IN THE COURT OF APPEALS OF IOWA
No. 14-0972
Filed October 14, 2015
IN RE THE MARRIAGE OF ANN M. FURY
AND THOMAS R. FURY
Upon the Petition of
ANN M. FURY,
Petitioner-Appellee,
And Concerning
THOMAS R. FURY,
Respondent-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Dubuque County, Monica L.
Ackley, Judge.
Thomas R. Fury appeals the decree dissolving his marriage to Ann M.
Fury. AFFIRMED AS MODIFIED.
Stephen W. Scott of Kintzinger Law Firm, P.C., Dubuque, for appellant.
Francis J. Lange of Lange & Neuwoehner, Dubuque, for appellee.
Considered by Doyle, P.J., Mullins, J., and Goodhue, S.J.*
*Senior judge assigned by order pursuant to Iowa Code section 602.9206 (2015).
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GOODHUE, Senior Judge.
Thomas R. Fury (Tom) appeals the decree dissolving his marriage to Ann
M. Fury. Tom challenges the amount and the duration of the spousal support
awarded to Ann. He also challenges the requirement that he provide life
insurance to fund the spousal support in the event of his death. Finally, he
challenges the division of the property made by the decree.
I. Background Facts
Tom and Ann were married in 1975. Tom was fifty-seven and Ann turned
fifty-six near the time of trial. They have had four children but lost two of them in
the mid-1990s, causing extreme emotional turmoil to the parties and to the
marriage and causing both of the parties serious depression. The depression
resulted in Ann’s work efforts becoming intermittent and unsettled and resulted in
Tom throwing himself full-force into his work. Their problems were aggravated
by financial disagreements and difficulties.
Tom has been a roofer most of his adult life, and in 2007, he and another
experienced roofer formed a subchapter S corporation and went into the roofing
business on their own under the name of Experienced Roofing (Roofing). A
balance sheet prepared immediately prior to the trial, indicated Roofing only had
a value of $4685. Roofing does not maintain an inventory. Charges are made
and collected when a job is finished. There may be significant amounts of
accounts receivable at any given time, but they are offset by accounts payable.
Tom still owes his brother $7500 of his contribution to capital made when the
corporation was first formed. The value of Roofing’s other assets are
substantially offset by other liabilities. Three old, high-mileage pickups were
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given no value since they apparently had been fully depreciated, but they surely
have some minimal value.
Tom and the co-owner, Craig, are equal shareholders in Roofing. It
employs three others, but only one has been with the company for more than one
year. Tom is in charge of estimating, bidding, and other bookwork. Craig is the
on-site project manager. Tom testified that Craig was sixty-three years old and it
was uncertain how long Craig could do the physical work roofing entails or how
or whether he could be replaced. The business appears to have limited value
absent Tom and Craig’s involvement.
Pursuant to the recommendation of their tax advisor, Tom and Craig are
paid only $550 per week as wages with all other withdrawals considered
distributions out of the corporation. A 2012 tax return for Ann showed wages of
$9810. Only 2011 income tax returns for Tom and the corporation were
provided. The corporate return showed that Tom had a total withdrawal and
wages of $68,500. No one contested that $68,500 is Tom’s annual earning
capacity. There was testimony that he also received $500 per month as rental
for Roofing’s place of business that he also occupied as his residence.
Although Ann had been excused from her employment by a doctor’s order
for the trial, she had full-time employment waiting at $13.62 per hour where she
had been employed off and on for several years. Neither party suffered any
physical disability that prohibited them from full-time work.
There is also a commercial building in Dubuque that Ann had purchased
in 1988 for $50,500, with the intent to start a boutique. The upstairs has been
remodeled and is rented for $500 per month, and the downstairs is stocked with
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miscellaneous merchandise, but Ann has never operated the business on a full-
time basis. Instead it has been operated only on a hit-and-miss basis. Ann had
worked buying and selling antique, decorative, and boutique items on a part-time
basis even before the boutique shop had been purchased. Ann presented no
record of her mercantile operations and apparently has none. The purchase of
the building was made by a real-estate contract that called for a $10,500 down
payment and $334.48 per month. The contract has been paid off, and Tom
testified that the down payment, outstanding balance, utilities, real estate taxes,
and substantial improvements were made out of joint funds and his efforts. Ann
testified that at least a part of the payment had been made by her father as a pre-
death inheritance, but no records were provided. Because of a new loan there is
indebtedness secured by the commercial building of about $22,000. The district
court found that the Dubuque commercial property minus the indebtedness and
Roofing to be of equal value and awarded Roofing to Tom and the commercial
building to Ann.
