Stevenson v. Stevenson
| Decision Date | 14 February 1984 |
| Docket Number | 58763 and 58780,Nos. 59682,No. 2,s. 59682,2 |
| Citation | 680 P.2d 642,1984 OK CIV APP 10 |
| Parties | 1984 OK CIV APP 10 Robert Donald STEVENSON, Appellant, v. Carol Ann STEVENSON, Appellee |
| Court | United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma |
Appeal from the District Court of Canadian County; Stan Chatman, trial judge.
Appeal from property division and award of attorney's fees in a divorce action.
REVERSED AND REMANDED.
Mark Henricksen, Erbar, Henricksen & Erbar, El Reno, for appellant.
Virginia Henson, Henson, Laster & Henson, Shawnee, for appellee.
Both Husband and Wife have appealed from the property division in this divorce action. Wife also appeals from the award of attorney's fees. Having reviewed the record and applicable law, we reverse in part and remand in part.
Husband sued Wife for divorce on grounds of incompatibility. Wife cross petitioned, asking for divorce on the grounds of extreme cruelty. Wife named J-Rae Oil Field Construction as a third party defendant, contending that Husband owned an interest in J-Rae and that the corporation was hiding his interest to defraud her of jointly acquired property.
The trial court heard both actions in the same proceeding. At the end of the trial J-Rae entered a demurrer to the evidence on the fraud action, which was sustained. The trial court granted the divorce, awarded custody of the minor child, ordered visitation rights, and awarded support alimony. These rulings are not on appeal. However, both parties have appealed from the property division asserting that the division was inequitable.
At a later date, the court conducted a hearing on the subject of attorney's fees. The court awarded Wife an attorney's fee of $3,000, and ordered defendant Wife to pay the third party defendant J-Rae an attorney's fee of $5,689.49. Wife has appealed both these awards.
On appeal, Husband raises the following propositions of error:
(1) The court erred in awarding Husband's separate property;
(2) The court abused its discretion in an inequitable distribution of jointly acquired debts and assets;
(3) The court erred in requiring Husband to relieve Wife of marital debts;
(4) Husband was prejudiced by trying the third party action in the divorce proceeding.
Wife raises the following issues:
(1) The court abused its discretion in its determination of a fair and equitable property division;
(2) The court erred in failing to award Wife a more substantial attorney's fee;
(3) The court erred in requiring Wife to pay third party defendant J-Rae's attorneys' fees.
In reviewing a property division, the court will not set aside a judgment nor substitute its own judgment for that of the trial court, absent a clear abuse of discretion. Peters v. Peters, 539 P.2d 26, 27 (Okl.1975).
We note at the outset that the trial court made no specific findings concerning the value of any of the property. The trial judge also failed to determine whether the property was separate or jointly acquired. The trial judge merely divided the property in the following manner:
Property Awarded to Wife Property Awarded to Husband
------------------------ ---------------------------
Marital Residence Rent House
803 N. Bickford 105 W. Caddo
Rent House Old Ice Building
801 N. Bickford West Caddo
Stradivari Sterling Pit Stop
(separate property) Choctaw Avenue
Jewelry (includes $225 watch
belonging to Wife's brother E-Z Way Laundry
and $2,400 worth of jewelry
which was Wife's separate Warehouse
property) (Bread Building)
Medici Sterling
1977 Oldsmobile Life Insurance Policies
All household furnishings at
both houses Jewelry
All mineral interests under all
property
Approximate value: Approximate value
$60,275 $270,590
From the examination of the record, we have determined that each party owned the following property prior to marriage.
Husband--All property except the Pit Stop and rent house at 801 N. Bickford, including the lot on which the marital home was later located. Although the testimony is unclear, it appears that the only structure on any of the property was the Old Ice Building. Buildings were constructed or moved on the property later. Husband paid $5,000 for the Old Ice Building and the other lots, 46 days before marriage.
Wife--$60,000 in savings; new car; sterling (now valued at $7,519.07); jewelry (valued at $2,400).
