Mustard v. Mustard
2010-Ohio-2175
Twelfth Appellate District
Warren County
-Spousal Support
Consideration of Current Spouses Income When Determining Support for Ex-Spouse
Anthony and Barbara Mustard were married in 1984. Their divorce was finalized in February of 2008. As part of the divorce decree, Anthony agreed to pay $500 per month in child support until the youngest child was emancipated, as well as $750 per month in spousal support for 72 months.
A year after the divorce, Anthony filed a motion to modify spousal support, citing a change in circumstances due to his decreased salary. Anthony, who was previously self-employed, closed his business and accepted employment at a company where he earned considerably less than he did while self-employed.
After a hearing on the issue, the magistrate decreased Anthony’s spousal support obligation to $500 after finding the requisite change in circumstances. Anthony appeals on several grounds, but for the purposes of this discussion, we will discuss the second Assignment of Error, that the trial court abused its discretion when it considered Anthony’s new spouses income for spousal support purposes. After distinguishing authority cited by Anthony, the appellate court found no merit to Anthony’s arguments when it upheld the trial court. The trial court held it was proper to consider the new spouses income “since Anthony is remarried and Barbara is not, he has help with the basic living expenses, whereas Barbara does not.”
From the Opinion:
{¶17} Essentially, Anthony argues that because the trial court considered his wife's earnings, his income was considered much greater than it actually is. However, the trial court never imputed the $45,000 salary to Anthony, and instead considered the fact that due to Angela's salary, he has help with his living expenses whereas Barbara does not.
{¶18} Anthony relies on Leopold v. Leopold, Washington App. No. 04CA14, 2005-Ohio-214, in which the Fourth District Court of Appeals upheld the trial court's decision not to consider the annual income of the appellant's live-in girlfriend when determining the proper amount of spousal support he owed his ex-wife. In determining that the girlfriend's income was not relevant, the court considered that appellant paid $500 per month in fixed living expenses and that his share of the expenses was the same regardless of how much his live-in girlfriend made. The court also refused to consider the girlfriend's earnings because there was no evidence to establish that
appellant and his girlfriend shared checking accounts or commingled their funds in anyway.
{¶19} While Anthony asks this court to apply the same logic as that applied by the Fourth District, the case at bar is readily distinguishable from Leopold. The trial court heard evidence that rather than having a live-in girlfriend who holds no legal status, Anthony has remarried and permanently resides with his new wife. Instead of trying to keep the evidence out of court as the appellant did in Leopold, Anthony testified on direct examination that his wife earned $45,000 per year. Unlike the girlfriend in Leopold who did not commingle funds with the appellant, Anthony verified on crossexamination that he deposits his earnings into a joint account with Angela and that their funds are commingled for purposes of paying household bills and expenses. The trial court's determination that Angela's income helps reduce Anthony's living expenses is markedly different than a trial court considering the income of a live-in girlfriend, and Anthony's reliance on Leopold is misplaced.
{¶20} The trial court considered Angela's earnings, as introduced by Anthony during the hearing, when considering the R.C. 3105.18 factors. However, the trial court did not include Angela's salary in Anthony's annual earnings, but rather determined that because of his wife's salary, Anthony's living expenses are reduced. See Manzella v. Manzella, Montgomery App. No. 20618, 2005-Ohio-4519, ¶12 (upholding trial court's decision to consider that an "obligor directly benefits from sharing living expenses with his new spouse," and such consideration is properly considered "as part of the 'any other factor' section of R.C. 3105.18[C][1][n]"); and Fisher v. Fisher, Fairfield App. No. 2008CA00049, 2009-Ohio-4739, ¶36, (finding no abuse of discretion where trial court considered the fact that appellant directly benefited from sharing living expenses because his new wife's income was "available for living expenses").
{¶21} Having found that the trial court did not abuse its discretion by considering the impact Angela's income has on Anthony, Anthony's second assignment of error is overruled.
Monday, June 14, 2010
60(B) - Fraud adn Misrepresentation
Rettig v. Rettig
2010-Ohio-2122
Sixth Appellate District
Wood County
Rule 60(B) - Fraud and Misrepresentation
Appellant, J. Rettig, and appellee, C. Rettig were married in 1999 and have one minor child. On June 12, 2006, appellant and appellee filed a joint petition for the dissolution of their marriage. According to the separation agreement, appellant earned approximately $160,000 per year as the Chief Operating Officer of Greenline Foods, Inc. (“Greenline”) and appellee earned an actual $11,600 per year plus, $50,000 in spousal support.
On July 17, 2007 appellee filed a Civ. R. 60(B) motion for relief from judgment premised upon newly discovered evidence, fraud, misrepresentation, and other misconduct of appellant. Appellee averred that based upon recently learned facts, it appeared that at the time of the dissolution appellant held and interest, specifically, stock appreciation rights (“SARS”) in Greenline and an interest in the condominium in which he was residing.
The Court fo Appeals held that appellee proved, by a preponderance of the evidence that appellant perpetuated a fraud during the course of the parties’ dissolution in order to deprive appellee of her share of his SARS. The appellee was awarded her undivided one half interest in the SARS which amounted to $2,349,600.
From the opinion:
{¶ 8} Over the next few years, appellant was promoted to the positions of General Manager, Chief Financial Officer, and, finally, Chief Operations Officer. In May 2005, appellant received an additional 47 SARS. A few months later, appellant and appellee separated. Upon learning that appellant was residing in accommodations that he did not consider suitable, Twyman created a limited liability corporation ("LLC") for the sole purpose of purchasing a condominium and leasing it to appellant. Appellant later purchased the condominium from the LLC.
{¶ 9} According to Twyman he terminated the SARS Plan in December 2005 upon the advice of counsel, Victor Ten Brink. While appellant stated that he may have known as early as May 2005 that this plan would be terminated, Ten Brink testified that he first spoke with Twyman in October 2004. Ten Brink asserted that he informed Twyman of the fact that due to newly enacted federal tax laws, several changes would have to be made to Greenline's SARS Plan in order to comply with interim guidelines issued by the Internal Revenue Service. Twyman and Ten Brink then discussed the problem and the development of a new SARS plan over the next several months. In his testimony at trial, Ten Brink stated that appellant's SARS had no value at that point, therefore, terminating the SARS Plan would have no adverse effect. It is undisputed that Greenline was not performing well financially during this period, and Twyman wasseeking a purchaser of the company.
{¶ 10} Richard Ritter, who was hired to head the company in 2000, was the only other executive employee at Greenline. Ritter was also awarded SARS, but had a clause in his separate "Stock Appreciation Rights Grant and Agreement" stating that if the SARS Plan was terminated, that plan would be incorporated into the grant "so as to give effect to the Plan and Grant with respect to Ritter." This document and a second document captioned "Deferred Compensation Agreement" were both generated on March 1, 2000. When Ritter was fired, without cause, by Twyman on March 10, 2006, he was not only granted a promissory note for the amount due from Greenline as deferred compensation, but also provided with a separate "Incentive Fee Agreement." Pursuant to this agreement, Ritter would, upon the sale of Greenline, receive a fee in lieu of the value of his SARS. Ritter signed the fee agreement on June 29, 2006.
{¶ 11} At the hearing on appellee's motion for relief from judgment, Ritter testified that he was aware of the fact that Twyman was in negotiations for the sale of Greenline to
The Riverside Company ("Riverside") and that a company named Apio also expressed an
interest in buying Greenline. After the sale of Greenline to Riverside, Ritter received
over two million dollars pursuant to the terms of that agreement. He also became a consultant for Greenline.
{¶ 12} On May 23, 2006, Twyman, along with appellant, met with representatives of Riverside, a private equity buyer, which subsequently sought to purchase 100 percent of Greenline's issued and outstanding stock. A June 14, 2006 "Letter of Interest" sent to Greenline by Riverside, sets forth the "general terms under which we [Riverside] would acquire the Company [Greenline] from you [Twyman] subject to [Riverside's] due diligence."
{¶ 13} On June 16, 2006, David Gesmondi, a Keybank officer who apparently brokered the sale of Greenline, sent an e-mail to Riverside stating: "I spoke to Jeff Twyman and Jeff Rettig this morning, and we have a deal at cash closing * * *. Jeff is viewing this as a partnership * * * and will be prepared to execute this Monday. * * * He views this as a deal that both of us will work hard to close over the next 75 days. * * * As far as the next steps go, if you guys can get us a due diligence list and a proposed timetable, we will begin work on it immediately." On June 20, 2006, Riverside sent Twyman a "Letter of Interest" stating it would be able to issue a "formal" letter of intent and to close the transaction by August 30, 2006.
{¶ 14} On August 1, 2006, 12 days after the parties' dissolution was final, Twyman reinstated the SARS Plan, awarding appellant 109.3 SARS. One of the provisions in the SARS plan provided that the plan was fully vested upon the change in the control of Greenline. Riverside submitted its letter of intent to purchase 100 percent of the issued and capital stock of Greenline on August 14, 2006. According to Twyman, he did not decide to accept Riverside's offer until the Labor Day weekend. The closing on the actual
purchase occurred on September 21, 2006. On that date, appellant received $6,238,582.04 in exchange for his SARS.
{¶ 15} After the hearing, both parties filed proposed findings of fact and conclusions of law. On October 23, 2008, the magistrate issued a 28 page decision in which she determined that Twyman's and appellant's actions constituted fraud and misrepresentation. Thus, she granted appellee's motion for relief from judgment and determined that the $6,238,582.04 was marital property. She therefore ordered appellant to, among other things, transfer $2,349,600 of those funds to appellee as a division of property.
2010-Ohio-2122
Sixth Appellate District
Wood County
Rule 60(B) - Fraud and Misrepresentation
Appellant, J. Rettig, and appellee, C. Rettig were married in 1999 and have one minor child. On June 12, 2006, appellant and appellee filed a joint petition for the dissolution of their marriage. According to the separation agreement, appellant earned approximately $160,000 per year as the Chief Operating Officer of Greenline Foods, Inc. (“Greenline”) and appellee earned an actual $11,600 per year plus, $50,000 in spousal support.
On July 17, 2007 appellee filed a Civ. R. 60(B) motion for relief from judgment premised upon newly discovered evidence, fraud, misrepresentation, and other misconduct of appellant. Appellee averred that based upon recently learned facts, it appeared that at the time of the dissolution appellant held and interest, specifically, stock appreciation rights (“SARS”) in Greenline and an interest in the condominium in which he was residing.
The Court fo Appeals held that appellee proved, by a preponderance of the evidence that appellant perpetuated a fraud during the course of the parties’ dissolution in order to deprive appellee of her share of his SARS. The appellee was awarded her undivided one half interest in the SARS which amounted to $2,349,600.
From the opinion:
{¶ 8} Over the next few years, appellant was promoted to the positions of General Manager, Chief Financial Officer, and, finally, Chief Operations Officer. In May 2005, appellant received an additional 47 SARS. A few months later, appellant and appellee separated. Upon learning that appellant was residing in accommodations that he did not consider suitable, Twyman created a limited liability corporation ("LLC") for the sole purpose of purchasing a condominium and leasing it to appellant. Appellant later purchased the condominium from the LLC.
{¶ 9} According to Twyman he terminated the SARS Plan in December 2005 upon the advice of counsel, Victor Ten Brink. While appellant stated that he may have known as early as May 2005 that this plan would be terminated, Ten Brink testified that he first spoke with Twyman in October 2004. Ten Brink asserted that he informed Twyman of the fact that due to newly enacted federal tax laws, several changes would have to be made to Greenline's SARS Plan in order to comply with interim guidelines issued by the Internal Revenue Service. Twyman and Ten Brink then discussed the problem and the development of a new SARS plan over the next several months. In his testimony at trial, Ten Brink stated that appellant's SARS had no value at that point, therefore, terminating the SARS Plan would have no adverse effect. It is undisputed that Greenline was not performing well financially during this period, and Twyman wasseeking a purchaser of the company.
{¶ 10} Richard Ritter, who was hired to head the company in 2000, was the only other executive employee at Greenline. Ritter was also awarded SARS, but had a clause in his separate "Stock Appreciation Rights Grant and Agreement" stating that if the SARS Plan was terminated, that plan would be incorporated into the grant "so as to give effect to the Plan and Grant with respect to Ritter." This document and a second document captioned "Deferred Compensation Agreement" were both generated on March 1, 2000. When Ritter was fired, without cause, by Twyman on March 10, 2006, he was not only granted a promissory note for the amount due from Greenline as deferred compensation, but also provided with a separate "Incentive Fee Agreement." Pursuant to this agreement, Ritter would, upon the sale of Greenline, receive a fee in lieu of the value of his SARS. Ritter signed the fee agreement on June 29, 2006.
{¶ 11} At the hearing on appellee's motion for relief from judgment, Ritter testified that he was aware of the fact that Twyman was in negotiations for the sale of Greenline to
The Riverside Company ("Riverside") and that a company named Apio also expressed an
interest in buying Greenline. After the sale of Greenline to Riverside, Ritter received
over two million dollars pursuant to the terms of that agreement. He also became a consultant for Greenline.
{¶ 12} On May 23, 2006, Twyman, along with appellant, met with representatives of Riverside, a private equity buyer, which subsequently sought to purchase 100 percent of Greenline's issued and outstanding stock. A June 14, 2006 "Letter of Interest" sent to Greenline by Riverside, sets forth the "general terms under which we [Riverside] would acquire the Company [Greenline] from you [Twyman] subject to [Riverside's] due diligence."
{¶ 13} On June 16, 2006, David Gesmondi, a Keybank officer who apparently brokered the sale of Greenline, sent an e-mail to Riverside stating: "I spoke to Jeff Twyman and Jeff Rettig this morning, and we have a deal at cash closing * * *. Jeff is viewing this as a partnership * * * and will be prepared to execute this Monday. * * * He views this as a deal that both of us will work hard to close over the next 75 days. * * * As far as the next steps go, if you guys can get us a due diligence list and a proposed timetable, we will begin work on it immediately." On June 20, 2006, Riverside sent Twyman a "Letter of Interest" stating it would be able to issue a "formal" letter of intent and to close the transaction by August 30, 2006.
{¶ 14} On August 1, 2006, 12 days after the parties' dissolution was final, Twyman reinstated the SARS Plan, awarding appellant 109.3 SARS. One of the provisions in the SARS plan provided that the plan was fully vested upon the change in the control of Greenline. Riverside submitted its letter of intent to purchase 100 percent of the issued and capital stock of Greenline on August 14, 2006. According to Twyman, he did not decide to accept Riverside's offer until the Labor Day weekend. The closing on the actual
purchase occurred on September 21, 2006. On that date, appellant received $6,238,582.04 in exchange for his SARS.
{¶ 15} After the hearing, both parties filed proposed findings of fact and conclusions of law. On October 23, 2008, the magistrate issued a 28 page decision in which she determined that Twyman's and appellant's actions constituted fraud and misrepresentation. Thus, she granted appellee's motion for relief from judgment and determined that the $6,238,582.04 was marital property. She therefore ordered appellant to, among other things, transfer $2,349,600 of those funds to appellee as a division of property.
Sunday, May 2, 2010
Modification of Separation Agreement on Silent Issue
Morgan v. Morgan
2010-Ohio-1685
Montgomery County Court of Appeals
-Modification of Separation Agreement
David and Connie Morgan had their marriage terminated by Decree of Dissolution on October 11, 2002. The Decree incorporated the parties’ Amended Separation Agreement in which they divided their joint business interests. The parties’ owned several businesses. Connie’s appeal is in regards to the assets of D.C. Investments, specifically 714 Albany Street.
The Decree of Dissolution stated the property at 714 Albany Street will go to wife and she shall be solely responsible for the mortgage on said property. The Decree also stated the parties shall equally divide all remaining assets and debts of this partnership.
Connie sold the 714 Albany property, paid the balance due on the first mortgage and paid the remaining balance of $46,215.16 due on the second mortgage. Connie contended that the parties’ wholly forgot about the second mortgage on the property and argued that David should be responsible for that obligation because the proceeds of the loan secured by the second mortgage had been used to benefit a company David was awarded.
Connie filed a 60(B) motion asking the court to order David to reimburse her the amount paid on the second mortgage. After a hearing, the court ordered David to reimburse Connie $46,215.16. David objected to the Magistrate’s decision and ultimately appealed.
The appellate court reversed the Trial Court on the grounds there were provisions in the Decree that resolved issues like the one presented and was, therefore, not ambiguous.
From the Opinion:
{¶ 14} R.C. 3105.171(B) requires a court that grants a decree of divorce to divide the parties’ marital property equitably between them. "Marital property" is any real or personal property or any interest therein that either or both spouses currently owns. R.C. 3105.171(A)(3)(a)(i), (ii). R.C. 3105.171 is silent with respect to debts. Generally, when an asset is awarded to one of
the spouses in a division of marital property, a debt obligation that encumbers the asset follows the property award. Therefore, as between the parties to a divorce action, the debt becomes an
obligation of the party who is awarded the asset, to the extent that the debt is secured by the asset. The decree may create an exception by ordering a distributive award requiring the other
party to pay some or all of the debt obligation.
