In re the Marriage of Daneille Dickson & Craig Dickson

FILED

MAY 1,2014

In the Office of the Clerk of Court

W A State Court of Appeals, Division III

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIVISION THREE

In re the Marriage of: )
) No. 30459-1-III
DANEILLE DICKSON, )
)
Respondent, )
)
and ) UNPUBLISHED OPINION
)
CRAIG DICKSON, )
)
Appellant. )

FEARING, J. - In this marriage dissolution proceeding, the trial court ordered

Craig Dickson to pay maintenance to Daneille Dickson, child support and private school

tuition for the couple's minor child, all postsecondary expenses for the couple's college

age child, a property equalization payment, and a portion of Ms. Dickson's attorney fees.

Mr. Dickson assigns six errors to the rulings of the trial court. He contends the trial court

(1) failed to properly consider the statutory factors in calculating maintenance, (2)

wrongly set child and postsecondary support amounts, (3) neglected to consider his

separate property contribution to the family home, (4) failed to apply credit for

retroactive payments, (5) failed to take into account the business assets seized by the

federal government in dividing the parties' property, and (6) wrongly ordered him to pay
No.30459-1-III
In re Marriage ofDickson

a portion of Ms. Dickson's attorney fees. After a two-week trial but before the trial

court's ruling, the Federal Bureau ofInvestigation (FBI) seized a~sets of the couple as the

result of Mr. Dickson's criminal "structuring" activity. The seizure complicated the

issues to be resolved, and the trial court thereafter convened an additional week of trial.

FACTS

The Dicksons married on July 6, 1991. They have two children: Jordan (age 21)

and Regan (age 18). Ms. Dickson has only a high school education and stayed at home to

care for the children during much of the marriage. Mr. Dickson holds a college degree.

Ms. Dickson petitioned for dissolution on August 10,2009.

Mr. Dickson received an inheritance from his mother's estate in 2002. Mr.

Dickson claims that the parties used $200,000 of the inheritance for a down payment on a

family home. Ms. Dickson testified she was unaware the down payment came from an

inheritance.

Most of the parties' assets were acquired by income generated by their successful

business, Dickson Iron & Metals, Inc. (DI&M), which resells scrap metal. Mr. Dickson,

however, failed to produce in discovery or at trial income tax returns for the two years

preceding trial. In November 2008, Ms. Dickson opened Rogue, a coffee shop, but it

failed and closed less than a year later.

At the time of dissolution, Jordan was a sophomore attending Whitman College.

His annual tuition is $50,000 per year. Regan was ajunior at a private high school in

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Colorado, where her mother relocated. Her annual costs for tuition and fees approximate

$15,000.

Trial proceeded in mid-July 2010. During trial, expert appraisers testified as to the

value ofDI&M. Ms. Dickson's expert, Douglas Brajcich, employed a capitalized excess

earnings method of valuation and valued DI&M at $3 million. Mr. Dickson's expert,

Dan Harper, testified that a straight capitalization accounting methodology was a more

appropriate method to value the scrap metal business. Mr. Harper appraised DI&M as

being worth between $1,494,153 and $1,642,675.

On August 31, 2010, after trial but before the trial court entered final orders on the

petition for dissolution, the FBI raided DI&M, Mr. Dickson's residence, and the family

residence occupied by Ms. Dickson. The FBI seized cash, the account balances in DI&M

bank accounts, business records of the company, and personal vehicles. On August 31,

the FBI also seized, from Mr. Dickson, checks made payable to DI&M, totaling

$448,470. Dickson carried the checks in a duffie bag on his way to work. The checks

were dated from the middle of July 2010 through the fourth week of August 2010.

Eventually the federal government charged Mr. Dickson with structuring financial

transactions to avoid reporting requirements and conspiracy to commit structuring based

on DI&M business practices from January 1,2005 through April 30, 2008. The

government alleged that Mr. Dickson laundered stolen scrap metal for thieves and tried to

keep the transactions hidden. In March 2011, Mr. Dickson pled guilty to seven counts of

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structuring financial transactions and one count of conspiracy to commit the same

offense. Mr. Dickson and the government entered into a plea agreement whereby Mr.

Dickson forfeited real property, vehicles, and retirement accounts. He also agreed to pay

a money judgment.

During the forfeiture proceedings, Ms. Dickson asserted she was an innocent

owner and had a superior interest to some of the seized assets. On July 6, 2011, Ms.

Dickson entered into a stipulation with the federal government, under which the

government paid her $15,000 and returned to her a Lexus and a BMW. In exchange, Ms.

Dickson released all other claims to the forfeited assets.

At the request of Mr. Dickson, the trial court reopened the trial for presentation of

additional evidence resulting from the FBI seizures. The dissolution trial resumed on

July 13,2011, and continued until July 20,2011. During the reconvened trial, Mr.

Dickson testified that he had not deposited the $448,470 in checks seized by the

government because he had a "pile of paperwork coming out of trial." Report of

Proceedings (RP) at 1909.

After completion of trial, the trial court dissolved the parties' marriage and

ordered Mr. Dickson to pay $6,500.00 per month in maintenance from September 1,

2011, to August 31,2013. The court ordered Mr. Dickson to pay $1,257.60 per month in

child support for Regan, all of Jordan's educational expenses for the next three years, and

Regan's private school expenses up to $15,000.00 per school year for two years. On the

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child support worksheet, the court calculated Mr. Dickson's net monthly income at

$12,303.00 and Ms. Dickson's net monthly income at $5,725.62, based upon the

maintenance award. Also on the child support worksheet, the court used the figure for a

one-child household, even though Mr. Dickson was ordered to pay postsecondary support

for Jordan. In dividing the couple's property, the trial court awarded the $317,121.27

proceeds from the sale of the family home to Ms. Dickson, finding the $200,000.00 down

payment from Mr. Dickson's inheritance was commingled and, thus, community

property. The trial court estimated the value of the seized property, cash, and vehicles to

be $1,358,763.00. The court counted the assets seized by the government as assets

awarded to Mr. Dickson. In other words, only Mr. Dickson was burdened, in the trial

court ruling, by the seizure.

