Ness v. Ness, 900204

• Decision Date: 02 April 1991
• Docket Number: No. 900204,900204
• Citation: 467 N.W.2d 716
• Parties: Ralph Emanuel NESS, Plaintiff, Appellant and Cross-Appellee, v. Elisabeth C. NESS, Defendant, Appellee and Cross-Appellant. Civ.
• Court: North Dakota Supreme Court

Page 716

467 N.W.2d 716

Ralph Emanuel NESS, Plaintiff, Appellant and Cross-Appellee, v. Elisabeth C. NESS, Defendant, Appellee and Cross-Appellant.

Civ. No. 900204.

Supreme Court of North Dakota.

April 2, 1991.

Donald L. Peterson (argued), of McGee, Hankla, Backes & Wheeler, Ltd., Minot, for plaintiff, appellant, and cross-appellee.

Jonathan C. Eaton (argued), of Eaton, Van de Streek & Ward, Minot, for defendant, appellee, and cross-appellant.

MESCHKE, Justice.

Ralph Ness appealed, and Elisabeth Ness cross-appealed, from a judgment granting the parties a divorce, dividing the marital property, and awarding spousal support for Elisabeth. We affirm the judgment and remand for correction of an order about temporary support during this appeal.

At the time of their marriage in 1985, Ralph was 76 years of age and Elisabeth was 62 years of age. There was no prenuptial agreement. In February 1987 the parties separated and Ralph sued for divorce. An attempted reconciliation was ultimately unsuccessful.

The trial court entered judgment on May 1, 1990. The judgment ordered Ralph to pay Elisabeth $5,000 within 90 days of the entry of judgment. Elisabeth was also awarded twenty-five percent of the income received from Ralph's mineral interests for a period of five years, terminable upon Ralph's death or Elisabeth's death or remarriage. In the event that Ralph died before Elisabeth received $15,000 from the mineral interest payments, she was guaranteed payment up to $15,000 from his estate.

While this appeal was pending, a dispute arose over payment of interim support and payment of Elisabeth's costs and legal fees on appeal. We remanded to the trial court, which denied Elisabeth's motion for payment of costs and legal fees for the appeal and ordered recommencement of interim support of $500 per month effective October 1, 1990.

Ralph asserts that the trial court's $5,000 lump sum award and the award of twenty-five percent of the income from his minerals to Elisabeth are clearly erroneous. To begin, we must sort out the apparent confusion over whether these awards constitute property division or spousal support.

The trial court's award of the $5,000 states:

[Elisabeth] is to receive from [Ralph] the sum of $5,000.00 cash to be paid within 90 days from the filing of the entry of judgment herein. This payment is necessary to assist [Elisabeth] in her adjustment and transitional needs from married life to single life.

The court's statement that this award is to assist Elisabeth in her "adjustment and transitional needs" clearly marks this payment as spousal support.

The trial court's award of the income from Ralph's mineral interests states:

[Elisabeth] is to receive a 25% income interest for a period of five years from the date of the filing of the entry of judgment herein in all oil and gas income from the minerals owned by [Ralph] at the time of the marriage, and [Elisabeth] shall bear any tax consequences on said income. This income is to terminate upon the death or remarriage of [Elisabeth] or upon the death of [Ralph]. In the event of [Ralph's] death before the payment of $15,000.00 from this provision, [Elisabeth] is to be awarded from [Ralph's] estate the difference between $15,000.00 and any amount paid pursuant to this paragraph.

Classification of periodic payments as either spousal support or property division often turns upon whether payments are to terminate upon the death or remarriage of one spouse. See Rustand v. Rustand, 379 N.W.2d 806, 808-809 n. 2 (N.D.1986); Seablom v. Seablom, 348 N.W.2d 920, 924 (N.D.1984). Payments that are to terminate upon the receiving spouse's death suggest spousal support; payments that do not so terminate suggest property division. Rustand; Seablom. Because the need for spousal support ends with the obligee's death, payments that terminate upon the obligee's death fulfill the purposes of spousal support. However, where payments continue after the obligee's death, inuring to the benefit of the obligee's estate, the purposes of spousal support are not fulfilled. See Rustand; Seablom.

We also note that the trial court's award of income from the mineral interests provides that Elisabeth "shall bear any tax consequences on said income." While periodic payments in the nature of property division are not taxable to the recipient spouse, spousal support payments are deductible by the payor spouse and taxable to the recipient spouse. See Stoelting v. Stoelting, 412 N.W.2d 861 (N.D.1987); I.R.C. Secs. 71 and 215 (1990). The requirement that Elisabeth bear the tax consequences on these payments is a clear indication that they were intended as spousal support. Because the award of income from the mineral interests is to terminate upon Elisabeth's death or remarriage, and because Elisabeth is to pay taxes on these payments, we conclude that they are in the nature of spousal support.

We turn to Ralph's assertion that the trial court's award of spousal support is clearly erroneous. Ralph argues that Elisabeth is not disadvantaged by the divorce and that she is not in need of spousal support.

A trial court's determination of spousal support is a finding of fact, which will not be set aside on appeal unless clearly erroneous. Lucy v. Lucy, 456 N.W.2d 539, 543 (N.D.1990). Although findings of fact that disclose the reasons for the trial court's decision aid appellate review, an express finding on every possible point is not necessary. Pfliger v. Pfliger, 461 N.W.2d 432, 436 (N.D.1990). When the trial court fails to fully explain an award of spousal support, we will not upset it if the reasons are fairly discernible by deduction or inference. Id. Although the trial court's findings of fact and conclusions of law in this case are hardly a model of clarity or completeness, we think that we comprehend the trial court's reasons.

There is evidence to support an inference that Elisabeth was economically disadvantaged by the marriage. Testimony established that the parties set up joint savings and checking accounts to pay marital expenses. The evidence indicated that during the course of the marriage Elisabeth contributed over $5,000 more to those joint accounts than Ralph. In addition, Elisabeth's marriage to Ralph caused a permanent reduction of $100 per month in her survivor's benefits under railroad retirement.

Ralph also challenges the amount of spousal support, asserting that Elisabeth has sufficient assets to provide for herself. We do not, however, substitute our judgment for that of the trial court. We will only disturb an award of spousal support if it is clearly erroneous. Lucy, 456 N.W.2d at 543. We conclude that this award of spousal support is not clearly erroneous.

Elisabeth argues that the trial court erred in holding that the entry of judgment terminated its prior order awarding temporary support payments. We agree.

On June 21, 1988, the trial court ordered Ralph to pay Elisabeth temporary support of $500 per month. After judgment was entered and both parties appealed, Ralph stopped making those payments. Elisabeth secured a remand to the trial court and sought an order directing Ralph to continue the interim support payments. The trial court denied the motion, ruling that "the lack of any reference to interim support in the divorce decree operates as a hiatus of support obligations." The court, apparently believing it was without authority to award interim support for the period between the entry of judgment and its ruling on the motion, ordered that the interim payments recommence effective October 1, 1990.

The trial court misconstrued North Dakota law. The trial court may award temporary support "[d]uring any time in which an action for divorce is pending" and, unless challenged within five days of service, an order awarding temporary support "shall be final and nonappealable pending a...