Opinion
No. A-07-432.
Filed June 24, 2008.
IRWIN, MOORE, and CASSEL, Judges.
NOTICE: THIS OPINION IS NOT DESIGNATED FOR PERMANENT PUBLICATION AND MAY NOT BE CITED EXCEPT AS PROVIDED BY NEB. CT. R. OF PRAC. 2E.
MEMORANDUM OPINION AND JUDGMENT ON APPEAL
I. INTRODUCTION
Pursuant to this court's authority under Neb. Ct. R. of Prac. 11B(1) (rev. 2006), this case was ordered submitted without oral argument. Edward J. Murphy appeals and Peggy L. Murphy cross-appeals from a decree of dissolution entered by the district court, which decree dissolved their marriage; divided the marital assets and debts; and awarded custody of the parties' minor child, child support, and alimony to Edward. On appeal, Edward asserts that the district court erred in approving the parties' property settlement stipulation and in not awarding him retroactive child support. Peggy asserts that the district court erred in awarding Edward alimony, in its distribution of the marital debt, and in not requiring Edward to sell or refinance the marital home. For the reasons set forth below, we affirm the district court's decision as modified.
II. BACKGROUND
Edward and Peggy were married on January 21, 1989. There was one child born of the marriage, Brianna, born March 1, 1989. Throughout the parties' marriage, Edward was employed pouring cement and Peggy was employed at United Parcel Service (UPS).
Edward has poured cement for a living since 1977. For a majority of his years in the business, Edward worked for a construction company. However, about 4 ½ years prior to the trial in this matter, Edward became self-employed.
At the time of trial, Peggy had worked for UPS for 22 years. She worked part time until 2001, and then she began working on a full-time basis. As a result of her employment with UPS, Peggy acquired multiple retirement and investment accounts.
On March 14, 2006, Peggy filed a petition for dissolution of marriage. Peggy specifically asked that the parties' marriage be dissolved; that she be awarded the care, custody, and control of Brianna; and that the court award her child support and the family residence.
On March 31, 2006, Edward filed an answer and cross-petition for dissolution of marriage. Edward sought dissolution of the parties' marriage; custody of Brianna; the family residence; and an award of child support, spousal support, and attorney fees. Also on March 31, Edward filed a motion for temporary custody of Brianna. In the motion, Edward requested the court grant him temporary custody of Brianna, temporary child support, temporary alimony, and "exclusive possession of the family residence."
On April 14, 2006, a hearing was held on Edward's motion for temporary custody. A transcription of this hearing is not included in our record. However, the trial court's order regarding this hearing indicates that the parties' daughter, Brianna, provided an "unsworn-to statement," presumably about her preference for residing with Edward or Peggy. There is no indication regarding any other evidence presented at this hearing.
On April 25, 2006, the court issued a temporary order. In the order, the court awarded temporary legal and physical custody of Brianna to Edward, subject to Peggy's parenting time. The court specifically declined to award Edward temporary child support, stating:
That at this time, [Peggy] is not required to pay child support to [Edward] until such time as the Court determines that child support is due and payable from [Peggy] to [Edward], which child support would be pursuant to the Nebraska Child Support Guidelines when ordered.
The court awarded Edward possession of the family home; however, the court stated: "[Peggy] is entitled to reside therein until either she determines that she would remove herself from the residence, or upon a[n] Order of the Court being issued that she not be allowed to stay and reside in the residence. . . ." The court also required Edward to be responsible for and to pay the house payment, the utility bills, and all reasonable and necessary maintenance for the family residence.
On October 20, 2006, trial was held. Prior to the parties presenting any evidence, they informed the court that they had reached a settlement regarding a portion of their property, custody of Brianna, and child support.
The oral settlement that was conveyed to the court included the parties' agreement that Edward should be awarded the family residence and that, in exchange, Edward would agree to relinquish all of his interest in Peggy's retirement and investment accounts. These accounts included Peggy's Wachovia securities account, UPS stock, Teamsters UPS National 401K account, and two pensions through UPS. When relating this oral property agreement to the court, the parties acknowledged that the value of the family residence was in dispute. Peggy argued that the value of the house should be determined by using the assessed value minus the remaining mortgage debt, while Edward generally argued that the actual value of the house was less than the assessed value due to its current condition and the impending need for repairs.
