Ritacco v. Ritacco, s. 4D19-809
| Decision Date | 27 January 2021 |
| Docket Number | Nos. 4D19-809,4D19-3888,s. 4D19-809 |
| Citation | 311 So.3d 988 |
| Parties | Erik RITACCO, Appellant, v. Bobbie RITACCO, Appellee. |
| Court | Florida District Court of Appeals |
Jonathan S. Root and Christopher A. Tiso of Jonathan S. Root P.A., Boca Raton, for appellant.
Holly Davidson Schuttler of Schuttler, Greenberg & Mullins LLC, Boca Raton, and Jeanne C. Brady of Brady & Brady P.A., Boca Raton, for appellee.
Appellant Erik Ritacco ("Former Husband") appeals the trial court's Final Judgment of dissolution of marriage. Appellee Bobbie Ritacco ("Former Wife") cross-appeals the same Final Judgment. Both parties raise numerous issues on appeal and, for the reasons stated below, we affirm in part and reverse in part.
The parties were married for over twenty-two years. During the marriage, Former Wife did not work outside of the home because she raised the parties’ two daughters. Former Husband is a police officer and was the household's income producer during the marriage. He receives a monthly pension and holds a Deferred Retirement Option Plan ("DROP") account from a prior employer in addition to drawing a salary at his current position with the Palm Beach County Sheriff's Office (PBSO). When the petition for dissolution was filed, one of the daughters was a minor but both children are now adults.
Dickson v. Dickson , 204 So. 3d 498, 502 (Fla. 4th DCA 2016) (alteration in original) (quoting Ondrejack v. Ondrejack , 839 So. 2d 867, 870 (Fla. 4th DCA 2003) ).
Former Husband claims the trial court erred when it found that Former Wife was entitled to permanent alimony and declined to classify Former Wife's potential DROP interest returns as income. We disagree as to both arguments. However, we agree with Former Husband that the trial court erred in calculating the alimony award by considering his employee benefits as income and basing its calculations on the parties’ gross income.
The trial court did not err in awarding Former Wife permanent alimony because the parties were married for over twenty-two years, a long-term marriage under section 61.08, and Former Husband did not overcome the presumption in favor of permanent alimony. See Dickson , 204 So. 3d at 502–03. The trial court made the requisite factual findings pursuant to section 61.08(2), Florida Statutes (2017), to determine permanent alimony was appropriate. The trial court also found that Former Husband had the ability to pay alimony and that Former Wife had a demonstrable need. See Zeballos v. Zeballos , 951 So. 2d 972, 974 (Fla. 4th DCA 2007).
The parties agreed to split the DROP account equally based on the value at the time of division and that Former Wife's half would be transferred to an Individual Retirement Account (IRA) in her name. The DROP account earns interest annually. Former Husband argued that the trial court should impute investment income to Former Wife because of the interest she would earn from her half of the DROP account. Former Wife provided testimony that she would not receive investment income from the DROP account because she was planning on withdrawing a large portion from the account as a down payment on a house, and that for the remaining funds, the use of a section 72(t) withdrawal plan was impractical because of the ten percent penalty she would incur for making an early withdrawal due to her age.1 See Niederman v. Niederman , 60 So. 3d 544, 550 (Fla. 4th DCA 2011).
"A court should impute income that could reasonably be projected on a former spouse's liquid assets." Id. at 548 (quoting Rosecan v. Springer , 985 So. 2d 607, 609 (Fla. 4th DCA 2008) ). " ‘When a party receives an asset in equitable distribution that will result in immediate investment income,’ that income should not be excluded for purposes of determining alimony." Sherlock v. Sherlock , 199 So. 3d 1039, 1044 (Fla. 4th DCA 2016) (quoting McLean v. McLean , 652 So. 2d 1178, 1181 (Fla. 2d DCA 1995) ).
The trial court did not abuse its discretion when it decided not to impute the investment income from the DROP account to the Former Wife. After the trial court considers evidence regarding a 72(t) payment plan, it can decline to impute investment income for equitable reasons. See Regan v. Regan , 217 So. 3d 91, 94 (Fla. 4th DCA 2017). This is because Niederman , 60 So. 3d at 550. The trial court considered the interest that could have been generated if Former Wife had elected to receive funds from the DROP account under a 72(t) payment plan, and it was within its discretion to decline to include those funds as imputed income. See Regan , 217 So. 3d at 94.