The court valued DI&M at $2,500,000.00 and awarded the business to Mr.

Dickson. The court ordered him to pay Ms. Dickson an equalization payment of

$2,012,059.50. The distribution and equalization payment resulted in each party

receiving distribution of $2,888,774.50. The court ordered Mr. Dickson to pay

$59,047.00 in Ms. Dickson's attorney fees and costs. The court allowed these fees to be

deducted from the equalization payment, reducing the equalization payment to

$1,953,012.50 with an interest rate of 12 percent per annum.

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LAW AND ANALYSIS

ISSUE I. Maintenance

The trial court granted Ms. Dickson $6,500 per month for two years beginning

September 2011. On appeal, Mr. Dickson argues the maintenance amount is unjust and

contrary to RCW 26.09.090 for various reasons. According to Mr. Dickson, the parties

did not have a long-term marriage. Ms. Dickson has marketable skills. Ms. Dickson is

financially able to provide for herself and is supported by her cohabitating boyfriend.

She continues to live the same, if not better, lifestyle. Mr. Dickson does not have the

ability to pay. Mr. Dickson claims legal error because the trial court refused to consider

the income ofMs. Dickson's boyfriend as support to Ms. Dickson before assessing

spousal maintenance upon Mr. Dickson.

RCW 26.09.090 controls awards of spousal maintenance. The statute reads, in

relevant part:

(1) In a proceeding for dissolution of marriage ... , the court may grant a
maintenance order for either spouse. . .. The maintenance order shall be in
such amounts and for such periods of time as the court deems just, without
regard to misconduct, after considering all relevant factors including but
not limited to:
(a) The financial resources of the party seeking maintenance, including
separate or community property apportioned to him or her, and his or her
ability to meet his or her needs independently, including the extent to which
a provision for support of a child living with the party includes a sum for
that party;
(b) The time necessary to acquire sufficient education or training to
enable the party seeking maintenance to find employment appropriate to his
or her skill, interests, style of life, and other attendant circumstances;

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(c) The standard of living established during the marriage or

domestic partnership;

(d) The duration of the marriage or domestic partnership;
(e) The age, physical and emotional condition, and financial

obligations of the spouse or domestic partner seeking maintenance;

and

(t) The ability of the spouse or domestic partner from whom

maintenance is sought to meet his or her needs and financial

obligations while meeting those of the spouse or domestic partner

seeking maintenance ..

We review the trial court's decision on an award of maintenance for abuse of

discretion. In re Marriage o/Zahm, 138 Wn.2d 213,226-27,978 P.2d 498 (1999). "An

award of maintenance that is not based upon a fair consideration of the statutory factors

constitutes an abuse of discretion." In re Marriage o/Crosetto, 82 Wn. App. 545, 558,

918 P.2d 954 (1996). Ultimately, the court's main concern must be the parties' economic

situations postdissolution. In re Marriage o/Williams, 84 Wn. App. 263,268,927 P.2d

679 (1996). "The only limitation on amount and duration of maintenance under RCW

26.09.090 is that, in light of relevant factors, the award must be just." In re Marriage 0/

Bulicek, 59 Wn. App. 630, 633,800 P.2d 394 (1990).

The record establishes that the trial court explicitly considered each factor in its

oral ruling and findings of fact before ruling that Ms. Dickson had a need for

maintenance and Mr. Dickson had the ability to pay. The Dicksons were married for 19

years, a sufficient duration to warrant maintenance. Ms. Dickson only has a high school

education while Mr. Dickson has a college decree. Ms. Dickson spent the majority of the

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parties' marriage at home performing the noble role of mom. Her homemaking provided

time and opportunity for Mr. Dickson to establish a successful family business that

provided an abundant lifestyle for the family. Ms. Dickson was accustomed to this

lifestyle.

Washington decisions show the trial court did not abuse its discretion. In In re

Marriage ofFernau, 39 Wn. App. 695, 705, 694 P.2d 1092 (1984), the court affirmed a

maintenance award when the parties were married 9 years. In In re Marriage ofMyers,

54 Wn. App. 233, 773 P.2d 118 (1989), this court affirmed a 5-year maintenance award

,
following the dissolution ofa 12-year marriage.

Mr. Dickson fails to identify any authority requiring a trial court to consider the

income of a spouse's cohabitating friend when resolving maintenance. Such income is
1
not a factor listed in RCW 26.09.090(1).

The trial court has discretion to weigh the relevant statutory factors and

circumstances ofthe case, and we do not substitute our judgment for that of the trial

court. Zahm, 138 Wn.2d at 227. We uphold the award of spousal maintenance.

ISSUE II. Child Support

The trial court set child support at $1,257.60 per month for Regan and ordered Mr.

Dickson to pay all of Regan's private school tuition and all of Jordan's postsecondary

support. Mr. Dickson assigns three errors to the trial court's award of child support.

First, according to Dickson, the court order exceeds 45 percent of his net income, which

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is impermissible under RCW 26.19 .065( 1). Second, the court failed to impute income to

Ms. Dickson. Third, the court erred in calculating child support for Regan based on a

one-child family when Mr. Dickson provides support for two children. We agree with

Mr. Dickson's third contention.

