Steinke v. Steinke
| Decision Date | 26 November 1985 |
| Docket Number | No. 84-1337,84-1337 |
| Citation | 376 N.W.2d 839,126 Wis.2d 372 |
| Parties | In re the Marriage of Judith M. STEINKE, Petitioner-Appellant-Petitioner, * v. Robert Allen STEINKE, Respondent. |
| Court | Wisconsin Supreme Court |
T. Christopher Kelly, argued, for the respondent; Dewa, Beaudin & Kelly, S.C., Madison, on brief.
The petitioner, Judith Steinke, appeals from an unpublished order of the court of appeals, dated January 9, 1985, summarily affirming both the property division and maintenance award in a divorce judgment of the circuit court for Washington county, J. Tom Merriam, circuit judge. We reverse the court of appeals.
The parties present two issues for our review:
(1) Did the circuit court abuse its discretion in failing to consider Robert Steinke's employment pension as an asset of the marital estate to be divided between the parties; and
(2) Did the circuit court abuse its discretion in its award of maintenance to Judith Steinke of $150 per month for one year?
With regard to the first issue, we hold that the circuit court abused its discretion in not treating Robert Steinke's pension as an asset of the marriage and, therefore, in not including that asset in its division of the marital estate. Second, we find that This divorce proceeding commenced on April 30, 1982. Robert and Judith Steinke had been married for twenty-four years at the time of the divorce decree on December 7, 1983. Both parties were then fifty-six years old. Their two children were adults.
the trial court abused its discretion in not explicitly setting forth its rational mental process in granting the maintenance award. In addition, a substantial error in the property division necessitates a reconsideration of the maintenance award.
The husband had been employed as a Miller Brewing Company (Miller) worker for thirty-five years prior to and during the course of the marriage. On September 1, 1983, he made an irrevocable election to retire early from Miller and thereby to begin receiving monthly payments from his pension plan.
Under the terms of the pension plan, Robert Steinke began receiving monthly payments of $945. (He also is receiving and will receive $900 per month for five years as an incentive for selecting early retirement, but Mrs. Steinke makes no claim that this incentive amount is an asset of the marriage subject to division.) Because Robert will be eligible for social security in October of 1989, his payments through the pension plan will be reduced to $495 per month; the payments will increase to $622 per month when Mr. Steinke reaches age 65. The record implies, however, that his pension benefits plus his social security benefits will always approximate the $945 per month which he is presently receiving.
Mrs. Steinke's employment history has been more varied than Mr. Steinke's. During the early years of the marriage, she was a homemaker and took care of their children (1960-67). Later, she occasionally served as a substitute Spanish teacher (1967-72). Mrs. Steinke also performed some factory work (1974-75) and then some clerical duties for an employment agency (1975-76). At the time of the divorce proceedings, she was living in West Germany and was employed selling insurance and mutual funds to American servicemen stationed in Europe. The record indicates that Mrs. Steinke's earnings at this latest job have been minimal and that her prospects of significant earnings there are not good. Mrs. Steinke has a B.A. degree in education and is a securities dealer, licensed through the National Association of Securities Dealers.
Various documents within the record reveal that for the four-year period from 1979 through 1982, the husband earned approximately $156,000. The wife in the same period earned about $44,000, including at least $6,000 of which was received as unemployment compensation. In his last full year of employment, 1982, Mr. Steinke earned $34,035 from his job. The most that Mrs. Steinke ever earned in any of her employment positions was $15,355 in 1979. The trial court's findings of fact indicate that in 1983, she earned only $3,300.
The parties orally stipulated during the trial to the division of all assets of the marital estate, with the exception of Mr. Steinke's pension plan. The marital estate included a homestead worth approximately $140,000, additional realty, securities and tax shelters, insurance policies, two cars, a boat, and a horse. The stipulation effected a virtually equal division of the estate. Thus, the only issues submitted to the trial court for determination were the division of the husband's pension plan and the award of maintenance.
The trial court, in a three-paragraph decision, 1 determined that the pension plan The court of appeals summarily affirmed the trial court. It stated, based on its reading of Leighton v. Leighton, 81 Wis.2d 620, 635, 261 N.W.2d 457 (1978), that a trial court, in its discretion, may exclude an interest in a pension fund from the property division if the pension fund is considered as income in awarding maintenance. The court of appeals also held that the trial court did not abuse its discretion in setting the maintenance award, although "at first glance the trial court's award appears unduly low in light of the potential value of Robert's pension benefits...."
should be excluded from the division of the estate and instead be considered as income in determining the issue of maintenance. The court awarded Mrs. Steinke maintenance of $150 per [126 Wis.2d 377] month for a period of one year; at the end of the one-year period the matter of maintenance would be held open with respect to both parties.
Bahr v. Bahr, 107 Wis.2d 72, 84-85, 318 N.W.2d 391 (1982). (Citation omitted.)
Although the stated issue is whether the trial court abused its discretion in dividing the marital estate, we discuss first the proper characterization of a pension plan as either property or income.
The general treatment of a pension plan in this jurisdiction has been to consider it as property and either divide it or divide other marital assets to effect a de facto pension division. See, Leighton, 81 Wis.2d at 633, 261 N.W.2d 457. For example, in Schafer v. Schafer, 3 Wis.2d 166, 87 N.W.2d 803 (1958), this court held that the value of a spouse's interest in a postal service pension fund, even though the asset itself was incapable of division, "should have been ascertained and taken into account by the trial court in making the division of estate." Id. at 171, 87 N.W.2d 803.
In Pinkowski v. Pinkowski, 67 Wis.2d 176, 226 N.W.2d 518 (1975), the trial court did not consider the value of a spouse's interest in a vested pension fund. This court held that the value of the fund must be included in the assets to be divided between the parties. The fund's value was to be included notwithstanding the fact that the pension fund would not be paid out until as late as twelve years following the divorce decree, when the pensioned spouse would reach retirement age. Id. at 180, 184, 226 N.W.2d 518. 3
Based on the reasoning of our prior cases, we hold that, as a matter of law, the value of a spouse's interest in a pension fund must be included by the trial court in the division of the property between the spouses.
A spouse's interest in a pension plan is in the nature of property of the marital estate to be divided. The marital estate represents the total of the wealth of property brought into the marriage by either party, as well as wealth accumulated during the marriage, pursuant to the parameters of section 767.255, Stats. The division of the estate, presumed to be equal, effectuates the policy that each spouse makes a valuable contribution to the marriage and that each spouse should be compensated Our holding is consistent with the rationale of the presumption of equal division of the marital estate. See, section 767.255, Stats.
for his or her respective contributions. 4 An interest in a pension plan is a part of the wealth brought to, or accumulated during, the marriage. As with other property constituting the marital estate, the value of the pension interest must be included in the property division
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