Opinion
No. 3-160 / 02-1019.
Filed April 30, 2003.
Appeal from the Iowa District Court for Johnson County, WILLIAM L. THOMAS, Judge.
Morris Swenka appeals the property division and attorney fee provisions of the decree dissolving his marriage to Donna Swenka. AFFIRMED AS MODIFIED.
James Affeldt of Elderkin Pirnie Law Firm, Cedar Rapids, for appellant.
Sharon Mellon of Mellon Spies, Iowa City, for appellee.
Considered by HUITINK, P.J., and MAHAN and HECHT, JJ.
Morris Swenka appeals the property division and attorney fee provisions of the decree dissolving his marriage to Donna Swenka. Donna does not cross-appeal.
I. Background Facts and Proceedings.
The parties were married on December 11, 1976. They have three adult children whose interests are not implicated in this appeal.
Morris is fifty-seven years of age. With the exception of military service, Morris has farmed since graduating from high school in 1963. According to Morris's 1999 — 2001 tax returns, his average annual income from farming and work as a part-time truck driver is $39,883.
Donna is fifty-two years of age. For most of the marriage Donna devoted her time to raising the children and other domestic matters. In 1998 Donna earned her associate of arts degree in interior design and has since been employed by a furniture retailer at a salary of $30,000 a year.
The parties' pretrial stipulation provided for a property division under which Morris would receive all of the parties' farm assets, including 416.5 acres of farmland and machinery subject to any liabilities secured by those assets. In addition to specific personal property, the parties agreed that Donna would receive a "cash settlement" from Morris to accomplish an equitable property division. Morris proposed to pay $6017. Donna demanded $353,500.
This disparity stemmed from Morris's claimed credit against any "cash settlement" for $250,000 of gifts and inheritance from his family, as well as his claimed premarital net worth of $402,307. The trial judge, citing Donna's proposed and "approximately correct" distribution scheme, determined the net value of the property set aside to Morris after credits for farm debts, gifts, and inheritances was $693,204. The judge credited Morris with an additional $20,000 gift to reflect the intended benefit of a bargain real estate transaction with his sister, Shirley. Using the same distribution scheme, the judge valued the property set aside to Donna at $6150, leaving a net property value of $687,054 available for division under the parties' preferred "cash settlement" method of arriving at an equitable property division. The resulting provision of the parties' decree provides:
4. EQUITABLE DISTRIBUTION. To achieve an equitable distribution of total net assets in this case, the Respondent shall pay to the Petitioner the sum of $300,000 as follows:
a. $100,000 within 60 days of entry of decree of Dissolution of Marriage herein;
b. $40,000 plus accrued interest on or before the first day of March of 2003, 2004, 2005, 2006 and 2007.
c. The principal sum shall bear interest at a rate of 7% per annum commencing on the date of entry of Decree of Dissolution of Marriage herein.
Morris was also ordered to pay $6000 of Donna's trial attorney fees and one-half of the court costs.
On appeal, Morris argues:
(1) The trial court erred by failing to take into account property owned by Morris prior to the marriage,
(2) The trial court erred by failing to take into account the gifts and the inheritance Morris received during the marriage,
(3) The property settlement was inequitable, and
(4) Morris should not have been required to pay attorney fees to Donna's attorney.
II. Standard of Review.
Our standard of review for dissolution of marriage decrees is de novo. Iowa R.App.P. 6.4. In re Marriage of Fields, 508 N.W.2d 730, 731 (Iowa 1993). We give weight to the fact findings of the trial court, especially when considering the credibility of witnesses, but we are not bound by them. Iowa R.App.P. 6.14(6)( g).
III. Property Division.
The partners in a marriage are entitled to a just and equitable share of the property accumulated through their joint efforts. In re Marriage of Bonnette, 584 N.W.2d 713, 714 (Iowa Ct.App. 1998). Equitable distribution does not necessarily mean an equal division of property, nor does it mean a percentage division of the property. Id. In making this assessment, we consider the factors set forth in Iowa Code section 598.21 (2001). We generally do not give credit to a party for the value of the property owned prior to the marriage. Property brought to the marriage by each party is only a factor to consider together with the other relevant factors in determining an equitable property division. Iowa Code § 598.21(1)(b) (Supp. 1999). Unless the marriage is short in duration, our law does not credit a party for the value of property owned prior to the marriage. See In re Marriage of Hass, 538 N.W.2d 889, 892-93 (Iowa Ct.App. 1995); In re Marriage of Brainard, 523 N.W.2d 611, 616 (Iowa Ct.App. 1994). "Only inherited and gifted property are set aside from the distribution scheme, and only if it would not be inequitable to the other party or the children of the marriage." Brainard, 523 N.W.2d at 616 (citing Iowa Code § 598.21(2) (1993)). Although an equitable award need not be equal, substantially equal property awards are generally appropriate in marriages of long duration. See In re Marriage of Geil, 509 N.W.2d 738, 742 (Iowa 1993).
