Ritter v. Ritter, 96-00772
| Decision Date | 04 April 1997 |
| Docket Number | No. 96-00772,96-00772 |
| Citation | 690 So.2d 1372 |
| Parties | 22 Fla. L. Weekly D863 Ronald Allen RITTER, Appellant, v. Margaret T. RITTER, Appellee. |
| Court | Florida District Court of Appeals |
James Heptner, Tampa, for Appellant.
William S. Chambers of Law Offices of Richard A. McKinley, Bartow, for Appellee.
Ronald Ritter seeks review of the final judgment dissolving his marriage to Margaret Ritter. He raises seven issues on appeal. We have divided these issues into three topics, and will address each topic separately. All elements of the final judgment not specifically discussed in this opinion are affirmed.
The husband's major argument, which he addresses in three separate issues, is that the trial court erred in imputing income to him for the purpose of determining his alimony obligation to the wife. Although Mr. Ritter does not dispute his former wife's need for alimony in the amount awarded, he contends that the imputation of income to him resulted in an award that exceeds his ability to pay. We hold that the evidence at the final hearing did not support the court's decision to impute income, and, accordingly, reverse that portion of the final judgment.
Mr. and Mrs. Ritter began these divorce proceedings in November 1992. At the June 1995 final hearing, the husband testified that he was employed, making a salary of $36,000.00 per year. During the marriage, however, he had owned a small business, Continental Condenser Corporation. He operated this business from 1991 until it filed for bankruptcy, just before the final hearing. Both the husband and the wife presented extensive expert testimony about his income from Continental Condenser between 1991 and 1993. While this testimony was conflicting, both experts opined that, in those years, the husband had earned substantially more than $36,000.00 per year. Neither party presented any other evidence about the husband's ability to earn. 1 The trial court imputed a yearly income of $75,000.00 to the husband, finding that "with his educational background, experience, and specialized ability in his chosen field, [he] has the present ability" to earn that amount.
A court may impute income if a party is earning less than he could, based on a showing that he has the capability of earning more by the use of his best efforts. Gildea v. Gildea, 593 So.2d 1212, 1213 (Fla. 2d DCA 1992). Present income cannot, however, be imputed based on previous income from a defunct corporation. See Gomez v. Gomez, 659 So.2d 705, 706 (Fla. 3d DCA 1995). Nothing in the record established that Mr. Ritter is now capable of earning the same amount he did when Continental Condenser was a going concern. While the testimony showed he held a college degree in mechanical engineering, no one offered an opinion about how much a person with Mr. Ritter's education and experience could be expected to earn as an employee. Mr. Ritter's earnings as the owner of a small business simply do not establish his earning potential as an employee of another company. The evidence did not support the court's finding that he had the "present ability" to earn in excess of his salary.
We reverse the portion of the final judgment that awards alimony premised on the imputation of a $75,000.00 annual income to Mr. Ritter. We remand to the trial court with directions to calculate Mr. Ritter's alimony obligation based on his salary of $36,000.00 per year. We also note that our review of the record revealed that Mr. Ritter has held many jobs and has operated several small businesses during his lifetime. The trial court should retain jurisdiction to modify the wife's alimony award should Mr. Ritter's financial circumstances improve. Gildea, 593 So.2d at 1212. See also Schlesinger v. Emmons, 566 So.2d 583, 584 (Fla. 2d DCA 1990)(increase in payor's ability to pay, standing alone, can justify upward modification of alimony where recipient's needs were not met by initial award due to payor's then-existing financial inability to meet those needs).
Mr. Ritter also argues that the final judgment is legally insufficient because it fails to make specific factual findings required under section 61.08(2)(a)-(g), Florida Statutes (1993), supporting the award of alimony to the wife. We disagree. We first note that Mr. Ritter stipulated that his wife was entitled to an award of permanent, periodic alimony; only the amount of the award was in dispute. The husband correctly points out that the court must make the required findings under section 61.08(2). § 61.08(1), Fla.Stat. (1993); Harreld v. Harreld, 682 So.2d 635 (Fla. 2d DCA 1996). We have reviewed the final judgment, and hold that the necessary findings are present, although not in the order listed in the statute. We affirm the order on this point.
Mr. Ritter asserts two errors in the lower court's equitable distribution scheme. He first argues that the equitable distribution should be reversed because the court incorrectly valued the parties' marital assets and refused to distribute their marital liabilities. We find no error in the asset valuations contained in the final judgment, with the exceptions of a promissory note referred to as the "Tribble note," and the husband's life insurance policies.
The unsecured note was given in consideration for a loan of $18,347.00 the parties made to friends of Mrs. Ritter's father, the Tribbles. They used the loan proceeds to improve their real property so that Mrs. Ritter's father, who was disabled, would have a place to live. The Tribbles were not required to repay the loan until they sold the property. The trial court posited that because the terms of the note were vague, it was uncollectible and without value for purposes of equitable distribution. While the note might not be worth its face amount, it does have some value. We, therefore, remand to the trial court to take evidence on the value of this asset on a date determined under section 61.075(6), Florida Statutes (1991), and to include it in the equitable distribution scheme.
Mr. Ritter testified that he owned three life insurance policies. Both his financial statements and his testimony showed that the policies had a cash redemption value of $29,000.00, but that they were encumbered by secured loans of approximately $15,000.00. The court found the "cash surrender value" of the three policies was $29,735.00, and awarded $18,367.50 to the wife and $11,367.50 to the husband, without any discussion of the responsibility for the outstanding loans. This was error. We remand to the court, either to subtract the outstanding loan balances from the cash surrender value of the polices, or to assign the liabilities under the equitable distribution scheme.
Not only did the court fail to account for the...
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