Child support, extraordinary expenses, and postsecondary support orders are all

reviewed for abuse of discretion. In re Marriage a/Griffin, 114 Wn.2d 772, 776, 791

P.2d 519 (1990); Childers v. Childers, 89 Wn.2d 592, 601,575 P.2d 201 (1978).

Discretion is abused when it is exercised on untenable grounds or for untenable reasons.

In re Marriage a/Littlefield, 133 Wn.2d 39, 46-47,940 P.2d 1362 (1997). Substantial

evidence must support the trial court's factual findings. In re Parentage a/Goude, 152

Wn. App. 784,790,219 P.3d 717 (2009). This court will not substitute its judgment for

trial court judgments if the record shows the court considered all relevant factors and the

award is not unreasonable under the circumstances. Griffin, 114 Wn.2d at 776.

RCW 26.09.100(1) requires the trial court, after considering "all relevant factors,"

to order either or both parents to pay child support in an amount determined under

chapter 26.19 RCW. The trial court calculates the total amount of child support, allocates

the basic support obligation between the parents based on each parent's share of the

combined monthly net income, RCW 26.19.080(1), then orders the parent with the

greater obligation to pay the other a support transfer payment. RCW 26.19.011(9).

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RCW 26.19.065(1) reads:

(1) Limit at forty-five percent ofa parent's net income. Neither
parent's child support obligation owed for all his or her biological
or legal children may exceed forty-five percent of net income except
for good cause shown.

(b) Before determining whether to apply the forty-five percent

limitation, the court must consider whether it would be unjust to

apply the limitation after considering the best interests ofthe child

and the circumstances of each parent. Such circumstances include,

but are not limited to, leaving insufficient funds in the custodial

parent's household to meet the basic needs of the child, comparative

hardship to the affected households, assets or liabilities, and any

involuntary limits on either parent's earning capacity including

incarceration, disabilities, or incapacity.

(c) Good cause includes, but is not limited to, possession of substantial
wealth, children with day care expenses, special medical need, educational
need, psychological need, and larger families.

The court calculated Mr. Dickson's net monthly income as $12,303. While Mr.

Dickson testified his wages were only $10,000 per month at the time of trial, he provided

no proof of this amount. Without proof of more recent earnings, the court calculated

earnings based on 2006 through 2008 tax records, which showed Mr. Dickson's wages

were respectively $235,000, $283,000, and $335,720. These tax returns provide

sufficient evidence that Mr. Dickson's net monthly income is $12,303. Accordingly, the

trial court did not abuse its discretion.

We must next determine the amount of child support paid by Mr. Dickson each

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month to determine if the amount exceeds 45 percent of his net monthly income.

Division Two of this court examined the meaning of "child support" under RCW
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26.19.065(1). In re Marriage olCola, 177 Wn. App. 527,312 P.3d 695 (2013). The

court concluded that postsecondary educational support "is money paid to support a

dependent child, therefore it is child support" for purposes of the 45 percent limitation.

Cola, 177 Wn. App at 541 (quoting In re Marriage o/Schneider, 173 Wn.2d 353, 368,

268 P.3d 215 (2011 )). The court relied upon the Supreme Court decision in Schneider.

In Schneider, the court explained "that postsecondary educational support ... fits within

the structure ofthe child support statute in general [and in some situations] can function

just like ordinary child support." Schneider, 173 Wn.2d at 368. Therefore, we hold that

tuition Mr. Dickson pays for both Jordan and Regan is included in his "child support

obligations" for purposes ofRCW 26.19.065(1).

The court ordered Mr. Dickson to pay $1,257.60 per month in ordinary child

support for Regan, all of Jordan's educational expenses of$50,000.00 annually for the

next three years, and Regan's private school expenses up to $15,000.00 per school year

for two years. Jordan's educational expenses are $4,166.00 per month; while Regan's

school expenses are $1,250.00 per month. The support totals $6,673.60 per month.

Forty-five percent of Mr. Dickson's net monthly income of$12,303.00 is $5,536.35, so

the monthly payment exceeds the 45 percent limit by $1,137.25.

RCW 26.19.065(1)(c), however, permits a court to exceed the 45 percent cap "for

good cause shown," including for "educational need" or when one party possesses

"substantial wealth." In his written findings of fact and conclusions of law, the trial court

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found Jordan and Regan possessed an educational need for support and that Craig

possessed substantial wealth. On a motion to reconsider, the trial court found "[c]urrent

postsecondary and child support amounts reflect a significant deviation which remains

supported by good cause." Clerk's Papers (CP) at 1060. We conclude that the trial court

did not abuse its discretion in exceeding the 45 percent limit.

Mr. Dickson next argues the court erred by failing to impute income to Ms.

Dickson when calculating child support. At the time of the decree, Ms. Dickson was 40

years old, with a high school education, and without significant marketable skills. At the

time of trial, Ms. Dickson was unemployed and had no recent work history or education

that would mandate an imputation of income. The coffee shop she opened quickly failed.

The trial court did not abuse its discretion when it chose not to impute income to her, but

instead attributed the spousal maintenance to her as income. The maintenance amount is

in an amount higher than whatever income Ms. Dickson may later gain. Mr. Dickson

argues the court should have factored in Ms. Dickson's boyfriend's income, but income

and resources of a new spouse or domestic partner are specifically "excluded" in

calculating the parent's gross monthly income. RCW 26.19.071(4).

