Opinion
NO. 2010-CA-001557-MR
07-27-2012
JAMES E. HOGUE APPELLANT v. KAREN HOGUE APPELLEE
NOT TO BE PUBLISHED
APPEAL FROM BOYLE CIRCUIT COURT
HONORABLE DOUGLAS BRUCE PETRIE, JUDGE
ACTION NO. 08-CI-00123
OPINION
AFFIRMING
BEFORE: KELLER, TAYLOR AND THOMPSON, JUDGES. KELLER, JUDGE: James E. Hogue (James) appeals the family court's order requiring him to pay maintenance to his ex-wife, Karen Hogue (Karen). On appeal, James argues that the family court's award of maintenance was clearly erroneous, because it was not supported by evidence of substance. Karen argues to the contrary. Having reviewed the record, we affirm.
FACTS
James and Karen married on July 27, 1979, and separated on February 29, 2008. One child, who is now an adult and attending the University of Kentucky, was born of the marriage.
Following the separation, the parties agreed to the distribution of the marital and non-marital property and debt. Excluding their respective retirement plans, the parties' most valuable asset was the marital residence. They had listed the property for sale at $315,000 but had no offers. Therefore, they agreed to sell it at auction. To protect as much of their equity as possible, James agreed that he would bid at least $200,000. Because there were no higher bidders, James purchased the marital residence for that amount. He then took out a loan, paid off the existing debt, and agreed to pay Karen $82,000 as her marital share of the equity.
Although they were able to agree on the division of property and debt, the parties could not agree regarding maintenance; therefore, the court held a hearing on that issue on July 13, 2009. Based on the evidence presented before, during, and after the hearing, Karen has an average monthly net income from her job as a warehouse laborer of $1,490.00. Karen's job, which she has held since 1981, requires her to lift up to forty pounds and to be on her feet all day. Karen testified that her job is fairly secure; however, she misses at least one-half day of work per month due to pain from arthritis.
James has an average monthly net income from his job as a UPS driver of $4,859.00. According to James, he lifts up to seventy pounds and works an average of ten hours per day. Like Karen, James has had some problems performing his job due to pain; however, he was not experiencing any problems at the time of the hearing.
During the marriage, both parties made substantial contributions to their retirement plans. James continued to do so post-separation; however, Karen testified that she has had to stop making those contributions, because she needs all of her income to pay toward $2,625 in monthly expenses. We note that, although Karen was living in an apartment at the time of the hearing, she included an estimated $600 per month mortgage payment in her monthly expenses, because she intends to purchase a house. When she finds a house, Karen plans to use $50,000 from her share of the proceeds from the sale of the marital residence as a down payment. She plans to use the remainder of those proceeds to pay off her car loan ($5,000) and as savings for "a rainy day."
James testified to monthly expenses of approximately $1,700.00, and he filed a post-hearing list of monthly expenses equaling $3,131.50. From that list, it appears that James has a $1,044.00 per month mortgage payment on a house he bought after the parties separated. We note that the list does not include $6,000.00 per semester James pays toward the college education of the parties' adult son. Furthermore, the list does not include the approximately $1,300.00 per month James pays on the mortgage on the former marital home. As to that home, James testified that he planned on selling either it or his current house when market conditions improve.
Finally, the parties provided information regarding the amounts they anticipate receiving in monthly social security retirement benefits. At age 62, Karen will receive $697.00 and James will receive $1,292.00. At ages 67 and 66.5 respectively, Karen will receive $991.00 and James will receive $1,772.00. At age 70, Karen will receive $1,229.00 and James will receive $2,269.00. Both will also receive unspecified retirement benefits from their employers and private retirement plans.
Based on the preceding evidence, the court awarded Karen $750.00 per month in maintenance until she reaches age 65, then $300.00 per month thereafter. In doing so, the court found that Karen
lacks sufficient property to provide for her reasonable needs, the most pressing need being permanent housing . . . . Without maintenance, [Karen's] ability to meet her current needs and also save for the future would be severely hampered. To not require maintenance would require [Karen] to look for help from family, which the parties' testimony indicated was not reasonable to expect, or to accumulate debt, which was also not the practice of the parties during the marriage.Furthermore, the court found that the amount awarded, while permitting Karen to meet her needs, would not endanger James's ability to meet his. Finally, the court found that Karen "has worked in a physically demanding job which now requires some medication for arthritis, a condition that she will most likely have to deal with for the rest of her life along with additional medication that is certain to come with age."
It is from this award of maintenance that James now appeals.
STANDARD OF REVIEW
The standard of review regarding the decision whether to award maintenance is abuse of discretion. Powell v. Powell, 107 S.W.3d 222, 224 (Ky. 2003). The test for abuse of discretion is whether the trial judge's decision was "arbitrary, unreasonable, unfair, or unsupported by sound legal principles." Sexton v. Sexton, 125 S.W.3d 258, 272 (Ky. 2004).
