Opinion
No. 12–P–1526.
2013-05-24
Christine A. RUSSO–MARTINES v. John R. MARTINES.
By the Court (GRASSO, KATZMANN & GRAINGER, JJ.).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
John Martines (husband) appeals from a judgment of divorce rendered by a judge of the Probate and Family Court, asserting the judgment as a whole to be inequitable, specifically alleging error in the division of the marital estate and in the award of alimony to his former wife, Christine A. Russo–Martines (wife). The material background facts, taken from the judge's findings, are essentially undisputed; the contest below and on appeal revolves around legal inferences derived from those facts, and certain asset valuations.
Background. The parties lived together for almost twenty years in what the judge found to be a de facto marriage. They were legally married for the last five years and nine months of this twenty year period.
The husband is the president and chief executive officer of Bedford Charter Services, Inc. (hereinafter Bedford Charter or the corporation). Bedford Charter is a closely held company which provides busing services to several area school districts. In 2008, the husband was paid $622,000 in wages from Bedford Charter. With the exception of 2008, an anomaly, the husband's annual income in each of the four years before the judgment of divorce issued was at or near $300,000. The wife was employed by Bedford Charter as a school bus driver until April 16, 2010, when the parties agreed to terminate her employment. She earned approximately $17,500 annually for her services as a bus driver in 2008 and 2009, the last two years she worked full time for the company during the school year.
The judge found specifically, in considering and resolving the issues, that the parties had a “twenty year relationship,” equivalent to a marriage of that duration.
The judge found that the marital assets held by the husband totaled $3,719,511.99 and those held by the wife totaled $84,380.29. The husband characterizes the distribution of assets (57.92 percent of the net asset value of the marital estate to the husband, 42.08 percent to the wife) as improper and, additionally, complains that the total asset value is inflated by overvaluation of his business, Bedford Charter. He finds error as well in the award of alimony.
The wife's 2009 compensation recited above included unemployment income she received during the summer months when school was not in session. In 2010, the wife was paid $3,472.19 for her services as a school bus driver and received unemployment income of $8,129 (as well as temporary alimony of $57,172).
Valuation of the husband's business. The parties each presented expert testimony on this issue. The husband's expert calculated the value of the husband's interest in his business at $918,000; the wife's expert testified to a value of $2,039,000. The judge arrived at a valuation of $1,845,690 by accepting the husband's approach, but increasing the resulting appraisal through the elimination of discounts applied by the husband's expert. The husband's discount for lack of marketability was invalidated by the judge because she determined that the husband, who had never had any other means of support other than the company (which had enjoyed a profitable fifty-three years in business at the time of trial) had no intention or desire to sell the business despite his claims to the contrary.
The judge also determined, both in this context and in light of the fiduciary relationship between the parties, that “fair value,” rather than “fair market value,” was the appropriate standard for valuation.
The company had contracts to provide school bus services with surrounding towns for many decades: thirty years with Carlisle and fifty-three years with Bedford. It also has contracts with the Belmont Hill School, Cambridge School of Weston and Hanscomb Field.
The judge's consideration of these factors, her findings, and her resulting valuation were well within her discretion.
The judge also rejected several opinions advanced by the wife's expert, finding a projected growth rate of 2 percent rather than 3.5 percent (citing the unchanging size of student populations in the relevant market) and determining no identifiable municipalities likely to become additional customers.
Asset distribution. As stated, the husband received 57.92 percent of the net asset value assigned to the marital estate by the judge; the wife received 42.08 percent.
The husband's detailed recital of error on appeal can be summarized as asserting that the respective contributions of each party to the marital estate, both at the time of marriage and during its continuation, cannot support an allocation of 42.08 percent to the wife.
At the time of the judgment these percentages equaled $2,776,634 for the husband and $1,837,000 for the wife.
The judge gave consideration both to the disproportionate assets that were brought to the marriage by each party and to the parties' respective contributions to the estate during the marriage. She also was required to confront the fact that the husband held $3,719,511 (or ninety-eight percent) of the total marital assets of $3,803,891 in his own name. The judge made detailed findings related both to financial and nonfinancial contributions to the marriage. She awarded the entire interest in the husband's business to him, and also a fifteen percent greater interest in the entire estate, or approximately $940,000 more than that awarded to the wife. The judge found, with support in the record, that despite the husband's conceded ability to pay court-ordered alimony out of earned income during the pendency of the hearings, he instead depleted an investment account comprising a portion of the marital estate. The judge did not abuse the considerable discretion assigned to her by statute and our cases.
