Quinn v. Quinn

• Decision Date: 01 September 1989
• Docket Number: No. 1561,1561
• Citation: 575 A.2d 764,83 Md.App. 460
• Parties: Kieron F. QUINN v. Margaret Lee QUINN. ,
• Court: Court of Special Appeals of Maryland

Page 460

83 Md.App. 460

575 A.2d 764

Kieron F. QUINN v. Margaret Lee QUINN.

No. 1561, Sept. Term, 1989.

Court of Special Appeals of Maryland.

June 28, 1990.

Michael S. Libowitz (Kevin B. Kamenetz and Moore, Libowitz & Thomas, on the brief), Baltimore, for appellant.

Ann M. Turnbull (Turnbull, Wase & Lyons, P.A., on the brief), Towson, for appellee.

Argued before MOYLAN, GARRITY and WENNER, JJ.

WENNER, Judge.

On May 16, 1989, after protracted and acrimonious proceedings in the Circuit Court for Baltimore City, the appellee, Margaret Lee Quinn, was granted an absolute divorce from the appellant, Kieron F. Quinn, on the grounds of a two year separation. Although the appellee was denied alimony, the circuit court granted her a monetary award. Obviously unhappy with this turn of events, appellant noted this appeal. Before us, appellant contends that:

I. In awarding appellee fifty percent of the value of all marital property, the circuit court erroneously refused to consider appellant's post-separation efforts, increasing the value of certain property, that were made without any monetary or nonmonetary contribution by appellee.

II. The circuit court committed reversible error by failing to determine the value of certain marital property prior to making the monetary award.

III. The circuit court erroneously determined that certain marital property was nonmarital property.

IV. The circuit court erroneously failed to consider other factors affecting the monetary award.

For reasons we will explain, we shall vacate the monetary award and remand the case to the circuit court for further proceedings consistent with this opinion.

Facts

The parties were married on August 5, 1964. Their only child, a daughter born in 1965, is now emancipated. The parties have resided in Maryland since 1967. Both of them are practicing attorneys and members of the Maryland Bar.

After almost twenty-two years of marriage, ¹ the parties separated on July 12, 1986. A complaint and a cross-complaint for divorce followed. Ultimately, in addition to an absolute divorce and a monetary award of $249,866, the appellee was awarded $16,000 in attorney fees and $5,480.80 in suit money. The award was reduced to judgment, as authorized by Md.Fam.Law Code Ann. § 8-205(c). ² This appeal followed.

Discussion

In determining an equitable distribution of marital property, Maryland courts are required to engage in a three-step process. First, all property owned by the parties must be categorized as either marital or nonmarital. Second, the marital property must be valued. Finally, the court may make a monetary award. See Sharp v. Sharp, 58 Md.App. 386, 394, 473 A.2d 499 (1984). Failure to comply with the three-step process requires that any monetary award be vacated. Campolattaro v. Campolattaro, 66 Md.App. 68, 78, 502 A.2d 1068 (1986).

In determining the amount and method of payment of the monetary award, the court must consider the statutory factors enumerated in Md.Fam.Law Code Ann § 8-205(b). ³ The failure to consider the statutory factors also requires that any monetary award be vacated. Holston v. Holston, 58 Md.App. 308, 318, 473 A.2d 459, cert. denied, 300 Md. 484, 479 A.2d 372 (1984). ⁴

Post-Separation Efforts

In the case sub judice, appellant contends that in awarding appellee fifty percent of the value of all marital property, the circuit court erroneously refused to consider, or in any case failed to consider, appellant's post-separation efforts, which increased the value of certain property, without any monetary or nonmonetary contribution by the appellee. Specifically, appellant contends that the circuit court should have considered his post-separation efforts in increasing his retirement fund, in purchasing a home on Linwood Avenue, and in developing his new law firm. We agree.

Section 8-205(b)(8) of the Family Law Article requires that, in determining the amount and method of payment of a monetary award, the court must consider:

how and when specific marital property or interest in the pension, retirement, profit sharing, or deferred compensation plan, was acquired, including the effort expended by each party in accumulating the marital property or the interest in the pension, retirement, profit sharing, or deferred compensation plan, or both....

And, we have held that:

[t]he extent to which the efforts of one spouse may have led to acquisition of property or an increase in its value without any monetary or non-monetary contribution by the other spouse after the parties separated can, and should, be taken into account in determining what would constitute an equitable monetary award.

Wilen v. Wilen, 61 Md.App. 337, 354-355, 486 A.2d 775 (1985).

