Opinion
No. 3-096 / 02-1496
Filed July 10, 2003
Appeal from the Iowa District Court for Scott County, Bobbi M. Alpers, Judge.
A husband appeals from the property division, spousal support and attorney fee provisions of the decree dissolving the parties' marriage, and the wife cross-appeals as to spousal support. AFFIRMED ON APPEAL; AFFIRMED AS MODIFIED ON CROSS-APPEAL.
Cheryl Newport of Newport Newport, P.L.C., Davenport, for appellant.
Edward Wehr of Wehr, Berger, Lane Stevens, Davenport, for appellee.
Heard by Mahan, P.J., and Miller and Vaitheswaran, JJ.
Randall Lindstrom appeals from the decree dissolving his marriage to Jill Lindstrom. He argues the property division, spousal support award, and attorney fee award were inequitable. Jill cross-appeals, seeking an increase in spousal support. We affirm the property division and attorney fee award, and modify the spousal support award to extend the period of time that Jill is entitled to support.
Background Facts Proceedings . Jill and Randall Lindstrom married in August 1976. Randall had recently obtained employment with John Deere in the Quad Cities area, having completed his bachelor's degree in accounting the year before. After the marriage Jill finished her bachelor's degree in art education and, in 1977, obtained a full-time teaching position. Randall was transferred to Waterloo a year later, where Jill obtained a part-time teaching position. She remained at that job until the couple's first son, James, was born in January 1981. Their younger son, Eric, was born in July 1984.
The parties agreed Jill would stay home with the children, and she did not work for approximately thirteen years after James's birth. Randall continued his employment with John Deere, and the family returned to the Quad Cities area in about 1984. In 1995 Jill obtained a part-time position with the Bettendorf School District as an elementary school art teacher.
Randall began commuting to Northwestern University in Chicago in pursuit of a master's of management degree, which he received in 1995 or 1996. Jill had contemplated pursuing a master's degree, but had not done so for a number of reasons. One concern was that the higher salary she could command with a master's degree would have made her a less desirable candidate for employment with a school district.
The parties separated in 2001. By the June 2002 dissolution hearing, Randall was forty-seven years old and employed as John Deere's director of finance. His base gross yearly salary was $137,000. He had, however, received bonuses in eight of the preceding nine years, including a $23,200 bonus in 2001. Jill was forty-eight years old, and set to return to her part-time teaching position in August 2002. Her gross yearly salary was $18,200.
Jill had taken a leave of absence from work in 2001, in part to try and launch a home-based art lesson business. Her leave was extended when, in the summer of 2001, Eric was diagnosed with a brain tumor. By the time of the dissolution hearing Eric was expected to make a full recovery, but the ultimate impact of his cancer was unknown.
By the time the dissolution decree was entered in July 2002, Eric had turned eighteen years old, and custody was no longer an issue. However, as Eric had yet to graduate from high school, Randall agreed to pay and was ordered to pay $1018 per month in child support for Eric until June 1, 2003. He also agreed to and was ordered to pay Eric's out-of-pocket medical expenses, one-third of Eric's college expenses, and living expenses for James so long as he remained eligible for a postsecondary subsidy. This obligation to James would expire in January 2003, when James turned twenty-two years old.
The district court awarded Jill the family residence, subject to the debt thereon. The parties' significant investment and retirement accounts, and other items of property, were divided. The court did not assign a value to several assets, including Randall's pension. Of the property that was assigned a value, Jill received a net award of $285,650, while Randall received a net award of $260,777. The court acknowledged the disparity, but found it equitable in light of the "future earning capacity and retirement benefits available to each party."
The court further ordered Randall to pay Jill $1250 per month in spousal support for sixty months, followed by $800 per month in support for eighty-four months. Finally, the court ordered Randall to pay his own attorney fees and $4000 towards Jill's attorney fees. After Randall filed a motion pursuant to Iowa Rule of Civil Procedure 1.904(2), the district court clarified that the first sixty months of spousal support were rehabilitative alimony, while the next eighty-four months constituted reimbursement alimony.
