MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before any FILED
court except for the purpose of establishing May 31 2017, 10:45 am
the defense of res judicata, collateral CLERK
Indiana Supreme Court
estoppel, or the law of the case. Court of Appeals
and Tax Court
ATTORNEY FOR APPELLANT ATTORNEY FOR APPELLEE
Chad D. Wuertz Stacy L. Kelley
Wuertz Law Office, LLC Glaser & Ebbs
Indianapolis, Indiana Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Anthony J. Rhea, May 31, 2017
Appellant-Petitioner, Court of Appeals Case No.
49A02-1611-DR-2572
v. Appeal from the Marion Superior
Court
Marjorie Rhea, The Honorable James A. Joven
Appellee-Respondent. Trial Court Cause No.
49D13-1503-DR-8513
Bailey, Judge.
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Case Summary
[1] Anthony Rhea (“Husband”) appeals the property division in the dissolution of
his marriage to Marjorie Rhea (“Wife”). We affirm.
Issues
[2] Husband presents two issues for review:
I. Whether the trial court abused its discretion by precluding
Husband’s realtor from testifying as an expert on the value
of real properties owned by the parties; and
II. Whether the trial court abused its discretion by deviating
from a presumptive 50/50 split of the marital pot.
Facts and Procedural History
[3] The parties were married on May 19, 1995. On March 16, 2015, Husband filed
a petition for dissolution of the marriage.
[4] At that time, Husband and Wife owned three real properties in Marion County,
Indiana. The property located on Priscilla Avenue had been purchased and
occupied by Wife prior to the marriage. It was the initial marital home, but was
later converted to exclusive use as a day care center. The property located on
East 23rd Street had been purchased and renovated for re-sale. The property on
Bluestem had been the second marital home. It had been occupied by Husband
post-separation and was in foreclosure at the time of the final hearing. A
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private sale was pending, but for a purchase price of less than the two
mortgages and expenses of sale.
[5] Provisional hearings were conducted in July, August, and September of 2015.
A final hearing was conducted on October 17 and 18, 2016. The marriage was
dissolved pursuant to a decree entered on November 3, 2016. Wife received
58% of the marital assets and Husband received 42%. This appeal ensued.
Discussion and Decision
Exclusion of Testimony
[6] Husband argues that his realtor should have been allowed to testify as an expert
on the value of real properties owned by the parties. The competency of a
witness to testify as an expert is a matter for the trial court to determine and is
subject to its discretion. Hegerfeld v. Hegerfeld, 555 N.E.2d 853, 855 (Ind. Ct.
App. 1990). An abuse of discretion occurs if the trial court’s decision is clearly
against the logic and effect of the facts and circumstances before the court, or
the reasonable, probable, and actual deductions to be drawn therefrom. Dillard
v. Dillard, 889 N.E.2d 28, 32 (Ind. Ct. App. 2008). An abuse of discretion also
occurs when the trial court has misinterpreted the law. Id.
[7] Wife requested that she be awarded the properties on Priscilla Avenue and East
23rd Street. She obtained written appraisals for the properties, with assigned
values of $67,000.00 and $203,500.00, respectively. The appraisals were
admitted into evidence at the final hearing. Husband disagreed with those
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values but did not submit into evidence an alternate appraisal. Rather, he
called as a witness Merrill Moores (“Moores”), the attorney and real estate
agent who was handling the short sale of the Bluestem property, 1 to “rebut” the
appraisals. (Tr. Vol. I at 158).
[8] At the commencement of his testimony, Moores stated that he was a licensed
real estate agent and a practicing attorney who did not have a real estate
appraiser’s license. He testified that he did appraisals “for divorces” and for
“his own purposes seeking listings.” (Tr. Vol. I at 152.) Husband’s counsel
asked Moores if he had “looked at” the Priscilla Avenue property and Wife
objected that Husband was eliciting speculative testimony unsupported by
documentation. (Tr. Vol. I at 155.) Wife asked a “preliminary question” of
Moores, and Moores confirmed that he had not compiled a written appraisal.
(Tr. Vol. I at 156.) Wife moved to exclude Moores’ testimony as irrelevant.
[9] In the ensuing bench conference, the trial court characterized Wife’s objection
as an objection to Moores’ qualifications as an expert, and stated that a lay
witness is not permitted to give opinion testimony. The trial court inquired
whether Husband’s counsel had authority for the proposition that someone
other than a licensed appraiser could testify concerning real estate value;
counsel responded that he did not currently possess such authority; and the trial
court ruled that Moores could not give opinions regarding properties other than
1
Moores testified without objection regarding the progress of the Bluestem property sale and the anticipated
proceeds.