In addition to this property agreement, the parties also agreed that Edward should be awarded custody of Brianna subject to Peggy's reasonable rights of visitation and that Peggy should pay $600 per month in child support to Edward. Edward noted that, while he agreed to accept $600 a month in child support, he was requesting the support payments to be retroactive to the time the temporary order was filed in April 2006.
After the parties presented the oral settlement to the court, both Peggy and Edward testified regarding the remaining issues in contention.
On February 16, 2007, the court entered a decree of dissolution. In the decree, the court approved the terms of the parties' oral property settlement agreement, ordered Peggy to pay Edward alimony in the amount of $300 per month for a period of 5 years, and divided the parties' remaining personal property. In addition, the court specifically approved the parties' agreement regarding custody of Brianna and child support payments. The court noted that Edward requested temporary support in some amount back to the entry of the temporary order in April 2006. The court found "it does not have jurisdiction to enter a child support order in a dissolution case retroactively. However, noting the equities of the matter, the Court will order that child support begin on the first day of the month following the trial in this matter, which is November 1, 2006."
Both parties subsequently filed motions for new trial. In an order filed April 5, 2007, the court overruled these motions. Edward and Peggy now appeal to this court.
III. ASSIGNMENTS OF ERROR
On appeal, Edward asserts that the district court erred in approving the parties' property settlement stipulation and in not awarding retroactive child support.
On cross-appeal, Peggy asserts that the district court erred in awarding Edward alimony, in its distribution of the marital debt, and in not requiring Edward to sell or refinance the marital home. Peggy also asserts that the district court erred in awarding Edward temporary alimony during the pendency of this appeal. However, Peggy does not specifically argue this assertion other than to generally allege that the court erred in awarding Edward permanent alimony and, thus, erred in awarding Edward any temporary alimony. Because Peggy does not argue her assertion regarding the award of temporary alimony, we decline to address the issue. See Harris v. Harris, 261 Neb. 75, 621 N.W.2d 491 (2001) (errors assigned but not argued will not be addressed).
IV. ANALYSIS 1. STANDARD OF REVIEW
An appellate court's review in an action for dissolution of marriage is de novo on the record to determine whether there has been an abuse of discretion by the trial judge. Gress v. Gress, 271 Neb. 122, 710 N.W.2d 318 (2006). This standard of review applies to the trial court's determinations regarding child support, division of property, and alimony. Id. An abuse of discretion occurs when the trial court's decision is based upon reasons that are untenable or unreasonable or if its action is clearly against justice or conscience, reason, and evidence. Adams v. Adams, 13 Neb. App. 276, 691 N.W.2d 541 (2005).
2. EDWARD'S ASSIGNED ERRORS (a) Property Settlement Agreement
Edward's first assignment of error is that the trial court erred in approving the parties' property settlement agreement. Edward alleges that the court did not determine the value of the property discussed in the property settlement agreement and that, as such, the "court clearly neglected its duty to scrutinize the parties' stipulation regarding their property distribution." Brief for appellant at 9. We disagree. It is the duty of the parties to produce evidence on the issues before the court. Accordingly, it was Edward's duty to present to the court sufficient evidence to establish the value of the property discussed within the parties' stipulation so that the court could determine whether the stipulation was unconscionable. Because we find nothing in the record to indicate that Edward presented any evidence to demonstrate that the parties' stipulation was unconscionable, we cannot say that the trial court abused its discretion in approving the parties' agreement.
Neb. Rev. Stat. § 42-366 (Reissue 2004) discusses the effect and enforcement of property settlement agreements in dissolution actions. Section 42-366 states in pertinent part:
(1) To promote the amicable settlement of disputes between the parties to a marriage attendant upon their separation or the dissolution of their marriage, the parties may enter into a written property settlement agreement containing provisions for the maintenance of either of them, the disposition of any property owned by either of them, and the support and custody of minor children.
