Worthington v. Worthington

• Decision Date: 15 January 1986
• Docket Number: No. 84-1536,84-1536
• Citation: 21 Ohio St.3d 73,21 OBR 371,488 N.E.2d 150
• Parties: , 21 O.B.R. 371 WORTHINGTON, Appellant, v. WORTHINGTON, Appellee.
• Court: Ohio Supreme Court

Page 73

21 Ohio St.3d 73

488 N.E.2d 150, 21 O.B.R. 371

WORTHINGTON, Appellant, v. WORTHINGTON, Appellee.

No. 84-1536.

Supreme Court of Ohio.

Jan. 15, 1986.

Syllabus by the Court

A trial court, in determining the division of property pursuant to the factors contained in R.C. 3105.18 and all other relevant factors, does not abuse its discretion by apportioning the appreciation in value of non-marital property as a marital asset, where significant marital funds and labor are expended to improve and maintain such property.

The parties to this appeal were married in 1968. Prior to the marriage, appellee, Frederick W. Worthington, owned an eighty-eight acre farm in Brown County and had begun construction of a new home on the property. The new home was completed after the marriage and served as the marital residence. The couple expended a substantial sum of marital funds for repairs and improvements to the farm property during the marriage.

Also during the marriage, the couple bought an unimproved property in Florida and acquired business property in Hamersville, Ohio. The parties mortgaged appellee's farm in order to purchase and improve the Hamersville business property.

Appellee was a career employee of the Procter and Gamble Company. His participation in the company's profit-sharing trust plan began in 1950 and continued throughout the marriage.

On October 18, 1982, the trial court awarded appellant, Kyong N. Worthington, a divorce on grounds of gross neglect. The parties had agreed to a division of their tangible personal property but could not agree on the issues of alimony and division of marital property, and so submitted these issues to the trial court.

In its decision of April 8, 1983, the trial court determined that although the farm was appellee's non-marital property, appellant had acquired an equitable interest in that property by virtue of the expenditure of marital funds and labor to maintain and improve the property. The trial court determined that appellant should share in the increase in value of that property. In arriving at the parties' equitable interest in the farm, the trial court averaged the parties' estimates of its present value ($145,500), deducted the existing mortgage ($45,000) and the value of the farm at time of marriage ($49,400), leaving a figure of $51,100 available for property distribution. In essence, the trial court divided the appreciation into marital and non-marital components.

Considering this figure together with the values of the other properties to be distributed, the trial court then awarded to appellant the Hamersville business property, free and clear of any mortgage. The court awarded to appellee the eighty-eight acre farm, subject to the mortgage on the property. The court also awarded to appellee the Florida lot and ordered him to pay appellant for her one-half interest in that property.

The trial court further determined that appellant should receive an award of a thirty-percent interest in the pension fund shares earned by appellee during the marriage. At the time of this decision, the parties were not certain as to whether appellee was eligible to withdraw his shares. Therefore, the trial court ordered that, in the event appellee could not presently withdraw his shares, appellee would withdraw and deliver the shares to appellant at his earliest opportunity. In the event of appellee's death, appellant would have a claim against appellee's estate for the shares.

The court of appeals found that the trial court had abused its discretion in considering the appreciation on a non-marital property, the farm, as a marital asset subject to property division. The court of appeals also found that the trial court had abused its discretion in ordering the distribution of appellee's pension shares prior to a determination of his ability to withdraw those shares.

The cause is now before this court pursuant to the allowance of a motion to certify the record.

McConn & Cutrell and Jay D. Cutrell, Georgetown, for appellant.

West, West & Yelton, Paul R. Yelton, Bethel, Lindhorst & Dreidame and Robert C. Martin, Cincinnati, for appellee.

CELEBREZZE, Chief Justice.

The issue first presented for our review is whether the trial court abused its discretion in considering as a marital asset the appreciation in value of a non-marital property.

We begin by restating what is by now a well-established principle relevant to the equitable division of property, which is that " * * * trial courts are vested with broad powers in determining the appropriate scope of property awards in divorce actions." Berish v. Berish (1982), 69 Ohio St.2d 318, 319, 432 N.E.2d 183 .

Appellee contends that appreciation in the value of a non-marital property is not a marital asset and cannot be apportioned into marital and non-marital components. Appellee supports a formula which provides that only additions or improvements made by the expenditure of marital funds and labor are marital property in the ratio of the value added and the value of the non-marital property prior to the addition or improvement. ¹

Adherence to such a hard and fast rule is not desirable especially when, as here, the parties are unable to agree on the division of property and place the controversy squarely in the trial court's hands for an equitable solution. Indeed, this court stated in Cherry v. Cherry (1981), 66 Ohio St.2d 348, 355, 421 N.E.2d 1293 , that " * * * it is ill-advised and impossible for any court to set down a flat rule concerning property division upon divorce."

Many competing considerations confront the trial court when it must make a fair division of property. We emphasized in Cherry, supra, the importance of the trial court's consideration of the factors contained in R.C. 3105.18 ² and all other relevant factors in arriving at a property division. As we have recognized, these factors differ from case to case, and thus a formulaic division of property is virtually an impossible task for the trial court.

Among the considerations for the trial court in the instant case were the relative earning abilities of the parties, the parties' physical and emotional conditions, retirement benefits, duration of the marriage, the extent of education of the parties, and appellant's contribution as homemaker. Evidence before the court showed that appellant, who was Korean-born and married appellee at age twenty-six, still spoke only broken English. She had apparently not pursued further education, but rather had chosen the role of homemaker for appellee and his children from a previous marriage. The breakdown of the marriage left her with serious emotional problems necessitating therapy. Her opportunities for employment were limited. Appellee, on the other hand, was a long-time employee of Procter and Gamble who looked forward to a comfortable pension upon retirement. He also owned a valuable tract of farmland which had substantially increased in value, in part due to the efforts of both parties during the marriage.

In view of appellant's less fortunate status, her need for emotional rehabilitation and the security of a steady income, and in view of her significant contribution to the maintenance and improvement of appellee's farm property during the marriage, the trial court decided that it was equitable to apportion the appreciation on appellee's farm property in determining the division of the property. As we stated in Martin v. Martin (1985), 18 Ohio St.3d 292, 294-295, 480 N.E.2d 1112 "[i]n reviewing the equity of a division of property, one of the basic guidelines an appellate court is bound to follow is that the trial court's judgment cannot be disturbed on appeal absent a showing that the common pleas court abused its discretion in formulating its division of the marital assets and liabilities of the parties."

This implies more than merely an error of law or judgment. Rather, to constitute abuse of discretion, the court's attitude must be unreasonable, arbitrary or unconscionable. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219, 450 N.E.2d 1140. Given the facts and circumstances of the instant case, and our refusal to impose flat rules for the division of property, we cannot say that the trial court abused its discretion by apportioning into marital and non-marital components the appreciation on appellee's farm property. We hold that a trial court, in determining the division of property pursuant to the factors contained in R.C. 3105.18 and all other relevant factors, does not abuse its discretion by apportioning the appreciation in value of non-marital property as a marital asset, where significant marital funds and labor are expended to improve and maintain such property.

Appellee next contends that the trial court abused its discretion in awarding appellant her interest in appellee's pension fund shares earned during the marriage without first determining whether appellee had a present right to withdraw those shares. Appellee does not dispute the fact that the pension shares were a marital asset, but rather objects to the award contingent on the happening of a future event, his eligibility to withdraw them. Although the parties themselves were not certain as to appellee's present eligibility, the trial court was aware from the record that appellee's pension was vested and that his mandatory retirement age was seventy. Thus, the trial court knew that...