Schiller v. Schiller

• Decision Date: 05 October 1993
• Docket Number: 92-1484,Nos. 92-1300,s. 92-1300
• Citation: 625 So.2d 856
• Parties: 18 Fla. L. Weekly D2194 Karl SCHILLER, Appellant/Cross-Appellee, v. Ann Darlene SCHILLER, Appellee/Cross-Appellant. Herman SCHILLER, S & S Associates, a general partnership, and Dayton Excel Mold & Die, Inc., an Ohio corporation, Appellants, v. Ann Darlene SCHILLER, Appellee.
• Court: Florida District Court of Appeals

Page 856

625 So.2d 856

18 Fla. L. Weekly D2194

Karl SCHILLER, Appellant/Cross-Appellee, v. Ann Darlene SCHILLER, Appellee/Cross-Appellant.

Herman SCHILLER, S & S Associates, a general partnership,

and Dayton Excel Mold & Die, Inc., an Ohio

corporation, Appellants, v. Ann Darlene SCHILLER, Appellee.

Nos. 92-1300, 92-1484.

District Court of Appeal of Florida Fifth District.

Oct. 5, 1993.

Christopher W. Wickersham, Sr. of Christopher W. Wickersham, Sr., P.A., Daytona Beach, for Karl Schiller.

Random R. Burnett of Black, Crotty, Sims, et al., Daytona Beach, for Herman Schiller, S & S Associates, and Dayton Excel Mold & Die, Inc.

Dwight Chamberlin of Monaco, Smith, Hood, Perkins, Loucks & Stout, Daytona Beach, for Ann Darlene Schiller.

W. SHARP, Judge.

Karl Schiller appeals from a final judgment of dissolution of marriage and his former wife, Ann, cross-appeals. He argues the trial court erred in awarding Ann too large a share of the parties' marital assets, in fashioning the award to include his partnership interest in S & S Associates, and in awarding Ann permanent alimony and attorney's fees. Ann argues the trial court failed to take into account various marital assets expended by Karl for his sole benefit, after the parties' separation. S & S is a Florida general partnership owned fifty percent by Karl and fifty percent by Herman Schiller, a longtime business associate. ¹ We agree the trial court erred in its attempt to distribute Karl's partnership interest to Ann, and in its award of attorney's fees to her, in view of the other awards made in the final judgment.

We also consolidate with the Schiller dissolution appeal, ² Herman Schiller's appeal from the trial court's denial of his motion to intervene in the dissolution case, after final judgment had been rendered. ³ These cases were heard together at oral argument. Because both appeals involve related questions of partnership law in Florida (the Uniform Partnership Act, Ch. 620), we consolidate them for disposition in this proceeding. We affirm the trial court's denial of Herman's motion to intervene, based in part on the outcome we reach in the dissolution case.

The record establishes that Karl and Ann married in 1958. Ann was primarily a housewife and mother, although she helped Karl both when he started his business in Ohio (Dayton Excel Mold & Die, Inc.), and after it was moved to Daytona Beach. The business makes steel molds for plastic industrial and commercial parts. Herman Schiller became Karl's associate in this business in Ohio. It was operated as a closely held corporation, with Karl and Herman each owning fifty percent of the stock.

In 1982, Karl and Herman moved the business to Daytona Beach, Florida. It is currently operating under the name Daytona Mold. Initially, Karl and Herman and their spouses took title to unimproved land on Fentress Boulevard in Daytona Beach, in their individual names. A special manufacturing building was built for their business, and was financed by a bank loan. All four individuals signed the mortgage and note, and currently remain liable on the remaining mortgage indebtedness.

The title to the real estate was transferred to a general Florida partnership named S & S Associates. It is owned fifty percent by Herman and fifty percent by Karl. The partnership agreement contains prohibitions against the sale or assignment of a partner's interest in the partnership without the other's consent. S & S's sole assets are the Fentress Boulevard real estate and the building used by Daytona Mold for its business operations. Daytona Mold pays rent to S & S, which is used to pay the mortgage on the property.

Equitable Distribution

The trial judge entered a lengthy written order which appears to comply substantially with the fact-finding and valuation requirements of section 61.075(1) and (3). The parties stipulated that the bulk of their properties were marital assets. Except for the value of Daytona Mold and some airplane parts and frames, the parties stipulated to the value of the other marital assets.