(2) In a proceeding for dissolution of marriage or for legal separation, the terms of the agreement, except terms providing for the support and custody of minor children, shall be binding upon the court unless it finds, after considering the economic circumstances of the parties and any other relevant evidence produced by the parties, on their own motion or on request of the court, that the agreement is unconscionable.
The Nebraska Supreme Court has previously found that § 42-366(1) and (2) constitute:
[A]n explicit statement of legislative policy concerning both the desirability and binding effect of property settlement agreements attendant upon the dissolution of marriage. The trial court is limited to the consideration of the economic circumstances of the parties and any other relevant evidence in reaching its conclusions whether or not the agreement is unconscionable.
Prochazka v. Prochazka, 198 Neb. 525, 253 N.W.2d 407 (1977).
In the present case, the parties stipulated that Edward would be awarded the family home and that, in return, Edward would relinquish any interest in various retirement and investment accounts held by Peggy. These accounts included a Wachovia securities account, UPS stock, a Teamsters UPS National 401K account, and two pensions acquired through UPS.
When the parties presented the agreement to the court, they informed the court that they were in dispute regarding the precise value of the home. Peggy estimated that the equity in the house was worth $49,422.70. She based this estimate on the assessed value of the house minus the remaining mortgage debt. Edward, on the other hand, argued that the house was actually worth less than the assessed value because the house "could use some work." Edward did not provide a specific estimate of the value of the house nor did he present any evidence regarding what work needed to be completed on the house other than his general statements that the house could use some siding, still had its original carpeting, and still had its original bathroom sinks.
Neither party presented any evidence regarding the total value of Peggy's retirement and investment accounts. Edward did submit an exhibit to the court which valued the Wachovia Securities account at $19,225.66, the UPS stock at $13,482.44, and the Teamsters UPS National 401K at $11,533.29. However, at trial, Edward stated that he was not certain that these were accurate values. Neither Edward nor Peggy presented any evidence regarding the value of Peggy's two pensions through UPS.
At the close of the evidence, the trial court determined that the parties' property settlement agreement was not unconscionable and incorporated the terms of the agreement into the decree of dissolution.
On appeal, Edward argues that the court erred in accepting the parties' agreement without first determining the specific values of the assets being exchanged. In effect, Edward is arguing that the trial court has an affirmative duty to produce or request evidence regarding the values of property at issue prior to making a determination about whether a property settlement agreement is unconscionable. However, § 42-366 does not place such a burden on the court. While the statute does permit the court to make a request for evidence on the issue of the conscionability of a proposed settlement agreement, it is not required to do so. See Buker v. Buker, 205 Neb. 571, 288 N.W.2d 732 (1980). Rather, the statute provides that the court should determine whether an agreement is unconscionable after considering the general economic circumstances of the parties and "any other relevant evidence produced by the parties." Clearly, then, it is the duty of the parties and their counsel to produce evidence relevant to the property settlement agreement. "[T]o place this duty on the trial judge would overstep the bounds of judicial propriety." Id.
Edward presented very limited evidence about the value of the family home and the values of Peggy's retirement and investment accounts. Moreover, at trial, he did not disclose any lack of knowledge regarding the values of Peggy's pension accounts, he did not question Peggy regarding the specific values of those accounts, and he did not adduce any evidence to demonstrate any unconscionable disparity between the value of the equity in the house and the value of Peggy's accounts.
Without "any other relevant evidence" pertaining to the agreement, under § 42-366, the court only had evidence of the parties' economic circumstances to rely on in determining whether the property settlement agreement was unconscionable. Upon our de novo review of the record, and specifically, our review of the evidence which demonstrated the parties' general economic circumstances, we cannot say that the trial court abused its discretion in finding that the settlement agreement was not unconscionable. Edward's assertion is without merit.
(b) Retroactive Child Support
Edward's next assignment of error is that the court erred in not ordering Peggy to pay child support retroactive to the date of the temporary order filed in April 2006. Edward asserts that the trial court did have the authority to award retroactive child support and that in failing to do so, the trial court abused its discretion. We disagree.
