Zander v. Zander, 900121

• Decision Date: 03 June 1991
• Docket Number: No. 900121,900121
• Citation: 470 N.W.2d 603
• Parties: Kenneth M. ZANDER, Plaintiff and Appellant, v. Bernadette ZANDER, Defendant and Appellee. Civ.
• Court: North Dakota Supreme Court

Page 603

470 N.W.2d 603

Kenneth M. ZANDER, Plaintiff and Appellant, v. Bernadette ZANDER, Defendant and Appellee.

Civ. No. 900121.

Supreme Court of North Dakota.

June 3, 1991.

Wefald Law Office, Ltd., Bismarck, for plaintiff and appellant, argued by Robert O. Wefald.

Feldner & Danielson, Mandan, for defendant and appellee, argued by Rodney A. Danielson.

GIERKE, Justice.

Kenneth Zander appeals from (1) a district court judgment; and (2) an order denying his motion for new trial, relief from judgment and for a stay pending appeal. We affirm in part and reverse in part and remand.

Kenneth and Bernadette Zander were married in 1972. The couple separated in May of 1988 and their children, Christi and Jennifer, continued to reside with Bernadette. The Burleigh County Juvenile Court subsequently found Christi and Jennifer to be deprived and transferred legal custody to Burleigh County Social Services.

Kenneth filed for divorce in March of 1989. The District Court's judgment awarded custody of Jennifer to Kenneth and custody of Christi to Bernadette, with each party having reasonable visitation rights. Kenneth was allocated the dependency exemptions for both children. Kenneth was ordered to pay $500 per month in child support for Christi. Bernadette was not required to contribute to Jennifer's support. The court awarded Bernadette $12,000 of the $18,500 that Kenneth had contributed to his pension plan as part of an equitable distribution of the marital property and specified that $4,000 of that award be deemed spousal support. In addition, Bernadette was awarded 10% of Kenneth's pension entitlement when he begins to draw it. Kenneth was also ordered to pay Bernadette $100 per month as additional spousal support for 24 months.

Kenneth asserts on appeal that the district court erred in ordering him to pay $500 monthly child support for Christi. The trial court found that Bernadette was destitute and did not have the ability to contribute to Jennifer's support. Further, the trial court stated in its "Memorandum Of Opinion" that: "[Kenneth] is employed by BNI Coal and earns $17.55 per hour. His net take home pay averages $2,200. per month.... [Bernadette] is unemployed". Relying on child support guidelines that we have since determined to be invalid, see Illies v. Illies, 462 N.W.2d 878 (N.D.1990), the trial court awarded $500 per month based on Kenneth's net income of approximately $2,200 per month. The then applicable guidelines did not contain a formula for allocating support when custody is split.

Kenneth argues that the former guideline amount for non-custodial children be evenly split for divided custody. Therefore, arguing that since the child support payment for two children is $660, he should only be required to pay $330, because he has custody of Jennifer. The new guidelines published as rules at Chapter 75-02-04.1, N.D.A.C., has an explicit, presumptive formula for allocating support when custody is split. Section 75-02-04.1-03, N.D A.C., provides: "A support amount must be determined for the child or children in each parent's sole custody. The lesser amount is then subtracted from the greater. The difference is the child support amount owed by the parent with the greater obligation." This allocation method is more reasonable than the method urged by Kenneth on appeal. However, given the facts in this case, the child support for Christi would not appreciably change under the new guidelines since Bernadette is destitute and unable to provide support for Jennifer.

A proper reading of our opinion in Illies is that we will not automatically reverse decisions in which the child support guidelines were applied by the trial court. See Puklich v. Puklich, 463 N.W.2d 651 (N.D.1990).

Under Section 14-09-09.7(3), N.D.C.C., there is a rebuttable presumption that the amount of child support resulting from an application of the guidelines would be correct. Although that amount is only presumptively correct, that presumption applied at the time the trial court, believing the guidelines were applicable, made the award. The presumption was not rebutted at trial, therefore, a remand for consideration under the new guidelines would constitute a matter of form not substance. Wenzel v. Wenzel, 469 N.W.2d 156 (N.D.1991).