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the Bluestem property. Husband was afforded the opportunity to make an offer
of proof. Counsel summarized:
If allowed to testify, this witness would testify that the valuation
of Priscilla property – or the property at Priscilla would be in a
market analysis that he performed looking at comparable
properties, at or above $80,000, I think $82 to $85, additionally
that the property that would be the 23rd Street address, in the
neighborhood it is with the transition of the market that’s there,
the actual evaluation of it would be $270 – or $265,000 to
$275,000 in a normal market condition; substantially higher than
what the – the appraisal has been offered and opposing party’s
documents.
(Tr. Vol. I. at 165.)
[10] On appeal, Husband directs our attention to Indiana Code Section 25-34.1-3-8.
This statute permits a person licensed as a real estate broker to appraise real
estate in Indiana for compensation, although he or she is not licensed or
certified as a real estate appraiser. Husband then argues that the trial court
made a mistake of law in concluding that Moores was unqualified to render an
opinion as to real estate values.
[11] Pursuant to Indiana Code Section 25-34.1-3-8, a real estate broker may accept
compensation for performing a real estate appraisal even if the broker does not
have an appraiser’s license. However, this statute does not directly concern the
qualifications of an expert witness to offer evidence. Indiana Rule of Evidence
702(a) addresses testimony by expert witnesses, providing:
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A witness who is qualified as an expert by knowledge, skill,
experience, training, or education may testify in the form of an
opinion or otherwise if the expert’s scientific, technical, or other
specialized knowledge will help the trier of fact to understand the
evidence or to determine a fact in issue.
[12] Nevertheless, whether a real estate broker may offer valuation testimony in
some circumstances2 is beside the point in this case. Even assuming Moores is
qualified and competent to conduct a property-specific appraisal, he did not
perform that function here. As indicated in the offer of proof, his anticipated
testimony was based upon an undocumented market analysis. The offer of
proof did not explain the methodology for or scope of a market analysis, and
Husband made no claim that Moores had examined the subject properties
beyond looking inside. In these circumstances, the trial court was within its
discretion to conclude that Moores’ valuation testimony would not assist in the
determination of a fact in issue.
Deviation from Presumptive Split
[13] Pursuant to Indiana Code Section 31-15-7-5, the trial court shall presume that
an equal division of the marital property between the parties is just and
reasonable. The presumption may be rebutted by relevant evidence, including
evidence concerning the following factors:
2
See e.g., Hudson v. McClaskey, 641 N.E.2d 36, 41 (Ind. Ct. App. 1994) (the trial court did not abuse its
discretion in permitting expert testimony of land value by an auctioneer/broker/appraiser who allegedly
lacked formal appraisal training but had taken several appraisal courses).
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(1) The contribution of each spouse to the acquisition of the
property, regardless of whether the contribution was income
producing.
(2) The extent to which the property was acquired by each
spouse:
(A) before the marriage; or
(B) through inheritance or gift.
(3) The economic circumstances of each spouse at the time of the
disposition of the property is to become effective, including
the desirability of awarding the family residence or the right to
dwell in the family residence for such periods as the court
considers just to the spouse having custody of any children.
(4) The conduct of the parties during the marriage as related to
the disposition or dissipation of their property.
(5) The earnings or earning ability of the parties as related to:
(A) a final division of property; and
(B) a final determination of the property rights of the
parties.
[14] Wife was awarded 58% of the marital estate and Husband was awarded 42%.
Husband argues that the deviation amounted to clear error because (1) Wife’s
counsel, in the written proposed order, improperly expanded upon the oral
direction of the trial court; (2) Wife’s testimony as to her day care earnings is
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contradicted by evidence of her cash flow; and (3) Husband was hindered in the
presentation of evidence relative to his retirement plans.
[15] On October 25, 2016, the trial court detailed an administrative event in the
Chronological Case Summary:
Comes now the court and directs counsel for [Wife] to submit a
Decree that adopts the stipulations of the parties and divides the
marital estate in accordance with Exhibit Q from trial. Husband
shall pay $10,000 of Wife’s attorney fees due to disparities in
income and discovery issues. Court finds that a deviation of the
50/50 presumption is appropriate given the property Wife
brought into the marriage, the disparity in incomes and economic
circumstances as they leave the marriage. Husband owes Wife
$1,500 for maintenance for Sept-Nov.