{¶ 15} The Amended Separation Agreement incorporated into the final decree of dissolution provided that D.C. Investments would be dissolved, that Connie would be responsible for the mortgage to the National City Bank on the property at 714 Albany Street, and that the parties would equally divide the remaining debts of D.C. Investments. Connie asked the court to order David to reimburse her for the $46,215.16 balance remaining on the second mortgage obligation that Connie paid when she sold the property. The second mortgage on the property at 714 Albany Street was a debt on an asset of D.C. Investments which the court found was not specifically identified in the Amended Separation Agreement. The trial court relied on Civ.R. 60(B) to modify the provision of the Amended Separation Agreement regarding the debt obligation on the
mortgage to National City Bank, requiring David to be responsible for the entire debt obligation on the second mortgage. We believe the court erred in so doing.
{¶ 16} R.C. 3105.65(B) provides:
{¶ 17} "A decree of dissolution of marriage has the same effect upon the property rights of the parties, including rights of dower and inheritance, as a decree of divorce. The court has full power to enforce its decree and retains jurisdiction to modify all matters pertaining to the allocation of parental rights and responsibilities for the care of the children, to the designation
of a residential parent and legal custodian of the children, to child support, to parenting time of parents with the children, and to visitation for persons who are not the children’s parents. The court, only in accordance with division (E)(2) of section 3105.18 of the Revised Code, may modify the amount or terms of spousal support."
{¶ 18} R.C. 3105.65(B) impacts Connie’s request and the court’s order in two ways. First, the provision in that section stating that a court that grants a decree of dissolution "has full power
to enforce its decree" has been applied to permit the court to construe a term of a separation agreement which is ambiguous, when there is good faith confusion concerning its requirements. In re dissolution of Marriage of Seders (1987), 42 Ohio App.3d 155; Saeks v. Saeks (1985), 24 Ohio App.2d 67; Bond v. Bond (1990), 69 Ohio App.3d 225; Smith v. Smith, Darke App. No. 09CA06, 2010-Ohio-31.
{¶ 19} Second, because per R.C. 3105.65(B) a decree of dissolution has the same effect on the property rights of the parties as a decree of divorce, the decree of dissolution is likewise subject to the limitation regarding property divisions in divorce actions that appears in R.C. 3105.171(I), which states: "A division or disbursement of property or a distributive award made under this section is not subject to future modification by the courts."
{¶ 20} There may be good faith confusion in this instance: the parties had extensive and intertwining financial interests which they made a good faith effort to divide between them. However, the Amended Separation Agreement, to the extent that it expressly dealt with any mortgage to National City Bank, imposed no obligation on David. The only obligation in that regard was imposed on Connie. Therefore, the court did not construe a term of its decree that was ambiguous. Indeed, the catch-all provision of the Amended Separation Agreement unambiguously requires the parties to equally divide debt obligations not specifically identified. Rather than following that course, the court modified the decree to impose an obligation on David that the Amended Separation Agreement did not. In doing so, the court ordered a distributive award requiring David to reimburse Connie, and thereby modified a property division order, relief which is specifically prohibited by R.C. 3105.171(I).
{¶ 21} Though a property division award may not be modified, a decree in which the award is made may be vacated pursuant to Civ.R. 60(B). Ordinarily, granting Civ.R. 60(B) relief requires that the entire judgment be vacated. However, the Supreme Court has held that a single provision of a decree of dissolution may be vacated pursuant to Civ.R. 60(B) when the incorporated separation agreement provides for future modifications by the court. In re Whitman (1998), 81 Ohio St.3d 239.
{¶ 22} "While the General Assembly has given courts continuing jurisdiction to modify those sections of a separation agreement that pertain to parental rights and responsibilities, R.C. 3105.63 and 3105.65 do not create continuing jurisdiction for a trial court to modify property divisions in separation agreements. However, nothing in the statutes suggest that parties are precluded from voluntarily including a provision for continuing jurisdiction in their separation agreement. . . .
{¶ 23} "Therefore, in a dissolution proceeding, if the parties have incorporated into the separation agreement a clause that allows the court to modify the agreement by court order, and the court has approved this agreement and incorporated it into the decree of dissolution, the court has continuing jurisdiction to enforce this clause. If the parties both consent to a modification of the agreement or actually incorporate a means for modification into their settlement agreement, the element of mutual consent has not been lost, and there is no reason to require vacation of the entire decree in order to grant relief under a Civ.R. 60(B) motion. Consequently, a trial court may grant relief from judgment under Civ.R. 60(B)(1), (2), or (3) as to the property division in the separation agreement without vacating the decree of dissolution where the parties to a dissolution have expressly agreed in a separation agreement that the agreement may be modified by court order and the agreement has been incorporated into the decree." Id. at 244.
{¶ 24} The trial court relied on Civ.R. 60(B)(5). The court could not rely on Civ.R. 60(B)(1), (2) or (3) because more than one year had passed since the decree of dissolution was granted. Civ.R. 60(B)(5), if it applies, permits relief on broader equitable grounds. Nevertheless, we believe its application is subject to the same constraint announced in Whitman regarding modifications of property division provisions in a separation agreement incorporated in a decree of dissolution.
{¶ 25} Article X of the Amended Separation Agreement is entitled "MODIFICATION BY PARTIES," and states: "Except as herein otherwise provided, this agreement shall not be altered, or modified unless it be done in writing signed by both parties." This provision does not allow the court to modify the terms of the Amended Separation Agreement. Rather, only through a subsequent agreement of the parties may the court modify the terms of the Amended Separation Agreement. Clearly, these parties never came to an agreement on an acceptable modification. Therefore, the trial court erred when it relied on Civ.R. 60(B) to modify the terms of the Amended Separation Agreement. In re Whitman.
2010-Ohio-1685
Montgomery County Court of Appeals
-Modification of Separation Agreement
David and Connie Morgan had their marriage terminated by Decree of Dissolution on October 11, 2002. The Decree incorporated the parties’ Amended Separation Agreement in which they divided their joint business interests. The parties’ owned several businesses. Connie’s appeal is in regards to the assets of D.C. Investments, specifically 714 Albany Street.
The Decree of Dissolution stated the property at 714 Albany Street will go to wife and she shall be solely responsible for the mortgage on said property. The Decree also stated the parties shall equally divide all remaining assets and debts of this partnership.
Connie sold the 714 Albany property, paid the balance due on the first mortgage and paid the remaining balance of $46,215.16 due on the second mortgage. Connie contended that the parties’ wholly forgot about the second mortgage on the property and argued that David should be responsible for that obligation because the proceeds of the loan secured by the second mortgage had been used to benefit a company David was awarded.
Connie filed a 60(B) motion asking the court to order David to reimburse her the amount paid on the second mortgage. After a hearing, the court ordered David to reimburse Connie $46,215.16. David objected to the Magistrate’s decision and ultimately appealed.
The appellate court reversed the Trial Court on the grounds there were provisions in the Decree that resolved issues like the one presented and was, therefore, not ambiguous.
From the Opinion:
{¶ 14} R.C. 3105.171(B) requires a court that grants a decree of divorce to divide the parties’ marital property equitably between them. "Marital property" is any real or personal property or any interest therein that either or both spouses currently owns. R.C. 3105.171(A)(3)(a)(i), (ii). R.C. 3105.171 is silent with respect to debts. Generally, when an asset is awarded to one of
the spouses in a division of marital property, a debt obligation that encumbers the asset follows the property award. Therefore, as between the parties to a divorce action, the debt becomes an
obligation of the party who is awarded the asset, to the extent that the debt is secured by the asset. The decree may create an exception by ordering a distributive award requiring the other
party to pay some or all of the debt obligation.
{¶ 15} The Amended Separation Agreement incorporated into the final decree of dissolution provided that D.C. Investments would be dissolved, that Connie would be responsible for the mortgage to the National City Bank on the property at 714 Albany Street, and that the parties would equally divide the remaining debts of D.C. Investments. Connie asked the court to order David to reimburse her for the $46,215.16 balance remaining on the second mortgage obligation that Connie paid when she sold the property. The second mortgage on the property at 714 Albany Street was a debt on an asset of D.C. Investments which the court found was not specifically identified in the Amended Separation Agreement. The trial court relied on Civ.R. 60(B) to modify the provision of the Amended Separation Agreement regarding the debt obligation on the
mortgage to National City Bank, requiring David to be responsible for the entire debt obligation on the second mortgage. We believe the court erred in so doing.
{¶ 16} R.C. 3105.65(B) provides:
{¶ 17} "A decree of dissolution of marriage has the same effect upon the property rights of the parties, including rights of dower and inheritance, as a decree of divorce. The court has full power to enforce its decree and retains jurisdiction to modify all matters pertaining to the allocation of parental rights and responsibilities for the care of the children, to the designation
of a residential parent and legal custodian of the children, to child support, to parenting time of parents with the children, and to visitation for persons who are not the children’s parents. The court, only in accordance with division (E)(2) of section 3105.18 of the Revised Code, may modify the amount or terms of spousal support."
{¶ 18} R.C. 3105.65(B) impacts Connie’s request and the court’s order in two ways. First, the provision in that section stating that a court that grants a decree of dissolution "has full power
to enforce its decree" has been applied to permit the court to construe a term of a separation agreement which is ambiguous, when there is good faith confusion concerning its requirements. In re dissolution of Marriage of Seders (1987), 42 Ohio App.3d 155; Saeks v. Saeks (1985), 24 Ohio App.2d 67; Bond v. Bond (1990), 69 Ohio App.3d 225; Smith v. Smith, Darke App. No. 09CA06, 2010-Ohio-31.
{¶ 19} Second, because per R.C. 3105.65(B) a decree of dissolution has the same effect on the property rights of the parties as a decree of divorce, the decree of dissolution is likewise subject to the limitation regarding property divisions in divorce actions that appears in R.C. 3105.171(I), which states: "A division or disbursement of property or a distributive award made under this section is not subject to future modification by the courts."
{¶ 20} There may be good faith confusion in this instance: the parties had extensive and intertwining financial interests which they made a good faith effort to divide between them. However, the Amended Separation Agreement, to the extent that it expressly dealt with any mortgage to National City Bank, imposed no obligation on David. The only obligation in that regard was imposed on Connie. Therefore, the court did not construe a term of its decree that was ambiguous. Indeed, the catch-all provision of the Amended Separation Agreement unambiguously requires the parties to equally divide debt obligations not specifically identified. Rather than following that course, the court modified the decree to impose an obligation on David that the Amended Separation Agreement did not. In doing so, the court ordered a distributive award requiring David to reimburse Connie, and thereby modified a property division order, relief which is specifically prohibited by R.C. 3105.171(I).
{¶ 21} Though a property division award may not be modified, a decree in which the award is made may be vacated pursuant to Civ.R. 60(B). Ordinarily, granting Civ.R. 60(B) relief requires that the entire judgment be vacated. However, the Supreme Court has held that a single provision of a decree of dissolution may be vacated pursuant to Civ.R. 60(B) when the incorporated separation agreement provides for future modifications by the court. In re Whitman (1998), 81 Ohio St.3d 239.
{¶ 22} "While the General Assembly has given courts continuing jurisdiction to modify those sections of a separation agreement that pertain to parental rights and responsibilities, R.C. 3105.63 and 3105.65 do not create continuing jurisdiction for a trial court to modify property divisions in separation agreements. However, nothing in the statutes suggest that parties are precluded from voluntarily including a provision for continuing jurisdiction in their separation agreement. . . .
{¶ 23} "Therefore, in a dissolution proceeding, if the parties have incorporated into the separation agreement a clause that allows the court to modify the agreement by court order, and the court has approved this agreement and incorporated it into the decree of dissolution, the court has continuing jurisdiction to enforce this clause. If the parties both consent to a modification of the agreement or actually incorporate a means for modification into their settlement agreement, the element of mutual consent has not been lost, and there is no reason to require vacation of the entire decree in order to grant relief under a Civ.R. 60(B) motion. Consequently, a trial court may grant relief from judgment under Civ.R. 60(B)(1), (2), or (3) as to the property division in the separation agreement without vacating the decree of dissolution where the parties to a dissolution have expressly agreed in a separation agreement that the agreement may be modified by court order and the agreement has been incorporated into the decree." Id. at 244.
{¶ 24} The trial court relied on Civ.R. 60(B)(5). The court could not rely on Civ.R. 60(B)(1), (2) or (3) because more than one year had passed since the decree of dissolution was granted. Civ.R. 60(B)(5), if it applies, permits relief on broader equitable grounds. Nevertheless, we believe its application is subject to the same constraint announced in Whitman regarding modifications of property division provisions in a separation agreement incorporated in a decree of dissolution.
{¶ 25} Article X of the Amended Separation Agreement is entitled "MODIFICATION BY PARTIES," and states: "Except as herein otherwise provided, this agreement shall not be altered, or modified unless it be done in writing signed by both parties." This provision does not allow the court to modify the terms of the Amended Separation Agreement. Rather, only through a subsequent agreement of the parties may the court modify the terms of the Amended Separation Agreement. Clearly, these parties never came to an agreement on an acceptable modification. Therefore, the trial court erred when it relied on Civ.R. 60(B) to modify the terms of the Amended Separation Agreement. In re Whitman.
Monday, April 26, 2010
Duration of Spousal Support Award - "Tacking" of Previous Marriage
Tyler v. Tyler
2010-Ohio-1428
Eighth Appellate District
Cuyahoga County
-Spousal Support - "Tacking" of previous marriage
Plaintiff-appellant Kenneth Tyler appeals the portion of his divorce decree dividing property and awarding spousal support to Diana Tyler. Specifically, Kenneth objects to the lifetime award of spousal support.
Kenneth and Diana were first married in February 1989 and divorced in 1993. They reunited, began living together again in 1996 and were remarried in July of 2002. The couple separated in 2008. At the time of their second divorce, Diana was receiving permanent disability in the amount of $753 per month while Kenneth anticipated earning $74,000 in that respective calendar year.
After a hearing, the trial court determined that Diana was entitled to lifetime spousal support of $1,100 per month, subject to modification by the court. Kenneth asserts that the trial court erred when it ordered him to pay "lifetime spousal support for a marriage lasting 6.5 years." The appellate court affirmed.
From the Opinion:
{¶ 13} Specifically, Kenneth argues that the trial court’s decision — making the spousal support indefinite — was not consistent with the Ohio Supreme Court’s holding in Kunkle v. Kunkle (1990), 51 Ohio St.3d 64, 554 N.E.2d 83. in Kunkle, the Ohio Supreme Court held, at paragraph one of the syllabus:"Except in cases involving a marriage of long duration, parties of advanced age or a homemaker-spouse with little opportunity to develop meaningful employment outside the home, where a payee spouse has the resources, ability and potential to be self-supporting, an award of sustenance alimony should provide for the termination of the award, within a reasonable time and upon a date certain, in order to place a definitive limit upon the parties’ rights and responsibilities."
{¶ 14} Notably, however, the Kunkle court also recognized that "providing a termination date is not legally mandated and, in some situations, it could work a hardship on either the payor or payee. " Id. at 68, quoting Koepke v. Koepke (1983), 12 Ohio App.3d 80, 81, 466 N.E.2d 570. The high court further pointed out that "if under reasonable circumstances a divorced spouse does not have the resources, ability or potential to become self-supporting, then an award of
sustenance alimony for life would be proper." (Emphasis sic.) Id. at 69.
{¶ 15} In the present case, the trial court found that Diana suffered from obsessive compulsive disorder with depression and "has been deemed by the Social Security Administration to be permanently disabled." The court further found that Diana’s disability prevents her from seeking gainful employment and that she "cannot complete her daily activities of life." And based on a report from the SSA, the court also determined that Diana "cannot maintain employment," and that her income from Social Security disability was $9,036 per year.
{¶ 16} The trial court considered that Kenneth’s income was $74,000 per year and that he was "gainfully employed in an area that is highly specialized."
{¶ 17} The trial court then determined that Diana was entitled to lifetime spousal support of $1,100 per month, subject to modification by the court.
{¶ 19} Although the trial court in this case found the duration of the marriage to be 6.5 years, it also heard evidence that the parties were previously married and that they lived together all but three years since they were first married in 1989 (thus, all but three out of 20 years). Under similar circumstances, the Ninth District upheld an indefinite spousal support. See Moore v. Moore (1992), 83 Ohio App.3d 75, 613 N.E.2d 1097. In Moore, the parties were married twice, with the second marriage lasting only four years. The court found that "the previous legal, marital relationship [was] relevant to the trial court’s decision to award spousal support" under R.C. 3105.18(C)(1)(n) ("any other factor that the court *** finds to be relevant and equitable"). See, also, Jernigan v. Jernigan (July 2, 1998), 8th Dist. No. 72899 (recognizing the principle set forth in Moore that the parties’ first marriage may be considered in determining spousal support for the second marriage); Swartz v. Swartz (Feb. 24, 1997), 12th Dist. No. CA96-07-063 (parties’ first marriage may be relevant to a spousal support determination).
{¶ 20} Moreover, the trial court (unlike the trial court in Kunkle) reserved jurisdiction to modify the amount and the term of the spousal support award pursuant to R.C. 3105.18(E). The failure to assign a termination date is not a lifetime award where the court retains continuing jurisdiction to decrease or terminate the spousal support based on a change in either party’s circumstances. Donese v. Donese (Apr. 10, 1998), 2d Dist. No. 97CA70. And at a modification hearing, the court can once again determine if it is appropriate to set a termination date. See Vanke v. Vanke (1992), 80 Ohio App.3d 576, 581, 609 N.E.2d 1328. Accordingly, appellant is not without a remedy should future facts demonstrate a modification is warranted.