Mr. Dickson next argues that the court should have awarded child support on the

basis of a two-child, not a one-child family. If the court used the figures for a two-child

family, the total child support obligation would be reduced from $1,844 to $1,440 for

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Regan. Jordan was no longer the subject of child support, since he received

postsecondary education support.

Chapter 26.19 RCW directs a specific process a trial court must follow before

entering an order of child support. The first step is to set the basic child support

obligation based on the parents' combined monthly net income and the number and ages

ofthe children. RCW 26.19.011(1), .020; In re Marriage ofMcCausland, 159 Wn.2d

607,611, 152 PJd 1013 (2007). The obligation amount is determined from an economic

table. RCW 26.19.020. The per child amount is reduced with multiple children in the

family. RCW 26.19.020. When the combined monthly income of both parents exceeds

$12,000 the court "may exceed the presumptive amount of support set for combined

monthly net incomes of twelve thousand dollars." RCW 26.19.020.

Our trial court used the economic table to calculate the basic support obligation for

Regan at $1,844.00. This is the highest amount for a one-child family, with parents

having a combined monthly income of$12,000.00. Mr. Dickson's portion of the child

support obligation was $1,257.60. Ms. Dickson argues this was a deviation because the

parties' combined monthly income is over $12,000.00, thus, the court could set any

amount it wanted. But, the court listed as the "Reason[s] why Request for Deviation Was

Denied" was because Mr. Dickson was "independently provid[ing] funds directly to each

child." CP at 804. Evidence showed that Mr. Dickson gave Regan $1,500.00 per month

directly and the court wanted the funds to be paid to Ms. Dickson instead. Using the

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presumptive amount resulted in Mr. Dickson paying the approximate amount that he paid

before dissolution. Thus, the court did not intend a deviation.

Another division of our court recently addressed a similar situation, in Cota, 177

Wn. App. 527. The court held, "[W]e believe that our Supreme Court's statement that

postsecondary educational support is child support controls here. Therefore, we hold that

postsecondary educational support is part ofa parent's 'child support obligation.'" Cota,

177 Wn. App at 542 (citing Schneider, 173 Wn.2d at 367-68). In Daubert, the court held,

"when calculating support for the younger minor children, the schedule applies and

requires consideration of the postsecondary child, because this child is still a child

receiving support." In re Marriage ofDaubert, 124 Wn. App. 483,503,99 P.3d 401

(2004), abrograted on other grounds by McCausland, 159 Wn. 2d 607. The Daubert

court ultimately reversed the award of child support for the youngest child and remanded

"for recalculation based on two children receiving support." Id. at 506.

Mr. Dickson pays child support for Regan and postsecondary support for Jordan.

Because the trial court intended to rely on the economic table and because both children

received support, the trial court should have relied on the column for a two-child family.

As set forth in Daubert, the proper recourse is to remand for recalculation based on two

children receiving support.

ISSUE III. Tuition Expenses for Regan

Mr. Dickson next contends the trial court erred when ordering him to pay Regan's

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entire private school tuition. RCW 26.19.080(3) provides Mr. Dickson solace and reads,

in part, "[S]pecial child rearing expenses, such as tuition ... are not included in the

economic table. These expenses shall be shared by the parents in the same proportion as

the basic child support obligation." But, under subsection (4), "The court may exercise

its discretion to determine the necessity for and the reasonableness of all amounts ordered

in excess of the basic child support obligation."

As a result of the mandatory language in RCW 26.19.080(3), early cases held that

a trial court must allocate special expenses in the same proportion as the child support

obligation. Murphy v. Miller, 85 Wn. App. 345, 349, 932 P.2d 722 (1997); In re

Paternity o/Hewitt, 98 Wn. App. 85,988 P.2d 496 (1999); In re Marriage o/Scanlon,

109 Wn. App. 167,34 P.3d 877 (2001). Beginning with Division Two in In Re Marriage

o/Casey, 88 Wn. App. 662,967 P.2d 982 (1997), courts have recognized an exception to

proportionate allocation for extraordinary expenses. Thus, the trial court is not always

bound to comply with the restrictions ofRCW 26.19.080(2). In re Marriage 0/

McCausland, 129 Wn. App. 390, 411, 118 P.3d 944. Findings must support any

requirement that a parent bear the full cost of any extraordinary expenses. McCausland,

129 Wn. App. at 411.

Our trial court found in its oral ruling that Regan is "a delightful student" and

"going to be exploring all of the other opportunities that may be presented in Highlands

Ranch, Colorado, which is the site of her new school Valor Christian." RP at 2051. The

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court also found, "Because the children's needs are very closely related to their

education, dad should be responsible for their schooling." RP at 2052. Mr. Dickson has

solely paid Regan's expenses in the past. Notably, Ms. Dickson's income is limited to

maintenance. Although we may prefer more thorough findings, we conclude the trial

court acted within its discretion when ordering Mr. Dickson to pay the entire tuition of

his daughter.

ISSUE IV. Postsecondary Support for Jordan

RCW 26.19.090(2) gives the trial court discretion to order support for

postsecondary educational expenses and sets forth criteria the trial court should consider

when making such an award. The trial court initially must find that the child is

dependent and "relying upon the parents for the reasonable necessities of life." RCW

26.19.090(2). Once that threshold requirement is satisfied, the trial court must also

consider the following nonexhaustive list of factors:

Age of the child; the child's needs; the expectations of the parties
for their children when the parents were together; the child's prospects,
desires, aptitudes, abilities or disabilities; the nature of the postsecondary
education sought; and the parents' level of education, standard of living,
and current and future resources.