Randall appeals. He argues the district court should have equally divided the parties' property, and that Jill was not entitled to any spousal support or any attorney fee award. In the alternative, he seeks a reduction in the support and fee awards. Jill cross-appeals, seeking an increase in her spousal support.
This is a change from the position Randall took during the dissolution hearing and in his rule 1.904(2) motion. In both instances he acknowledged Jill's entitlement to some level of spousal support, disputing only the amount and duration of the payments.
Scope of Review . We conduct a de novo review of dissolution proceedings. Iowa R.App.P. 6.4. We give weight to, but are not bound by, the district court's findings. Iowa R.App.P. 6.14(6)( g). This is particularly true regarding credibility determinations, given the court's opportunity to observe witness demeanor. In re Marriage of Forbes, 570 N.W.2d 757, 759 (Iowa 1997).
Property Division. We must decide whether the property division made by the district court, even though not equal, was nevertheless equitable and just under the circumstances. In re Marriage of Russell, 473 N.W.2d 244, 246 (Iowa Ct.App. 1991). In making this determination we consider a number of factors, including the length of the marriage, the contributions of the parties to the marriage, and the parties' relative earning capacities. See Iowa Code § 598.21(1) (2001). In reviewing all relevant factors, we conclude the property division was appropriate.
Randall argues that there is a $39,000 disparity between his net property award and Jill's. In addition to the $25,000 difference created by the district court's division of specifically-valued property, Randall contends he should be credited for his attorney fees and Jill's attorney fee award. He also argues that he was wrongly assessed the entirety of parties' $8700 tax refund. His claims have little merit. Jill's attorney fee award and Randall's personal fee debt are not a part of the property division. Cf. In re Marriage of Driscoll, 563 N.W.2d 640, 643 (Iowa Ct.App. 1997) (finding it appropriate to allocate attorney fees to husband's share of property where he voluntarily paid fees out of marital assets, rather than use the free legal services plan available through employer). In addition, while it is clear Randall received the entirety of the refund, it is only his somewhat vague testimony that ties the spending of the refund to the pre-dissolution support of both parties. Assessing the credibility of this claim, in light of the remaining facts, is a matter better left to the district court. See In re Marriage of Brown, 487 N.W.2d 331, 332 (Iowa 1992). More importantly, the total net value of the parties' property includes all the divided property, both valued and unvalued. Thus, we are less concerned with the exact dollar amount of the difference between the net awards of specifically-valued property, than we are with the relatively small percentage difference this amount actually represents.
Randall and Jill came to this twenty-six year marriage on relatively equal footing. Through their agreement and collective effort, Randall achieved financial security for the family, while Jill undertook the primary responsibility for maintaining the family home. Although Jill did work during the marriage, she spent a significant amount of time out of the job market. Moreover, her particular skills and training are of somewhat limited marketability, with or without additional education. Simply stated, Jill's earning capacity will always be substantially lower than Randall's, and is likely to remain low even by objective standards. The disparity in the parties' earning capacities also provides Randall with a greater opportunity to set aside future retirement funds. Under the circumstances, we find the property distribution to be equitable. Spousal Support . Determining whether spousal support should be ordered requires a balancing of the equities. In re Marriage of Clinton, 579 N.W.2d 835, 839 (Iowa Ct.App. 1998). The support is used as a means of compensating the party who leaves the marriage at a financial disadvantage, particularly where there is a large disparity in earnings. Id. It is a discretionary award, dependent upon each party's earning capacity and present standard of living, as well as the ability to pay and the relative need for support. In re Marriage of Bell, 576 N.W.2d 618, 622 (Iowa Ct.App. 1998), abrogated on other grounds by In re Marriage of Wendell, 581 N.W.2d 197, 200 (Iowa Ct.App. 1998). In marriages of long duration, particularly where there is a large disparity in earning capacity, it is often appropriate to award spousal support in addition to a substantially equal property distribution. See In re Marriage of Hettinga, 574 N.W.2d 920, 922 (Iowa Ct.App. 1997). Upon a review of the record, we find this to be just such a case.