2010-Ohio-1428
Eighth Appellate District
Cuyahoga County
-Spousal Support - "Tacking" of previous marriage
Plaintiff-appellant Kenneth Tyler appeals the portion of his divorce decree dividing property and awarding spousal support to Diana Tyler. Specifically, Kenneth objects to the lifetime award of spousal support.
Kenneth and Diana were first married in February 1989 and divorced in 1993. They reunited, began living together again in 1996 and were remarried in July of 2002. The couple separated in 2008. At the time of their second divorce, Diana was receiving permanent disability in the amount of $753 per month while Kenneth anticipated earning $74,000 in that respective calendar year.
After a hearing, the trial court determined that Diana was entitled to lifetime spousal support of $1,100 per month, subject to modification by the court. Kenneth asserts that the trial court erred when it ordered him to pay "lifetime spousal support for a marriage lasting 6.5 years." The appellate court affirmed.
From the Opinion:
{¶ 13} Specifically, Kenneth argues that the trial court’s decision — making the spousal support indefinite — was not consistent with the Ohio Supreme Court’s holding in Kunkle v. Kunkle (1990), 51 Ohio St.3d 64, 554 N.E.2d 83. in Kunkle, the Ohio Supreme Court held, at paragraph one of the syllabus:"Except in cases involving a marriage of long duration, parties of advanced age or a homemaker-spouse with little opportunity to develop meaningful employment outside the home, where a payee spouse has the resources, ability and potential to be self-supporting, an award of sustenance alimony should provide for the termination of the award, within a reasonable time and upon a date certain, in order to place a definitive limit upon the parties’ rights and responsibilities."
{¶ 14} Notably, however, the Kunkle court also recognized that "providing a termination date is not legally mandated and, in some situations, it could work a hardship on either the payor or payee. " Id. at 68, quoting Koepke v. Koepke (1983), 12 Ohio App.3d 80, 81, 466 N.E.2d 570. The high court further pointed out that "if under reasonable circumstances a divorced spouse does not have the resources, ability or potential to become self-supporting, then an award of
sustenance alimony for life would be proper." (Emphasis sic.) Id. at 69.
{¶ 15} In the present case, the trial court found that Diana suffered from obsessive compulsive disorder with depression and "has been deemed by the Social Security Administration to be permanently disabled." The court further found that Diana’s disability prevents her from seeking gainful employment and that she "cannot complete her daily activities of life." And based on a report from the SSA, the court also determined that Diana "cannot maintain employment," and that her income from Social Security disability was $9,036 per year.
{¶ 16} The trial court considered that Kenneth’s income was $74,000 per year and that he was "gainfully employed in an area that is highly specialized."
{¶ 17} The trial court then determined that Diana was entitled to lifetime spousal support of $1,100 per month, subject to modification by the court.
{¶ 19} Although the trial court in this case found the duration of the marriage to be 6.5 years, it also heard evidence that the parties were previously married and that they lived together all but three years since they were first married in 1989 (thus, all but three out of 20 years). Under similar circumstances, the Ninth District upheld an indefinite spousal support. See Moore v. Moore (1992), 83 Ohio App.3d 75, 613 N.E.2d 1097. In Moore, the parties were married twice, with the second marriage lasting only four years. The court found that "the previous legal, marital relationship [was] relevant to the trial court’s decision to award spousal support" under R.C. 3105.18(C)(1)(n) ("any other factor that the court *** finds to be relevant and equitable"). See, also, Jernigan v. Jernigan (July 2, 1998), 8th Dist. No. 72899 (recognizing the principle set forth in Moore that the parties’ first marriage may be considered in determining spousal support for the second marriage); Swartz v. Swartz (Feb. 24, 1997), 12th Dist. No. CA96-07-063 (parties’ first marriage may be relevant to a spousal support determination).
{¶ 20} Moreover, the trial court (unlike the trial court in Kunkle) reserved jurisdiction to modify the amount and the term of the spousal support award pursuant to R.C. 3105.18(E). The failure to assign a termination date is not a lifetime award where the court retains continuing jurisdiction to decrease or terminate the spousal support based on a change in either party’s circumstances. Donese v. Donese (Apr. 10, 1998), 2d Dist. No. 97CA70. And at a modification hearing, the court can once again determine if it is appropriate to set a termination date. See Vanke v. Vanke (1992), 80 Ohio App.3d 576, 581, 609 N.E.2d 1328. Accordingly, appellant is not without a remedy should future facts demonstrate a modification is warranted.
Termination of Parenting Time (Juvenile Visitation)
Dubec v. Pochiro
2010-Ohio-1293
Seventh District Court of Appeals
Mahoning County
Juvenile Visitation
Defendant-appellant Christopher Pochiro appeals a decision terminating visitation with his fourteen-year-old daughter (Lana) and reducing his contact to weekly phone calls. The parties were never married. Several years of battling and one relocation resulted in Pochiro being granted the Standard Order of Visitation with visitation to take place at the paternal grandmother’s residence. The Order was effective September 15, 2008.
On October 8, 2008, less than a month after the Order took effect, Pochiro’s mother died. Pochiro exercised his regularly scheduled visitation the weekend of the funeral. During the weekend, the police were called to Pochiro’s residence. After Lana expressed concerns regarding her safety, the police decided to remove her from Pochiro’s care and placed her in the temporary custody of her maternal aunt. Venuto (Plaintiff-appellee) filed a motion to suspend visitation. After a hearing the court terminated Pochiro’s physical visitation with Lana, but did allow weekly telephone contact. On appeal, Pochiro asserted three assignments of error. All of which were found to have merit.
From the Opinion:
{¶23} Generally, the trial court looks only to the factors enumerated in R.C. 3109.051(D) and determines if modification of visitation is in the best interest of the child. Braatz v. Braatz (1999), 85 Ohio St.3d 40, 45, 706 N.E.2d 1218. However, in some cases, the foregoing statute does not stand in isolation. In re Kaiser, 7th Dist. No. 04 CO 9, 2004-Ohio-7208, ¶10. It must be read and interpreted in conjunction with other factors derived from caselaw to protect against infringement upon an individual’s constitutional rights. Id.
{¶24} This court has specifically held that "[t]he nonresidential parent has a fundamental and natural right to visitation." Anderson v. Anderson (2002), 147 Ohio App.3d 513, 2002-Ohio-1156, 771 N.E.2d 303, ¶22 (7th Dist.), citing Johntonny v. Malliski (1990), 67 Ohio App.3d 709, 588 N.E.2d 200, and Pettry v. Pettry (1984), 20 Ohio App.3d 350, 486 N.E.2d 213. "The child also has a fundamental right to visitation with the nonresidential parent." Id., citing Porter v. Porter (1971), 25 Ohio St.2d 123, 54 O.O. 260, 267 N.E.2d 299, paragraph three of the syllabus.
{¶25} Concerning this fundamental right of the nonresidential parent to visitation with their child, this court has also noted that the right should be denied only under extraordinary circumstances. Hoppel v. Hoppel, 7th Dist. No. 03 CO 56, 2004-Ohio-1574, ¶44, citing Pettry, supra, paragraph one of the syllabus. The burden of proof is on the one contesting visitation to demonstrate extraordinary circumstances by clear and convincing evidence. Pettry, 20 Ohio App.3d at 352-353, 486 N.E.2d 213.
{¶26} Pettry identified two extraordinary circumstances that would qualify: (1) if the noncustodial parent was unfit; or (2) if visitation would cause harm to the child. Another court has held that it would be an extraordinary circumstance if the noncustodial parent were imprisoned for a term of years for a crime of violence. In re Hall (1989), 65 Ohio App.3d 88, 90, 582 N.E.2d 1055. The examples listed in Pettry and Hall are not meant to provide an exclusive list of possible extraordinary circumstances. Hoppel, supra (involving nonresidential parent’s conviction for sexual battery against subject child’s stepsister). Once the custodial parent proves the existence of an extraordinary circumstance, the burden shifts back to the noncustodial parent to prove that any visitation would be in the best interests of the child. Id.
{¶30} Given that the trial court terminated Pochiro’s constitutionally protected visitation rights, we must now review the court’s judgment based on the standard elucidated above. The trial court did review Lana’s best interests under the factors enumerated in R.C. 3109.051(D). The court gave particular attention to: Lana’s prior interrelationship with Pochiro, R.C. 3109.051(D)(1); her age, R.C. 3109.051(D)(4); her adjustment to home, school, and community; R.C.3109.051(D)(5); her wish to not spend time with Pochiro, R.C. 3109.051(D)(6); and the "perceived safety of the child," R.C. 3109.051(D)(7). However, a thorough review of the trial court’s judgment entry reveals that it did not make the required initial finding that there was clear and convincing evidence of extraordinary circumstances that would justify terminating Pochiro’s visitation rights. The trial court skipped that step and instead limited its review to R.C. 3109.051(D)’s best interests of the child factors.
2010-Ohio-1293
Seventh District Court of Appeals
Mahoning County
Juvenile Visitation
Defendant-appellant Christopher Pochiro appeals a decision terminating visitation with his fourteen-year-old daughter (Lana) and reducing his contact to weekly phone calls. The parties were never married. Several years of battling and one relocation resulted in Pochiro being granted the Standard Order of Visitation with visitation to take place at the paternal grandmother’s residence. The Order was effective September 15, 2008.
On October 8, 2008, less than a month after the Order took effect, Pochiro’s mother died. Pochiro exercised his regularly scheduled visitation the weekend of the funeral. During the weekend, the police were called to Pochiro’s residence. After Lana expressed concerns regarding her safety, the police decided to remove her from Pochiro’s care and placed her in the temporary custody of her maternal aunt. Venuto (Plaintiff-appellee) filed a motion to suspend visitation. After a hearing the court terminated Pochiro’s physical visitation with Lana, but did allow weekly telephone contact. On appeal, Pochiro asserted three assignments of error. All of which were found to have merit.
From the Opinion:
{¶23} Generally, the trial court looks only to the factors enumerated in R.C. 3109.051(D) and determines if modification of visitation is in the best interest of the child. Braatz v. Braatz (1999), 85 Ohio St.3d 40, 45, 706 N.E.2d 1218. However, in some cases, the foregoing statute does not stand in isolation. In re Kaiser, 7th Dist. No. 04 CO 9, 2004-Ohio-7208, ¶10. It must be read and interpreted in conjunction with other factors derived from caselaw to protect against infringement upon an individual’s constitutional rights. Id.
{¶24} This court has specifically held that "[t]he nonresidential parent has a fundamental and natural right to visitation." Anderson v. Anderson (2002), 147 Ohio App.3d 513, 2002-Ohio-1156, 771 N.E.2d 303, ¶22 (7th Dist.), citing Johntonny v. Malliski (1990), 67 Ohio App.3d 709, 588 N.E.2d 200, and Pettry v. Pettry (1984), 20 Ohio App.3d 350, 486 N.E.2d 213. "The child also has a fundamental right to visitation with the nonresidential parent." Id., citing Porter v. Porter (1971), 25 Ohio St.2d 123, 54 O.O. 260, 267 N.E.2d 299, paragraph three of the syllabus.
{¶25} Concerning this fundamental right of the nonresidential parent to visitation with their child, this court has also noted that the right should be denied only under extraordinary circumstances. Hoppel v. Hoppel, 7th Dist. No. 03 CO 56, 2004-Ohio-1574, ¶44, citing Pettry, supra, paragraph one of the syllabus. The burden of proof is on the one contesting visitation to demonstrate extraordinary circumstances by clear and convincing evidence. Pettry, 20 Ohio App.3d at 352-353, 486 N.E.2d 213.
{¶26} Pettry identified two extraordinary circumstances that would qualify: (1) if the noncustodial parent was unfit; or (2) if visitation would cause harm to the child. Another court has held that it would be an extraordinary circumstance if the noncustodial parent were imprisoned for a term of years for a crime of violence. In re Hall (1989), 65 Ohio App.3d 88, 90, 582 N.E.2d 1055. The examples listed in Pettry and Hall are not meant to provide an exclusive list of possible extraordinary circumstances. Hoppel, supra (involving nonresidential parent’s conviction for sexual battery against subject child’s stepsister). Once the custodial parent proves the existence of an extraordinary circumstance, the burden shifts back to the noncustodial parent to prove that any visitation would be in the best interests of the child. Id.
{¶30} Given that the trial court terminated Pochiro’s constitutionally protected visitation rights, we must now review the court’s judgment based on the standard elucidated above. The trial court did review Lana’s best interests under the factors enumerated in R.C. 3109.051(D). The court gave particular attention to: Lana’s prior interrelationship with Pochiro, R.C. 3109.051(D)(1); her age, R.C. 3109.051(D)(4); her adjustment to home, school, and community; R.C.3109.051(D)(5); her wish to not spend time with Pochiro, R.C. 3109.051(D)(6); and the "perceived safety of the child," R.C. 3109.051(D)(7). However, a thorough review of the trial court’s judgment entry reveals that it did not make the required initial finding that there was clear and convincing evidence of extraordinary circumstances that would justify terminating Pochiro’s visitation rights. The trial court skipped that step and instead limited its review to R.C. 3109.051(D)’s best interests of the child factors.
Thursday, April 8, 2010
Social Security Benefits to Offset Public Pension
Obar v. Obar
2010-Ohio-1333
Fifth District
Ashland County
-Social security benefits evaluated in relation to the other party’s interest in a public pension
Plaintiff-Appellant, Richard Don Obar appeals from the Decree of Divorce entered by the Ashland County DR Court. The appellant raised two assignments of error, but for the purposes of this review, we will only discuss the social security offset.
Appellant argues that the trial court erred by not considering the hypothetical Social Security offset against appellants PERS pension. Specifically, appellant argues that because appellee’s social security retirement benefits are not subject to division then the fact that appellant’s PERS is subject to division, and was, in fact, divided by the trial court, such division would obviously be unfair unless the PERS value is adjusted for the discrepancy.
After determining that "illumination of this issue is warranted," the court examines several approaches to considering social security benefits when dividing a public pension. The court examined Cornbleth v. Cornbleth, 580 A.2d 369, 372 (calculation of a hypothetical social security benefit to deduct from the public pension), Neville v. Neville, 791 N.E.2d 434 (the trial court may consider the parties’ future Social Security benefits in relation to all marital assets) and R.C. 3105.171(F)(9).
The trial court’s decision was upheld on the basis of R.C. 3105.171(F)(9) which, when enacted in April of 2009, made it clear that the trial court has discretion as to whether to consider social security benefits in dividing a public pension.
From the Opinion:
{¶18} "In the leading case of Cornbleth v. Cornbleth (1990), 397 Pa.Super. 421, 427, 580 A.2d 369, 372, the court stated:
{¶19} "’To facilitate a process of equating [public pension participants] and Social Security participants we believe it will be necessary to compute the present value of a Social Security benefit had the [public plan] participant been participating in the Social Security system. This present value should then be deducted from the present value of the [public pension] at which time a figure for the marital portion of the pension could be derived and included in the marital estate for distribution purposes. This process should result in equating, as near as possible, the two classes of individuals for equitable distribution purposes.'
{¶20} "This formula, which calculates a ‘hypothetical Social Security benefit’ for a party who has, in reality, participated in a public retirement plan, not Social Security, and then deducts that hypothetical amount from the public pension, has been adopted by several appellate districts in Ohio.
{¶21} "[T]he Cornbleth method seems to be both the most thorough and the most equitable under the circumstances presented herein. Specifically, this method appears to give both parties comparable credit in terms of the years of participation in their respective programs, whereas, in practice, the other methods may well penalize the PERS participant by subjecting a larger proportionate share of that spouse's retirement to division as a marital asset. On remand, the trial court should apply the Cornbleth formula of calculation* * *." Id. at 30-32.
{¶25} "However, as appellant concedes, the Ohio Supreme Court has not mandated the Cornbleth approach as the preferred method of addressing these types of private/public retirement benefit scenarios. Moreover, our most recent ruling in this realm can be found in Back v. Back (Dec. 29, 1999), Richland App. No. 99 CA 46, unreported. In that case, appellant wife was employed by the City of Mansfield and participated in PERS, the public employees' retirement plan. Appellee husband worked for a waste management company, participating in social security but not in any pension plans. We held: Upon reconsideration, we find the trial court did not abuse its discretion in calculating the division of retirement benefits on remand even though the trial court did not follow the mandate of this court. We conclude, as did the trial court, the proper division of retirement benefits is to subtract appellee's potential social security benefit from appellant's potential PERS benefit and divide the remaining portion of the potential monthly PERS benefit equally between the parties. Id. at 2." Id at 2.
{¶27} The cases appellant cites pre-date the Ohio Supreme Court's decision in Neville. In Neville, the Court held that "to make an equitable distribution of marital property, [the trial court] may consider the parties' future Social Security benefits in relation to all marital assets." (Emphasis added.) Id at paragraph 11. As noted by the court in Rorick v. Rorick, Lorain App. No. 09CA009533, 2009-Ohio-3173. "Neville clearly does not mandate that the trial court consider Social Security benefits when equitably dividing marital assets." Id at paragraph 12.
{¶28} Subsequent to Neville, R.C. 3105.171(F)(9) was adopted, effective April 7, 2009. It states, "In making a division of marital property and in determining whether to make and the amount of any distributive award under this section, the court shall consider all of the following factors: …. (9) Any retirement benefits of the spouse, excluding the social security benefits of a spouse except as may be relevant for purposes of dividing a public pension,…" While Neville allowed social security benefits to be considered against all martial assets, this section limits social security benefits to be considered "as may be relevant" in dividing public pensions. This statute took effect only days before the decree in this case. And this statute still seems to leave it to the
discretion of the trial court as to whether to consider said benefits in dividing a public pension. In addition, the statement of this assignment of error by the appellant specifically argues for the Cornbleth method, not the procedure set forth by us in Bourjaily or by the Ohio Supreme Court in Neville or by R.C. 3105.171(F)(9).