As we discussed above, Edward filed a motion for temporary custody of the parties' daughter on April 14, 2006. In his motion, Edward requested, among other things, temporary child support. On April 25, 2006, the court filed a temporary order which granted Edward temporary custody of Brianna, but which specifically denied his request for temporary child support. In the order, the court stated:
That at this time, [Peggy] is not required to pay child support to [Edward] until such time as the Court determines that child support is due and payable from [Peggy] to [Edward], which child support would be pursuant to the Nebraska Child Support Guidelines when ordered.
During the pendency of the proceedings in the trial court, Edward did not request that the court reexamine its previous denial of temporary child support.
On appeal, Edward does not assign as error the trial court's denial of temporary child support. Because Edward does not complain about the trial court's affirmative determination to deny such temporary relief, we cannot say that the court's decision to not provide retroactive child support for the same time period covered by the temporary order was an abuse of discretion. Furthermore, we note that we do not have a transcription of the hearing regarding temporary custody and temporary child support. Accordingly, even if Edward had assigned as error the court's temporary order denying him temporary child support, we would be unable to meaningfully review the issue. We find that Edward's assertion is without merit.
3. PEGGY'S ASSIGNED ERRORS
Before we address Peggy's assigned errors on cross-appeal, we first address whether Peggy adequately complied with the rules for filing a brief on cross-appeal. Regarding cross-appeals, Neb. Ct. R. of Prac. 9D(4) (rev. 2006) provides:
Where the brief of appellee presents a cross-appeal, it shall be noted on the cover of the brief and it shall be set forth in a separate division of the brief. This division shall be headed "Brief on Cross-Appeal" and shall be prepared in the same manner and under the same rules as the brief of appellant.
The appellate courts of this state have repeatedly indicated that a cross-appeal must be properly designated, pursuant to rule 9D(4), if affirmative relief is to be obtained. See, e.g., Schindler v. Walker, 256 Neb. 767, 592 N.W.2d 912 (1999); Michael B. v. Donna M., 11 Neb. App. 346, 652 N.W.2d 618 (2002).
We note that, in accordance with the court rules, Peggy did set forth her brief on cross-appeal in a separate division of her brief, did properly head the division, and did prepare the brief in accordance with the pertinent court rules by including all of the necessary components. However, Peggy failed to note the presence of her brief on cross-appeal on the cover of her appellate brief. While we take this opportunity to restate the importance of complete compliance with rule 9D(4), we determine that Peggy's brief on cross-appeal adequately complies with rule 9D(4) to warrant review of her assignments of error. Accordingly, we now address each of Peggy's assigned errors in turn.
(a) Alimony
Peggy's first assignment of error is that the trial court erred in awarding Edward alimony. She argues that there is not a significant disparity in the parties' incomes, that Edward was employed throughout the marriage and did not forgo any career advancements or educational opportunities as a result of the marriage, and that she does not have the ability to pay alimony due to the amount of her monthly expenses. Accordingly, Peggy argues, the trial court abused its discretion in awarding Edward alimony. Upon our de novo review of the record, we cannot say that the trial court abused its discretion in awarding Edward alimony. We affirm.
In awarding alimony, a court should consider, in addition to the specific criteria listed in Neb. Rev. Stat. § 42-365 (Reissue 2004), the income and earning capacity of each party as well as the general equities of each situation. Marcovitz v. Rogers, 267 Neb. 456, 675 N.W.2d 132 (2004). The criteria in § 42-365 include:
[T]he circumstances of the parties, duration of the marriage, a history of the contributions to the marriage by each party, including contributions to the care and education of the children, and interruption of personal careers or educational opportunities, and the ability of the supported party to engage in gainful employment without interfering with the interests of any minor children in the custody of such party.
Disparity in income or potential income may partially justify an award of alimony. Hosack v. Hosack, 267 Neb. 934, 678 N.W.2d 746 (2004).