ANALYSIS
Kentucky Revised Statute (KRS) 403.200 provides that:
(1) In a proceeding for dissolution of marriage or legal separation, or a proceeding for maintenance following dissolution of a marriage by a court which lacked personal jurisdiction over the absent spouse, the court may grant a maintenance order for either spouse only if it finds that the spouse seeking maintenance:Thus, before making an award of maintenance, the court was required to find that Karen does not have sufficient property and income to support herself and provide for her reasonable needs. Once the court made that determination, it was required to consider the factors in KRS 403.200(2) to calculate the amount and duration of maintenance. James argues that the court erred in making both calculations.
(a) Lacks sufficient property, including marital property apportioned to him, to provide for his reasonable needs; and
(b) Is unable to support himself through appropriate employment or is the custodian of a child whose condition or circumstances make it appropriate that the custodian not be required to seek employment outside the home.
(2) The maintenance order shall be in such amounts and for such periods of time as the court deems just, and after considering all relevant factors including:
(a) The financial resources of the party seeking maintenance, including marital property apportioned to him, and his ability to meet his needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party as custodian;
(b) The time necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment;
(c) The standard of living established during the marriage;
(d) The duration of the marriage;
(e) The age, and the physical and emotional condition of the spouse seeking maintenance; and
(f) The ability of the spouse from whom maintenance is sought to meet his needs while meeting those of the spouse seeking maintenance.
In support of his argument that Karen has sufficient property, James notes that Karen has her share of the proceeds from the sale of the marital home, $4,047.65 in cash paid by James "to equalize the personal property division," $3,400.00 that she had "in her lock box," and a one-third interest in her mother's house, which is valued at $45,000.00. According to James, these assets, in addition to her monthly net income of $1,409.00, would permit Karen "to purchase a 'good decent affordable house' as stated in her testimony."
Karen does not dispute that she has a significant amount of money available from the sale of the marital home. However, she notes that James received an equal share of the marital property and that his monthly net income exceeds hers by $3,369.00. Furthermore, Karen notes that her monthly expenses exceed her monthly net income by approximately $1,200.00. Given these facts, we cannot say that the court abused its discretion in awarding Karen maintenance.
James next argues that the court erred with regard to the amount and duration of maintenance. We address each argument separately. In support of his argument that the amount of maintenance is too high, James notes that he has two mortgages, one for the house he purchased post-separation and one for the former marital home that he purchased at auction. According to James, these mortgage obligations make it difficult for him to meet his reasonable needs and specifically make it impossible for him to continue contributing to his 401k retirement plan. The court noted that paying both mortgages does impact James's lifestyle. However, the court noted that James had voluntarily purchased the former marital home and that Karen had not yet found adequate housing. We note that James plans to sell one of the houses when the real estate market "turns around," which will result in James getting additional funds and eliminating one of his mortgage payments.
Furthermore, James's ability to pay maintenance while meeting his own needs is only one of the factors in KRS 403.200(2). As to the other factors, the court found that: the parties had a nearly thirty year marriage; Karen was not likely to benefit from additional education or training; the parties had a comfortable standard of living during the marriage; and Karen has physical problems that might impair her ability to perform work other than what she was performing.
Finally, as previously noted, Karen's income falls approximately $1,200 short of meeting her reasonable expenses. Based on the preceding evidence, we cannot say that the court abused its discretion in awarding Karen $750.00 per month in maintenance.
As to the duration of the maintenance award, James cites to Weldon v. Weldon, 957 S.W.2d 283 (Ky. App. 1997) for the proposition that the court's award of maintenance beyond age 65 "is clearly in error." In Weldon, the husband had a yearly income of $81,000, and the wife had a yearly income of $28,000. The wife had non-marital property valued at $15,000 and received approximately $40,000 as her share of equity in marital property. The trial court awarded the wife $706.70 per month in child support and $750 per month in maintenance, with the maintenance award increasing to $1,200 per month when the child support obligation stopped. The maintenance award continued at that level until the wife died, remarried, or cohabitated. This Court held that continuing the award past the wife's retirement age was an abuse of discretion because the wife would have "received maintenance in a substantial amount for a 20-year period. Furthermore, the parties' income levels will be more equal since she will be entitled to half of [the husband's] pension, as he will be entitled to half of hers." Id. at 286.
This case is distinguishable from Weldon for at least two reasons. First, the parties will likely not have equal income after retirement. At normal retirement age, James will receive social security benefits in the amount of $1,772 per month and Karen will receive $991 per month. Furthermore, although both parties have 401k retirement plans and will share equally in the marital value of those plans, James has continued to contribute to his plan, while Karen has not been financially able to do so. Therefore, James's non-marital share in his 401k retirement plan will, in all likelihood, greatly exceed Karen's.
Second, the court herein, unlike the court in Weldon, provided for a reduction in maintenance when Karen reaches retirement age. Thus, this court recognized Karen's decreased need for maintenance after she retires. Therefore, while we may not have extended maintenance beyond retirement, we cannot state that the court abused its discretion by doing so.
CONCLUSION
For the foregoing reasons, we affirm the court's award of maintenance.
ALL CONCUR. BRIEFS FOR APPELLANT: Robert R. Baker
Stanford, Kentucky
BRIEF FOR APPELLEE: Ephraim W. Helton
Danville, Kentucky