Walker v. Walker

• Decision Date: 04 December 2002
• Docket Number: No. 20020062.,20020062.
• Citation: 2002 ND 187,653 N.W.2d 722
• Parties: Marjorie Florence WALKER, Plaintiff and Appellant, v. James Dwayne WALKER, Defendant and Appellee.
• Court: North Dakota Supreme Court

653 N.W.2d 722

2002 ND 187

Marjorie Florence WALKER, Plaintiff and Appellant, v. James Dwayne WALKER, Defendant and Appellee.

No. 20020062.

Supreme Court of North Dakota.

December 4, 2002.

Paul M. Probst, Probst Law Firm, Minot, ND, for plaintiff and appellant.

Faron E. Terry, Minot, ND, for defendant and appellee.

VANDE WALLE, Chief Justice.

[¶ 1] Marjorie F. Walker appealed from a judgment granting her a divorce from James Dwayne Walker, distributing their marital property, and awarding her temporary spousal support. We conclude the trial court's property distribution is not clearly erroneous, but conclude the court erred in fashioning the temporary spousal support award. We modify the judgment and affirm the judgment as modified.

I

[¶ 2] Marjorie and James, both age 63 at the time of trial, were married July 19, 1969, in Minot. It was Marjorie's second marriage. Her first husband died in August 1968, and her youngest son from the first marriage, a volunteer firefighter, died from toxic smoke inhalation in the mid 1990s. Marjorie and James had a son, who was an adult at the time of trial.

[¶ 3] Before and during this marriage, Marjorie did not work outside of the home. Shortly before the marriage, she made a down payment on the parties' jointly-owned home from a $3,000 life insurance payment she received after her first husband died. Marjorie also received a $119,894 death benefit from the United States Department of Justice in 1997 after her son died. James has been employed with the Minot Sanitation Department throughout the marriage and, at the time of trial, was earning a gross monthly income of $2,570 and had a vested retirement pension valued at $37,558.92. James was eligible to retire with a monthly pension benefit of $1,572.62, but he was still working at the time of trial.

[¶ 4] The parties separated in 1995, and in a separate proceeding, James was ordered to pay Marjorie $600, and later $700, per month in spousal support, to pay the real estate taxes on the marital home, and to pay $4,500 in expenses for the funeral of Marjorie's son. James paid the spousal support, but did not pay the taxes on the home or the funeral expenses.

[¶ 5] In October 2000, Marjorie brought this divorce action against James. Property distribution and spousal support were contested. The major disputed marital assets consisted of: (1) their home, valued at $65,000 with real estate taxes owing of $7,117.43; (2) Marjorie's bank account, containing $36,000 remaining from her son's death benefit; and (3) James's retirement fund, valued at $37,558.92. The trial court awarded the marital home to Marjorie, subject to a lifetime encumbrance in favor of James. Under this award, if Marjorie sells the home during James's lifetime, Marjorie would receive the first $15,000 of the net proceeds, and James would receive one-third of the remainder. Of the $36,000 in Marjorie's bank account, James was awarded $6,000. Marjorie was awarded the remainder, but was ordered to pay the $7,117.43 real estate taxes owing on the home. The parties were ordered to pay their own attorney fees. The trial court also ruled Marjorie was entitled to one-third of James's retirement account, "calculated on the balance of this account as of June 6, 2001." The court further ordered James to continue "to pay Marjorie spousal support in the amount of $700 per month until the effective date of James' retirement, or until the month of James' sixty-fifth (65) birthday, which ever occurs first." Marjorie appealed.

II

[¶ 6] Marjorie argues the trial court's property division and debt allocation is inequitable in this case.

[¶ 7] Section 14-05-24(1), N.D.C.C., requires the court to "make an equitable distribution of the property and debts of the parties." Although there is no set formula for dividing a marital estate, the trial court must equitably divide the property based on the circumstances of the particular case judged in light of the Ruff Fischer guidelines, which include:

the respective ages of the parties to the marriage; their earning abilities; the duration of the marriage and the conduct of each during the marriage; their station in life; the circumstances and necessities of each; their health and physical conditions; their financial circumstances as shown by the property owned at the time; its value and income-producing capacity, if any, and whether it was accumulated or acquired before or after the marriage; and such other matters as may be material.