As noted earlier, this is a twenty-six-year marriage. During the marriage Donna and Morris both contributed to the gradual increase in the parties' net worth. Although Morris was primarily responsible for the parties' successful farming operation, Donna is nevertheless entitled to credit for the economic value of her homemaking and childcare services. Iowa Code § 598.21(1)(c). Donna has also assumed personal liability for loans secured by the parties' farming assets, and her employment income was considered in determining the sufficiency of their cash flow to service those debts. We, like the trial court, decline to set off additional property or otherwise increase Morris's share of the property division based on his premarital net worth.
Morris additionally claims the trial court failed to set off the entire $250,000 value of gifts he received from his family. He has itemized them as follows:
$10,000 gift from [Morris's parents] 1977 $10,000
40 acre parcel with residence [gift from Morris's parents] 1983 $100,000
Discount on purchase of 40 acres/Shirley [sister] 1993 49,000
Discount on purchase of 40 acres/Norman [brother] 1988 30,000
Inheritance from [Morris's] Father's Estate 1992 61,000
According to the distribution scheme relied on by the trial judge, Morris was credited with $165,068 for gifts and inheritance from his family. This amount included a $20,000 credit for the discount Morris received on the land he purchased from his sister, Shirley. The trial judge's stated rationale for these credits was that "his [Morris's] family has been the source of the opportunity that the parties had to accumulate a great deal of property." The difference between Morris's demands and the credit received is based on the court's refusal to credit Morris for any discount on the land he purchased from his brother, Norman, and Morris's overstated values placed on the land he purchased. Because both of these findings implicate the trial court's assessment of the credibility of Morris's testimony concerning Norman's motivation to sell land to Morris and the fair market value of each parcel at the date of sale, we defer to those findings. Contrary to Morris's claims, the trial judge set off or otherwise credited him with the reasonable value of gifts and the inheritance he received from his family. We accordingly affirm on this issue.
Although we find the trial judge's property division was equitable, we find the terms under which the resulting "cash settlement" is payable are not. We accordingly modify the payment terms by requiring Morris to pay Donna $50,000 within sixty days of the entry of this opinion. The remaining $250,000 shall be paid over ten years. Morris shall pay Donna $25,000 on or before the first day of April 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012, and 2013. We also modify the interest provision by reducing the seven-percent rate to zero. See In re Marriage of Richards, 439 N.W.2d 876, 883 (Iowa Ct.App. 1989); see also In re Marriage of Pittman, 346 N.W.2d 33, 37 (Iowa 1984) (authorizing noninterest bearing awards). Interest shall however accrue on any delinquent installment at the then prevailing rate of interest on installment judgments.
IV. Evidentiary Issues.
At trial Morris claimed the fair market value of farmland he purchased before and after the marriage exceeded the purchase price. He attempted to support this claim by offering a survey of land values covering the relevant dates prepared by the Iowa State University Extension Service. The court excluded these surveys on relevancy and hearsay grounds.
On appeal Morris argues that the surveys were admissible under the business record and public record exceptions to the general rule excluding hearsay testimony. See Iowa R. Evid. 5.803(6), 5.803(8)(A), 5.803(8)(B).
Even if we assume without deciding the challenged documents were admissible, Morris was not prejudiced by their exclusion. Our review of the record indicates the relevant land values were included in testimony by Morris's appraiser as well as the appraiser's report. See State v. McGuire, 572 N.W.2d 545, 547-48 (Iowa 1997).
V. Trial Attorney Fees.
Morris argues the trial court erred by awarding Donna $6000 trial attorney fees. We disagree. Review of a trial court's order for the payment of attorney fees is de novo because the matter was tried in equity. See In re Marriage of Wiedemann, 402 N.W.2d 744, 747 (Iowa 1987). Iowa trial courts have considerable discretion in awarding attorney fees. In re Marriage of Giles, 338 N.W.2d 544, 546 (Iowa Ct.App. 1983). To overturn an award the complaining party must show that the trial court abused its discretion. In re Marriage of Hansen, 514 N.W.2d 109, 112 (Iowa Ct.App. 1994).
After considering the complexity of the issues and the parties' relative financial condition, we find no abuse of discretion and affirm on this issue.
VI. Appellate Attorney Fees.
An award of appellate attorney fees is not a matter of right, but rests within the court's discretion and the parties' financial positions. In re Marriage of Cooper, 524 N.W.2d 204, 207 (Iowa Ct.App. 1994). We are to consider the needs of the party making the request, the ability of the other party to pay, and whether the party making the request was obligated to defend the trial court's decision on appeal. Id. We decline to award either party appellate attorney fees.
We have carefully considered all of the issues raised by the parties and find they have no merit or are controlled by the foregoing. The judgment and decree of the trial court is affirmed as modified.