In reviewing an alimony award, an appellate court does not determine whether it would have awarded the same amount of alimony as did the trial court, but whether the trial court's award is untenable such as to deprive a party of a substantial right or just result. Hosack, supra. In determining whether alimony should be awarded, in what amount, and over what period of time, the ultimate criterion is one of reasonableness. Id. The purpose of alimony is to provide for the continued maintenance or support of one party by the other when the relative economic circumstances make it appropriate. Id.
In the case at bar, the trial court ordered Peggy to pay Edward alimony in the amount of $300 per month for a period of 5 years. The court found the award of alimony to be appropriate given "the long-term nature of the marriage and the disparity of income."
The record reflects that the parties were married for approximately 16 years. Peggy does not dispute the court's finding that the parties' marriage was "long-term." She does, however, dispute the court's findings regarding the disparity in the parties' incomes. The record reflects the district court found Peggy had a net monthly income of nearly $3,000 and Edward had a net monthly income of approximately $1,500. Our review of the record reveals that, while the evidence regarding the parties' monthly incomes and expenditures is conflicting, there is evidence to support the trial court's finding concerning the disparity in the parties' net monthly incomes.
Evidence at trial revealed Peggy's annual income had gradually increased over the 2 years just prior to trial. In 2004, she earned approximately $42,600, and in 2005, she earned approximately $45,000. Edward's annual income, however, had decreased in the years just prior to trial. In 2004, Edward earned approximately $23,000, and in 2005, he earned approximately $20,500. In fact, Edward testified that business was "very slow" for him at the time of trial in October 2006 and that he had only earned $14,000 from January to October. Though Peggy testified that Edward earned approximately $7,000 per year doing "side jobs" and that this income was not reported on his tax returns, Edward testified that he does not earn this much additional income and that the majority of what he does earn from these side jobs is included in his tax returns.
Peggy testified that her monthly expenses were approximately $3,300. However, other evidence at trial suggested that Peggy's calculation of her monthly expenses was only an estimate since she currently did not have a house payment, a property tax or insurance payment, or any utility bills, and these items were included in her calculation of monthly expenses.
Edward provided a breakdown of his current, basic monthly expenses, which totaled over $1,800, or more than $300 over his monthly income.
In addition to the disparity in the parties' net monthly incomes, evidence in the record showed that Edward does not have any retirement funds or any health insurance because he is self-employed. To the contrary, Peggy has retirement funds from multiple sources.
While we review the record de novo, we give weight to the fact that the district court observed the witnesses and accepted one version of the facts over another. In consideration of all of the above information, we cannot find that the trial court abused its discretion in awarding Edward $300 per month in alimony for 5 years. As such, this assignment of error is without merit.
(b) Distribution of Marital Debt
Peggy's next assignment of error is that the trial court erred in requiring her to pay the entire remaining balance of $2,187.76 on the parties' Capital One credit card. She asserts that the majority of the debt was incurred for repairs to Edward's truck and that because Edward received the majority of benefit from the debt, he should be responsible for at least half of the remaining balance. Upon our de novo review of the record, we find that the trial court did not assign the Capital One credit card debt to either party in the decree. However, we do find evidence of the court's intent to assign the total amount of the debt to Peggy. When we consider this evidence along with other provisions of the court's property division, we determine that the decree should be modified to reflect that Peggy is required to pay the entire remaining balance of $2,187.76 on the parties' Capital One credit card.
Under § 42-365, the equitable division of property is a three-step process. The first step is to classify the parties' property as marital or nonmarital. The second step is to value the marital assets and marital liabilities of the parties. The third step is to calculate and divide the net marital estate between the parties in accordance with the principles contained in § 42-365. Gress v. Gress, 271 Neb. 122, 710 N.W.2d 318 (2006). Although the division of property is not subject to a precise mathematical formula, the general rule is to award a spouse one-third to one-half of the marital estate, the polestar being fairness and reasonableness as determined by the facts of each case. Id.