RCW 26.19.090(2). "Also to be considered are the amount and type of support that the

child would have been afforded ifthe parents had stayed together." RCW 26.19.090(2).

We presume that the court considered all evidence before it in fashioning an order on

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postsecondary educational expenses. In re Marriage ofKelly, 85 Wn. App. 785, 793, 934

P.2d 1218 (1997).

Our trial court properly considered the factors in RCW 26.19.090(2). Jordan is

strong in math and earned a perfect Scholastic Assessment Test (SAT) score before he

graduated. Jordan successfully completed his freshman year at a premier undergraduate

school, Whitman College. Ms. Dickson had a high school education, and Mr. Dickson

had a college degree. Mr. Dickson had paid Jordan's expenses in the past and had the

ability to continue to pay his expenses. The only income Ms. Dickson received was

spousal maintenance.

We do not second-guess the trial court's discretionary evaluation of these factors.

The trial court does not abuse its discretion in determining postsecondary educational

support ifit considers all factors in RCW 26.19.090(2). Goude, 152 Wn. App. at 791.

The trial court did not err in ordering Mr. Dickson to continue to provide postsecondary

support for Jordan.

ISSUE V. Family Home

Mr. Dickson next contends the court erred in characterizing the proceeds from the

sale of the family home as entirely community property and awarding the proceeds to

Ms. Dickson. Property acquired prior to marriage or afterward by gift, bequest, devise,

decent, or inheritance is presumed to be separate. RCW 26.16.010; In re Estate of

Borghi, 167 Wn.2d 480, 483, 219 P.3d 932 (2009). The separate property presumption

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can be rebutted by clear and convincing evidence of conversion to community property.

Borghi, 167 Wn.2d at 490. When money in a joint account is hopelessly commingled

and cannot be separated it is rendered entirely community property. In re Marriage of

Skarbek, 100 Wn. App. 444, 448, 997 P.2d 447 (2000).

Mr. Dickson's inheritance was initially separate property. But, a party loses the

benefit of any separate property presumption and assumes the burden of proving the

separate character of property when he or she puts it "into an account where it [is]

commingled with community funds." Skarbek, 100 Wn. App. at 449. The Dickson

family home was purchased during the marriage in 2002, and was held in both parties'

names. For nine years, the couple made mortgage payments with community funds.

While part of the down payment was initially separate property, the funds were

commingled thereby rendering the home community property. The trial court did not err

in concluding likewise. The trial court also held discretion when awarding the proceeds

from the sale of the family home to Ms. Dickson.

The trial court is in the best position to determine what is fair and equitable and

has broad discretion in distributing the property and liabilities in dissolution proceedings.

In re Marriage ofBrewer, 137 Wn.2d 756, 769, 976 P.2d 102 (1999). We will not

reverse a trial court's property distribution on appeal absent a showing of manifest abuse

of discretion. Id.

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ISSUE VI. Retroactive Payments

Mr. Dickson made several payments to Ms. Dickson while the parties were

separated, but before dissolution. Mr. Dickson seeks a credit for the payments in the

property distribution. He objects to the characterization of the payments as spousal

maintenance.

As addressed previously, the trial court has wide discretion in fashioning a fair

I property distribution. Brewer, 137 Wn.2d at 769. The trial court's denial of Mr.

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Dickson's request for a credit against the property distribution is reviewed for an abuse of

I discretion.

The trial court opted not to credit Mr. Dickson with the advances and to instead

view the payments as maintenance or child support during separation. The court also

found, "It goes into the new determination that his upcoming [child] support amount is

admittedly somewhat low given the bracket that he is in, but it is a recognition of what

has been paid." RP at 2103-04. There was no abuse of discretion.

ISSUE VII. Valuation Method ofDI&M

The trial court valued DI&M at $2,500,000. Mr. Dickson contends the trial court

committed error in its valuation because it relied on the methods for calculating value set

forth in In re Marriage ofHall, 103 Wn.2d 236,692 P.2d 175 (1984). Mr. Dickson

contends the Hall methods should be employed only when valuing professional practices

and not to a corporation engaged in selling commodities.

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It is difficult to value the shares of a closely held corporation; the task calls for the

careful weighing of relevant facts and the ultimate exercise of reasoned judgment. In re

Marriage o/Gillespie, 89 Wn. App. 390, 402, 948 P.2d 1338 (1997); In re Marriage 0/
Berg, 47 Wn. App. 754, 756-57, 737 P.2d 680 (1987). The trial court must include in the

record its method of valuation and the weight it gave to the factors it considered. Berg,

47 Wn. App. at 757. The valuation ofa corporation is a factual issue that we review for

an abuse of discretion. Suther v. Suther, 28 Wn. App. 838, 839-40, 627 P.2d 110 (1981);

Gillespie, 89 Wn. App. at 403. The trial court has discretion to consider a variety of

factors in assessing the value of a closely held business. Gillespie, 89 Wn. App. at 403

(citing Suther, 28 Wn. App. at 846-47). In detennining whether substantial evidence

exists to support a court's finding of fact, the record is reviewed in the light mo~t

favorable to the party in whose favor the findings were entered. DeBenedictis v. Hagen,

77 Wn. App. 284, 291, 890 P.2d 529 (1995).

Our trial court found that the capitalization of excess earning method was the most

appropriate methodology to utilize in valuing DI&M. This method is known as method

three in the seminal decision: Hall, 103 Wn.2d at 244. The Hall court, when reviewing

the valuation of a physician's practice, listed five nonexclusive and not mutually

exclusive methods in valuing businesses. 103 Wn.2d at 243-45. The Supreme Court

described Hall method three as taking "the average net income of the business for the last

five years[,] and subtract[ing] a reasonable rate of return based on the business'[s]

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In re Marriage ofDickson

average net tangible assets. From this amount[,] a comparable net salary is subtracted.

