Olsen v. Mackay, Record No. 1553-09-4 (Va. App. 4/27/2010)
| Decision Date | 27 April 2010 |
| Docket Number | Record No. 1553-09-4. |
| Court | Virginia Court of Appeals |
| Parties | ROBERT E. OLSEN v. BARBARA E. MACKAY. |
Appeal from the Circuit Court of Fairfax County, Jan L. Brodie, Judge.
Cory Frederick Goriup (Dorothy M. Isaacs; Surovell Markle Isaacs & Levy, PLC, on briefs), for appellant.
Colleen C. Sweeney (William B. Reichhardt; William B. Reichhardt & Associates, on brief), for appellee.
Present: Judges Elder, Frank and Senior Judge Coleman.
Robert E. Olsen (husband) appeals the equitable distribution ruling made by the trial court. Husband argues the trial court erred by (1) classifying his civil lawsuit settlement proceeds as marital property subject to equitable distribution; (2) awarding a lump sum distribution of $77,000 to Barbara E. Mackay (wife); (3) finding that the $10,000 earnest money deposit for the purchase of the martial residence came from wife's separate property; and (4) failing to classify the $50,000 used for the down payment on the marital residence as husband's separate property. We hold that (1) wife met her burden of tracing the settlement proceeds into husband's separate account; (2) the trial court properly classified the earnest money and down payment contributions as wife's separate property and marital property respectively; and (3) the trial court did not abuse its discretion in relying on the statutory factors enunciated in Code § 20-107.3(E). Further, because husband has presented judiciable issues on appeal, we decline to award wife attorneys fees. Accordingly, we affirm the trial court's findings.
When reviewing a trial court's decision on appeal, we view the evidence in the light most favorable to the prevailing party below, granting it the benefit of all reasonable inferences. See Congdon v. Congdon, 40 Va. App. 255, 258, 578 S.E.2d 833, 834 (2003). Thus, a trial court's judgment will not be disturbed on appeal unless plainly wrong or without evidence to support it. Jennings v. Jennings, 12 Va. App. 1187, 1189, 409 S.E.2d 8, 10 (1991). So viewed, the evidence proved that the parties were married on July 25, 1992, separated on May 2, 2007, and divorced on June 16, 2009. Husband and wife had one adopted child who was placed in wife's custody pursuant to a pendente lite order dated June 27, 2008. The trial court held a hearing from February 24 through February 26, 2009, to determine equitable distribution and spousal support.
Husband was previously employed as a Foreign Service officer with the United States Department of State until September 1994. Husband challenged his termination via the proper grievance procedures. After exhausting his administrative remedies, husband filed suit in federal court and pursued five claims, including two claims under the Administrative Procedure Act. The two Administrative Procedure Act claims were resolved in husband's favor, and he was reinstated with back pay. For the remaining claims, husband reached a settlement agreement through which he received $250,000, of which $50,000 was paid to his attorneys. Husband deposited the proceeds into his Charles Schwab account in May 2000. The parties stipulated that aside from the $200,000 deposit, this account and all funds therein were husband's separate property. Husband argued that the $200,000 settlement was his separate property; however, the trial court disagreed and held that it was marital property.
The parties jointly owned, as tenants by the entireties, a single-family home. The parties stipulated that husband used $100,000 of his separate funds and wife used $35,000 of her separate funds for part of the down payment. The parties disputed the source of the funds for the earnest money deposit and the remainder of the down payment. The trial court held that the $10,000 earnest money deposit came from wife's separate property and that husband did not meet his burden to prove that the remaining down payment of $50,000 was his separate property.
The trial court calculated the marital interest in the marital residence at $271,547. The other marital liquid assets totaled $26,503. The trial court further determined the $200,000 settlement proceeds were marital property, with $35,000 having been applied to improvements of the marital residence. Based upon these findings, the trial court divided the marital interest in the marital residence evenly between the parties and incorporated the proceeds into their respective equity shares of the residence. The trial court further ordered husband to make a one-time lump sum payment of $77,000 to wife for her share of the marital property.
Husband timely noted his objections, and this appeal followed.
