Opinion
No. C7-02-571.
Filed December 31, 2002.
Appeal from the District Court, Hennepin County, File No. DC 255711.
Ellen Dresselhuis, Dresselhuis Law Office, P.A., (for respondent)
Kelley R. Lorix, Mahoney, Dougherty and Mahoney, P.A., (for appellant)
Considered and decided by Schumacher, Presiding Judge, Randall, Judge, and Hudson, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
In this marriage dissolution appeal, appellant husband challenges the district court's findings that (1) his $65,000 non-marital contribution toward purchase of respondent wife's home was an "unconditional gift"; and (2) wife was entitled to 25% share of husband's pension plan. Wife also claims that husband should pay the guidelines amount in retroactive child support and the district court should have awarded her attorneys' fees. We affirm.
FACTS
Elaine and Ernest Parker separated on June 20, 1991, after a 21-year marriage. Shortly thereafter, in anticipation of an eventual dissolution, the parties divided most of their marital property, except for husband's Teacher's Retirement Account (TRA) and the family home, though husband retained possession of both. Upon separation, husband remained in the family home with the couple's three children, two of whom reached majority soon after. Wife did not pay husband child support. In 1994, husband gave wife approximately $65,000 toward the purchase of her townhouse. At some point, the youngest daughter moved in with wife, and by the time wife filed these proceedings, daughter resided there. While daughter lived with wife, husband contributed approximately $250 per month toward daughter's needs until shortly after wife filed these proceedings. In addition, husband gave wife money as needed during their separation, totaling $26,523.
The parties attempted to resolve their financial differences through mediation after their separation in June 1991. Considerable effort was expended in 1991 and again in 1994, but no agreement was reached. Even though an agreement was never reached, the parties divided a significant amount of their property in anticipation of an eventual dissolution.
Wife filed this petition for dissolution on March 10, 2000, and after a ten-year period of separation, the marriage ended in dissolution by judgment filed December 4, 2001. At the time of dissolution, wife was employed by the Bloomington Chamber of Commerce and earned approximately $25,000 per year in gross income. Husband was employed by Hennepin Technical College, earning approximately $57,050 in gross income. The district court found that both parties had been self-supporting during their lengthy separation. Neither party requested spousal maintenance, and the district court found that neither party demonstrated a need for temporary or permanent spousal maintenance. The court left the parties' 1991 property division undisturbed, addressing only the division of the parties' respective residences and husband's TRA. As to the residences, the parties obtained market analyses of both husband's house, formerly the family home, and wife's townhouse and determined that the appreciated value of the parties' residences during the ten-year separation was nearly identical: the appreciation on husband's home was $56,000; the appreciation on wife's townhouse was $55,600. The court determined that allowing each party to retain their respective appreciated real estate values was fair and equitable. But because the overall value of husband's residence was $24,000 higher than wife's town home ($155,000 versus $131,000), the court allowed wife to keep both her 401(k) ($20,582) and her American Express account.
With respect to husband's TRA, the court found wife was entitled to a portion of the post-separation increase because the pension plan "technically remain[ed] marital property." The court considered the parties' likely opportunities for earning and found that husband would accrue far greater retirement funds than wife. Additionally, husband preserved substantially more of his portion of the 1991 settlement than wife due to his greater income, as wife had to spend her share to meet daily living expenses. Ultimately, the court awarded wife 25% of the TRA's value at the time of decree. The court characterized this division as "a delicate balancing act," recognizing wife's needs as well as her lack of contribution to the post-separation accrual.
The TRA was valued at $33,917 in 1991 when the parties separated. At the time of dissolution in 2001, it was valued at $41,041.50. The trial court found that "62.75 percent of the increase was related to the post-separation period," but determined that the record failed to establish how much of the interest portion of the account was attributable to post-separation contributions.
The court ordered husband to pay child support at the guidelines level of $906.50 per month beginning October 1, 2001 and ordered husband to pay child support arrears from the date he terminated voluntary payment of $250 per month until October 1, 2001. The court set the monthly amount for child support arrearage at $250, as opposed to the guidelines amount of $906.50. The court explained that in light of husband's significant financial support during the parties' separation, recognizing this contribution by ordering commencement of guidelines support at a later date was fair and equitable.