The court awarded the former wife:

                1)  House & real property at Pebble Beach                      $ 50,000
                                                                                 (equity)
                2)  1982 Mercedes                                              $  3,000
                3)  50% interest in S & S Partnership (land and building at    $221,153 (value)
                      720 Fentress Boulevard, Daytona Beach, Florida) which
                      interest is in Husband's name
                                                                               ----------------
                       Total                                                   $274,153
                

The court awarded the former husband:

                1)  Daytona Excel Mold & Die Co., Inc. d/b/a Daytona Mold, 1/2 of all  $224,769
                      stock
                2)  1978 Anniversary Corvette                                          $  9,000
                3)  Two Messerschmitt airplane parts and frames                        $ 12,000
                4)  Bass boat, John boat and trailer                                   $  5,000
                5)  Real property in Naples, Florida                                   $ 11,000
                                                                                       --------
                       Total                                                           $263,269
                

The parties presented expert witnesses and exhibits to arrive at a valuation of the Daytona Mold business, and the resulting value for fifty percent of its stock owned by Karl. Karl's expert testified his stock was worth $125,000. However, he did not include any value for goodwill, even though Daytona Mold has generally outperformed others in the same business over a twenty-year period. Ann's expert witness established a value of $231,944 for Karl's one-half interest. The court resolved this controversy by considering the values established for the equipment (less five percent of its fair market value), and less depreciation, and added to that a value for goodwill, officer loans as assets, and book value. Its determination that Karl's one-half share was worth $224,769 is within the discretion of the court and is based on substantial evidence.

The fair market value of the airplane parts was highly controverted. Shortly after the parties separated in 1987, Karl traveled to Europe at least twice. One trip was for the purpose of buying two World War II German Messerschmitt airplanes, which had been disassembled and were in pieces. He testified he spent at least $30,000 to buy them and have them shipped to the Fentress plant in Daytona. He financed the purchase and currently owes $20,000 on that indebtedness.

As a member of the Valiant Air Command Club, Karl planned to renovate the planes, and hopes to put them in flying or saleable condition. It will take much time and effort. If successful, Karl could sell one for as much as $65,000, although his witness, McDonald, testified that buying such an airplane is a "gamble" and a "labor of love." He thought the planes currently were only worth $8,000, because they had not been de-registered in France.

The court made findings that Karl had expended at least $32,000 on the planes, against which there is a $20,000 indebtedness. If the plane were de-registered in France, the expert opined they would be worth $15,000. No clear testimony was offered as to why the planes could not be de-registered. Karl continues to pay a substantial monthly sum for the airplane debt. Based on this record, we cannot overturn the court's finding that the planes are currently worth $12,000.

Based on the values found by the court, Karl received marital assets worth $262,269. Ann's distribution was valued at $274,153. The split is close to equal--only a $11,884 disparity. Given the size of the total marital assets and their nature, it may not have been feasible to divide them more equally. But on remand, the court (in its discretion) may re-address this matter.

By way of explanation for this less than fifty/fifty split of marital assets, Ann argues that after their separation, Karl spent substantial marital funds for his own purposes, and the court failed to account for an investment credit he received, as well as other expenditures for which there is no existing asset. She points out Karl purchased a $5,200 Cadillac, obtained a $22,000 investment credit payment from S & S and spent $17,000 on flying lessons and trips to Europe. However, pursuant to section 61.075(3)(d), the trial court is directed to expressly state its rationale for distribution of marital assets and allocation of liabilities. We can no longer, as an appellate court, search the record for reasons or factors the trial court might have relied upon in fashioning its awards.

On this point, the court expressly stated it was not going to give any marital asset credit for Karl's purchase of the Cadillac and its later sale for $3,200, nor his expenditure of $17,800 of marital funds for his flying lessons, trips to Europe and vacations. However, such considerations could have justified the less than fifty/fifty split of marital assets, in this case. ⁴ On remand, the trial court may revisit this part of the decree.

The part of the equitable distribution judgment being appealed in this case which concerns us, is the outright award to Ann of Karl's fifty percent interest in the S & S Partnership, and its attempt to award her a fifty percent interest in the partnership assets (the land and building). Since adoption of the Uniform Partnership Act in Florida, it is well established that a creditor of an individual partner cannot levy directly on a partner's interest in a partnership, nor on the partnership assets. Anderson v. Potential Enterprises, Ltd., 596 So.2d 488 (Fla. 5th DCA 1992); Century Bank of Lee County v. Gillespy, 399 So.2d 1109 (Fla. 5th DCA 1981); Myrick v. Second National Bank of Clearwater, 335 So.2d 343 (Fla. 2d DCA 1976). See also Addis v. Addis, 288 Ark. 205, 703 S.W.2d 852 (1986); Warren v. Warren, 12 Ark.App. 260, 675 S.W.2d 371 (1984); Berry...