See Adams v. Adams, 459 Mass. 361, 380 (2011), quoting from Rice v. Rice, 372 Mass. 398, 400 (1977) (“[I]t is the well-settled foundation of domestic relations law ... that a trial judge has ‘discretion to assign one spouse the property of the other spouse whenever and however acquired’ ”). See also Altomare v. Altomare, 77 Mass.App.Ct. 601, 611 (2010), quoting from Williams v. Massa, 431 Mass. 619, 626 (2000) (“There are ‘no hard and fast rules' governing” allocation of the marital estate). In sum, “the court may assign to either husband or wife all or any part of the estate of the other.” G.L. c. 208, § 34.
The relative liquidity of the assets awarded to the wife was also a proper exercise of discretion in this case where the record shows the wife had relatively small amounts of cash at any time during the marriage. The husband's reliance on Sampson v. Sampson, 62 Mass.App.Ct. 366, 372 (2004), criticizing a cash award based on the present value of future pension benefits, is unavailing.
Alimony. Finally, the husband asserts that both the amount and duration of alimony awarded the wife constitute error.
a. Duration. The judge awarded alimony to continue, under what was the traditional scheme in the Commonwealth, until either party's death, the wife's remarriage, or the husband's retirement. The husband asserts that the provisions of G.L. c. 208, §§ 48–55, changing the traditional approach and effective two days after the judgment in this case, should be applied. He characterizes the marriage as “short term ... of less than six years,” notwithstanding the judge's characterization of the marriage as lasting twenty years. See note 1, supra. Applying the new statute's requisite formula applicable to marriages of less than ten years (sixty percent of the number of months of marriage, in this case asserted by the husband to be seventy-six months) the husband argues that the proper award is of 45.6 months' duration. We are unpersuaded by this approach for several reasons.
The effective date of a statute is necessarily a precise and defined point in time, invoking rights and responsibilities, as well as issues of precedent, retroactivity, and societal expectations. See Fernandez–Vargas v. Gonzales, 548 U.S. 30, 37 (2006); Smith v. Massachusetts Bay Transp. Authy., 462 Mass. 370, 372 (2012). As is the case with statutes of limitation, the need to define a specific time for changes in the law can create harsh results in close cases. The judge did not err in applying the law in effect at the time of trial, and still in effect at the time of judgment.
Further, the judge would not have been limited to the seventy-six month duration of the parties' legal marriage in awarding alimony even had she applied the new statute before its effective date. “[T]he court may increase the length of the marriage if there is evidence that the parties' economic marital relationship began during their cohabitation period prior to the marriage.” G.L. c. 208, § 48, inserted by St.2011, c. 124, § 3. Here the judge was able to find, with ample evidentiary support, that the “economic marital relationship” lasted twenty years.
The husband also challenges the duration of the alimony as contradicted by the judge's finding that the wife will be fully employable in five years. In fact the judge referred to the need for the wife to be supported while she pursued a bachelor's degree, describing that course as a “reasonable” desire that will “broaden her employment opportunities and generate a level of income necessary” for financial independence. The prospect of independence does not address the future standard of living, below that enjoyed during the marriage and below that continued to be enjoyed by the husband, with which the judge found the wife would be faced.
See Rosenblatt v. Kazlow–Rosenblatt, 39 Mass.App.Ct. 297, 300–301 (1995) (even short-term marriages need not be measured by premarital standards of living).
The wife's projected annual income after she has obtained a psychiatric nursing degree is $61,000. This is in contrast to the husband's present annual income of approximately $300,000.
b. Amount. The record demonstrates that the husband's earned income provides him with a monthly cash surplus of close to $10,000. The wife was dependent on the husband's income and resources throughout the relationship, having left the employment market and worked for the company at a minimal salary level. In setting the amount of alimony, the judge made careful findings, supported by the record, considering all the relevant factors. See Moriarty v. Stone, 41 Mass.App.Ct. 151, 158–159 (1996) (factors properly considered in alimony award included diminished earnings and lifestyle of one spouse contrasted with substantial earnings and unchanged lifestyle of the other).
The judge also identified certain expenses incurred by the wife as “somewhat excessive” and took these into account to the husband's benefit in reducing her calculation of the wife's weekly needs. Her finding that the husband is “in a much better position for future acquisition of assets” cannot be challenged credibly. We conclude that she was well within her discretion in the award of alimony. Bernier v. Bernier, 449 Mass. 774, 793–794 (2007).
Judgment affirmed.