Randall argues that the his future earning capacity is irrelevant to both the property division and spousal support award, because he obtained his bachelor's degree and a job with John Deere before he married Jill. This argument not only misinterprets prior case law, but ignores the clear statutory mandate of Iowa Code sections 598.21(1) and (3), which require courts to consider not only a party's educational background and earning capacity, but any other relevant factor. See Iowa Code § 598.21(1)(m), (3)(j). Jill may not have played a role in Randall obtaining his bachelor's degree or his initial position with John Deere, or financially supported Randall thereafter. She nevertheless contributed to the marriage in ways that inevitably factored into Randall's current level of financial success.
Given the total property divided, Randall and Jill received substantially equal property awards. There also seems to be little doubt that, even with additional education or training, Jill will simply not be able to become self-supporting at a standard of living reasonably comparable to that which she enjoyed during the marriage. See Iowa Code § 598.21(3)(f). We have also reviewed Randall's income, and taken into account all valid expenses. In doing so, we conclude that he is able to afford the support set forth by the district court.
We agree with Randall that the facts of this case do not readily fit within concepts of rehabilitative or reimbursement alimony. Rehabilitative alimony is meant to support an economically dependent spouse through a limited period of education or training, with a goal of achieving self-sufficiency. In re Marriage of O'Rourke, 547 N.W.2d 864, 866 (Iowa Ct.App. 1996). While Jill is an economically dependent spouse and obtaining a master's degree would apparently increase her earning capacity, there is little or no evidence that it would increase her income. Reimbursement alimony is also a somewhat difficult fit, as it is awarded to compensate the economic sacrifices of one spouse that directly enhanced the future earning capacity of the other. In re Marriage of Ales, 592 N.W.2d 698, 704 (Iowa Ct.App. 1999). It is typically employed in those cases where the dissolution occurs before the spouse seeking support can share in the financial benefits of the other spouse's degree or specialized training. See In re Marriage of Francis, 442 N.W.2d 59, 63 (Iowa 1989).
While certain facts in this case support awards of rehabilitative and reimbursement alimony, the facts more strongly support a traditional alimony award, which is payable for life or so long as the spouse seeking maintenance is incapable of self-support. O'Rourke, 547 N.W.2d at 866. Traditional alimony is often employed in long-term marriages such as the one here, where
life patterns have largely been set, the earning potential of both parties can be predicted with some reliability, and the contributions and sacrifices of the one spouse . . . have been compensated by many years of . . . comfortable lifestyle.
Francis, 442 N.W.2d at 63 (quoting Petersen v. Petersen, 737 P.2d 237, 242 n. 4 (Utah Ct.App. 1987)).
The district court's spousal support award provides Jill with support until she is approximately sixty years of age. Under the facts of this case, we conclude that support should be extended until Jill reaches age sixty-five, as she requested in the trial court. We therefore affirm the district court's award of $1250 per month in spousal support for sixty months, but modify the subsequent support award to provide for $800 per month in support until Jill reaches age sixty-five. We consider the first sixty months of spousal support to contain elements of rehabilitative and reimbursement support as well as traditional support.
Attorney Fees. Randall argues it was inequitable to order him to pay $4000 towards Jill's attorney fees. Such a decision rests within the discretion of the district court. In re Marriage of Applegate, 567 N.W.2d 671, 675 (Iowa Ct.App. 1997). An award of fees should consider the parties' respective abilities to pay, and the amount awarded should be fair and reasonable. Id. Considering the relevant factors in this case, not the least of which is the respective earning capacities of the parties, we find no abuse of discretion in the district court's decision.
Jill and Randall each seek attorney fees on appeal. Such an award is discretionary and is determined by assessing the needs of the requesting party, the opposing party's ability to pay, and whether the requesting party was forced to defend the appeal. In re Marriage of Gaer, 476 N.W.2d 324, 330 (Iowa 1991). We conclude that Jill should be awarded $2000 in appellate attorney fees. Randall's request for appellate attorney fees is denied.