In addition, the parties owned a residence and a condominium both in
Dubuque and a timeshare in Florida. The decree transferred the residence to
Tom but ordered it sold and the mortgage and selling costs to be paid with the
net proceeds to be divided equally between the parties. The Florida timeshare
was also to be sold with the net proceeds to be divided equally. Of the buildings,
only the residence has any appreciable net value. Using the tax assessor’s
value, the residence had a net value of approximately $12,000.
Tom was awarded the contents of the residence, and Ann was awarded
the condominium and its contents. She had been living in the condominium and
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wanted to keep it. It was encumbered with a $207,000 loan. Valuation testimony
varied widely. If Ann retained it, she was ordered to refinance and remove Tom’s
name within three months of the decree’s entry. Ann thought the condominium
had a value of $240,000, but the assessor had it valued at $162,200. It is highly
likely the mortgage significantly exceeds its value.
A 1998 Ford van and a 2007 GMC Acadia with negligible equity were
awarded to Ann along with numerous boutique and collectable items with no
known value. Among these items was possible Marilyn Monroe paraphernalia
that had been purchased reportedly at a cost of $10,800. At the time of trial,
neither party knew where the items were or whether they were still in either’s
possession. Retirement assets of approximately $50,000 were divided equally
between the parties. Tom’s financial statement indicated there was
approximately $15,000 of unsecured obligations.
After awarding the property as indicated and allocating the debts between
them, the court made a calculation that Ann had received $7049 worth of
property and Tom $23,596 worth of property. It then ordered Tom to pay an
adjustment of $8200 to Ann to equalize the distribution.
The court specifically found that for a good portion of their marriage, Ann
had been “a traditional stay-at-home mom” and that she would never be able to
generate an income equal to Tom’s earning capacity. Tom’s experience is
limited to roofing, but he obtained a business degree while the parties were
married. It was paid for with marital funds. The court also found that Tom would
have a better opportunity for job possibilities than Ann, even if his business
should be lost because of Craig’s inability to continue or for other reasons.
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Accordingly, Ann was awarded $1500 per month as permanent support
commencing January 1, 2014, to continue until the death of either Ann or Tom.
In addition, Tom was ordered to maintain a life insurance policy on his life with
Ann as the beneficiary sufficient to make a payment to her for $1500 per month
for the rest of her life expectancy. The court calculated that amount initially to be
$500,000, but indicated that it could be reduced as the payments were made and
Ann’s life expectancy decreased. There was no evidence of the cost of such a
policy or its availability. Tom was ordered to pay $5000 of Ann’s attorney fees.
II. Error Preservation
Generally error has been preserved as to any issue raised and considered
by the trial court. Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002).
Property division and spousal support, including the insurance guarantee, were a
part of the court’s ruling. As to those issues, error has been preserved.
III. Scope of Review
Dissolution matters are reviewed de novo. Iowa R. App. P. 6.907; In re
Marriage of Gensley, 777 N.W.2d 705, 713 (Iowa Ct. App. 2009). We give
weight to the factual findings of the district court but are not bound by them. Iowa
R. App. P. 6.904(3)(g); Gensley, 777 N.W.2d at 713.
IV. Discussion
Property division is based on each spouse’s right to a just and equitable
share of what has been accumulated during the marriage as a result of their joint
efforts. In re Marriage of Francis, 442 N.W.2d 59, 62 (Iowa 1989).
In order to maintain an equitable division, the district court awarded each
party fifty percent of each asset of significant value when reasonably possible.
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The finding that Roofing and the commercial building—less the indebtedness if
secured—were of equal value was not challenged by Tom. Ann wanted to keep
the condominium, and she felt it could have a value of $240,000, which would
leave it with a net value of $33,000. The court noted, however, that it was
assessed at $162,100. Ann was made responsible for the entire indebtedness
secured by the condominium.
Ann did not cross-appeal, but both Ann and Tom made computations
showing how the court’s calculation resulting in Tom owing Ann $8200 was
inequitable as to their particular interests. Where valuations were given by a
party’s testimony they varied widely and there were multiple minor items for
which no credible valuation was given. The variations permitted the parties to
pick and choose which valuations to use and gave them the opportunity to come
up with any result they wanted.