{¶29} We find, therefore, that the trial court did not err in refusing to consider appellant’s ypothetical social security offset against appellant’s PERS pension.
2010-Ohio-1333
Fifth District
Ashland County
-Social security benefits evaluated in relation to the other party’s interest in a public pension
Plaintiff-Appellant, Richard Don Obar appeals from the Decree of Divorce entered by the Ashland County DR Court. The appellant raised two assignments of error, but for the purposes of this review, we will only discuss the social security offset.
Appellant argues that the trial court erred by not considering the hypothetical Social Security offset against appellants PERS pension. Specifically, appellant argues that because appellee’s social security retirement benefits are not subject to division then the fact that appellant’s PERS is subject to division, and was, in fact, divided by the trial court, such division would obviously be unfair unless the PERS value is adjusted for the discrepancy.
After determining that "illumination of this issue is warranted," the court examines several approaches to considering social security benefits when dividing a public pension. The court examined Cornbleth v. Cornbleth, 580 A.2d 369, 372 (calculation of a hypothetical social security benefit to deduct from the public pension), Neville v. Neville, 791 N.E.2d 434 (the trial court may consider the parties’ future Social Security benefits in relation to all marital assets) and R.C. 3105.171(F)(9).
The trial court’s decision was upheld on the basis of R.C. 3105.171(F)(9) which, when enacted in April of 2009, made it clear that the trial court has discretion as to whether to consider social security benefits in dividing a public pension.
From the Opinion:
{¶18} "In the leading case of Cornbleth v. Cornbleth (1990), 397 Pa.Super. 421, 427, 580 A.2d 369, 372, the court stated:
{¶19} "’To facilitate a process of equating [public pension participants] and Social Security participants we believe it will be necessary to compute the present value of a Social Security benefit had the [public plan] participant been participating in the Social Security system. This present value should then be deducted from the present value of the [public pension] at which time a figure for the marital portion of the pension could be derived and included in the marital estate for distribution purposes. This process should result in equating, as near as possible, the two classes of individuals for equitable distribution purposes.'
{¶20} "This formula, which calculates a ‘hypothetical Social Security benefit’ for a party who has, in reality, participated in a public retirement plan, not Social Security, and then deducts that hypothetical amount from the public pension, has been adopted by several appellate districts in Ohio.
{¶21} "[T]he Cornbleth method seems to be both the most thorough and the most equitable under the circumstances presented herein. Specifically, this method appears to give both parties comparable credit in terms of the years of participation in their respective programs, whereas, in practice, the other methods may well penalize the PERS participant by subjecting a larger proportionate share of that spouse's retirement to division as a marital asset. On remand, the trial court should apply the Cornbleth formula of calculation* * *." Id. at 30-32.
{¶25} "However, as appellant concedes, the Ohio Supreme Court has not mandated the Cornbleth approach as the preferred method of addressing these types of private/public retirement benefit scenarios. Moreover, our most recent ruling in this realm can be found in Back v. Back (Dec. 29, 1999), Richland App. No. 99 CA 46, unreported. In that case, appellant wife was employed by the City of Mansfield and participated in PERS, the public employees' retirement plan. Appellee husband worked for a waste management company, participating in social security but not in any pension plans. We held: Upon reconsideration, we find the trial court did not abuse its discretion in calculating the division of retirement benefits on remand even though the trial court did not follow the mandate of this court. We conclude, as did the trial court, the proper division of retirement benefits is to subtract appellee's potential social security benefit from appellant's potential PERS benefit and divide the remaining portion of the potential monthly PERS benefit equally between the parties. Id. at 2." Id at 2.
{¶27} The cases appellant cites pre-date the Ohio Supreme Court's decision in Neville. In Neville, the Court held that "to make an equitable distribution of marital property, [the trial court] may consider the parties' future Social Security benefits in relation to all marital assets." (Emphasis added.) Id at paragraph 11. As noted by the court in Rorick v. Rorick, Lorain App. No. 09CA009533, 2009-Ohio-3173. "Neville clearly does not mandate that the trial court consider Social Security benefits when equitably dividing marital assets." Id at paragraph 12.
{¶28} Subsequent to Neville, R.C. 3105.171(F)(9) was adopted, effective April 7, 2009. It states, "In making a division of marital property and in determining whether to make and the amount of any distributive award under this section, the court shall consider all of the following factors: …. (9) Any retirement benefits of the spouse, excluding the social security benefits of a spouse except as may be relevant for purposes of dividing a public pension,…" While Neville allowed social security benefits to be considered against all martial assets, this section limits social security benefits to be considered "as may be relevant" in dividing public pensions. This statute took effect only days before the decree in this case. And this statute still seems to leave it to the
discretion of the trial court as to whether to consider said benefits in dividing a public pension. In addition, the statement of this assignment of error by the appellant specifically argues for the Cornbleth method, not the procedure set forth by us in Bourjaily or by the Ohio Supreme Court in Neville or by R.C. 3105.171(F)(9).
{¶29} We find, therefore, that the trial court did not err in refusing to consider appellant’s ypothetical social security offset against appellant’s PERS pension.
Sunday, March 28, 2010
Relocation of the Custodial Parent - What is the Trial Court Supposed to Determine?
Acus v. Acus
2010-Ohio-856
Twelfth District Court of Appeals
Madison County
-Custody: Relocation of Custodial Parent
Appellant-Mother appeals from the decision of the Madison County DR Court denying her request to relocate to Cleveland with her daughter following her divorce from Appellee-Father. Mother, as residential parent argues that pursuant to R.C. 3109.051, the DR Court erred in its decision preventing her from relocating.
The Appellate Court, after reviewing R.C. 3109.051 reversed and remanded finding that the DR Court did not comply with the required statute. In short, the statute gives the DR Court the authority to determine, at a hearing, whether it is in the best interest of the child to revise the parenting time schedule for the child. The statute does not give the DR Court the authority to prevent the residential parent from relocating with the child.
From the Opinion:
{¶12} R.C. 3109.051(G)(1), which deals with the requirements of a residential parent intending to relocate, states, in pertinent part:
{¶13} "If the residential parent intends to move to a residence other than the residence specified in the parenting time order or decree of the court, the parent shall file a notice of intent to relocate with the court that issued the order or decree. * * * Upon receipt of the notice, the court, on its own motion or the motion of the parent who is not the residential parent, may schedule a hearing with notice to both parents to determine whether it is in the best interest of the child to revise the parenting time schedule for the child." (Emphasis added.)
{¶14} In turn, while the express terms of R.C. 3109.051(G)(1) permit the trial court to schedule a hearing "to determine whether it is in the best interest of the child to revise the parenting time schedule for the child," the statute "does not give the trial court the authority to prevent the residential parent from relocating with the child."[citations omitted].
{¶15} In this case, there were no prior agreements preventing Mother from relocating, nor were there any provisions in the dispositional order regarding her ability to relocate.2 See In re T.M. at ¶13, citing Williams v. Williams, Trumball App. No. 2002- T-0101, 2004-Ohio-3992; Kassavei, 2001 WL 589392 at *2; see, also, Zimmer v. Zimmer, Franklin App. No. 00AP-383, 2001-Ohio-4226, 2001 WL 185356, at *2-*4. As a result, and under the facts of this case, the trial court did not have the authority to prevent Mother from relocating to Cleveland with her minor daughter. Instead, pursuant to R.C. 3109.051(G)(1), the court could merely schedule a hearing "to determine whether it is in the best interest of the child to revise the parenting time schedule for the child."3 See In re Noble, 2001 WL 314889 at *2; Kassavei, 2001 WL 589392 at *2; Spain, 1995 WL 380067 at *2. Therefore, because the trial court's decision preventing Mother from relocating with her daughter outside of the "Madison County area" was contrary to law, appellant's assignments of error are sustained and this matter is remanded for further proceedings. Kassavei, 2001 WL 589392 at *2.
2010-Ohio-856
Twelfth District Court of Appeals
Madison County
-Custody: Relocation of Custodial Parent
Appellant-Mother appeals from the decision of the Madison County DR Court denying her request to relocate to Cleveland with her daughter following her divorce from Appellee-Father. Mother, as residential parent argues that pursuant to R.C. 3109.051, the DR Court erred in its decision preventing her from relocating.
The Appellate Court, after reviewing R.C. 3109.051 reversed and remanded finding that the DR Court did not comply with the required statute. In short, the statute gives the DR Court the authority to determine, at a hearing, whether it is in the best interest of the child to revise the parenting time schedule for the child. The statute does not give the DR Court the authority to prevent the residential parent from relocating with the child.
From the Opinion:
{¶12} R.C. 3109.051(G)(1), which deals with the requirements of a residential parent intending to relocate, states, in pertinent part:
{¶13} "If the residential parent intends to move to a residence other than the residence specified in the parenting time order or decree of the court, the parent shall file a notice of intent to relocate with the court that issued the order or decree. * * * Upon receipt of the notice, the court, on its own motion or the motion of the parent who is not the residential parent, may schedule a hearing with notice to both parents to determine whether it is in the best interest of the child to revise the parenting time schedule for the child." (Emphasis added.)
{¶14} In turn, while the express terms of R.C. 3109.051(G)(1) permit the trial court to schedule a hearing "to determine whether it is in the best interest of the child to revise the parenting time schedule for the child," the statute "does not give the trial court the authority to prevent the residential parent from relocating with the child."[citations omitted].
{¶15} In this case, there were no prior agreements preventing Mother from relocating, nor were there any provisions in the dispositional order regarding her ability to relocate.2 See In re T.M. at ¶13, citing Williams v. Williams, Trumball App. No. 2002- T-0101, 2004-Ohio-3992; Kassavei, 2001 WL 589392 at *2; see, also, Zimmer v. Zimmer, Franklin App. No. 00AP-383, 2001-Ohio-4226, 2001 WL 185356, at *2-*4. As a result, and under the facts of this case, the trial court did not have the authority to prevent Mother from relocating to Cleveland with her minor daughter. Instead, pursuant to R.C. 3109.051(G)(1), the court could merely schedule a hearing "to determine whether it is in the best interest of the child to revise the parenting time schedule for the child."3 See In re Noble, 2001 WL 314889 at *2; Kassavei, 2001 WL 589392 at *2; Spain, 1995 WL 380067 at *2. Therefore, because the trial court's decision preventing Mother from relocating with her daughter outside of the "Madison County area" was contrary to law, appellant's assignments of error are sustained and this matter is remanded for further proceedings. Kassavei, 2001 WL 589392 at *2.
Amending a QDRO That Does Not Reflect a Divorce Decree's Intent
Schneider v. Schneider
2010-Ohio-534
Fifth Appellate District
Stark County
-Qualified Domestic Relations Orders (QDRO)
Appellant, Paul and Appellee Helen were divorced on November 7, 1996. The decree divided appellant’s pension equally (50/50). A QDRO was filed and approved by the trial court on March 4, 1997. Upon retiring on December 31, 2008, appellant discovered appellee woudl receive fifty percent of his pension for the entire period of his employment rather than for the years of the parties’ marriage.
On October 28, 2008, appellant filed a motion for clarification. On March 30, 2009, the trial court found no ambiguity in its order and denied appellant’s motion for clarification. Appellant appealed claiming the QDRO incorrectly applied a coverture formula because of an ambiguity in the divorce decree’s award of pension benefits.
The QDRO language included the 50% of the "Marital Portion of the Partifipant’s Accrued Benefit," but the denominator as defined extended the benefit to the entire time the appellant participated in the plan. The ultimate result was that appellee would receive a benefit for some twelve years beyond the termination of marriage.
After finding that the QDRO acknowledged it pertained only to the marital portion the appellate court reversed and remanded the trial court to modify the QDRO to correct the clear error in the denominator.
From the Opinion:
{¶10} "The trial court has broad discretion in clarifying ambiguous language by considering not only the intent of the parties but the equities involved.***An interpretive decision by the trial court cannot be disturbed upon appeal absent a showing of an abuse of discretion.***" Bond v. Bond (1990), 69 Ohio App.3d 225, 227-228, citations omitted. In order to find an abuse of discretion, we must determine the trial court's decision was unreasonable, arbitrary or unconscionable and not merely an error of law or judgment. Blakemore v. Blakemore (1983) 5 Ohio St.3d 217.
{¶11} In Mckinney v. Mckinney (2001), 142 Ohio App.3d 604, 608, our brethren from the Second District explained the following:
{¶12} "A QDRO is a current distribution of the rights in a retirement account that is payable in the future, when the payee retires. It is ordinarily issued subsequent to and separate from the decree of divorce itself, after the employer payor has approved its terms as conforming with the particular pension plan involved. A QDRO is, therefore, merely an order in aid of execution on the property division ordered in the divorce decree. So long as the QDRO is consistent with the decree, it does not constitute a modification, which R.C. 3109.171(I) prohibits, and the court does not lack jurisdiction to issue it. Tarbert v. Tarbert (Sept. 27, 1996), Clark App. No. 96-CA-0036, unreported."
{¶16} The QDRO filed March 4, 1997 specifically stated the following:
{¶17} "7. Amount of Alternate Payee's Benefit: This Order assigns to Alternate Payee an amount equal to the actuarial equivalent of Fifty Percent (50%) of the Marital Portion of the Participant's Accrued Benefit under the Plan as of the Participant's benefit commencement date, or the Alternate Payee's benefit commencement date, if earlier. The Marital Portion shall be determined by multiplying the Participant's Accrued Benefit by a fraction (less than or equal to 1.0), the numerator of which is the number of months of the Participant's participation in the Plan earned during the marriage (from June 8, 1968 to November 7, 1996), and the denominator of which is the total number of months of the Participant's participation in the Plan as of the earlier of his date of cessation of benefit accruals or the date that Alternate Payee commences her benefits hereunder."
{¶18} The QDRO language includes the fifty percent of the "Marital Portion of the Participant's Accrued Benefit," but the denominator as defined extends the benefit to the entire time appellant participated in the plan. The ultimate result is that appellee will receive a benefit for some twelve years beyond the termination of the marriage.
{¶19} As explained in McKinney, supra, a QDRO is basically a vehicle to effectuate the provisions of a divorce decree. It is the equivalent of a quitclaim deed. A trial court therefore has the right and privilege to amend a QDRO that does not reflect a divorce decree's intent.
{¶20} As we read the divorce decree in toto, paragraph five cited supra divided a marital asset; therefore, the retirement benefit should be determined by the amount of time the parties were married. See, R.C. 3105.171(A)(3)(a). Even the QDRO acknowledges it pertains to the marital portion.
2010-Ohio-534
Fifth Appellate District
Stark County
-Qualified Domestic Relations Orders (QDRO)
Appellant, Paul and Appellee Helen were divorced on November 7, 1996. The decree divided appellant’s pension equally (50/50). A QDRO was filed and approved by the trial court on March 4, 1997. Upon retiring on December 31, 2008, appellant discovered appellee woudl receive fifty percent of his pension for the entire period of his employment rather than for the years of the parties’ marriage.
On October 28, 2008, appellant filed a motion for clarification. On March 30, 2009, the trial court found no ambiguity in its order and denied appellant’s motion for clarification. Appellant appealed claiming the QDRO incorrectly applied a coverture formula because of an ambiguity in the divorce decree’s award of pension benefits.
The QDRO language included the 50% of the "Marital Portion of the Partifipant’s Accrued Benefit," but the denominator as defined extended the benefit to the entire time the appellant participated in the plan. The ultimate result was that appellee would receive a benefit for some twelve years beyond the termination of marriage.
After finding that the QDRO acknowledged it pertained only to the marital portion the appellate court reversed and remanded the trial court to modify the QDRO to correct the clear error in the denominator.
From the Opinion:
{¶10} "The trial court has broad discretion in clarifying ambiguous language by considering not only the intent of the parties but the equities involved.***An interpretive decision by the trial court cannot be disturbed upon appeal absent a showing of an abuse of discretion.***" Bond v. Bond (1990), 69 Ohio App.3d 225, 227-228, citations omitted. In order to find an abuse of discretion, we must determine the trial court's decision was unreasonable, arbitrary or unconscionable and not merely an error of law or judgment. Blakemore v. Blakemore (1983) 5 Ohio St.3d 217.
{¶11} In Mckinney v. Mckinney (2001), 142 Ohio App.3d 604, 608, our brethren from the Second District explained the following:
{¶12} "A QDRO is a current distribution of the rights in a retirement account that is payable in the future, when the payee retires. It is ordinarily issued subsequent to and separate from the decree of divorce itself, after the employer payor has approved its terms as conforming with the particular pension plan involved. A QDRO is, therefore, merely an order in aid of execution on the property division ordered in the divorce decree. So long as the QDRO is consistent with the decree, it does not constitute a modification, which R.C. 3109.171(I) prohibits, and the court does not lack jurisdiction to issue it. Tarbert v. Tarbert (Sept. 27, 1996), Clark App. No. 96-CA-0036, unreported."