(App. at 13.) In the Decree of Dissolution, the reasons for deviation have been
expanded to include “the actions of the parties during the pendency of this
matter.” (Appealed Order at 3.) It appears that counsel followed the trial
court’s directive but then took some liberty in drafting.3 However, the trial
court adopted the additional grounds in counsel’s submission. Ultimately, even
if a trial court has adopted verbatim a party’s proposed findings and
conclusions, causing a lower level of confidence that findings reflect the
independent judgment of the trial court, the task of this Court is to review for
3
Husband makes a cursory allegation that the Decree also improperly referenced a stipulation, when the
parties had none. As Husband points out, the final hearing began with the parties denying that they had
made any stipulation. However, during a break in the final hearing, the parties reached an agreement as to
personal property and advised the trial court accordingly. This stipulation was properly included in the
Decree.
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clear error the findings as adopted. Kitchell v. Franklin, 26 N.E.3d 1050, 1058
(Ind. Ct. App. 2015).
[16] When reviewing a property division, we begin with a strong presumption that
the trial court considered and complied with the applicable law governing
property division. Perkins v. Harding, 836 N.E.2d 295, 299 (Ind. Ct. App. 2005).
We cannot substitute our judgment for the trial court’s, even if the evidence
could have supported a different property distribution. Augspurger v. Hudson,
802 N.E.2d 503, 512 (Ind. Ct. App. 2004). We decide whether the decision
distributing property constitutes an abuse of discretion, considering only the
evidence most favorable to the court’s disposition of the property. Estudillo v.
Estudillo, 956 N.E.2d 1084, 1092 (Ind. Ct. App. 2011).
[17] At the time of the final hearing, Wife was receiving Social Security payments of
$947.00 per month. Her 2015 tax return indicates that her net annual income
from the operation of a day care center was $421.00 per year. She testified that
she was in 2016 earning $87.00 per week in net income. Husband’s income for
the prior year consisted of wages of $126,530.00. He had earned $63,090.79 for
January through May of 2016. As such, there was evidence to support the
finding of disparate economic circumstances. Wife testified that she had owned
the Priscilla Avenue property when the parties got married. This supports the
finding that Wife brought property into the marriage. As for the conduct during
the proceedings – the basis for the finding that Wife’s counsel added and the
trial court adopted – there was testimony that Husband was ordered to pay the
mortgage on the Bluestem property during his tenancy there, but did not do so
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despite regular income. Ultimately, the Bluestem property was sold in a short
sale after foreclosure proceedings were commenced. This evidence supports the
determination that Husband’s conduct negatively impacted the net marital
estate available for division. In sum, the deviation is amply supported by the
evidence.
[18] Husband argues, however, that certain evidence should be disregarded. That is,
he focuses upon the testimony that Wife nets $87.00 weekly from the day care
center together with the testimony that the Priscilla Avenue property was
owned free of any mortgage. Ignoring Schedule C of the 2015 tax return
indicating that Wife took in gross proceeds of $60,648.00, Husband insists that
it is a “financial impossibility” for Wife to have maintained the “cash flow” for
a mortgage payoff if she earns only $87.00 per week. (Appellant’s Brief at 15.)
His argument represents a stark request to reweigh evidence. We decline the
invitation. See Estudillo, 956 N.E.2d at 1092 (recognizing that we do not
reweigh the evidence nor assess witness credibility when reviewing a property
distribution decision).
[19] Finally, Husband asserts that the finding of disparate incomes rests upon an
assumption that he will continue working, yet he was not offered a meaningful
opportunity to introduce evidence of his need to retire. Husband directs our
attention to a colloquy between Husband’s counsel and the trial court, during
which counsel suggested that sixty-two “is retirement, Judge.” (Tr. Vol. II at
pg. 189.) The trial court disagreed and expressed the view that, in the absence
of medical necessity, a claim of plans for early retirement would likely not be
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accorded much evidentiary weight. Thereafter, Husband testified that he is a
diabetic. He did not, however, claim that his retirement was imminent or that
his early retirement would be medically necessary. Husband’s cursory
argument in this regard is, at bottom, an additional request to reweigh the
evidence. Husband has not demonstrated that the trial court abused its
discretion by deviating from the presumptive 50/50 split.
Conclusion
[20] The trial court did not abuse its discretion by precluding valuation testimony
concerning two of the marital real properties. The trial court’s order of property
division is supported by the evidence and does not constitute an abuse of
discretion.
[21] Affirmed.
Vaidik, C.J., and Robb, J., concur.
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