Dufner v. Dufner, 2002 ND 47, ¶ 9, 640 N.W.2d 694 (citation omitted). See also Ruff v. Ruff, 78 N.D. 775, 52 N.W.2d 107 (N.D.1952)

; Fischer v. Fischer, 139 N.W.2d 845 (N.D.1966). The trial court must consider all property accumulated by the parties, whether jointly or individually owned, and property brought into the marriage by one party, and separate property acquired by gift, inheritance, or otherwise, must be included in the marital estate and is subject to distribution. Dufner, at ¶ 9. A trial court's determinations regarding division of property are treated as findings of fact and will not be reversed on appeal unless they are clearly erroneous. Mellum v. Mellum, 2000 ND 47, ¶ 14, 607 N.W.2d 580. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, although there is some evidence to support it, on the entire evidence we are left with a definite and firm conviction a mistake has been made. DesLauriers v. DesLauriers, 2002 ND 66, ¶ 20, 642 N.W.2d 892.

[¶ 8] Marjorie argues it was inequitable to award James any interest in the parties' home because he did not provide the down payment, never made a mortgage payment, and did not pay for any of the $15,000 in improvements Marjorie made to the home with her son's death benefit. When property is acquired by one spouse before the marriage, this factor is not controlling but is one of many factors to be considered in determining a property distribution. See, e.g., Weigel v. Weigel, 2000 ND 16, ¶ 8, 604 N.W.2d 462

. Moreover, there is evidence from which the trial court could find that James contributed to the purchase of the home. James testified he gave his paychecks to Marjorie and they would together drive to their creditors to pay the bills. James testified he provided the money for the mortgage payments until the mortgage was satisfied from flood insurance proceeds in 1982. James also testified he took a second mortgage on the home, which has since been satisfied, to construct a family room, wash room, bathroom, and two bedrooms above the garage. He further testified he provided some of the labor to make those improvements. We conclude it was not inequitable for the trial court to give James an encumbrance on the home while Marjorie lives there and an interest in the proceeds of its sale if it should be sold during his lifetime.

[¶ 9] Marjorie also argues the trial court erred in awarding her only one-third of James's retirement pay. Because the parties were married throughout the time James was contributing to his pension account, Marjorie argues she is entitled to one-half of James's retirement pay under the formula adopted in Bullock v. Bullock, 354 N.W.2d 904 (N.D.1984). However, we have often said use of the Bullock formula to distribute retirement pay is not mandatory because the formula is not the only method of achieving an equitable division of marital property. See, e.g., Johnson v. Johnson, 2002 ND 151, ¶ 18, 652 N.W.2d 315

. If, as we discuss in this section, the overall distribution of the marital estate is equitable, the award of one-third of James's retirement pay to Marjorie is not error. See Braun v. Braun, 532 N.W.2d 367, 370 (N.D.1995).

[¶ 10] Marjorie claims the trial court erred in awarding James a share of Marjorie's bank account because this account contains the remaining death benefit proceeds for her son which she received after the parties had separated. Marjorie argues she has been using the money to sustain herself and it is inequitable for James to be awarded any of it. She also argues she should not have been allocated the real estate tax debt because James had been ordered to pay that debt in the separation action.

[¶ 11] The trial court in this case was faced with difficult circumstances. Two of the parties' three major assets, the home and James's retirement account, are not easily liquidated assets. Marjorie's bank account, the majority of which the court said "should remain with Marjorie," was the only truly liquid asset between the parties. James requested the home be sold and the proceeds split between the parties, but the trial court instead granted Marjorie's request that she be awarded the home. Only if she decides to sell the home does she have to share any of the sale proceeds with James. James was ordered to pay the real estate taxes on the home before Marjorie received her son's death benefit, and he testified it was difficult making all of the periodic payments on the taxes because he was "short of funds." Marjorie was awarded one-third of James's not-yet accessible retirement funds, leaving the trial court only Marjorie's bank account to adjust the equitability of the distribution. The trial court awarded James $6,000 from the bank account and allocated the $7,117.43 real estate tax debt to Marjorie in an attempt to make the overall property distribution equitable. We have approved offsetting monetary awards when it is impractical or unsound to liquidate essentially nonliquid assets. See Linrud v. Linrud, 1998 ND 55, ¶ 13, 574 N.W.2d 875

; Gibbon v. Gibbon, 1997 ND 210, ¶ 8, 569 N.W.2d 707; Heley v. Heley, 506 N.W.2d 715, 718 (N.D.1993). It might have been easier for the trial court to order the home sold and the proceeds divided in a manner that avoided the necessity of awarding James funds from Marjorie's bank account to achieve what the trial court found an equitable distribution, but Marjorie did not want the...