{¶16} The QDRO filed March 4, 1997 specifically stated the following:
{¶17} "7. Amount of Alternate Payee's Benefit: This Order assigns to Alternate Payee an amount equal to the actuarial equivalent of Fifty Percent (50%) of the Marital Portion of the Participant's Accrued Benefit under the Plan as of the Participant's benefit commencement date, or the Alternate Payee's benefit commencement date, if earlier. The Marital Portion shall be determined by multiplying the Participant's Accrued Benefit by a fraction (less than or equal to 1.0), the numerator of which is the number of months of the Participant's participation in the Plan earned during the marriage (from June 8, 1968 to November 7, 1996), and the denominator of which is the total number of months of the Participant's participation in the Plan as of the earlier of his date of cessation of benefit accruals or the date that Alternate Payee commences her benefits hereunder."
{¶18} The QDRO language includes the fifty percent of the "Marital Portion of the Participant's Accrued Benefit," but the denominator as defined extends the benefit to the entire time appellant participated in the plan. The ultimate result is that appellee will receive a benefit for some twelve years beyond the termination of the marriage.
{¶19} As explained in McKinney, supra, a QDRO is basically a vehicle to effectuate the provisions of a divorce decree. It is the equivalent of a quitclaim deed. A trial court therefore has the right and privilege to amend a QDRO that does not reflect a divorce decree's intent.
{¶20} As we read the divorce decree in toto, paragraph five cited supra divided a marital asset; therefore, the retirement benefit should be determined by the amount of time the parties were married. See, R.C. 3105.171(A)(3)(a). Even the QDRO acknowledges it pertains to the marital portion.
Termination of Spousal Support Based on a Change in Circumstances
Tufts v. Tufts
2010-Ohio-641
Ninth District Court of Appeals
Summit County
-Spousal Support
Defendant-Appellant, Frederick N. Tufts ("Husband") appeals from the judgement of the Summit County DR Court denying his motion to terminate/modify spousal support being paid to Plaintiff-Appellee, Sandra L. Tufts ("Wife").
The parties were married for 35 years before divorcing in March of 1995. The Decree of Divorce awarded $2,500 per month to wife with the TC retaining jurisdiction to modify the amount of spousal support based on a change in circumstances. At the time of the divorce, Husband’s base salary was 107k, with his total compensation reaching 240k annually.
In 2000 Husband’s income dropped to approximately 64k. He filed a motion to modify and his spousal support obligation dropped to $1,600 per month. In May 2008, Husband filed a motion to modify on the basis of a change in circumstances as his income had dropped to 48k annually. Following a hearing, the magistrate denied Husband’s motion. Husband objected and the TC overruled those objections and adopted the magistrate’s findings.
On appeal, Husband asserted four assignments of error. The Ninth Circuit reversed after finding the TC erred by not making the requisite findings to establish jurisdiction over Husband’s motion to terminate. The reversal was based on what constitutes a "change in circumstances" under the recently decided Mandelbaum v. Mandelbaum.
From the Opinion:
{¶8} It is well established that R.C. 3105.18 requires a two-step analysis before an award of spousal support may be modified. Malizia v. Malizia, 9th Dist. No. 22565, 2005-Ohio-5186, at ¶8, citing Leighner v. Leighner (1986), 33 Ohio App.3d 214, 215. The first step is jurisdictional and requires the trial court to determine whether the original divorce decree provided continuing jurisdiction to modify the spousal support award, and if so, whether the circumstances of either party have changed. Malizia at ¶8. See, also, R.C. 3105.18(E). With respect to this jurisdictional hurdle, the Ohio Supreme Court has clarified that "[a] trial court lacks jurisdiction to modify a prior order of spousal support unless the decree of the court expressly reserved jurisdiction to make the modification and unless the court finds (1) that a substantial change in circumstances has occurred and (2) that the change was not contemplated at the time of the original decree." (Emphasis added.) Mandelbaum v. Mandelbaum, 121 Ohio St.3d 433, 2009-Ohio-1222, at paragraph two of the syllabus. Once jurisdiction is established, the second step of the analysis requires the trial court to determine whether the existing support order should be modified in light of the change in circumstances that has occurred. Johnson v. Johnson, 9th Dist. No. 24159, 2008-Ohio-4557, at ¶7. Such a determination is conducted in consideration of the factors set forth in R.C. 3105.18(C). Id.
{¶9} Recently, this Court considered the implications of Mandelbaum when deciding appeals related to spousal support modification. Johns v. Johns, 9th Dist. No. 24704, 2009-Ohio-5798, at ¶6-11. In doing so, we noted that "we are bound by the Supreme Court’s precedent which abrogated our holding in Kingsolver [reasoning that any change in circumstance could warrant a modification to spousal support] and concluded that in order to modify spousal support a trial court must have continuing jurisdiction and must find ‘(1) that a substantial change in circumstances has occurred and (2) that the change was not contemplated at the time of the original decree.’" Johns at ¶8, quoting Mandelbaum at ¶33. In doing so, we held that, "because the trial court’s entry d[id] not include these findings, *** the trial court erred in modifying the spousal support award[.]" Id. at ¶10
{¶11} Upon review of the trial court’s July 2009 entry, it is apparent that the trial court did not make the requisite findings under Mandelbaum because it did not recount whether there was a substantial change in circumstances and that the change was not contemplated by the parties at the time of the divorce. Mandelbaum at paragraph two of the syllabus; Johns at ¶9-10. Given that the trial court failed to make such findings to properly establish jurisdiction over this matter, it further erred in proceeding to the second step of the analysis where it determined whether the existing support order should be terminated or reduced. Mandelbaum v. Mandelbaum, 2d Dist. No. 21817, 2007-Ohio-6138, at ¶95 (concluding that a court may only proceed to the second step in the spousal support modification analysis once it has satisfied the first).
{¶12} Pursuant to the Supreme Court’s holding in Mandelbaum and this Court’s application of Mandelbaum in Johns, this matter must be remanded to the trial court for a determination of whether there was a substantial change in circumstances and whether the change was contemplated by the parties at the time of their divorce. Mandelbaum at paragraph two of the syllabus; Johns at ¶9-10.
2010-Ohio-641
Ninth District Court of Appeals
Summit County
-Spousal Support
Defendant-Appellant, Frederick N. Tufts ("Husband") appeals from the judgement of the Summit County DR Court denying his motion to terminate/modify spousal support being paid to Plaintiff-Appellee, Sandra L. Tufts ("Wife").
The parties were married for 35 years before divorcing in March of 1995. The Decree of Divorce awarded $2,500 per month to wife with the TC retaining jurisdiction to modify the amount of spousal support based on a change in circumstances. At the time of the divorce, Husband’s base salary was 107k, with his total compensation reaching 240k annually.
In 2000 Husband’s income dropped to approximately 64k. He filed a motion to modify and his spousal support obligation dropped to $1,600 per month. In May 2008, Husband filed a motion to modify on the basis of a change in circumstances as his income had dropped to 48k annually. Following a hearing, the magistrate denied Husband’s motion. Husband objected and the TC overruled those objections and adopted the magistrate’s findings.
On appeal, Husband asserted four assignments of error. The Ninth Circuit reversed after finding the TC erred by not making the requisite findings to establish jurisdiction over Husband’s motion to terminate. The reversal was based on what constitutes a "change in circumstances" under the recently decided Mandelbaum v. Mandelbaum.
From the Opinion:
{¶8} It is well established that R.C. 3105.18 requires a two-step analysis before an award of spousal support may be modified. Malizia v. Malizia, 9th Dist. No. 22565, 2005-Ohio-5186, at ¶8, citing Leighner v. Leighner (1986), 33 Ohio App.3d 214, 215. The first step is jurisdictional and requires the trial court to determine whether the original divorce decree provided continuing jurisdiction to modify the spousal support award, and if so, whether the circumstances of either party have changed. Malizia at ¶8. See, also, R.C. 3105.18(E). With respect to this jurisdictional hurdle, the Ohio Supreme Court has clarified that "[a] trial court lacks jurisdiction to modify a prior order of spousal support unless the decree of the court expressly reserved jurisdiction to make the modification and unless the court finds (1) that a substantial change in circumstances has occurred and (2) that the change was not contemplated at the time of the original decree." (Emphasis added.) Mandelbaum v. Mandelbaum, 121 Ohio St.3d 433, 2009-Ohio-1222, at paragraph two of the syllabus. Once jurisdiction is established, the second step of the analysis requires the trial court to determine whether the existing support order should be modified in light of the change in circumstances that has occurred. Johnson v. Johnson, 9th Dist. No. 24159, 2008-Ohio-4557, at ¶7. Such a determination is conducted in consideration of the factors set forth in R.C. 3105.18(C). Id.
{¶9} Recently, this Court considered the implications of Mandelbaum when deciding appeals related to spousal support modification. Johns v. Johns, 9th Dist. No. 24704, 2009-Ohio-5798, at ¶6-11. In doing so, we noted that "we are bound by the Supreme Court’s precedent which abrogated our holding in Kingsolver [reasoning that any change in circumstance could warrant a modification to spousal support] and concluded that in order to modify spousal support a trial court must have continuing jurisdiction and must find ‘(1) that a substantial change in circumstances has occurred and (2) that the change was not contemplated at the time of the original decree.’" Johns at ¶8, quoting Mandelbaum at ¶33. In doing so, we held that, "because the trial court’s entry d[id] not include these findings, *** the trial court erred in modifying the spousal support award[.]" Id. at ¶10
{¶11} Upon review of the trial court’s July 2009 entry, it is apparent that the trial court did not make the requisite findings under Mandelbaum because it did not recount whether there was a substantial change in circumstances and that the change was not contemplated by the parties at the time of the divorce. Mandelbaum at paragraph two of the syllabus; Johns at ¶9-10. Given that the trial court failed to make such findings to properly establish jurisdiction over this matter, it further erred in proceeding to the second step of the analysis where it determined whether the existing support order should be terminated or reduced. Mandelbaum v. Mandelbaum, 2d Dist. No. 21817, 2007-Ohio-6138, at ¶95 (concluding that a court may only proceed to the second step in the spousal support modification analysis once it has satisfied the first).
{¶12} Pursuant to the Supreme Court’s holding in Mandelbaum and this Court’s application of Mandelbaum in Johns, this matter must be remanded to the trial court for a determination of whether there was a substantial change in circumstances and whether the change was contemplated by the parties at the time of their divorce. Mandelbaum at paragraph two of the syllabus; Johns at ¶9-10.
Spousal Support Modification - Examining the Obligee's "Need" for Spousal Support
Hutchinson v. Hutchinson
2010-Ohio-597
Twelfth District Court of Appeals
Clermont County
-Spousal Support
Defendant-Appellant, Pamel S. Hutchinson, appeals an order of the Clermont County DR Court reducing the spousal support obligation paid to her by Plaintiff-Appellee, Dennis R. Hutchinson upon his retirement.
After 31 years of marriage, the parties divorced in 1995. By Decree of Divorce, Dennis was ordered to pay Pamela 1k per month in spousal support until death with the TC retaining jurisdiction. Dennis retired in 2007 at the age of 62.
In 2008, Dennis moved to modify his spousal support obligation on the ground that his retirement had significantly decreased his annual income. Pamela moved to increase Dennis’ spousal support obligation on the grounds that she was unable to afford housing and that retirement had not significantly impacted Dennis’ income.
At a hearing held November 17, 2008, Dennis testified regarding the reduction in his income after divorce and also testified that after the divorce, Pamela’s gambling habits spun out of control. By his calculations, Pamela had spent up to 54k at local casinos in 2007. The magistrate found that there was a change in the parties’ circumstances justifying a reduction in, but not a termination of, Dennis’ spousal support obligation.
The magistrate found that Pamela had been gambling excessively and has been dissipating not only her income, but her assets and as such, Dennis should not be expected to subsidize Pamela’s excessive gambling. The magistrate found that $607 per month would provide for Pamela’s current needs but did not subsidize her gambling.
Pamela asserted two assignments of error on appeal. First, Pamela stated that the TC lacked jurisdiction to reduce Dennis’ spousal support obligation under Mandelbaum and the TC erred by reducing her spousal support. The Twelfth District affirmed the TC’s decision.
From the Opinion:
{¶19} Here, the change of circumstances for Dennis was his retirement from Ethicon in 2004. Pamela argues that Dennis' retirement was "voluntary" and therefore cannot be considered in determining whether a substantial change in circumstances occurred. However, this court has held that voluntary retirement "does not bar consideration of [a party's] decrease in income when determining if there was a substantial change of circumstances." Robinson v. Robinson (Apr. 4,
1994), Brown App. Nos. CA93-02-027, CA93-03-047, 1994 WL 110197, at *1.
{¶20} In evaluating the effects of Dennis' retirement upon his ability to pay spousal support, the magistrate concluded that "all of [Dennis'] investments have been declining in value." In addition, the magistrate accounted for the sharp decline in Dennis' annual income after retirement. Before retirement, Dennis made roughly $70,000 annually; after retirement, Dennis made only $36,300 annually, consisting of Social Security benefits of $1,600 per month ($19,200 per year) and a pension of $1,425 per month ($17,100 per year). In essence, Dennis' gross annual income after retirement was cut in half – a substantial change in circumstances by any standard.
See Carnahan, 118 Ohio App.3d 393 (the trial court did not abuse its discretion in finding a substantial change in circumstances where an obligor spouse made $72,000 annually before retirement and $19,000 afterward); Reveal v. Reveal, Montgomery App. No. 19812, 2003-Ohio- 5335, ¶18 ("a reduction in income due to voluntary retirement is literally a change of circumstances").
{¶21} Upon considering the foregoing, we cannot say that the trial court abused its discretion in upholding the magistrate's finding that Dennis' retirement caused a change in circumstances warranting a modification of the spousal support award.
{¶22} However, this does not end our examination of the change in Dennis' circumstances. Pamela also argues that Dennis' retirement was contemplated at the time of the divorce. At the divorce hearing in 1995, Dennis testified that he anticipated Ethicon would offer him an "early retirement package" on his 50th birthday, which fell in the fourth quarter of that year. However, when the offer failed to come, Dennis continued to work for Ethicon for nine more years until 2004. It is clear that the retirement Dennis contemplated at the time of the divorce was his "early retirement" in 1995 and not his actual retirement in 2004. Thus, Pamela's argument that Dennis' retirement in 2004 was necessarily contemplated at the time of divorce is without merit.
{¶23} Pamela next argues that even if the trial court had authority to review the spousal support award based on a change in circumstances, the trial court abused its discretion in adopting the magistrate's modification. Pamela claims that the magistrate failed to consider all relevant factors under R.C. 3105.18(C)(1) when he determined an unreasonably low spousal support figure. Pamela argues that in modifying the support award, the magistrate erred on three distinct fronts: (1) the modification was erroneously based solely on Pamela's "needs," [edited].
{¶31} In calculating the new spousal support award, the magistrate determined Pamela's "need" by totaling her monthly expenses and comparing them to her current assets, social security income, and benefits she received from Dennis' pension plan. The magistrate also assessed Dennis' post-retirement ability to pay spousal support by reviewing his pension benefits, social security income, and investment assets. Based on the totality of the parties' circumstances, the magistrate concluded that $607 per month was an appropriate amount of spousal support to
support Pamela's lifestyle, minus her gambling habits, and that Dennis had the "ability to pay" this amount, based on his reduced income.
{¶32} In sum, the magistrate factored Pamela's former standard of living into his calculations and determined that Dennis was not responsible for Pamela's deteriorated lifestyle; rather, Pamela's mismanaged finances and gambling habits were clearly to blame. Upon review of the record, we find that the magistrate's decision modifying the spousal support award is supported by the evidence, and that the trial court did not abuse its discretion in upholding the modification.
2010-Ohio-597
Twelfth District Court of Appeals
Clermont County
-Spousal Support
Defendant-Appellant, Pamel S. Hutchinson, appeals an order of the Clermont County DR Court reducing the spousal support obligation paid to her by Plaintiff-Appellee, Dennis R. Hutchinson upon his retirement.
After 31 years of marriage, the parties divorced in 1995. By Decree of Divorce, Dennis was ordered to pay Pamela 1k per month in spousal support until death with the TC retaining jurisdiction. Dennis retired in 2007 at the age of 62.
In 2008, Dennis moved to modify his spousal support obligation on the ground that his retirement had significantly decreased his annual income. Pamela moved to increase Dennis’ spousal support obligation on the grounds that she was unable to afford housing and that retirement had not significantly impacted Dennis’ income.
At a hearing held November 17, 2008, Dennis testified regarding the reduction in his income after divorce and also testified that after the divorce, Pamela’s gambling habits spun out of control. By his calculations, Pamela had spent up to 54k at local casinos in 2007. The magistrate found that there was a change in the parties’ circumstances justifying a reduction in, but not a termination of, Dennis’ spousal support obligation.
The magistrate found that Pamela had been gambling excessively and has been dissipating not only her income, but her assets and as such, Dennis should not be expected to subsidize Pamela’s excessive gambling. The magistrate found that $607 per month would provide for Pamela’s current needs but did not subsidize her gambling.
Pamela asserted two assignments of error on appeal. First, Pamela stated that the TC lacked jurisdiction to reduce Dennis’ spousal support obligation under Mandelbaum and the TC erred by reducing her spousal support. The Twelfth District affirmed the TC’s decision.
