. The parties married July 11, 1981. They were divorced by decree entered February 10, 1983. The trial court found the real estate to be marital property, awarded it to the husband and ordered him to pay the note and hold the wife harmless. An award of $1,000 was made to the wife as her share of the real estate. Upon appeal, the wife contended the trial court erred in finding that the house was marital property and disposing of it in a dissolution proceeding. On appeal, the trial court's action was affirmed:

There was sufficient substantial evidence in this case from which the trial court could find that the parties intended the house to be marital property. There was testimony that the property was purchased in contemplation of marriage and was intended to be used as the marital home. (Citation omitted.)

Having found that the house was marital property the court was required to make an equitable division of the property. This the court did in accordance with the evident purpose of the statute by terminating, without recourse to further litigation, all unity of possession as well as unity of title between the spouses. (Citations omitted.)

F.W.H. v. R.J.H., supra, at 912 (emphasis added). Thus, in F.W.H. v. R.J.H., supra, property...