However, the court erred in considering Former Husband's employee benefits, including health and vision insurance, as income for the purpose of alimony calculation. These benefits are not liquid assets or in-kind payments. See Niederman , 60 So. 3d at 548. The case law that identifies insurance as income relies on section 61.30, the child support guidelines, which has a broader definition of "income" that includes in-kind payments. See Cozier v. Cozier , 819 So. 2d 834, 836 (Fla. 2d DCA 2002) ; Dep't of Revenue o/b/o Shorter v. Amico , 265 So. 3d 681, 683 (Fla. 5th DCA 2019). Even using this more expansive definition, Former Husband's insurance would not be considered income. The evidence showed that as an employee of PBSO, Former Husband cannot opt out of his insurance benefits and choose instead to have additional income. See Long v. Long , 967 So. 2d 1069, 1070 (Fla. 4th DCA 2007) ().
Further, we agree with Former Husband that the trial court's decision to make all alimony decisions based on the parties’ gross income was error. See Julia v. Julia , 263 So. 3d 795, 797 (Fla. 4th DCA 2019) ; see also Badgley v. Sanchez , 165 So. 3d 742, 744-45 (Fla. 4th DCA 2015) ().
We affirm Former Wife's award of permanent alimony and the trial court's decision to exclude any potential income from the DROP account from income calculations. But we reverse and remand for the trial court to remove Former Husband's employee benefits as part of his income and to calculate alimony based on net income. "The court may hold an evidentiary hearing if it needs additional evidence to make the required findings." Rentel v. Rentel , 124 So. 3d 993, 994 (Fla. 4th DCA 2013).
"We review a trial court order requiring that a party maintain life insurance for abuse of discretion." Jimenez v. Jimenez , 211 So. 3d 76, 79 (Fla. 4th DCA 2017). The trial court can issue this order "only if there is a demonstrated need to protect the alimony recipient." Forgione v. Forgione , 845 So. 2d 968, 969 (Fla. 4th DCA 2003) (quoting Moorehead v. Moorehead , 745 So. 2d 549, 552 (Fla. 4th DCA 1999) ). "The ‘demonstrated need’ must be supported by competent, substantial evidence." Galstyan v. Galstyan , 85 So. 3d 561, 566 (Fla. 4th DCA 2012).
The trial court found that Former Husband works in a dangerous field and could afford to pay the monthly premium for life insurance. It further found that without the alimony payments, Former Wife could become destitute. The court did not err in finding that Former Husband had the ability to pay for life insurance and that Former Wife has a demonstrable need. See Galstyan , 85 So. 3d at 566 ; Forgione , 845 So. 2d at 969.
However, the trial court erred by requiring Former Husband provide collateral that exceeds the amount of his support obligation. See Brennan v. Brennan , 122 So. 3d 923, 926–27 (Fla. 4th DCA 2013) (). Former Wife is entitled to half of Former Husband's pension as part of the equitable distribution of assets but if Former Husband were to die, she would be the 100% beneficiary of the pension. As the 100% beneficiary of Former Husband's pension, Former Wife would receive an amount that exceeds her current alimony award. Thus, assigning Former Wife both life insurance and the 100% pension survivor benefit would overcompensate her. See Mallard v. Mallard , 771 So. 2d 1138, 1140 (Fla. 2000) ().
We affirm the order for Former Husband to maintain insurance but reverse and remand for the trial court to amend the final judgment so that the collateralization of Former Wife's alimony award does not exceed Former Husband's support obligations.
"The standard of review of a trial court's determination of equitable distribution is abuse of discretion." Steele v. Steele , 945 So. 2d 601, 602 (Fla. 4th DCA 2006) (quoting Kovalchick v. Kovalchick , 841 So. 2d 669, 670 (Fla. 4th DCA 2003) ). "Distribution of the marital assets and liabilities must be supported by factual findings in the judgment or order based on competent, substantial evidence." Krift v. Obenour , 152 So. 3d 645, 649 (Fla. 4th DCA 2014). However, "[a] trial court's legal conclusion that an asset is marital or nonmarital is subject to de novo review." Mondello v. Torres , 47 So. 3d 389, 392 (Fla. 4th DCA 2010).
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