From the Opinion:
{¶19} Here, the change of circumstances for Dennis was his retirement from Ethicon in 2004. Pamela argues that Dennis' retirement was "voluntary" and therefore cannot be considered in determining whether a substantial change in circumstances occurred. However, this court has held that voluntary retirement "does not bar consideration of [a party's] decrease in income when determining if there was a substantial change of circumstances." Robinson v. Robinson (Apr. 4,
1994), Brown App. Nos. CA93-02-027, CA93-03-047, 1994 WL 110197, at *1.
{¶20} In evaluating the effects of Dennis' retirement upon his ability to pay spousal support, the magistrate concluded that "all of [Dennis'] investments have been declining in value." In addition, the magistrate accounted for the sharp decline in Dennis' annual income after retirement. Before retirement, Dennis made roughly $70,000 annually; after retirement, Dennis made only $36,300 annually, consisting of Social Security benefits of $1,600 per month ($19,200 per year) and a pension of $1,425 per month ($17,100 per year). In essence, Dennis' gross annual income after retirement was cut in half – a substantial change in circumstances by any standard.
See Carnahan, 118 Ohio App.3d 393 (the trial court did not abuse its discretion in finding a substantial change in circumstances where an obligor spouse made $72,000 annually before retirement and $19,000 afterward); Reveal v. Reveal, Montgomery App. No. 19812, 2003-Ohio- 5335, ¶18 ("a reduction in income due to voluntary retirement is literally a change of circumstances").
{¶21} Upon considering the foregoing, we cannot say that the trial court abused its discretion in upholding the magistrate's finding that Dennis' retirement caused a change in circumstances warranting a modification of the spousal support award.
{¶22} However, this does not end our examination of the change in Dennis' circumstances. Pamela also argues that Dennis' retirement was contemplated at the time of the divorce. At the divorce hearing in 1995, Dennis testified that he anticipated Ethicon would offer him an "early retirement package" on his 50th birthday, which fell in the fourth quarter of that year. However, when the offer failed to come, Dennis continued to work for Ethicon for nine more years until 2004. It is clear that the retirement Dennis contemplated at the time of the divorce was his "early retirement" in 1995 and not his actual retirement in 2004. Thus, Pamela's argument that Dennis' retirement in 2004 was necessarily contemplated at the time of divorce is without merit.
{¶23} Pamela next argues that even if the trial court had authority to review the spousal support award based on a change in circumstances, the trial court abused its discretion in adopting the magistrate's modification. Pamela claims that the magistrate failed to consider all relevant factors under R.C. 3105.18(C)(1) when he determined an unreasonably low spousal support figure. Pamela argues that in modifying the support award, the magistrate erred on three distinct fronts: (1) the modification was erroneously based solely on Pamela's "needs," [edited].
{¶31} In calculating the new spousal support award, the magistrate determined Pamela's "need" by totaling her monthly expenses and comparing them to her current assets, social security income, and benefits she received from Dennis' pension plan. The magistrate also assessed Dennis' post-retirement ability to pay spousal support by reviewing his pension benefits, social security income, and investment assets. Based on the totality of the parties' circumstances, the magistrate concluded that $607 per month was an appropriate amount of spousal support to
support Pamela's lifestyle, minus her gambling habits, and that Dennis had the "ability to pay" this amount, based on his reduced income.
{¶32} In sum, the magistrate factored Pamela's former standard of living into his calculations and determined that Dennis was not responsible for Pamela's deteriorated lifestyle; rather, Pamela's mismanaged finances and gambling habits were clearly to blame. Upon review of the record, we find that the magistrate's decision modifying the spousal support award is supported by the evidence, and that the trial court did not abuse its discretion in upholding the modification.
Failure to Disclose Marital Assets Results in Relief From Judgment
Baker v. Baker
2010-Ohio-570
Sixth Appellate District
Erie Count
-Rule 60(B) Motion
Appellant, Daniel P. Baker, appeals a judgement of the Erie County DR Court granting appellee, Kathleen Baker’s motion to vacate judgment pursuant to Civ. R. 60(B). Appellant asserts three assignments of error. I will only discuss one of appellants claims in this post, that appellee’s Civ. R. 60(B) motion should have been dismissed since evidence presented by appellee was not ‘newly discovered’ and was capable of discovery prior to the final hearing in the divorce.
Appellee filed a motion for relief from judgment after she discovered a document from Fidelity Trust Management Company listing two accounts in appellant’s name. Appellee claimed that only one of the accounts was disclosed to her during the divorce proceedings.
A hearing was held on March 9, 2009 where both parties testified. Appellee asserted she had no knowledge of the Fidelity Account and Appellant testified that the account had been disclosed. Specifically, appellant testified that he discussed the Fidelity Account at a meeting with all necessary parties present. Appellant stated that he informed appellee and her counsel that withdrawls were being made on the accounts to pay the marital bills and she agreed with this practice.
After examining the credibility of the parties, the magistrate awarded appellee proceeds from the Fidelity Account.
From the Opinion:
{¶ 8} Civ.R. 60(B), in material part, provides:
{¶ 9} "On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(B); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation or other misconduct of an adverse party; (4) the judgment has been satisfied, released or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (5) any other reason justifying relief from the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2) and (3) not more than one year after the judgment, order or proceeding was entered or taken. * * *"
{¶ 10} In order to be granted relief under Civ.R. 60(B)(2), "the moving party must demonstrate that: (1) the evidence was actually 'newly discovered', that is, it must have been discovered subsequent to trial; (2) the movant exercised due diligence; and (3) the evidence is material, not merely impeaching or cumulative, and that a new trial would probably produce a different result." Cominsky v. Malner, 11th Dist. No. 2002-L-103,4. 2004-Ohio-2202, ¶ 20, citing Holden v. Bureau of Motor Vehicles (1990), 67 Ohio App.3d 531.
{¶ 11} The question of whether relief should be granted or denied is within the sound discretion of the trial court and will not be reversed absent an abuse of that discretion. Griffey v. Rajan (1987), 33 Ohio St.3d 75, 77. An abuse of discretion is more than a mistake of law or an error of judgment, the term connotes that the court's attitude is arbitrary, unreasonable or unconscionable. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219.
{¶ 15} A review of the transcript of the proceedings before the magistrate indicates that his decision finding that appellant had failed to disclose certain assets was based on the credibility of the parties. The trial court relied on the magistrate's assessment of the parties' credibility, and we will do the same, as the magistrate was in the best position to make this assessment. Singh v. Singh, 12th Dist. No. CA2002-08-080, 2003-Ohio-2372.
2010-Ohio-570
Sixth Appellate District
Erie Count
-Rule 60(B) Motion
Appellant, Daniel P. Baker, appeals a judgement of the Erie County DR Court granting appellee, Kathleen Baker’s motion to vacate judgment pursuant to Civ. R. 60(B). Appellant asserts three assignments of error. I will only discuss one of appellants claims in this post, that appellee’s Civ. R. 60(B) motion should have been dismissed since evidence presented by appellee was not ‘newly discovered’ and was capable of discovery prior to the final hearing in the divorce.
Appellee filed a motion for relief from judgment after she discovered a document from Fidelity Trust Management Company listing two accounts in appellant’s name. Appellee claimed that only one of the accounts was disclosed to her during the divorce proceedings.
A hearing was held on March 9, 2009 where both parties testified. Appellee asserted she had no knowledge of the Fidelity Account and Appellant testified that the account had been disclosed. Specifically, appellant testified that he discussed the Fidelity Account at a meeting with all necessary parties present. Appellant stated that he informed appellee and her counsel that withdrawls were being made on the accounts to pay the marital bills and she agreed with this practice.
After examining the credibility of the parties, the magistrate awarded appellee proceeds from the Fidelity Account.
From the Opinion:
{¶ 8} Civ.R. 60(B), in material part, provides:
{¶ 9} "On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(B); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation or other misconduct of an adverse party; (4) the judgment has been satisfied, released or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (5) any other reason justifying relief from the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2) and (3) not more than one year after the judgment, order or proceeding was entered or taken. * * *"
{¶ 10} In order to be granted relief under Civ.R. 60(B)(2), "the moving party must demonstrate that: (1) the evidence was actually 'newly discovered', that is, it must have been discovered subsequent to trial; (2) the movant exercised due diligence; and (3) the evidence is material, not merely impeaching or cumulative, and that a new trial would probably produce a different result." Cominsky v. Malner, 11th Dist. No. 2002-L-103,4. 2004-Ohio-2202, ¶ 20, citing Holden v. Bureau of Motor Vehicles (1990), 67 Ohio App.3d 531.
{¶ 11} The question of whether relief should be granted or denied is within the sound discretion of the trial court and will not be reversed absent an abuse of that discretion. Griffey v. Rajan (1987), 33 Ohio St.3d 75, 77. An abuse of discretion is more than a mistake of law or an error of judgment, the term connotes that the court's attitude is arbitrary, unreasonable or unconscionable. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219.
{¶ 15} A review of the transcript of the proceedings before the magistrate indicates that his decision finding that appellant had failed to disclose certain assets was based on the credibility of the parties. The trial court relied on the magistrate's assessment of the parties' credibility, and we will do the same, as the magistrate was in the best position to make this assessment. Singh v. Singh, 12th Dist. No. CA2002-08-080, 2003-Ohio-2372.
Dividing a Country Club Membership Years After Purchase
Hardy v. Hardy
2010-Ohio-561
Twelfth District Court of Appeals
Montgomery County
-Division of Property
Appellant Nancy Hardy appeals from the DR Court after the DR Court ordered appellee to reimburse Nancy $1,500 for her marital interest in the Dayton Racquet Club membership and $1,500 for her marital interest in the Moraine Country Club membership. The amount awarded represents one-half the marital funds used to acquire the memberships at the time of purchase, many years ago.
Nancy argues on appeal that the award by the DR Court fails to consider the present value of the memberships and further contends that she “can think of no reason why these ‘valuable’ assets should be treated any differently than other assets that typically appreciate in value, such as a marital residence.”
The Court of Appeals reversed the DR Court’s ruling as it found the compensation ordered to Nancy for the amounts that were paid for the memberships unjust.
From the Opinion:
{¶ 9} R.C. 3105.171(A)(2) requires the domestic relations court, when it orders a division of marital property that R.C.3105.171 requires, to adopt a value for that property in the amount
of its value as of the date of the final hearing in the action, unless the court selects a different date on a finding that it would be more equitable. In the present case, the court did not expressly find that the dates when the two club memberships were purchased would be a more equitable date for their valuation. Instead, the court relied on our holding in Maloney adopting that date, as we said it should.
{¶ 10} We are aware of no holding, other than our holding in Maloney, which addresses the value to be assigned to club memberships of this kind. Further, Maloney did not explain the
basis for the valuation it ordered. The present appeal presents an opportunity to revisit the issue.
{¶ 11} The two club memberships at issue are marital property, being assets that were acquired during the marriage and purchased with marital funds. The domestic relations court is required by R.C. 3105.171(C)(1) to divide marital property equally. However, and unlike a marital residence, a club membership is an intangible asset. Furthermore, being non-transferrable, these two memberships are illiquid assets that lack any fair market value. Lawrence will not gain a benefit he does not now enjoy by retaining the memberships. Nancy will, however, relinquish a benefit she formerly enjoyed because she will no longer be a member of the
two clubs.
{¶ 12} In dividing marital property, the domestic relations court is charged by R.C. 3105.171(F)(5) to consider “[t]he economic desirability of retaining intact an asset or interest in an asset.” An award of the memberships to one of the parties to the divorce action, in this case Lawrence, preserves intact the memberships that would otherwise lapse. The issue is the amount of compensation for her loss that Nancy should be awarded.
{¶ 13} R.C. 3105.171(E)(1) states: “The court may make a distributive award to facilitate, effectuate, or supplement a division of marital property.” R.C. 3105.171(A)(1) defines a distributive award to mean “any payment or payments, in real or personal property, that are payable in a lump sum or over time, in fixed amounts, that are made from separate property or income, and that are not made from marital property and do not constitute payments of spousal support, as defined in section 3105.18 of the Revised Code.”
{¶ 14} The goal of any property division the court orders is equity. R.C. 3105.171(B). The nature and character of these club memberships favor determining their monetary value as marital property for purposes of division as of the date they were acquired, not at their current cost. Therefore, the domestic relations court did not abuse its discretion when the court valued and divided the memberships as it did, awarding Nancy $1,500 for each. However, where it is impractical or burdensome to reach an equitable division comprised of marital property alone, the court may also make an R.C. 3105.171(E)(1) distributive award to supplement the
marital property division the court orders.
2010-Ohio-561
Twelfth District Court of Appeals
Montgomery County
-Division of Property
Appellant Nancy Hardy appeals from the DR Court after the DR Court ordered appellee to reimburse Nancy $1,500 for her marital interest in the Dayton Racquet Club membership and $1,500 for her marital interest in the Moraine Country Club membership. The amount awarded represents one-half the marital funds used to acquire the memberships at the time of purchase, many years ago.
Nancy argues on appeal that the award by the DR Court fails to consider the present value of the memberships and further contends that she “can think of no reason why these ‘valuable’ assets should be treated any differently than other assets that typically appreciate in value, such as a marital residence.”
The Court of Appeals reversed the DR Court’s ruling as it found the compensation ordered to Nancy for the amounts that were paid for the memberships unjust.
From the Opinion:
{¶ 9} R.C. 3105.171(A)(2) requires the domestic relations court, when it orders a division of marital property that R.C.3105.171 requires, to adopt a value for that property in the amount
of its value as of the date of the final hearing in the action, unless the court selects a different date on a finding that it would be more equitable. In the present case, the court did not expressly find that the dates when the two club memberships were purchased would be a more equitable date for their valuation. Instead, the court relied on our holding in Maloney adopting that date, as we said it should.
{¶ 10} We are aware of no holding, other than our holding in Maloney, which addresses the value to be assigned to club memberships of this kind. Further, Maloney did not explain the
basis for the valuation it ordered. The present appeal presents an opportunity to revisit the issue.
{¶ 11} The two club memberships at issue are marital property, being assets that were acquired during the marriage and purchased with marital funds. The domestic relations court is required by R.C. 3105.171(C)(1) to divide marital property equally. However, and unlike a marital residence, a club membership is an intangible asset. Furthermore, being non-transferrable, these two memberships are illiquid assets that lack any fair market value. Lawrence will not gain a benefit he does not now enjoy by retaining the memberships. Nancy will, however, relinquish a benefit she formerly enjoyed because she will no longer be a member of the
two clubs.
{¶ 12} In dividing marital property, the domestic relations court is charged by R.C. 3105.171(F)(5) to consider “[t]he economic desirability of retaining intact an asset or interest in an asset.” An award of the memberships to one of the parties to the divorce action, in this case Lawrence, preserves intact the memberships that would otherwise lapse. The issue is the amount of compensation for her loss that Nancy should be awarded.
{¶ 13} R.C. 3105.171(E)(1) states: “The court may make a distributive award to facilitate, effectuate, or supplement a division of marital property.” R.C. 3105.171(A)(1) defines a distributive award to mean “any payment or payments, in real or personal property, that are payable in a lump sum or over time, in fixed amounts, that are made from separate property or income, and that are not made from marital property and do not constitute payments of spousal support, as defined in section 3105.18 of the Revised Code.”
{¶ 14} The goal of any property division the court orders is equity. R.C. 3105.171(B). The nature and character of these club memberships favor determining their monetary value as marital property for purposes of division as of the date they were acquired, not at their current cost. Therefore, the domestic relations court did not abuse its discretion when the court valued and divided the memberships as it did, awarding Nancy $1,500 for each. However, where it is impractical or burdensome to reach an equitable division comprised of marital property alone, the court may also make an R.C. 3105.171(E)(1) distributive award to supplement the
marital property division the court orders.
Tuesday, March 16, 2010
Enforceability of a Prenuptual Agreement
Barth v. Barth
2010-Ohio-425
Fourth Appellate District
Washington County
Appellant, Jackie Barth, appeals the Trial Court's ("TC") decision awarding her husband, Appellee Christopher Barth, certian real property in their divorce action. Specifically, the Appellant states the TC erred in finding th parties had entered into a valid, binding premarital agreement and objects to the resulting property division.
Two days prior to their marriage, Appellant signed a premarital agreement which had been prepared by Appellee's father, melvin Barth. The premarital agreement concerned real property and a residence that was to be constructed after the marriage. The premarital agreement was drafted to protect real property transferred to appellee more than two years before the marriage took place. After the marriage, Melvin Barth arranged for a series of transfers of money from his wife's mother and aunt to pay for the construction of the home. The controbutions from the women totaled approximately $190,000.
From the Opinion:
{¶10} Though the provisions of the document itself were not in dispute, the parties' testimony concerning the circumstances surrounding the document’s execution was vastly different. Appellee and Melvin Barth testified that: Appellant willingly provided information for the creation of the agreement, namely her debts and assets; she was given a copy of the full agreement for her review prior to the day she signed it; she understood the terms of the agreement, including that it was to protect the money being transferred to Appellee for the construction of the house; she was told that, if she did not sign the agreement, the money to build the house would not be forthcoming, and she had a discussion with Melvin Barth to that effect; and Melvin Barth specifically told her the document was a premarital agreement.
Directly contradicting that testimony, Appellant testified that: she had nothing to do with creating the agreement, but she did admit to providing her father-in-law information about her assets; she was not provided a copy of the agreement before she signed it and had never seen any part of it until the day she signed it; the document she signed was not the full, premarital agreement; she never read the agreement and did not know what she was signing; a discussion about the availability of the money to build the house being contingent upon her signing the agreement never took place; she was told the agreement was just insurance to protect her and her children from the potential claims of her previous spouses; the document was never referred to as a premarital agreement; and had she known it was a premarital agreement, she never would have signed it.