Husband moved to amend the findings. Wife filed a responsive motion, raising the issue of attorneys' fees for the first time. The district court denied husband's motion in large part, but credited him for two months' payment in child support arrears. The district court denied wife's motions as untimely, and did not consider her claims on the merits. Husband's appeal and wife's notice of review followed.
DECISION I
Husband claims the district court erred by characterizing his $65,000 contribution toward the purchase of wife's townhouse as an "unconditional gift." We review a district court's factual determinations for clear error and will uphold those findings unless the record does not support its findings. Minn.R.Civ.P. 52.01; Vangness v. Vangness, 607 N.W.2d 468, 472 (Minn.App. 2000). When performing clear error analysis, we review the record in a light most favorable to the factual findings. Id. "That the record might support findings other than those made by the trial court does not show that the court's findings are defective." Id. at 474 (citations omitted). One challenging a district court's factual findings bears a heavy burden; the party must show that, even when viewed in a light most favorable to the court's findings, "the record still requires the definite and firm conviction that a mistake was made." Id. Only when such a showing has been made does the existence of contrary evidence become relevant. Id.
Husband contends that the district court erred by failing to recognize his non-marital interest in his contribution toward the purchase of wife's townhouse. Husband notes that he contributed 86.7 percent of the purchase price for the acquisition of wife's townhouse ($65,400 ÷ $75,400 = 0.867) out of his non-marital property. He claims that because the appreciation of wife's townhouse was entirely passive, and he contributed $65,000 in non-marital funds, he is entitled to at least half the appreciated value of his contribution, or approximately $57,000. See Schmitz v. Schmitz, 309 N.W.2d 748, 750 (Minn. 1981) (providing that nonmarital interest grows in proportion to appreciation of property). Husband asserts that the district court erred by characterizing this contribution as an "unconditional gift" because the record lacks evidence of donative intent. We disagree.
The elements of a gift are: (1) delivery; (2) donative intent; and (3) the donor's absolute disposition of the intended gift. Weber v. Hvass, 626 N.W.2d 426, 431 (Minn.App. 2001), review denied (Minn. June 27, 2001). A court considers donative intent the most important of the three. See Olsen v. Olsen, 562 N.W.2d 797, 800 (Minn. 1997). Intent is a fact question. Oehler v. Falstron, 273 Minn. 453, 456, 142 N.W.2d 581, 585 (1966). "Donative intent is demonstrated by the surrounding circumstances, including the form of the transfer." Olsen, 562 N.W.2d at 800.
Here, the district court reasonably inferred from the circumstances that husband made an unconditional gift of $65,000 to wife for the purchase of her townhouse. The parties do not dispute that the money was originally non-marital property, as it was part of husband's inheritance from his father's estate. But the record reflects that husband simply gave wife the money. Wife purchased the townhouse in her name. She maintained, renovated and paid taxes on the house. Husband presented no evidence that the money was a loan, that there were any "strings" attached, or that he intended to maintain an interest in the property as a co-owner. The district court found no evidence suggesting husband meant the contribution as anything other than an "unconditional gift," and concluded that husband was attempting to change the nature of the transaction after the fact. Husband has not shown that the findings concerning the townhouse are unsupported in the record. See Novick v. Novick, 366 N.W.2d 330, 332 (Minn.App. 1985) (holding record supported trial court's characterization of undocumented, unsecured, and interest-free "loans" from wife's parents as gifts). Nor has husband shown that the district court clearly erred in finding that husband made an unconditional gift of $65,000 to wife for the purchase of her townhouse.
Moreover, if husband's contribution was not an unconditional gift, the property division as well as wife's need for maintenance and would need to be re-evaluated. See Minn. Stat. § 518.552, subds. 1, 2 (2002) (requiring consideration of amount of property a person has when determining that person's need for maintenance); Minn. Stat. § 518.58, subds. 1, 2 (2002) (requiring equitable division of marital property and allowing for award to party of a spouse's nonmarital property). This record is devoid of evidence demonstrating husband's $65,000 contribution was meant as anything other than an unconditional gift. To hold otherwise would disrupt the district court's otherwise equitable property division and create financial hardship for wife.
