Wolfe v. Wolfe
Decision Date | 23 June 2017 |
Docket Number | NO. 2015-CA-001887-MR,NO. 2015-CA-001247-MR,NO. 2015-CA-001425-MR,2015-CA-001247-MR,2015-CA-001425-MR,2015-CA-001887-MR |
Parties | KENNETH RAY WOLFE APPELLANT/CROSS-APPELLEE v. MARGARET WOLFE (NOW HARRISON) APPELLEE/CROSS-APPELLANT |
Court | Kentucky Court of Appeals |
NOT TO BE PUBLISHED
APPEALS FROM KENTON CIRCUIT COURT
Ken Wolfe and Margaret Harrison married on September 29, 1985. Margaret first filed a petition for divorce on June 29, 2012. That action was dismissed without prejudice on May 2, 2013. Within two weeks, Margaret re-filed a petition for divorce on May 15, 2013. Pertinent to this matter is the fact that throughout the marriage, the parties kept separate checking accounts and credit cards.
The trial took place over three days - July 11, 2014; August 1, 2014, and October 31, 2014. During the trial, the parties disputed the division of the parties' property, classification of property as marital or non-marital, the allocation of the parties' debts, and evidentiary concerns. On January 9, 2015, the trial courtentered findings of fact, conclusions of law, and a separate decree. Thereafter, Ken filed a motion to alter and amend the judgment. The trial court held a hearing about the motion on June 23, 2015. On July 21, 2015, the trial court entered an order denying the motion.
On the first day of trial, Christine Dwyer, Margaret's sister testified about Margaret's inheritance and assets purchased or procured through the inheritance. Christine was the sole manager for the investments resulting from the family inheritance. First, she testified about individual lifetime gift transfers made to members of the family, including Ken. According to Christine, members of the Harrison family, and their spouses, each received $10,000 as an annual gift from Christine and Margaret's parents, William and Emilia Harrison, until their respective deaths in 2004 and 2007. In total, Ken and Margaret each received $161,000 in gifts from 1999 through 2007.
In addition, Christine provided information about the assets that Margaret inherited from her parents. William and Emilia Harrison, the parents, had three children - Margaret, Christine, and Fred Harrison. Fred died in 2001 and predeceased his parents. Margaret's father died in November 2004, and her mother died in March 2007. When the father died, his estate passed to his wife with one exception. The father's estate had an A.G. Edwards investment account, valued at $345,322. His wife did not accept the proceeds from this account, and as such, it was divided evenly among their children and passed directly to Margaret,Christine, and Fred's estate. Each recipient was given $115,105. Margaret deposited her portion into an A.G. Edwards account opened in her name.
When the mother died in 2007, the will directed that her estate be divided evenly among the three children. She too had an A.G. Edwards investment account, valued at $190,015. Each child and/or his estate took approximately one-third of this account. Margaret's share was $65,424, which was deposited into her A.G. Edwards investment account.
Besides the investment accounts, the parents had, in 2002, formed a company, Harrison Investments, LLC. It was registered in Tennessee and had an initial contribution of $2,600,000. The members of the limited liability company ("LLC") were the mother, father, Christine, Margaret and Fred's estate. The parents' ownership share was 85%, with the three remaining members each having a 5% ownership share. As previously noted, Christine was the managing partner with the sole trading authority for the LLC. The purpose of the company was to manage an investment portfolio for the benefit of the family. When William died, his share was divided evenly among the children. Similarly, when Emilia died, her share was divided evenly among the children.
In May 2008, Fred's estate requested to relinquish its interest in the company. Fred's estate received its portion and the remaining share of the LLC was reapportioned between Margaret and Christine. Then, in 2012, the LLC was transferred from Tennessee to Florida and renamed Dwyer Wolfe Investment, LLC("DWI"). At the time of the trial, Margaret had a 48% interest and Christine had a 52% interest.
Next, Margaret testified. She clarified that she had four separate Stifel Nicolaus accounts, which were entirely or partially funded with non-marital assets except that Account No. 5565-3565 was funded with her share of the proceeds resulting from the sale of the marital asset - the Den Lou Motel. This account was No. 5565-3565 - TOD account2. This account was stipulated as "marital."
The account below was non-marital:
Account No. 3174-9791 - an annuity account funded by Harrison Investments (now DWI).
The next two accounts have marital and non-marital funds:
The first account included Margaret's premarital retirement account from Procter & Gamble. She received this account prior to the marriage. Margaret retired in 1982 with eligibility to access her retirement account in 1988. When she received access to the retirement account, she rolled $97,760 of it into this account.
The second account, the Roth IRA account, began with an initial $10,000 contribution. In 2003, a $3,500 contribution was made, which was martial. But all subsequent contributions were made with non-marital funds. Theamount contributed to the IRA was approximately $42,000 from Margaret's inheritance.
Margaret also has an interest in two condominiums in Myrtle Beach, South Carolina. These condominiums were purchased by Margaret with Christine and her husband, Kenneth Dwyer, as joint tenants. The first condominium (Unit 651) is based on a fractional ownership with other owners. They purchased it for $212,000, which was paid from Margaret and Christine's inheritance. Margaret and Christine purchased another condominium (Unit 935) in Myrtle Beach for approximately $300,000. The parties are the sole owners of this condominium. The funds were obtained from their LLC that had been funded by their parents.
In 1980, Margaret bought a condominium in Villa Hills, Kentucky (2928 Vista Court). She made a down payment of $77,000 and had a mortgage for $54,829. The parties have stipulated to both the mortgage amount and the current value of the property, $165,000. During the marriage, the original mortgage for this condominium was paid off. But it now has an outstanding mortgage of $55,829. Later, Margaret and Ken bought the next-door condominium (2926 Vista Court) and combined the units into one living space. This condominium has current value of $210,000 and an outstanding mortgage of $170,000. Both mortgages were obtained during the marriage. Besides the previously-mentioned property, the Den Lou Motel, Margaret and Ken own an office building with a fair market value of $435,000.
The allocation of debt is a crucial issue in this divorce action. First, Margaret claimed that Ken owes her $42,723.15 for various expenses itemized in Petitioner's Exhibit 5. In addition, the parties had a number of credit cards. The record shows that the parties used twelve credit cards. Margaret testified that she used American Express, Discover, Target, Fifth Third MasterCard, PNC card, US Bank Visa, and Dillard's credit cards, and Ken used the remaining cards.
The parties also owned a number of vehicles. In 2010, they purchased a Winnebago. The $10,000 down payment for this vehicle, according to Margaret, came from a non-marital account. Further, she maintains that Ken provided his $10,000 from a line of credit on one of the condominiums.
Ken has control of several accounts: Oppenheimer IRA (Account #1870), Oppenheimer IRA (Account #2249), Bank of Kentucky IRA, Union Central IRA (Account #0381), and Thrift Savings Account. He testified that the Oppenheimer IRA (Account #2249) and Thrift Savings Account were entirely marital, that the Oppenheimer IRA (Account #1870) and the Bank of Kentucky IRA were a mixed marital asset; and that the Union Central IRA (Account #0381) was entirely non-marital. But Ken was unable to provide any proof of the non-marital nature nor give the non-marital monetary value of these assets.
On January 9, 2015, the trial court entered findings of fact, conclusions of law, and a decree of dissolution. In the orders, the trial court, on the disputed issues, held regarding the division of property that the following assets were non-marital and awarded to Margaret:
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