As the parties do not contest the terms of the agreement itself, but rather the circumstances surrounding its execution, the validity and enforceability of the agreement are issues of fact. The magistrate determined that while the testimony of both parties could be seen as selfserving, Appellant’s version of events was less credible than Appellee’s. The magistrate found that the agreement contained both detailed information regarding the parties’ respective assets and an acknowledgement concerning each party’s right to seek the advice of counsel, which was located
immediately above the dated and notarized signatures. Further, the magistrate found the parties had signed not only the primary document but also the exhibits listing the parties assets and liabilities and an acknowledgement that each had received copies of the other parties’ exhibits.
As previously stated, determining the validity of a prenuptial agreement is primarily an issue for the trier of fact. That deference is particularly appropriate in the present case, where the parties’ testimony is factually contradictory on a number of vital issues, including whether Appellant was provided with a copy of the document prior to the day of signing, and whether the document was understood to be a premarital agreement. “The underlying rationale for appellate courts to defer to the trier of fact on matters of evidence weight and witness credibility is that the trier of fact is best positioned to view the witnesses and to observe their demeanor, gestures, and voice inflections and to use those observations to weigh credibility.” Cox Paving, Inc. v. Indell Constr. Corp., 4th Dist. No. 08CA11 at ¶11, citing Myers v. Garson (1993), 66 Ohio St.3d 610, 615, 614 N.E.2d 742; Seasons Coal Co. v. Cleveland (1984), 10 Ohio St.3d 77, 80,
461 N.E.2d 1273.
Here, the magistrate found Appellant’s version of events to be less credible than Appellee’s version. Under the particular circumstances of the case, we cannot say the trial court, which adopted the magistrate’s decision, abused its discretion in determining that Appellant entered into the premarital agreement with full knowledge and without fraud, duress, coercion or overreaching. Accordingly, Appellant’s first assignment of error is overruled.
2010-Ohio-425
Fourth Appellate District
Washington County
Appellant, Jackie Barth, appeals the Trial Court's ("TC") decision awarding her husband, Appellee Christopher Barth, certian real property in their divorce action. Specifically, the Appellant states the TC erred in finding th parties had entered into a valid, binding premarital agreement and objects to the resulting property division.
Two days prior to their marriage, Appellant signed a premarital agreement which had been prepared by Appellee's father, melvin Barth. The premarital agreement concerned real property and a residence that was to be constructed after the marriage. The premarital agreement was drafted to protect real property transferred to appellee more than two years before the marriage took place. After the marriage, Melvin Barth arranged for a series of transfers of money from his wife's mother and aunt to pay for the construction of the home. The controbutions from the women totaled approximately $190,000.
From the Opinion:
{¶10} Though the provisions of the document itself were not in dispute, the parties' testimony concerning the circumstances surrounding the document’s execution was vastly different. Appellee and Melvin Barth testified that: Appellant willingly provided information for the creation of the agreement, namely her debts and assets; she was given a copy of the full agreement for her review prior to the day she signed it; she understood the terms of the agreement, including that it was to protect the money being transferred to Appellee for the construction of the house; she was told that, if she did not sign the agreement, the money to build the house would not be forthcoming, and she had a discussion with Melvin Barth to that effect; and Melvin Barth specifically told her the document was a premarital agreement.
Directly contradicting that testimony, Appellant testified that: she had nothing to do with creating the agreement, but she did admit to providing her father-in-law information about her assets; she was not provided a copy of the agreement before she signed it and had never seen any part of it until the day she signed it; the document she signed was not the full, premarital agreement; she never read the agreement and did not know what she was signing; a discussion about the availability of the money to build the house being contingent upon her signing the agreement never took place; she was told the agreement was just insurance to protect her and her children from the potential claims of her previous spouses; the document was never referred to as a premarital agreement; and had she known it was a premarital agreement, she never would have signed it.
As the parties do not contest the terms of the agreement itself, but rather the circumstances surrounding its execution, the validity and enforceability of the agreement are issues of fact. The magistrate determined that while the testimony of both parties could be seen as selfserving, Appellant’s version of events was less credible than Appellee’s. The magistrate found that the agreement contained both detailed information regarding the parties’ respective assets and an acknowledgement concerning each party’s right to seek the advice of counsel, which was located
immediately above the dated and notarized signatures. Further, the magistrate found the parties had signed not only the primary document but also the exhibits listing the parties assets and liabilities and an acknowledgement that each had received copies of the other parties’ exhibits.
As previously stated, determining the validity of a prenuptial agreement is primarily an issue for the trier of fact. That deference is particularly appropriate in the present case, where the parties’ testimony is factually contradictory on a number of vital issues, including whether Appellant was provided with a copy of the document prior to the day of signing, and whether the document was understood to be a premarital agreement. “The underlying rationale for appellate courts to defer to the trier of fact on matters of evidence weight and witness credibility is that the trier of fact is best positioned to view the witnesses and to observe their demeanor, gestures, and voice inflections and to use those observations to weigh credibility.” Cox Paving, Inc. v. Indell Constr. Corp., 4th Dist. No. 08CA11 at ¶11, citing Myers v. Garson (1993), 66 Ohio St.3d 610, 615, 614 N.E.2d 742; Seasons Coal Co. v. Cleveland (1984), 10 Ohio St.3d 77, 80,
461 N.E.2d 1273.
Here, the magistrate found Appellant’s version of events to be less credible than Appellee’s version. Under the particular circumstances of the case, we cannot say the trial court, which adopted the magistrate’s decision, abused its discretion in determining that Appellant entered into the premarital agreement with full knowledge and without fraud, duress, coercion or overreaching. Accordingly, Appellant’s first assignment of error is overruled.
Dischargability of a Marital Obligation in Bankruptcy - Bankruptcy Filing in a Divorce Proceeding
Horvath v. Horvath, 2010-Ohio-316
Third District Court of Appeals
Union County
Rendered February 1, 2010
Plaintiff-Appellant/Cross-Appellee Suzanne Horvath (“Suzanne”)appeals the June 5, 2009 Judgment Entry of the Union County Court of Common Pleas, Domestic Relations Division, granting a divorce between Suzanne and Defendant-Appellee/Cross-Appellant Jeffrey Louis Horvath (“Jeffrey”) specifying the division of marital property and apportioning the marital debt between the parties. We will focus on Suzanne’s claim that the TC erred by equally dividing the parties’ marital debt when Ms. Horvath received a discharge in Bankruptcy for the outstanding marital debt owed to Jeffrey.
On January 15, 2008, Suzanne filed a complaint for divorce. On July 8, 2008, the Court stayed the divorce proceedings due to Suzanne’s filing of a Chapter 7 Bankruptcy petition. In Suzanne’s voluntary petition for bankruptcy, Suzanne listed Jeffrey as an unsecured creditor with a disputed non-priority claim. In describing Jeffrey’s claim, Suzanne stated, “potential disputed claim of estranged spouse” and listed the amount of the claim as “unknown”.
At trial, Suzanne presented the testimony of her Bankruptcy attorney and her Bankruptcy petition was entered into evidence. When the trial court equally split the marital debt (including the joint debt Suzanne had listed in the petition), Suzanne appealed. Suzanne argues that he action of listing Jeffrey as a potential creditor in her Bankruptcy petition - regardless of any claim actually materializing during the pendency of the Bankruptcy or thereafter - deprived the state trial court of jurisdiction to apportion any of the marital debt to her in the subsequent divorce action.
The Court of Appeals held that based on the principles of concurrent jurisdiction shared by the trial court and the Bankruptcy court in these matters, the TC had the authority to divide the marital debts in dispute.
From the Opinion:
Adopting Suzanne’s argument would effectively allow any party in a pending state divorce case to file a bankruptcy petition listing one debt and naming the spouse as a potential creditor and thereby permanently deprive the state court of any further authority to apportion marital debt between the parties— not only for those debts actually listed in the bankruptcy—but as to any debts that could have been listed.
We are not persuaded that Suzanne’s argument is consistent with basic principles of concurrent jurisdiction between the state and federal judicial systems in domestic relations matters. See Barnett v Barnett (1984), 9 Ohio St.3d 47, 49, 458 N.E.2d 834. Nor is Suzanne’s argument consistent with the “domestic relations exception” to federal jurisdiction which recognizes that state courts have exclusive jurisdiction in matters involving the issuance of a divorce, alimony, or
child support. See In Re: McMinis (Bkrtcy.N.D.Ohio 2008), No. 07-32411; see also Ankenbrant v. Richards (1992), 504 U.S. 689, 704.
In domestic relations matters, it has been established that state courts have concurrent jurisdiction with the bankruptcy courts in determining the allocation of specific obligations that arise from divorce actions. Barnett, supra. In particular, other appellate districts have stated that the nature of concurrent jurisdiction permits a state court to determine the dischargeability of a marital obligation despite the fact that the issue of dischargeability of that debt was not raised in the bankruptcy. See Loveday v. Loveday, (stating “that when [the] dischargeability of a marital debt is not raised in bankruptcy court, then it is an issue which may be ruled on by a court with concurrent jurisdiction after the discharge in bankruptcy.”); see also Markley v. Markley, 9th Dist. No. 07CA0085, 2008-Ohio-3208 (reiterating that the concurrent jurisdiction allows a state court to rule on the issue of a marital debt after a discharge in bankruptcy).
Third District Court of Appeals
Union County
Rendered February 1, 2010
Plaintiff-Appellant/Cross-Appellee Suzanne Horvath (“Suzanne”)appeals the June 5, 2009 Judgment Entry of the Union County Court of Common Pleas, Domestic Relations Division, granting a divorce between Suzanne and Defendant-Appellee/Cross-Appellant Jeffrey Louis Horvath (“Jeffrey”) specifying the division of marital property and apportioning the marital debt between the parties. We will focus on Suzanne’s claim that the TC erred by equally dividing the parties’ marital debt when Ms. Horvath received a discharge in Bankruptcy for the outstanding marital debt owed to Jeffrey.
On January 15, 2008, Suzanne filed a complaint for divorce. On July 8, 2008, the Court stayed the divorce proceedings due to Suzanne’s filing of a Chapter 7 Bankruptcy petition. In Suzanne’s voluntary petition for bankruptcy, Suzanne listed Jeffrey as an unsecured creditor with a disputed non-priority claim. In describing Jeffrey’s claim, Suzanne stated, “potential disputed claim of estranged spouse” and listed the amount of the claim as “unknown”.
At trial, Suzanne presented the testimony of her Bankruptcy attorney and her Bankruptcy petition was entered into evidence. When the trial court equally split the marital debt (including the joint debt Suzanne had listed in the petition), Suzanne appealed. Suzanne argues that he action of listing Jeffrey as a potential creditor in her Bankruptcy petition - regardless of any claim actually materializing during the pendency of the Bankruptcy or thereafter - deprived the state trial court of jurisdiction to apportion any of the marital debt to her in the subsequent divorce action.
The Court of Appeals held that based on the principles of concurrent jurisdiction shared by the trial court and the Bankruptcy court in these matters, the TC had the authority to divide the marital debts in dispute.
From the Opinion:
Adopting Suzanne’s argument would effectively allow any party in a pending state divorce case to file a bankruptcy petition listing one debt and naming the spouse as a potential creditor and thereby permanently deprive the state court of any further authority to apportion marital debt between the parties— not only for those debts actually listed in the bankruptcy—but as to any debts that could have been listed.
We are not persuaded that Suzanne’s argument is consistent with basic principles of concurrent jurisdiction between the state and federal judicial systems in domestic relations matters. See Barnett v Barnett (1984), 9 Ohio St.3d 47, 49, 458 N.E.2d 834. Nor is Suzanne’s argument consistent with the “domestic relations exception” to federal jurisdiction which recognizes that state courts have exclusive jurisdiction in matters involving the issuance of a divorce, alimony, or
child support. See In Re: McMinis (Bkrtcy.N.D.Ohio 2008), No. 07-32411; see also Ankenbrant v. Richards (1992), 504 U.S. 689, 704.
In domestic relations matters, it has been established that state courts have concurrent jurisdiction with the bankruptcy courts in determining the allocation of specific obligations that arise from divorce actions. Barnett, supra. In particular, other appellate districts have stated that the nature of concurrent jurisdiction permits a state court to determine the dischargeability of a marital obligation despite the fact that the issue of dischargeability of that debt was not raised in the bankruptcy. See Loveday v. Loveday, (stating “that when [the] dischargeability of a marital debt is not raised in bankruptcy court, then it is an issue which may be ruled on by a court with concurrent jurisdiction after the discharge in bankruptcy.”); see also Markley v. Markley, 9th Dist. No. 07CA0085, 2008-Ohio-3208 (reiterating that the concurrent jurisdiction allows a state court to rule on the issue of a marital debt after a discharge in bankruptcy).
Dischargability of a Marital Obligation in Bankruptcy
Horvath v. Horvath
Cite as [Horvath v. Horvatyh, 2010-Ohio-316]
Third District Court of Appeals
Union County
Rendered February 1, 2010
Bankruptcy filing in a Divorce Proceeding
Plaintiff-Appellant/Cross-Appellee Suzanne Horvath (“Suzanne”)appeals the June 5, 2009 Judgment Entry of the Union County Court of Common Pleas, Domestic Relations Division, granting a divorce between Suzanne and Defendant-Appellee/Cross-Appellant Jeffrey Louis Horvath (“Jeffrey”) specifying the division of marital property and apportioning the marital debt between the parties. We will focus on Suzanne’s claim that the TC erred by equally dividing the parties’ marital debt when Ms. Horvath received a discharge in Bankruptcy for the outstanding marital debt owed to Jeffrey.
On January 15, 2008, Suzanne filed a complaint for divorce. On July 8, 2008, the Court stayed the divorce proceedings due to Suzanne’s filing of a Chapter 7 Bankruptcy petition. In Suzanne’s voluntary petition for bankruptcy, Suzanne listed Jeffrey as an unsecured creditor with a disputed non-priority claim. In describing Jeffrey’s claim, Suzanne stated, “potential disputed claim of estranged spouse” and listed the amount of the claim as “unknown”.
At trial, Suzanne presented the testimony of her Bankruptcy attorney and her Bankruptcy petition was entered into evidence. When the trial court equally split the marital debt (including the joint debt Suzanne had listed in the petition), Suzanne appealed. Suzanne argues that he action of listing Jeffrey as a potential creditor in her Bankruptcy petition - regardless of any claim actually materializing during the pendency of the Bankruptcy or thereafter - deprived the state trial court of jurisdiction to apportion any of the marital debt to her in the subsequent divorce action.
The Court of Appeals held that based on the principles of concurrent jurisdiction shared by the trial court and the Bankruptcy court in these matters, the TC had the authority to divide the marital debts in dispute.
From the Opinion:
Adopting Suzanne’s argument would effectively allow any party in a pending state divorce case to file a bankruptcy petition listing one debt and naming the spouse as a potential creditor and thereby permanently deprive the state court of any further authority to apportion marital debt between the parties— not only for those debts actually listed in the bankruptcy—but as to any debts that could have been listed.
We are not persuaded that Suzanne’s argument is consistent with basic principles of concurrent jurisdiction between the state and federal judicial systems in domestic relations matters. See Barnett v Barnett (1984), 9 Ohio St.3d 47, 49, 458 N.E.2d 834. Nor is Suzanne’s argument consistent with the “domestic relations exception” to federal jurisdiction which recognizes that state courts have exclusive jurisdiction in matters involving the issuance of a divorce, alimony, or
child support. See In Re: McMinis (Bkrtcy.N.D.Ohio 2008), No. 07-32411; see also Ankenbrant v. Richards (1992), 504 U.S. 689, 704.
In domestic relations matters, it has been established that state courts have concurrent jurisdiction with the bankruptcy courts in determining the allocation of specific obligations that arise from divorce actions. Barnett, supra. In particular, other appellate districts have stated that the nature of concurrent jurisdiction permits a state court to determine the dischargeability of a marital obligation despite the fact that the issue of dischargeability of that debt was not raised in the bankruptcy. See Loveday v. Loveday, (stating “that when [the] dischargeability of a marital debt is not raised in bankruptcy court, then it is an issue which may be ruled on by a court with concurrent jurisdiction after the discharge in bankruptcy.”); see also Markley v. Markley, 9th Dist. No. 07CA0085, 2008-Ohio-3208 (reiterating that the concurrent jurisdiction allows a state court to rule on the issue of a marital debt after a discharge in bankruptcy).
Cite as [Horvath v. Horvatyh, 2010-Ohio-316]
Third District Court of Appeals
Union County
Rendered February 1, 2010
Bankruptcy filing in a Divorce Proceeding
Plaintiff-Appellant/Cross-Appellee Suzanne Horvath (“Suzanne”)appeals the June 5, 2009 Judgment Entry of the Union County Court of Common Pleas, Domestic Relations Division, granting a divorce between Suzanne and Defendant-Appellee/Cross-Appellant Jeffrey Louis Horvath (“Jeffrey”) specifying the division of marital property and apportioning the marital debt between the parties. We will focus on Suzanne’s claim that the TC erred by equally dividing the parties’ marital debt when Ms. Horvath received a discharge in Bankruptcy for the outstanding marital debt owed to Jeffrey.