Finally, this remaining amount is capitalized at a definite rate. The resulting amount is

goodwill." Hall, 103 Wn.2d at 244. This goodwill or intangible value is then added to

the value of the tangible assets to provide a total value of the business. Id.

Ms. Dickson's expert, Douglas Brajcich, employed Hall method three when

valuing DI&M. Mr. Dickson argues that the Hall method three should be limited to the

valuation of professional practices alone, contending that as a matter of law, this

methodology cannot be utilized to value DI&M. Mr. Dickson fails to cite legal authority

to support this proposition. Although the Hall decision involved the valuation of a

professional practice, the Supreme Court did not limit its holding to valuations of

practices. Our trial court set forth a lengthy analysis of its rationale, as well as underlying

evidence in support of adopting the methodology of Mr. Brajcich.

Mr. Brajcich valued the business enterprise at $3 million. Mr. Dickson's expert,

Mr. Harper, valued DI&M as ranging from $1,494,153 to $1,642,675. Both Brajcich and

Harper presented credible testimony and the trial court could have adopted either expert's

opinion. If either expert opinion could be accepted, the trial court should be free to

establish a value between the two amounts. The fact finder is given wide latitude in the

weight given expert opinion. In re Marriage ofSedlock, 69 Wn. App. 484, 491,849 P.2d

1243 (1993). When the parties offer conflicting evidence in valuation, the court may

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In re Marriage ofDickson

adopt the value asserted by either party, or any value in between the two. In re Marriage

ofRockwell, 141 Wn. App. 235, 250, 170 PJd 572 (2007); Sedlock, 69 Wn. App. at 491.

ISSUE VIII. $448,470 in Uncashed Checks

After the first two weeks of trial and while the trial court considered its ruling, Mr.

Dickson carried $448,4 70 in checks in a duffel bag. The checks were signed in July and

August 2010. The FBI seized the checks on August 31. Mr. Dickson had never

accounted for the checks when he disclosed assets during discovery or when he testified
i
} at trial. In his favor, the checks were likely dated after the first session of trial. But one

I could conclude he still was hiding assets from his wife and the court. Strolling with

$448,4 70 in checks, some more than one month old, is not an ordinary occurrence for

someone engaged in legal activity.

During the reconvened trial, Mr. Dickson provided no explanation for carrying

$448,470 in checks, other than the incredible explanation that he was too busy during the

initial trial to deposit the money. Of course, he did not explain why he still carried the

checks one month after completion of trial, or why a bookkeeper could not have

deposited this huge amount. More importantly, the large amount of checks seized was

consistent with the federal government's charges that Mr. Dickson committed the federal

crime of structuring. Structuring is the act of parceling what would otherwise be a large

financial transaction into a series of smaller transactions to avoid scrutiny by regulators

or law enforcement. See 31 U.S.C. § 5324. Carrying large sums of money, rather than

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In re Marriage ofDickson

depositing the money at one time to avoid reporting requirements, is the essence of

structuring. United States v. Gabel, 85 F.3d 1217,1223 (7th Cir. 1996). Structuring is

sometimes performed to effectuate money laundering. Id.

Both valuation experts testified to a value of DI&M at a date at least one-year

before trial. On appeal, Mr. Dickson argues that the $448,470 seized from him was

similar in nature to cash balances reflected on balance sheets used by the experts to value

the business on earlier dates. According to Mr. Dickson, the seized checks is a substitute

for the cash balances on the ~alance sheets. Nevertheless, the trial court considered the

checks to be an asset separate from the value of the business and charged the $448,470 to

Mr. Dickson's side of the ledger when dividing the property's assets. Mr. Dickson

complains about this allocation and argues that the $448,470 should be subsumed in the

value of the business for purposes of dividing community assets. Stated differently, he

grumbles that trial court engaged in double counting of the $448,470.

We reject Mr. Dickson's argument for various reasons. First, Mr. Dickson's own

expert based his valuation ofDI&M on a balance sheet listing a cash account of

"$217,000." Ex. R-128.18. This account balance is more than $200,000 less than the

checks carried by Dickson on August 31, 2010. The charges of structuring included

activity starting on January 1,2005, and continuing through the dates of the evaluations

by the experts. Thus, Mr. Dickson likely carried large sums of money unaccounted for at

the time of the preparation of company balance sheets used by the experts in evaluating

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In re Marriage 0/Dickson

DI&M.

Mr. Dickson argues in general that none of the seized assets should be charged to

him as assets in dividing the couple's property. Nevertheless, a trial court may consider

the dissipation of assets and the failure to account for assets in the trial court's

deliberations, relative to an equitable distribution. In re Marriage 0/ Clark, 13 Wn. App.
805,811,538 P.2d 145 (1975). The trial court, in this instance, deemed that it was

equitable to assign to Mr. Dickson the entire value of the forfeited community assets

based on his criminal acts.

Mr. Dickson did not fully account for all of his assets during trial. He provided

the court outdated tax returns. He engaged in criminal activity that harmed the marital

community. Ifthere is any confusion in the evidence as to double accounting, Mr.

Dickson's unethical conduct caused the confusion. In short, Mr. Dickson came to court

with unclean hands. Equity will not interfere on behalf of a party whose conduct in

connection with the subject matter in litigation has been unconscientious, unjust, or

marked by the want of good faith. Income Investors v. Shelton, 3 Wn.2d 599, 602, 101

P.2d 973 (1940); Port o/Walla Walla v. Sun-Glo Producers, Inc., 8 Wn. App. 51, 56, 504

P.2d 324 (1972).