II
Husband argues that because wife made no post-separation contribution to the TRA, it was unfair to give wife a 25% share because she had been compensated in other ways. He also claims that wife should not have been awarded a share of his pension plan because he did not get a share of hers.
"The division of property must be affirmed if it has a `reasonable and acceptable basis in fact and principle.'" Batsell v. Batsell, 410 N.W.2d 14, 16 (Minn.App. 1987), review denied (Minn. Sept. 30, 1987) (quotation omitted). This court will uphold an equitable division of property, even though it is not necessarily equal. March v. March, 435 N.W.2d 569, 571 (Minn.App. 1989). The increased value of a retirement plan is considered marital property if it resulted from joint spousal contributions. White v. White, 521 N.W.2d 874, 879 (Minn.App. 1994). "The valuation and division of pension rights is generally a matter for the trial court's discretion." Taylor v. Taylor, 329 N.W.2d 795, 798 (Minn. 1983). The district court must consider each party's contribution with respect to acquisition, preservation, depreciation or appreciation in the amount or value of marital property. Minn. Stat. § 518.58, subd. 1 (2002). While Minn. Stat. § 518.58 presumes that each spouse contributed to the value of marital property while living together, this presumption does not extend to periods of separation. Id.; Batsell, 410 N.W.2d at 17.
In this case, the district court determined that the TRA was still marital property. Further, even if it had found the pension plan to be nonmarital property, it could have awarded a portion of that property to the other spouse to avoid unfair hardship. See Minn. Stat. § 518.58, subd. 2. Moreover, the district court determined that awarding the entire pension plan to husband would be unfair to wife, who was already subject to undue hardship. The court recognized that awarding wife a share of husband's pension plan constituted "a delicate balancing act." The separation left wife in a "disadvantageous position," forcing her to spend her share of the marital assets to meet her basic daily needs. Conversely, because of his greater job skills, husband could meet his needs through generating income, allowing him the opportunity to preserve and invest his share of the marital assets.
Husband asserts that awarding wife this share of his TRA creates a windfall for wife because she received his $65,000 non-marital interest in her home. But the fact that the court characterized the $65,000 contribution as a gift does not mean that the court awarded wife husband's share of non-marital property; the court merely recognized what husband had already done. By gifting the money to wife, husband also gave up his interest in it, regardless of the money's non-marital origin.
Husband's other claim, that wife should not have been awarded a share of his pension plan because he did not get a share of hers, is similarly flawed. To be awarded a share of wife's pension, that pension (a) must be marital property and it must be equitable for husband to receive that portion of the pension; or (b) must be wife's nonmarital property, and an award of the portion of the pension must be required to avoid undue hardship to husband. See Minn. Stat. § 518.58, subds. 1, 2. In this case, the district court made no explicit findings as to the marital or nonmarital character of wife's pension. But the court factored in the pension as part of the equitable distribution between the parties. Wife demonstrated a greater need for retirement benefits because she had less earning capacity. Her income, half that of husband's, forced her to spend marital assets to meet daily living expenses. To award husband half of wife's pension plan would disrupt the court's otherwise fair and equitable property division. Husband notes that wife did not contribute to the TRA post-separation. But the court considered each spouse's contribution to the TRA, both before and after separation. Minn. Stat. § 518.58, subd. 1 (2002) requires that the court consider this as one of many factors in determining an equitable property division, but does not make contribution, or the lack thereof, dispositive.
Because abuse of discretion review is a fact-sensitive determination, we conclude the district court acted within its discretion when it awarded wife 25% of husband's TRA. The court properly considered the needs and resources of both parties and exercised its discretion to reach an equitable, but not necessarily equal, division of the parties' marital property by balancing the past, present, and future needs of both spouses.
III
Wife argues that the district court (1) abused its discretion by setting the retroactive child support at less than the guidelines amount; and (2) should have awarded her some or all of her $9,000 in legal fees. Because the district court found that these issues were not timely raised and did not address them on the merits, we decline to do so here. "A reviewing court must generally consider `only those issues that the record shows were presented and considered by the trial court in deciding the matter before it.'" Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988) (quotation omitted).