On January 15, 2008, Suzanne filed a complaint for divorce. On July 8, 2008, the Court stayed the divorce proceedings due to Suzanne’s filing of a Chapter 7 Bankruptcy petition. In Suzanne’s voluntary petition for bankruptcy, Suzanne listed Jeffrey as an unsecured creditor with a disputed non-priority claim. In describing Jeffrey’s claim, Suzanne stated, “potential disputed claim of estranged spouse” and listed the amount of the claim as “unknown”.
At trial, Suzanne presented the testimony of her Bankruptcy attorney and her Bankruptcy petition was entered into evidence. When the trial court equally split the marital debt (including the joint debt Suzanne had listed in the petition), Suzanne appealed. Suzanne argues that he action of listing Jeffrey as a potential creditor in her Bankruptcy petition - regardless of any claim actually materializing during the pendency of the Bankruptcy or thereafter - deprived the state trial court of jurisdiction to apportion any of the marital debt to her in the subsequent divorce action.
The Court of Appeals held that based on the principles of concurrent jurisdiction shared by the trial court and the Bankruptcy court in these matters, the TC had the authority to divide the marital debts in dispute.
From the Opinion:
Adopting Suzanne’s argument would effectively allow any party in a pending state divorce case to file a bankruptcy petition listing one debt and naming the spouse as a potential creditor and thereby permanently deprive the state court of any further authority to apportion marital debt between the parties— not only for those debts actually listed in the bankruptcy—but as to any debts that could have been listed.
We are not persuaded that Suzanne’s argument is consistent with basic principles of concurrent jurisdiction between the state and federal judicial systems in domestic relations matters. See Barnett v Barnett (1984), 9 Ohio St.3d 47, 49, 458 N.E.2d 834. Nor is Suzanne’s argument consistent with the “domestic relations exception” to federal jurisdiction which recognizes that state courts have exclusive jurisdiction in matters involving the issuance of a divorce, alimony, or
child support. See In Re: McMinis (Bkrtcy.N.D.Ohio 2008), No. 07-32411; see also Ankenbrant v. Richards (1992), 504 U.S. 689, 704.
In domestic relations matters, it has been established that state courts have concurrent jurisdiction with the bankruptcy courts in determining the allocation of specific obligations that arise from divorce actions. Barnett, supra. In particular, other appellate districts have stated that the nature of concurrent jurisdiction permits a state court to determine the dischargeability of a marital obligation despite the fact that the issue of dischargeability of that debt was not raised in the bankruptcy. See Loveday v. Loveday, (stating “that when [the] dischargeability of a marital debt is not raised in bankruptcy court, then it is an issue which may be ruled on by a court with concurrent jurisdiction after the discharge in bankruptcy.”); see also Markley v. Markley, 9th Dist. No. 07CA0085, 2008-Ohio-3208 (reiterating that the concurrent jurisdiction allows a state court to rule on the issue of a marital debt after a discharge in bankruptcy).
What Happens When a Juvenile Court and a Domestic Relations Court Both Assert Jurisdiction and Then Enter Different, Potentially Conflicting Orders?
Heisler v. Heisler 2010-Ohio-98
Fourth Appellate District
Hocking County
This case is on appeal from the Hocking County Court of Common Pleas where Mr. Heisler’s motion to modify a divorce decree allocating parental rights and responsibilities was dismissed.
A year after Mr. Heisler filed his motion, the parties reached an agreement, which was reduced to a handwritten entry signed by both parties. Mr. Heisler was ordered to present a formal agreed entry. Before Ms. Heisler received her copies, their son became subject to delinquency and truancy charges in Fairfield County Juvenile Court. Ms. Heisler then argued that, due to the action in Fairfield County Juvenile Court, that Hocking County had lost Jurisdiction to decide the motion to modify. The Hocking County Court of Common Pleas dismissed Mr. Heisler’s motion.
In his appeal, Mr. Heisler claims that the Hocking County Court of Common Pleas retained jurisdiction over the allocation of parental rights despite a pending delinquency matter in the Fairfield County Juvenile Court. The court held that the courts had concurrent jurisdiction and “where two courts have concurrent jurisdiction, the general rule is that the court where proceedings are first properly initiated acquired the right to adjudicate the matter to the exclusion of all other courts.” See State ex rel. Phillips v. Polcar (1977), 50 Ohio St. 2d 279, 364 N.E.2d 33.
From the Opinion:
A DR Court that enters an order allocating parental rights and responsibilities retains jurisdiction of those issues. R.C. 3109.06 provides, in part: “In any case in which a court of common pleas, or other court having jurisdiction, has issued an order that allocates parental rights and responsibilities for the care of minor children and designates their place of residence and legal custodian of minor children, has made an order...the jurisdiction of the courts shall not abate upon the death of the person awarded custody but shall continue for all purposes during the minority of the children. The court, upon its own motion or the motion of either parent or of any interested person acting on behalf of the children may proceed to make further disposition of the case in the best interests of the children and subject to sections 3109.42 to 3109.48 of the Revised Code.
But, somewhat contradictorily, a juvenile court obtains “exclusive original jurisdiction” concerning the custody of a child against whom delinquency is alleged. R.C. 2151.23(A). R.C. 2151.23(A)(1) and (2) provide that “[t]he juvenile court has exclusive original jurisdiction under the Revised Code as follows: (1) [c]oncerning any child who on or about the date specified in the complaint, indictment, or information is alleged *** to be a juvenile traffic offender or a delinquent, unruly, abused, neglected, or dependent child *** to determine the custody of any child not a ward of another court of this state[.]”
In In re Poling, 64 Ohio St.3d 211, 1992-Ohio-144, 594 N.E.2d 589, the Supreme Court of Ohio held that, despite the “not a ward of another court” language, a juvenile court may issue orders concerning the custody of a child who is the subject of a previous custody order contained in a separate domestic relations court’s divorce decree. Id. at syllabus. In effect, when a domestic relations court enters a decree addressing the allocation of parental rights and responsibilities concerning a child, the child does not become a “ward” of the domestic relations court for purposes of R.C. 2151.23. Id. at 214. The Court further held that where a domestic relations court has entered a decree regarding the custody of the child, and the child later comes under the jurisdiction of the juvenile court, the courts share “concurrent jurisdiction” over the custody of the child. Id. at 215.
Where courts share concurrent jurisdiction, the general rule is that the court where proceedings are first properly initiated acquires the right to adjudicate the matter to the exclusion of all other courts. See State ex rel. Phillips v. Polcar (1977), 50 Ohio St.2d 279, 364 N.E.2d 33, at syllabus; Miller v. Court of Common Pleas (1944), 143 Ohio St. 68, 70, 54 N.E.2d 130. Under this rule, the domestic relations court, which first established jurisdiction through the divorce decree, would retain exclusive jurisdiction to entertain custody issues involving a child the subject of an earlier divorce decree in that court. But in Poling the Court held that the legislative scheme set forth in R.C. 2151.23 (requiring juvenile courts to determine custody matters in accordance with R.C. 3109.04) indicated that juvenile courts may nonetheless make “particularized determinations regarding the care and custody of children subject to its jurisdiction, while respecting the continuing jurisdiction of the domestic relations or common pleas court that makes a custody decision in a divorce case.” Poling at 216.
The Trial Court did not address the more troubling issue of what happens when a juvenile court and a domestic relations court, possessing concurrent jurisdiction over the issues of custody and allocation of parental rights, both assert jurisdiction and then enter different, potentially conflicting orders. But we need not address that quandary. We are only faced with the question of whether Hocking County retained jurisdiction over the support matters addressed in the Memorandum Entry. And based on Poling, we hold that it did. Fairfield County Juvenile Court shares concurrent jurisdiction over the issue of custody by virtue of the delinquency charges. But this action did not divest Hocking County of the ability to modify its existing divorce decree.
Fourth Appellate District
Hocking County
This case is on appeal from the Hocking County Court of Common Pleas where Mr. Heisler’s motion to modify a divorce decree allocating parental rights and responsibilities was dismissed.
A year after Mr. Heisler filed his motion, the parties reached an agreement, which was reduced to a handwritten entry signed by both parties. Mr. Heisler was ordered to present a formal agreed entry. Before Ms. Heisler received her copies, their son became subject to delinquency and truancy charges in Fairfield County Juvenile Court. Ms. Heisler then argued that, due to the action in Fairfield County Juvenile Court, that Hocking County had lost Jurisdiction to decide the motion to modify. The Hocking County Court of Common Pleas dismissed Mr. Heisler’s motion.
In his appeal, Mr. Heisler claims that the Hocking County Court of Common Pleas retained jurisdiction over the allocation of parental rights despite a pending delinquency matter in the Fairfield County Juvenile Court. The court held that the courts had concurrent jurisdiction and “where two courts have concurrent jurisdiction, the general rule is that the court where proceedings are first properly initiated acquired the right to adjudicate the matter to the exclusion of all other courts.” See State ex rel. Phillips v. Polcar (1977), 50 Ohio St. 2d 279, 364 N.E.2d 33.
From the Opinion:
A DR Court that enters an order allocating parental rights and responsibilities retains jurisdiction of those issues. R.C. 3109.06 provides, in part: “In any case in which a court of common pleas, or other court having jurisdiction, has issued an order that allocates parental rights and responsibilities for the care of minor children and designates their place of residence and legal custodian of minor children, has made an order...the jurisdiction of the courts shall not abate upon the death of the person awarded custody but shall continue for all purposes during the minority of the children. The court, upon its own motion or the motion of either parent or of any interested person acting on behalf of the children may proceed to make further disposition of the case in the best interests of the children and subject to sections 3109.42 to 3109.48 of the Revised Code.
But, somewhat contradictorily, a juvenile court obtains “exclusive original jurisdiction” concerning the custody of a child against whom delinquency is alleged. R.C. 2151.23(A). R.C. 2151.23(A)(1) and (2) provide that “[t]he juvenile court has exclusive original jurisdiction under the Revised Code as follows: (1) [c]oncerning any child who on or about the date specified in the complaint, indictment, or information is alleged *** to be a juvenile traffic offender or a delinquent, unruly, abused, neglected, or dependent child *** to determine the custody of any child not a ward of another court of this state[.]”
In In re Poling, 64 Ohio St.3d 211, 1992-Ohio-144, 594 N.E.2d 589, the Supreme Court of Ohio held that, despite the “not a ward of another court” language, a juvenile court may issue orders concerning the custody of a child who is the subject of a previous custody order contained in a separate domestic relations court’s divorce decree. Id. at syllabus. In effect, when a domestic relations court enters a decree addressing the allocation of parental rights and responsibilities concerning a child, the child does not become a “ward” of the domestic relations court for purposes of R.C. 2151.23. Id. at 214. The Court further held that where a domestic relations court has entered a decree regarding the custody of the child, and the child later comes under the jurisdiction of the juvenile court, the courts share “concurrent jurisdiction” over the custody of the child. Id. at 215.
Where courts share concurrent jurisdiction, the general rule is that the court where proceedings are first properly initiated acquires the right to adjudicate the matter to the exclusion of all other courts. See State ex rel. Phillips v. Polcar (1977), 50 Ohio St.2d 279, 364 N.E.2d 33, at syllabus; Miller v. Court of Common Pleas (1944), 143 Ohio St. 68, 70, 54 N.E.2d 130. Under this rule, the domestic relations court, which first established jurisdiction through the divorce decree, would retain exclusive jurisdiction to entertain custody issues involving a child the subject of an earlier divorce decree in that court. But in Poling the Court held that the legislative scheme set forth in R.C. 2151.23 (requiring juvenile courts to determine custody matters in accordance with R.C. 3109.04) indicated that juvenile courts may nonetheless make “particularized determinations regarding the care and custody of children subject to its jurisdiction, while respecting the continuing jurisdiction of the domestic relations or common pleas court that makes a custody decision in a divorce case.” Poling at 216.
The Trial Court did not address the more troubling issue of what happens when a juvenile court and a domestic relations court, possessing concurrent jurisdiction over the issues of custody and allocation of parental rights, both assert jurisdiction and then enter different, potentially conflicting orders. But we need not address that quandary. We are only faced with the question of whether Hocking County retained jurisdiction over the support matters addressed in the Memorandum Entry. And based on Poling, we hold that it did. Fairfield County Juvenile Court shares concurrent jurisdiction over the issue of custody by virtue of the delinquency charges. But this action did not divest Hocking County of the ability to modify its existing divorce decree.
Wife Held In Contempt for Failure to Reiburse Half of College Expenses
Smith v. Smith, 2010-Ohio-31
Second District Court of Appeals
Darke County
Rendered: January 8, 2010
Plaintiff, Deborah Smith, appeals from a final judgment of the Court of Common Pleas holding her in contempt.
The parties marriage was terminated November 18, 2002 after the court granted a Decree of Dissolution. The Decree adopted the terms of a Separation Agreement the parties signed and filed. The Separation Agreement provided, among other things, that the parties equally split the minor child’s college educational expenses.
The Defendant, in his motion for contempt, alleged that he paid $4,752.70 to Wright State University on behalf of the minor child and that Plaintiff had failed to reimburse him for her half of those expenses. At a hearing on the issue, Plaintiff admitted that she had failed to reimburse Defendant but defended her failure by stating, “that while it was her ‘intention’ to pay an equal share when she signed the Separation Agreement, that intention was conditioned on her ability to do so. The [Plaintiff] testified that she now lacks that ability, and therefore did not reimburse the [Defendant] the amount he asked her for.
The Magistrate filed a written decision recommending that the Plaintiff be found in contempt, applying breach of contract principles. The Magistrate held that the Separation Agreement is a written contract, and that its terms regarding the intentions of the parties are unambiguous. The Magistrate reasoned that because “the parties specifically stated their intent to share costs equally,” ... “it was inherent in the language that the Plaintiff has the same obligation” as the Defendant.
After stating that a Separation Agreement is a contract, the Court of Appeals agreed with the Magistrate.
From the Opinion:
We agree with the finding of the magistrate, implicitly adopted by the trial court, that the separation agreement is not ambiguous. Accordingly, the parties’ intent is to be found solely within the four corners of the agreement. Blasser v. Enderlin (1925), 113 Ohio St.121.
Confining ourselves to the language of the agreement we can only conclude, as did the magistrate and trial court, that the parties obligated themselves to equally share their child’s college expenses.
The parties anticipated that their child would attend college. The first sentence of Article XII makes clear the parties’ “intention” to equally share the child’s college expenses. Any possible doubt about whether the word “intention” is merely aspirational is dispelled by the word “shall” in each of the remaining four sentences, particularly the second and fifth sentences. “Shall” is a word of obligation, not aspiration. Defendant wouldn’t be obligated to pay 50% of the expenses to Deborah, or 50% of equivalent expenses should the child attend an out-of-state school, if Deborah is not obligated to pay the other 50%. The agreement does not obligate the parties’ child to pay these expenses. That Defendant is to pay his share to Plaintiff recognizes that Plaintiff was the child’s custodial parent, as of the time the marriage was dissolved, as the magistrate observed.
Second District Court of Appeals
Darke County
Rendered: January 8, 2010
Plaintiff, Deborah Smith, appeals from a final judgment of the Court of Common Pleas holding her in contempt.
The parties marriage was terminated November 18, 2002 after the court granted a Decree of Dissolution. The Decree adopted the terms of a Separation Agreement the parties signed and filed. The Separation Agreement provided, among other things, that the parties equally split the minor child’s college educational expenses.
The Defendant, in his motion for contempt, alleged that he paid $4,752.70 to Wright State University on behalf of the minor child and that Plaintiff had failed to reimburse him for her half of those expenses. At a hearing on the issue, Plaintiff admitted that she had failed to reimburse Defendant but defended her failure by stating, “that while it was her ‘intention’ to pay an equal share when she signed the Separation Agreement, that intention was conditioned on her ability to do so. The [Plaintiff] testified that she now lacks that ability, and therefore did not reimburse the [Defendant] the amount he asked her for.
The Magistrate filed a written decision recommending that the Plaintiff be found in contempt, applying breach of contract principles. The Magistrate held that the Separation Agreement is a written contract, and that its terms regarding the intentions of the parties are unambiguous. The Magistrate reasoned that because “the parties specifically stated their intent to share costs equally,” ... “it was inherent in the language that the Plaintiff has the same obligation” as the Defendant.
After stating that a Separation Agreement is a contract, the Court of Appeals agreed with the Magistrate.
From the Opinion:
We agree with the finding of the magistrate, implicitly adopted by the trial court, that the separation agreement is not ambiguous. Accordingly, the parties’ intent is to be found solely within the four corners of the agreement. Blasser v. Enderlin (1925), 113 Ohio St.121.
Confining ourselves to the language of the agreement we can only conclude, as did the magistrate and trial court, that the parties obligated themselves to equally share their child’s college expenses.
The parties anticipated that their child would attend college. The first sentence of Article XII makes clear the parties’ “intention” to equally share the child’s college expenses. Any possible doubt about whether the word “intention” is merely aspirational is dispelled by the word “shall” in each of the remaining four sentences, particularly the second and fifth sentences. “Shall” is a word of obligation, not aspiration. Defendant wouldn’t be obligated to pay 50% of the expenses to Deborah, or 50% of equivalent expenses should the child attend an out-of-state school, if Deborah is not obligated to pay the other 50%. The agreement does not obligate the parties’ child to pay these expenses. That Defendant is to pay his share to Plaintiff recognizes that Plaintiff was the child’s custodial parent, as of the time the marriage was dissolved, as the magistrate observed.
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