Mr. Dickson's challenge concerns the distribution of property. A party

challenging a property distribution must demonstrate that the trial court manifestly

abused its discretion. In re Marriage o/Washburn, 101 Wn.2d 168, 179,677 P.2d 152

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In re Marriage ofDickson

(1984); In re Marriage ofTerry, 79 Wn. App. 866, 869, 905 P.2d 935 (1995). We find a

manifest abuse of discretion when the trial court exercises its discretion on untenable

grounds. In re Marriage ofOlivares, 69 Wn. App. 324, 328, 848 P.2d 1281 (1993).

In a dissolution action, the trial court must make a "just and equitable" distribution

of the property and liabilities of the parties after considering all relevant factors,

including the nature and extent of the separate and community properties and the duration

of the marriage. RCW 26.09.080. The trial court's paramount concern when distributing

property in a dissolution action is the economic condition in which the decree leaves the

parties. Williams, 84 Wn. App. at 270; RCW 26.09.080. We find no abuse of discretion

in the trial court's property division.

ISSUE IX. Attorney Fees Below

Mr. Dickson challenges the trial court's award of attorney fees to Ms. Dickson.

Like his argument regarding the characterization of the family home, he fails to provide

any citation to legal authority to support his terse argument. He challenges both a 2009

order to pay fees for $25,000 and a 2011 attorney fee award in the decree of dissolution

for $59,047. The 2009 fees were awarded by a superior court commissioner, who was

frustrated at Mr. Dickson's failure to provide credible information about his finances.

Both awards were based on need and ability to pay.

Case law is well established that "[a]n award of attorney fees rests within the

sound discretion of the trial court, which must balance the needs of the spouse requesting

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In re Marriage ofDickson

the fees with the ability of the other spouse to pay." In re Marriage ofMathews, 70 Wn.

App. 116, 125, 853 P.2d 462 (1993). A party challenging the trial court's decision to

award attorney fees "bears the burden of proving the trial court exercised its discretion in

a way that was 'clearly untenable or manifestly unreasonable.'" Crosetto, 82 Wn. App.

at 563 (quoting In re Marriage ofKnight, 75 Wn. App. 721, 729, 880 P.2d 71 (1994».

Mr. Dickson is a successful business man with a gross monthly income of

$23,714. Ms. Dickson only has a high school education, few marketable skills, and a

gross monthly income of $6,500, which consists solely of her maintenance award. Based

on these facts, the court had tenable grounds to award attorney fees to Ms. Dickson.

ISSUE X. Attorney Fees on Appeal

Both parties request attorney fees on appeal under RAP 18.1. In general, RAP

18.1 sets forth the procedure for requesting fees on appeal; it is not the applicable law

that grants fees. Nevertheless, under RCW ~6.09.140, this court may, in its discretion,

order a party to pay for the cost to the other party of maintaining the appeal, including

attorney fees, in addition to statutory costs. This provision gives the court discretion to

award attorney fees to either party based on the parties' financial resources, balancing the

financial need of the requesting party against the other party's ability to pay. In re

Marriage ofPenna men, 135 Wn. App. 790, 807·08, 146 P.3d 466 (2006).

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In re Marriage ofDickson

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Under RAP 18.1 (c), the parties have until 10 days prior to the date of appellate

oral argument to file their declarations of financial need. Neither party complied with

this rule. Therefore, we deny both parties an award of reasonable attorney fees and costs.

CONCLUSION

We remand the case to the trial court to recalculate child support based upon a

two-child family. Otherwise, we affirm the rulings of the trial court and applaud the trial

court for its handling of a difficult dissolution.
~
1 A majority of the panel has determined this opinion will not be printed in the
j Washington Appellate Reports, but it will be filed for public record pursuant to
1 RCW 2.06.040.

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SIDDOWAY, C.J. (dissenting) - It is hard to dispute Craig Dickson's contention

that the trial court exercised its discretion in favor of his former wife at virtually every

turn in resolving the property distribution, spousal maintenance, and child support issues

in this divorce. In the case of all but one of the rulings he challenges on appeal, however,

I agree with the majority that we have no basis for reversing the trial court. Trial court

decisions in a dissolution action will seldom be changed upon appeal; we will affirm

unless no reasonable judge would have reached the same conclusion. Tatham v. Rogers,

170 Wn. App. 76, 106,283 P.3d 583 (2012) (citing In re Marriage ofLandry, 103 Wn.2d

807,809-10,699 P.2d 214 (1985)). The trial court's rulings generally have a basis in the

evidence and fall within the broad scope of its discretion.

Where I part ways with my colleagues is in connection with the trial court's

decision to treat the $448,470 in checks payable to Dickson Iron & Metals, Inc. (DI&M)

that were seized from a duffel bag in Mr. Dickson's possession at the end of August 2010

as a noncorporate asset, which the court then allocated to him along with 100 percent of

the stock in DI&M valued as of year-end 2008. This is double-counting, pure and

simple.
No. 30459-1-111 - dissent
In re Marriage ofDickson

Daneille Dickson was initially referred to her valuation expert, Douglas Brajcich,

in the latter part of 2009 for legal advice, not valuation work. She was referred to Mr.