In arriving at a monetary award, the trial judge is not required to "articulate every step in his thought processes." Bangs v. Bangs, 59 Md.App. 350, 370, 475 A.2d 1214 (1984). The trial judge is presumed to know the law and to apply it correctly, and that presumption is not rebutted by "mere silence." Id. The presumption, however, may be rebutted by the trial judge's words. Campolattaro, supra, 66 Md.App. at 80, 502 A.2d 1068.

In the instant case, the trial judge did not merely remain silent as to whether she had considered the post-separation efforts of appellant in determining the monetary award. At the close of the evidence, after hearing argument from counsel, during which counsel for the appellant specifically asked her to consider "what increase [sic] marital property occurred post-separation," the trial judge delivered her opinion from the bench. After granting appellee an absolute divorce, and denying her alimony, the trial judge identified and valued the marital property. She then considered at length the various factors involved in deciding whether to make a monetary award. The trial judge specifically mentioned the acquisition of the marital property and the contributions of each of the parties during the marriage. At no point in that consideration, however, did she refer to appellant's post-separation efforts in increasing the value of his retirement fund, in purchasing a home on Linwood Avenue, or in developing his new law firm. After the trial judge had made a monetary award and had granted appellee attorneys fees and suit money, the following colloquy occurred:

[APPELLANT'S COUNSEL]: Your Honor, has the court talked about what, how and when those assets were acquired. Did the court address when they were acquired in the reasoning?

THE COURT: Well, I thought that I had.

[APPELLANT'S COUNSEL]: I thought you said how they were acquired. You said that Mr. Quinn contributed the bulk financially. I'm wondering whether the court considered the assets, considered post separation?

THE COURT: I don't think that makes any difference.

Under these circumstances, we hold that this statement by the trial judge clearly indicates that she failed to consider appellant's post-separation efforts which may have increased the value of certain property. Of course, as we have said, such consideration is required. Md.Fam.Law Code Ann. § 8-205(b)(8) (1984 & 1989 Repl.Vol.). See also Wilen, supra, 61 Md.App. at 354-355, 486 A.2d 775. As the circuit court failed to consider this factor in determining the monetary award, we shall vacate the award. See Holston, supra, 58 Md.App. at 318, 473 A.2d 459.

Valuation of Marital Property

Appellant next contends that the circuit court erred by failing to determine the value of certain marital property prior to making the monetary award. We agree.

A. Marital Debt

Both parties acknowledged that they received a loan from appellant's mother in 1973 to assist them in purchasing their first home. There is some disagreement, however, as to the amount of the loan and the terms of repayment. Appellant contends that the loan was to both parties in the amount of $7,500 with an interest rate of nine percent. Appellee testified that she was uncertain whether the loan was for $7,000 or $7,500. She also testified that the promissory note which evidenced the loan did not bear any interest.

Inasmuch as the parties agree that the loan was made to both of them, and was used in purchasing their first home, See Rogers v. Rogers, 80 Md.App. 575, 583, 565 A.2d 361 (1989), the obligation to repay the loan was a marital debt. Id. at 585, 565 A.2d 361. See also Schweizer v. Schweizer, 301 Md. 626, 636-637, 484 A.2d 267 (1984). Consequently, the net value of the marital property must be reduced by the amount of the marital debt. Rogers, supra, at 584, 565 A.2d 361. See also Zandford v. Wiens, 314 Md. 102, 107, 549 A.2d 13 (1988); Niroo v. Niroo, 313 Md. 226, 240-241, 545 A.2d 35 (1988); Schweizer, supra, at 637, 484 A.2d 267.

Accordingly, on remand, the circuit court must determine both the value of the marital debt and the rate of accrued interest, if any, and reduce the value of the marital property by the amount of the marital debt.

B. Colorado Condominium

Appellant also contends that the circuit court lacked an evidentiary basis to assign a value to appellant's interest in the Colorado condominium. Specifically, appellant contends that the court erroneously failed to consider evidence regarding diminution of the value of the property. We agree.

At trial, appellant offered recent newspaper articles and a publication of the Environmental Protection Agency (E.P.A.) which reported that the condominium development had been built on a toxic waste site, resulting in diminished property values. The circuit court refused to admit the E.P.A. report into evidence. The circuit court ultimately valued appellant's twenty-five percent interest in the condominium at $1,800.

We hold that the circuit court erred in failing to consider the E.P.A. report in determining the value of appellant's interest in the condominium. Maryland courts have held that reliable government evaluative reports should be admitted into evidence, unless they are otherwise shown to be unreliable. See ...