On appeal, "decisions concerning equitable distribution rest within the sound discretion of the trial court and will not be reversed on appeal unless plainly wrong or unsupported by the evidence." McDavid v. McDavid, 19 Va. App. 406, 407-08, 451 S.E.2d 713, 715 (1994); see Srinivasan v. Srinivasan, 10 Va. App. 728, 732, 396 S.E.2d 675, 678 (1990). "It is well established that the trier of fact ascertains a witness' credibility, determines the weight to be given to their testimony, and has discretion to accept or reject any of the witness' testimony." Street v. Street, 25 Va. App. 380, 387, 488 S.E.2d 665, 668 (1997) (en banc).
Husband argues the trial court erred in finding the money from his civil lawsuit settlement was marital property because his Administrative Procedure Act claims had already covered his economic losses. Specifically, husband contends that he was only unemployed for approximately three months and received compensation in the private sector exceeding his earnings as a Foreign Service officer, thereby rendering him ineligible under 5 U.S.C. § 5596(b)(1)(A)(i) of the Back Pay Act1 to receive back pay. Accordingly, husband argues that the settlement proceeds from the remaining three claims were solely for pain, suffering, and other non-economic harms.
Under Code § 20-107.3(A), the trial court must determine "the ownership and value of all property, real or personal, tangible or intangible, of the parties and shall consider which of such property is separate property, which is marital property, and which is part separate and part marital property." Further, "[i]n the case of any personal injury or workers' compensation recovery of either party," the trial "as defined in subsection H." Code § 20-107.3(A)(3). Subsection H defines the "marital share" of such an award2 as "that part of the total personal injury or workers' compensation recovery attributable to lost wages or medical expenses to the extent not covered by health insurance accruing during the marriage and before the last separation of the parties." Accordingly,
[T]he circuit court must first determine what part of the recovery was attributable to lost wages and medical expenses not covered by health insurance, and classify this portion as marital property. The remainder of the recovery, if any — that portion not "attributable to lost wages or [unreimbursed] medical expenses" — is separate property.
Chretien v. Chretien, 53 Va. App. 200, 205, 670 S.E.2d 45, 48 (2008); see 2 Brett R. Turner, Equitable Distribution of Property § 6.55 (3d ed. 2005). Husband "bore the burden of proving that some or all of the [settlement] was separate property." Chretien, 53 Va. App. at 205, 670 S.E.2d at 48.
As part of his settlement agreement, husband signed a stipulation and order of dismissal (stipulation) that set forth the terms and conditions of husband's receipt of the settlement proceeds. The stipulation states, in pertinent part:
[I]t is also agreed, by and among the parties, that the payment referenced in Paragraph 2 above [$250,000] represents the entire amount of the settlement, including but not limited to any claims for back pay, front pay, employment benefits (including but not limited to retirement and health care benefits), damages, interest, costs, and attorney's fees.
Husband testified that he suffered emotional pain and marital stress as a result of his termination. However, the clear language of the stipulation does not allocate any compensation for such non-economic losses. Cf. Thomas v. Thomas, 13 Va. App. 92, 96, 408 S.E.2d 596, 598-99 (1991) (). Moreover, the trial court did not err in disregarding the parties' 2000 income tax return. Even though the return could potentially evince the parties' intent to treat the settlement proceeds as compensation for non-economic losses, husband has pointed to no authority, and we have found none, that mandates the trial court's consideration of this fact.
Husband's reliance on 5 U.S.C. § 5596(b)(1)(A)(i) in support of his argument that the settlement proceeds did not compensate economic losses is not dispositive. This provision of the Back Pay Act entitles an aggrieved federal employee to
an amount equal to all or any part of the pay, allowances, or differentials, as applicable which the employee normally would have earned or received during the period if the personnel action had not occurred, less any amounts earned by the employee through other employment during that period.
5 U.S.C. § 5596(b)(1)(A)(i). The Foreign Service Grievance Board awarded husband back pay from September 22, 1994, to May 3, 1996, and instructed the parties to make the appropriate deductions. According to husband's testimony, he was unemployed for approximately three months and subsequently earned an annual salary in the private sector exceeding his salary as a Foreign...
To continue reading
Request your trial