Brajcich by her divorce lawyer, Martin Salina, after he learned she had discovered

$462,000 in cash in a duffel bag in her husband's truck. Mr. Brajcich discussed the cash

with Mr. Dickson's lawyer and by agreement of the parties, the cash (or almost all of it)

was placed in a safety deposit box. Concerned about the source of the funds and whether

taxes had been paid on them, Mr. Brajcich advised Ms. Dickson to file her tax returns

separately from that point forward. In a later deposition and at trial, Mr. Dickson claimed

that he had been setting cash aside over a period of time because of a concern over

potential environmental liabilities of his business and a desire to safeguard money for his

children's future college education.

When Mr. Brajcich was retained to serve as Ms. Dickson's valuation expert, then,

he had concerns about the large amount of cash and the reliability ofDI&M's internal

income statements. He approached the valuation assignment with those concerns in

mind. In preparing his valuation, he had access to DI&M's income tax returns from 2001

through 2008, internal income statements for later periods, and the couple's individual

income tax returns going back to the 1990s. He chose to value the corporation as of

December 31, 2008, based on its income tax reporting for the three years prior,

explaining that he considered that financial information to be the most reliable. In

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No. 30459-I-III - dissent
In re Marriage ofDickson

support of the validity of his valuation, he testified at trial that based on his interviews

and review of records, Mr. Dickson's business model had never changed.

Based on his concern that the cash Ms. Dickson discovered might not have been

fully reflected in the company's operating results, Mr. Brajcich adjusted the income of

the corporation in his excess earnings analysis upward by $40,000. When asked at trial

why he had not increased the income by $150,000 ($450,000 divided by three years), he

explained that he was not sure if tax had been paid on the income represented by the cash

and also recognized that Mr. Dickson had taken draws totaling $510,000 in 2007 and

2008, which might account for some of the cash. The $40,000 increase in excess

earnings was multiplied by four by Mr. Brajcich in determining goodwill, for a $160,000

increase in the value ofthe company.

The trial court largely relied upon Mr. Brajcich's valuation in making its property

distribution, finding that Mr. Brajcich had "placed the appropriate emphasis on those tax

years for which the income reporting was most probably accurate." Clerk's Papers (CP)

at 818. It rejected only Mr. Brajcich's approach to arriving at a reasonable salary for Mr.

Dickson. Given Mr. Brajcich's valuation approach, that meant that the court largely

accepted his excess earnings analysis. Among assets as of year-end 2008 that were

included by Mr. Brajcich in calculating the return on investment component of his excess

earnings analysis was the $574,000 cash on hand at that time.

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No. 30459-1-111 - dissent
In re Marriage ofDickson

It is undisputed that the $448,470 in checks later seized by federal agents belonged

to DI&M. The checks were all made payable to DI&M. It is undisputed that they were

for recent periods of operations; all were dated between mid-July and late August 2010.

Yet, having separately allocated to Mr. Dickson 100 percent of the value of the DI&M

stock as of December 31, 2008-the valuation date Ms. Dickson's expert chose to use for

a valuation that took into consideration $574,000 in cash on hand-the court treated these

later checks, reflecting later accounts receivable, as an additional asset.

The majority affirms the trial court's allocation of this supposedly separate asset to

Mr. Dickson on the basis that the existence of the checks in his duffel bag tends to

confirm the fact that he was engaged in criminal structuring and that carrying six weeks'

worth of checks around in a duffel bag casts continuing doubt on the reliability of the

financial information available to Mr. Brajcich in performing his work.

As to the rationale that the checks tend to support Mr. Dickson's involvement in

criminal structuring, it is hard to see why more evidence on that score is needed or

relevant. Mr. Dickson pleaded guilty. Because he did, the trial court charged him with

full financial responsibility for the $1.36 million in forfeitures to which he and Ms.

Dickson had agreed. It did so on the basis of disputed evidence that Mr. Dickson acted

without his wife's knowledge and that his activities diminished rather than increased the

size of the marital estate. Those factual disputes were for the court to resolve, and I agree

with the majority that the court's findings support its allocation of the substantial

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No. 30459-1-III - dissent
In re Marriage ofDickson

forfeited assets. There are no facts supporting a new and additional $448,470 asset,

though, even if the checks in the duffel bag are further evidence of suspicious money

handling.

As to the possible unreliability of the financial records, that possibility was known

to Ms. Dickson and her expert even before the federal seizure of assets. Mr. Brajcich

took it into consideration in the timing of his valuation and made adjustment for it. He

explained his reasoning and was subject to cross-examination. If the possible

unreliability ofDI&M's financial records warranted some adjustment, then the trial court

should have based the adjustment on the parties' evidence-not by double counting

DI&M's cash on hand.

Notably, it was not Ms. Dickson who asked to reopen the trial after federal agents

seized the $448,470 in checks. She never contended that the seizure undermined Mr.

Brajcich's year-end 2008 valuation or would cause him to choose a different valuation

date. It was Mr. Dickson who asked the court to reopen evidence. Ms. Dickson opposed

the request, testifYing by a declaration signed several weeks after the duffel bag of checks

was seized that "[t]he mere fact that search warrants have been issued and that there has

been some notoriety in the marketplace, does not in and of itself warrant a re-trial of the

issues in this case, particularly the business valuation issue." CP at 351-52.

None of us condones Mr. Dickson's activities but it was the federal court's role,

not the trial court's or ours, to sentence him for his criminal wrongdoing. The role of the

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No. 30459-1-II1 - dissent
In re Marriage ofDickson

trial court and this court is to see that the couple's property is distributed in accordance

with Washington law. There was no factual basis for the trial court to include the

$448,470 as a new, noncorporate asset. I therefore respectfully dissent.

Siddoway, C.J.

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