We believe the trial court's use of the child support guidelines amounted to harmless error, pursuant to Rule 61, N.D.R.Civ.P. Because we believe that the newly promulgated guidelines which became effective February 1, 1991, see Chapter 75-02-04.1, N.D.A.C., would apply were we to remand for further consideration of child support, we have examined the guidelines and conclude that the amount awarded by the trial court in this instance, $500, is within the guidelines. Wenzel, supra at 158.

We affirm the $500 monthly child support for Christi.

The next issue raised by Kenneth concerns whether or not the district court's distribution of Kenneth's retirement pension was clearly erroneous. A trial court's determination on matters of property division is treated as a finding of fact and will not be set aside unless "clearly erroneous". Heggen v. Heggen, 452 N.W.2d 96 (N.D.1990).

The record reflects that the only appreciable asset of this marriage is Kenneth's pension fund which was valued at $84,200 at the time of the trial. By statute, the district court is required to make an "equitable" distribution of the real and personal property of the parties. Section 14-05-24 N.D.C.C. The determination of what constitutes an equitable distribution lies within the discretion of the district court and is dependent upon the facts and circumstances of each case. Nastrom v. Nastrom, 284 N.W.2d 576 (N.D.1979).

Kenneth offered two proposals for dividing the pension fund. Kenneth's contributions to the fund totalled $18,500 at the time of the divorce. Half of that would be $9,275. As a compromise, and in lieu of Bernadette's right to future retirement benefits, Kenneth suggested awarding her more than half of the pension fund. He suggested $12,000. He suggested as an alternative proposal that the court award Bernadette 10% of his pension benefit when he retired. Bernadette proposed that she receive one-half of the value paid when Kenneth draws retirement based on the 144 months of employment during their marriage. As stated above, Kenneth intended his proposals to be in the alternative. The trial court was not required to accept one or the other, but should explain its reasons for using both alternatives.

Retirement benefits may be divided at the time of the divorce by either awarding the present value of the benefits or, when there are insufficient assets for a present division or when present evaluation is unacceptably speculative, by awarding future payments according to a fixed percentage. Lentz v. Lentz, 353 N.W.2d 742 (N.D.1984).

In deciding whether retirement benefits should be divided at the time of dissolution or upon future receipt by the employee spouse, the trial court should consider the advantages and disadvantages of each method in light of the facts before it. Taylor v. Taylor, 329 N.W.2d 795 (Minn.1983). Division of retirement benefits at the time of divorce is preferred where there are sufficient assets available at the time of divorce to divide the present value of the retirement benefits without causing an undue hardship to either spouse and where testimony on valuation is not speculative. The second method of division requires the determination of a fixed percentage for the non-employee spouse of any future payments the employee receives under the plan, payable when paid to the employee. This method should be used where present value determinations are unacceptably speculative or there are not enough assets to equitably split the retirement benefits at the time of the divorce. Taylor v. Taylor, supra. Either method is appropriate, depending upon the circumstances of the case, the status of the parties and whether the result is a reasonable valuation of the marital asset. Holbrook v. Holbrook, 103 Wis.2d 327, 309 N.W.2d 343 (App.1981).

The trial court's findings do not appear to support awarding Bernadette a present cash payment from the pension plan and also a percentage of Kenneth's pension at the time of his retirement. The trial court found a present value for the retirement benefits but divided the pension assets according to both present value and future payment methods of apportionment without explanation. If the trial court believed that Bernadette was entitled to benefit from Kenneth's employer's share paid into the pension fund, it made no specific finding to that effect. More importantly, the trial court did not determine what effect, if any, the withdrawal of $12,000 from the fund would have on Kenneth's retirement benefit. From the findings made by the trial court, we are unable to determine whether or not the distribution is equitable. On remand, we instruct the trial court to redetermine the equitable distribution of pension assets and make findings of fact to support the distribution.

Kenneth moved for a new trial based on newly discovered evidence stating that after the divorce trial he learned that Bernadette failed to disclose a $20,000 Certificate of Deposit (C.D.) she had received from her parents which should have been included in the marital estate. Bernadette and her mother responded by affidavit indicating that the money was not within Bernadette's control at any time and that the money was intended for Christi's and Jennifer's college educations. The trial court ruled that Kenneth failed to establish a basis for a new trial based on newly-discovered evidence, finding that there was no showing that the evidence proffered would produce a different result. We see no abuse of discretion in this ruling.

Accordingly, we affirm the child support award, we reverse and remand the pension distribution for reconsideration and we affirm the order denying the motion for new...