As we mentioned above, there is no mention of the parties' joint Capital One credit card debt or how such debt should be apportioned between the parties in the decree. However, Peggy consistently maintains that the court ordered her to pay the remaining balance of the credit card in its entirety. In her motion for new trial, Peggy stated: "The Court erred as a matter of fact and as a matter of law in not requiring the parties to each pay one-half of the Capital One credit card, with a current balance of approximately $2,200.00, most of which was expended for the repair of [Edward's] snow plowing equipment."
In the court's order overruling both parties' motions for a new trial, it responded to Peggy's assertions regarding the credit card debt as follows:
[Peggy] objects to the allocation of one particular debt and suggests that the debt be divided equally between the parties. In consideration of all of the equities in this case, the court continues to find that [Peggy] should pay the debt in question in its entirety.
Our review of the record reveals that the court issued a "letter/order" to the parties prior to the issuance of the decree. The court then requested that Peggy's counsel draft the final decree based on the findings in the letter/order and submit it to the court and to Edward for approval. During a hearing regarding the final decree, Peggy's counsel informed the court, "I have the decree of dissolution, and I have attempted to follow your letter opinion verbatim. . . .I'd give the Court the decree. I do believe that it does comply with your letter order."
Based on our review of the record, it appears that the omission of the apportionment of the Capital One debt from the decree was inadvertent and probably occurred when counsel was drafting the decree based on the court's prior letter/order. We note, however, that the court's order overruling the parties' motions for new trial does provide some evidence of the court's intent to require Peggy to pay the entire remaining balance of the credit card.
When we consider the evidence of the court's intent regarding the Capital One credit card debt and the other provisions of the property division between the parties, we conclude that the equities of the circumstances warrant that Peggy should pay the entire remaining balance on the credit card. Accordingly, we modify the decree to include a provision requiring Peggy to pay the entire remaining balance of $2,187.76 on the parties' Capital One credit card.
(c) Selling or Refinancing of Family Residence
Peggy's final assignment of error is that the court erred in not requiring Edward to sell or refinance the family residence within a certain period of time. Peggy asserts that the mortgage for the residence is in both parties' names and that she will not be able to "move forward financially due to her financial obligation to the family home." Brief for appellee on cross-appeal at 8. Upon our de novo review of the record, we do not find that the court abused its discretion in failing to require Edward to sell or refinance the residence.
As we discussed more thoroughly above, Edward was awarded the family residence pursuant to a property settlement agreement entered into by the parties. Specifically, the parties agreed:
[T]he family residence . . . is going to be awarded to [Edward] to be his sole and separate property, provided that he make the outstanding payments that are due or to become due thereon, that it would be interest, principal, taxes and insurance and hold [Peggy] harmless from the existing mortgage. . . .
In exchange for receiving the interest in the family residence, Edward agreed to relinquish any interest he had in certain retirement and investment accounts held by Peggy. This was the entirety of the agreement. There was no mention of Peggy's request that Edward should sell or refinance the house within a certain period of time; nor is there any mention of the parties agreeing to any provision regarding the sale or refinancing of the residence. Rather, the parties agreed that Edward would receive the residence, provided that he makes the outstanding payments on the mortgage.
The trial court accepted the parties' property settlement agreement and incorporated the exact terms of that agreement into the decree. The court stated:
The parties entered into a stipulation regarding their marital property which the Court approves in its entirety as not being unconscionable. . . . Specifically, in regard to the stipulation, the Court finds that the parties own a residence . . . which real estate shall become the sole and separate property of [Edward] subject to any encumbrances thereon, and that [Edward] shall hold [Peggy] harmless from the existing mortgage. . . .
When we consider that the parties did not make the requirement to sell or refinance the residence a part of their property agreement, in addition to the general financial circumstances of the parties as evidenced in the record, we do not find that the court abused its discretion in failing to require Edward to sell or refinance the family residence. Peggy's assertion is without merit.
V. CONCLUSION
Upon our de novo review of the record, we modify the decree of dissolution to reflect that Peggy should pay the entirety of the remaining balance on the parties' Capital One credit card. We affirm the judgment of the district court in all other respects.
AFFIRMED AS MODIFIED.