Tom particularly complains that the Marilyn Monroe memorabilia should
have been sold and divided equally. The court, in its initial decree, ordered the
items sold and the proceeds divided. In a posttrial motion, Ann asserted that the
memorabilia had been a gift from her children. In its posttrial order, the court
noted that the memorabilia had been gifted to Ann by her children and given to
Ann. Ann’s own testimony did not support that contention, and in fact, her
testimony was that she had purchased the items. Furthermore, if the items are
found and have value even approaching their cost, the equal division the district
court otherwise achieved has been distorted. An item worth $10,870 is a
significant marital asset to these parties.
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Tom also complains that the Florida timeshare has a maintenance fee
connected to it, and he wants it sold before any fee is incurred. He is afraid it will
accrue prior to the sale of the timeshare and he will be obligated to pay it. The
court ordered the timeshare to be sold in three months. What has happened
since is unknown, but we assume and expect compliance with the court’s order.
A trial court is given considerable latitude in the matter of property
distribution, and it will not be nullified on appeal unless it failed to do equity based
on the record made. In re Marriage of Schriner, 695 N.W.2d 493, 496 (Iowa
2005). Based on the record before us, we find no support upon which the district
court could appropriately change the distribution of the Marilyn Monroe
memorabilia in its original decree. Accordingly if the Marilyn Monroe memorabilia
is ever found it should be sold and the proceeds divided. Otherwise, we cannot
say the court failed to do equity in the property division it made and it is
accordingly affirmed.
Tom objects that the award of spousal support is excessive and that Ann
should have been awarded only rehabilitative support. The purpose of
permanent support is to provide the recipient with funds in lieu of an obligation to
support that person. In re Marriage of Hellinga, 574 N.W.2d 920, 922 (Iowa Ct.
App. 1997). Permanent support is based on need and ability to pay. Id. Where
a spouse cannot afford to pay spousal support, none should be awarded. In re
Marriage of Woodward, 426 N.W.2d 668, 670 (Iowa Ct. App. 1988). A long-term
marriage where income disparity can be predicted with reliability is a situation
where spousal support is generally appropriate. Francis, 442 N.W.2d at 62-63.
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Given the historic disparity in the parties’ income, their relative education
levels, and the general needs and ability to pay, this is a situation where
permanent support should be awarded. Tom’s continued employment at its
present level involves a measure of uncertainty, but spousal support awards are
subject to modification if a substantial change occurs. See Iowa Code
§ 598.21C(1) (2011). When determining spousal support, each case must be
considered based on its own circumstances and precedence is of little value. In
re Marriage of Sheckelberg, 824 N.W.2d 481, 486 (Iowa 2012). An award of
spousal support will be adjusted only where there has been a failure to achieve
equity. Id. The award of traditional support in the amount of $1500 per month is
equitable under the circumstances. There is nothing in the record to indicate Ann
will be able to earn an income approaching Tom’s earning capacity.
Tom also objects to the spousal support’s duration. The district court
required the monthly spousal support payments continue until one or the other
dies, but then required Tom to carry life insurance adequate to guarantee the
spousal-support payment for Ann’s life expectancy. The question of how much
spousal support is due upon retirement has recently been considered in depth by
our supreme court. See In re Marriage of Gust, 858 N.W.2d 402 (Iowa 2015).
Gust places particular reliance on a modification case that amended a spousal-
support award based on a change in circumstances resulting from a retirement.
858 N.W.2d at 412-13 (citing In re Marriage of Michael, 839 N.W.2d 630, 638-39
(Iowa 2013)). After considering the various approaches the court could follow,
the Gust court stated,
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We think the best course in this case is to follow In re Marriage of
Michael. Under this approach future retirement will ordinarily be
considered to raise too many speculative issues to be considered in
the initial spousal support award. In this case, as in In re Marriage
of Michael, we simply do not know important facts.
Id. at 416.
In Gust, the spousal support was left to continue with any change to be
made by modification at the time of retirement. Id. at 418. Ann considers Gust
dispositive. As stated above, Gust is applicable to the facts present in that case
and where important facts are simply not known. It did not foreclose other
options when appropriate. There are important facts that are known in this case
that make it a strong probability, if not a certainty, that if the spousal support is
left at $1500 per month and the insurance requirement is left intact, there will be
no retirement for Tom. Instead, he will be required to work in order to pay the
spousal support and life-insurance premium as long as he and Ann both live.
