Shymanski v. Shymanski
| Docket Number | 1618-2022 |
| Decision Date | 08 August 2023 |
| Parties | JOSEPH SHYMANSKI v. HEATHER SHYMANSKI |
| Court | Court of Special Appeals of Maryland |
Arthur, Tang, Zarnoch, Robert A. (Senior Judge, Specially Assigned), JJ.
On October 13, 2022, the Circuit Court for Calvert County entered a judgment of absolute divorce between the appellant, Joseph Shymanski ("Husband"), and the appellee, Heather Shymanski ("Wife"). In its written order, the court found, inter alia, that Husband had dissipated the parties' marital assets in the amount of $42,000 and that Wife held title to less than an equitable portion of the parties' marital property. Accordingly, the court granted Wife a monetary award in the amount of $181,000. On appeal, Husband presents four issues for our review, which we have reordered and recast as follows:
For the reasons that follow, we will affirm in part, vacate the circuit court's monetary award, and remand for further proceedings consistent with this opinion.
In February 2014, Husband purchased a six-bedroom house in Huntington, Maryland ("the Home") for $450,000, with a down payment of $160,000, thereby adding it to his real estate portfolio, which then included two rental properties located at 1616 and 1619 D Street, S.E., Washington, DC. Husband and Wife were wed in Maine on July 30, 2014. That same month, the parties and Wife's three children from a prior marriage moved into the Home, which was and would remain titled solely to Husband.
Two children were born of the parties' union, one in December 2014 and the other in December 2015.[1] During the first four years of their marriage, Husband worked as a self-employed professional event photographer, while Wife was a full-time stay-at-home mother.
In 2018, the parties formed New Day Farms, LLC ("New Day") with their then friends, Maggie Travis and her husband, Mike, each of whom owned a 25% membership interest thereof. New Day operated a hemp farm on real property owned by Apple Tree Vineyard &Farms LLC ("Apple Tree"), which Mike and his father, Jim Travis, co-owned, and sold "hemp products" online and at festivals.[2] Wife's duties at New Day included overseeing sales and managing the books, while Mike operated the hemp farm. Husband, by contrast, adopted a "hands-off" role.
Beginning in March 2020, Husband's freelance photography business no longer generated income, purportedly due to the COVID-19 pandemic. Accordingly, Wife applied for unemployment benefits on his behalf. Husband testified that Wife "was giving [him] about 55 percent and keeping about 45 percent" of that income "for her own personal account and her own personal use." Between 2020 and 2021, Husband obtained Small Business Administration loans in the aggregate amount of approximately $65,000, a portion of which he invested in Bitcoin through Coinbase Exchange, a cryptocurrency investment platform.
On July 18, 2021, Wife left the Home, taking the children with her, and moved to a farmhouse in Newport, Pennsylvania, which her parents had purchased at auction and where Wife resided rent free. Three days after Wife's departure, Husband filed a complaint for limited divorce, wherein he sought, among other things, joint legal and primary physical custody of the children, pendente lite child support, pendente lite possession and use of the Home, as well as "a monetary award adjusting the equities and rights of the parties in the marital property[.]" Wife filed a counter-complaint for limited divorce on July 27th and answered Husband's complaint on August 2nd. In the former filing, Wife sought, inter alia, sole custody of the children, pendente lite alimony, and reasonable attorney's fees.
On August 9, 2021, the court held a pendente lite hearing on the issue of child custody. In an ensuing pendente lite order entered on September 27, 2021, it granted the parties joint legal custody of their two mutual children with primary physical custody to Husband. On October 21st, the parties entered into a pendente lite consent order, whereby they withdrew their requests for pendente lite support, and Husband agreed to contribute $10,000 toward Wife's legal costs and attorney's fees.
Although she no longer occupied the Home, Wife continued to work for New Day, and in January 2022 began receiving a commission on the sales she made. During the ensuing four months, New Day's sales significantly increased. After making approximately $10,000 worth of sales in April, however, Wife quit. According to the parties' joint statement of marital and nonmarital property ("the Joint Property Statement"), by August 4, 2022, New Day's bank account balance was $9,548. In or around July 2022, Wife obtained substitute employment as a soliciting agent with New York Life Insurance Company. Wife testified that although she was then "precontract" and not yet earning an income, her full-time contract would be "triggered" within approximately one week, at which time she would earn $2,000 per month, plus commissions.
On July 19, 2022, Husband filed an amended complaint for absolute divorce, alleging a one-year voluntary separation, desertion, and adultery, seeking, inter alia, primary physical and sole legal custody of the parties' two biological children, child support, use and possession of the Home, and a "monetary award adjusting the equities and rights of the parties in the marital property and reduc[ing] said award to judgment." On August 3rd, Wife filed both an answer to Husband's complaint and an amended countercomplaint for absolute divorce, wherein she sought sole custody of the two children, a monetary award reduced to judgment, attorney's fees, and alimony.
Following a four-day hearing, the court announced its factual findings from the bench on October 11, 2022. Based upon those findings, which we will discuss below, the court determined that the "total value of the property interest of [Husband] is $1,109,425.33[,]" while "[t]he value of the property of [Wife] is $245,939.75." After addressing the statutory factors enumerated in FL § 8-205(b), the court ordered Husband to pay Wife a monetary award in the amount of $181,000 so as to effectuate an equitable distribution of the parties' property.[3] We will include additional facts as necessary in our discussion of the issues presented.
"[W]e utilize the 'clearly erroneous' standard to the court's determination of what is, and what is not marital property because '[o]rdinarily, it is a question of fact as to whether all or a portion of an asset is marital or non-marital property.'" Richards v Richards, 166 Md.App. 263, 271 (2005) (quoting Innerbichler v. Innerbichler, 132 Md.App. 207, 229, cert. denied, 361 Md. 232 (2000)). Ordinarily, the valuation of marital property is also "a question of fact subject to the clearly erroneous standard of review." Abdullahi v. Zanini, 241 Md.App. 372, 413 (2019). "In contrast, we review the [court's] determination of questions of law under a 'de novo' standard of review." Flanagan v. Flanagan, 181 Md.App. 492, 521 (2008). This includes the interpretation of Maryland case law as well as statutory law. Goff v. State, 387 Md. 327, 337-38 (2005).
Husband contends that the court undervalued his nonmarital share of the Home and overvalued the parties' marital interests therein. He advances three arguments in support of that contention, which we have reordered for purposes of analysis. First, Husband asserts that the court failed to credit him for over $50,000 in nonmarital funds he purportedly used to make mortgage payments on the Home. Secondly, he claims that the court clearly erred in determining the amount of marital debt by which the property was encumbered. Finally, he argues that the court applied the incorrect formula for determining the parties' marital interests in the Home.
Husband claims that the court "made two mistakes when identifying the source of funds used to acquire the [Home]." First, he argues that the court "did not give [him] credit for the six mortgage payments [Husband] made between when [he] purchased the [Home] in January 2014 and when the parties married in July 2014." Secondly, Husband complains that the court disregarded contributions to the Home's mortgage payments which were purportedly derived from nonmarital rental income.
When determining an equitable distribution of marital property, Maryland courts must undertake a three-step process. First, a court "shall determine which property is marital[.]" FL § 8-203(a). Second, it is required to "determine the value of all marital property." FL § 8-204(a). Third, a court must Flanagan, 181 Md.App. at 519-20 (quotation marks and citation omitted). The arguments at issue implicate the first step, i.e., the court's determination of which property is marital.
Marital property is defined as "property, however...
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