The trial court heard conflicting testimony as to the values of the real property. The court heard no evidence concerning the values of the household furnishings, automobile, or mineral interests. Although the judge heard evidence on the values of rental income, he failed to mention these in the decree. The trial judge neither established a value for, nor awarded any of the following property: equipment and inventory in the Pit Stop, equipment and inventory in the laundry, the partnership interest in the Pit Stop, an IRA account apparently in Husband's name, and a truck held in Husband's name.
Husband first alleges that the marital residence was his separate property at the time of the marriage. However, evidence shows that Husband purchased the lot 46 days prior to marriage. Later a house was moved to the lot and refurbished from joint funds and funds provided by Husband's father.
As stated numerous times by the courts, the property acquired by separate funds before marriage loses its character as separate property when used as the marital residence. See Umber v. Umber, 591 P.2d 299, 302 (Okl.1979); DuBoise v. DuBoise, 418 P.2d 924, 927-28 (Okl.1966); Gist v. Gist, 537 P.2d 460, 462 (Okl.App.1975).
The lot at 803 N. Bickford was purchased in anticipation of marriage. Both parties contributed to the improvements of the home. As such, it became joint property.
Husband next argues that the debts and assets of the parties were unfairly distributed. First, it must be noted that Husband's brief completely misstates the property awarded to Wife. Husband states that Wife was awarded 105 West Caddo--a rent house. This rent house was awarded to Husband. Wife was awarded the rent house at 801 N. Bickford, valued by Husband's appraiser at $5,000.
Wife testified that she spent her own funds to purchase the house and refurbish it. While Husband disagreed with Wife, there is no evidence that the trial judge considered it separate property. Both this house and the marital home were apparently considered jointly acquired property.
Regarding the debts of the parties, in October 1977, Husband and Wife executed a promissory note for $180,000 to the First National Bank of El Reno. This note was secured by a real estate mortgage on all the jointly acquired property. At the same time Wife and Husband's father also became guarantors on a continuing guarantee for Husband's indebtedness. At the time of trial the 1977 note was in default in the amount of $150,176.41.
In February 1982, Husband executed another note for $269,249.72, secured by equipment and inventory at the Pit Stop. Wife's name does not appear on this note which was guaranteed by Husband's father. Wife contends she is only secondarily liable as a guarantor on the 1982 note by the terms of the continuing guarantee she signed in 1977.
Concerning these debts, the trial court ordered:
The Court further finds that the Plaintiff herein is to assume and pay all the jointly acquired debts and obligations outstanding at the time of this decree and to hold Defendant harmless on the same; he is further directed to undertake such steps as may be necessary to release the Defendant from contingent liability on such debts, including replacing or adding collateral to existing notes, obtaining new guarantors, refinancing, etc.
Husband states that the parties were responsible for jointly acquired debts of over $400,000. Wife's name does not appear as a debtor on the $269,294.72 note. Wife's liability on this note is based solely on the continuing guarantee agreement she signed in 1977. The security agreement for the 1982 loan lists Husband's father as guarantor and fails to mention Wife. Furthermore, the note is secured by inventory and equipment out of the Pit Stop and lists "operating" as the purpose. According to both Husband's and Husband's father's testimony, Husband owns 10 percent of the Pit Stop while his father owns 90 percent. This obligation would seem a separate debt of Husband and one for which he only has 10 percent of the liability. Furthermore, Husband had filed for divorce more than a year earlier. This loan cannot possibly be considered a jointly acquired debt in furtherance of any marital goal. The 1982 loan is Husband's separate debt for which he is primarily liable.
Wife's name does appear on the note executed in October 1977. Wife's name also appears on the real estate mortgage as a grantor and on a continuing guaranty agreement as a guarantor. Although Wife testified that she did not remember signing the note, mortgage and guaranty, she did not deny the existence or authenticity of her signature. We find this debt to be jointly acquired.
Both Husband...
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