The important known facts are as follows: (1) Tom has no pension from an
employer. (2) The parties’ only retirement funds amounted to $50,000 and these
funds have been evenly divided between them. (3) Tom’s net income is less
than $70,000 per year and there is little chance it will increase. (4) Tom was fifty-
seven at the time of trial and Ann was fifty-six, which indicates that they can retire
for social security purposes at approximately the same time. (5) After the
dissolution, Tom has very limited assets. (6) Tom has little chance to increase
his net worth or retirement funds given his age, earning capacity, and the
obligations he has under this decree. (7) Tom’s retirement income almost
certainly will be primarily social security and he has been paying social security
on wages of only $28,600 per year. If this continues his social security income
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will be limited accordingly. Tom has some control over his social security
contribution, but he and Craig would need to agree to a different course of action.
An increase in wages would only be for the remaining years of his employment
before retirement. (8) Ann has rental income of $500 per month, one half of the
existing retirement funds of the parties, and a shop that could be rented or
operated. That income would continue after her retirement. Tom’s business has
little value absent both his and Craig’s involvement.
We believe the known information stated above dictates a reduction of
Ann’s spousal support when she reaches the age she can receive full benefits for
social security purposes. At that time, Ann’s spousal support should be reduced
so that her spousal support will be equal to fifty percent of the difference between
Ann’s gross social security award and Tom’s gross social security award. The
intent is to equalize the social security benefits between the parties by adjusting
the spousal support. The award attributable to Ann will be the greater of what
she can receive from her own earning history or from Tom’s. This formula
assumes Tom’s award will be greater than Ann’s and that Ann does not remarry.
In the event of either happening, Ann’s spousal support will end when she
reaches retirement age. Although both Tom and Ann may be required to work
after retirement, it is not anticipated they will have substantial earned income.
The formula will require an annual adjustment, but the formula should make the
adjustment easily done. This result is consistent with other case holdings. See,
e.g., In re Marriage of McCurnin, 681 N.W.2d 322, 326-31 (Iowa 2004); Craft v.
Craft, 226 N.W.2d 6, 8-9 (Iowa 1975).
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Ann has objected to usage of the social security implications since little
direct evidence was submitted at trial, but when a subject is capable of ready and
accurate verification that cannot reasonably be questioned, the court can take
the judicial notice of those facts. Iowa R. Evid. 5.201(b)
The facts in Gust were such that the minority would have eliminated the
support payable to the recipient at the payer’s retirement. 858 N.W.2d at 421
(Wiggins, J., dissenting in part). The primary effect of the dissent would be to
shift the burden of seeking modification upon retirement from one party to the
other. Under the facts of this case, we do not believe it is appropriate to place an
almost unavoidable requirement for modification on either party given the factors
that exist at this time. Modifications are expensive. Finally, given the factors that
are presently evident, it would be difficult to assert these facts were not
anticipated at the entry of the decree. Such a showing is required to support a
modification. In re Marriage of Sisson, 843 N.W.2d 866, 870-871 (Iowa 2014).
Under the present decree, it is quite possible and, in fact likely, that upon
reaching retirement age for social security purposes, Tom will be paying over half
of his social security to Ann and also paying a significant life-insurance premium.
The amount of the insurance would decrease each year, but Tom would have to
procure a policy that would guarantee coverage until he was eighty-four years of
age. There is no evidence regarding what such a policy would cost in premium,
but it surely would be substantial.
The amount of life insurance that Tom should be required to carry to cover
naming Ann as a beneficiary should be reduced to an amount that would pay
Ann $1500 per month until the date that she could retire and obtain full social
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security benefits. If Tom dies after his retirement and Ann does not remarry, the
social security marital payment to Ann would continue.
The modification we are making to the decree does not necessarily
eliminate the need of a future modification. But it does reduce the certainty of a
need to modify—or worse, a continuation of an inequity without possible
recourse. The ruling of the district court is affirmed with the modification as to the
property division and change of spousal support and insurance benefits as set
out above. Ann’s request for appellate attorney fees is denied.
Costs of the appeal are taxed equally to both parties.
AFFIRMED AS MODIFIED.