J-A26014-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
TROY R. PRESTON, IN THE SUPERIOR COURT
OF
PENNSYLVANIA
Appellee
v.
DEBRA PRESTON, NOW KNOWN AS
DEBRA TRUCHAN,
Appellant No. 636 WDA 2018
Appeal from the Decree/Order Entered April 2, 2018
In the Court of Common Pleas of Mercer County
Civil Division at No(s): 2014-2141
BEFORE: BENDER, P.J.E., SHOGAN, J., and MURRAY, J.
MEMORANDUM BY BENDER, P.J.E.: FILED JANUARY 23, 2019
Debra Preston n/k/a Debra Truchan (Wife) appeals from the April 2,
2018 decree in divorce from Troy R. Preston (Husband) and the equitable
distribution order incorporated therein. Wife raises issues concerning the
equitable distribution of the marital estate. After review, we affirm in part,
vacate in part and remand as directed below.
The trial court set forth the following information in its Pa.R.A.P. 1925(a)
opinion, filed on June 6, 2018, stating:
This is a divorce action following a marriage that only lasted 19
months. The parties were unable to resolve their economic
differences, so a series of equitable distribution hearings were
held before the court appointed Master. The Family Law Master
made various Findings of Fact, Conclusions of Law and set forth a
Proposed Schedule of Distribution addressing both non-marital
and marital property[,] which ultimately proposed distributing the
marital property on a 50-50 basis. [Husband] filed 17 separately
J-A26014-18
numbered exceptions, but subsequently withdrew exception
numbers 13 and 16. [Wife] filed two exceptions to the Proposed
Schedule of Distribution and Findings of Fact both of them dealing
with an accumulation of scrap metal and its purported value and
distribution. Both parties submitted briefs in support of their
exceptions, but [Wife’s] attorney did not address any of
[Husband’s] exceptions in her brief. Furthermore, the transcript
and various exhibits submitted at the equitable distribution
hearing were confusing and sometimes inadequate[,] which led
the Master to make Finding of Fact No. 69 noting that the “source
of funds used by the parties is confusing and co-mingled and
various accounts from the parties, the business and other pre-
marital investments” were difficult to digest. It is also worth
noting that the record developed [before] the Master was not
expanded and/or supplemented by either party after they filed
their exceptions.
After reviewing the record and the parties’ brief[s], the trial court
denied [Wife’s] two exceptions with regard to the scrap metal as
set forth in this [c]ourt’s Memorandum Opinion on pages four
through six. [Wife] does not challenge the denial of her two
exceptions by the trial court as they are not listed in her
Statement of Matters Complained of on Appeal.
Furthermore, the trial court granted several exceptions of the
[Husband] and found certain errors with the Master’s Report and
assessments pertaining to marital property, non-marital property
and the Proposed Schedule of Distribution. The trial court,
however, accepted the Master’s recommendation of a 50-50
division of the marital property (except as to Prudential account
3088), and the assessment of attorney fees against [Husband].
The trial court issued an Order and Decree of Distribution on April
2, 2018 along with a Memorandum Opinion and supporting
schedules listing non-marital property, marital property and a
distribution list of marital assets and credits between them with
the intent of carrying out a 50-50 division of almost all of the
assets. [Wife] filed a timely appeal therefrom and submitted a
Statement of Matters Complained Of [on Appeal].
Trial Court Rule 1925(a) Opinion (TCO), 6/6/18, at 1-3.
In her appeal to this Court, Wife raises the following issues:
-2-
J-A26014-18
1. When Husband deposited the proceeds of the sale of his
pre-marital business into an investment account held
jointly with Wife, did the lower court violate established
law and abuse its discretion by finding only 25 percent of
the account was marital property, then awarding Wife’s
share to Husband to enable him to pay undefined taxes
for which there is no evidence of record?
2. Without any evidence of record regarding costs of sale
for Florida real estate, did the court abuse its discretion
by automatically reducing the value of Husband’s real
estate by a percentage suggested in Husband’s [b]rief on
[e]xceptions to the Master’s [r]eport?
3. Through mathematical error and an illogical restoration
to Husband of ill-gotten gains from financial misconduct,
did the lower court abuse its discretion and disregard the
Divorce Code by manufacturing two fictitious credits to
cancel an award to Wife of $10,000 in legal fees and
litigation costs and further[] skew[ing] the unequal
division of marital property?
Wife’s brief at 5.
The following principles guide our review:
Our standard of review in assessing the propriety of a
marital property distribution is whether the trial court
abused its discretion by a misapplication of the law or
failure to follow proper legal procedure. An abuse of
discretion is not found lightly, but only upon a showing
of clear and convincing evidence.
Smith v. Smith, 904 A.2d 15, 18 (Pa. Super. 2006) (quoting
McCoy v. McCoy, 888 A.2d 906, 908 (Pa. Super. 2005)). As we
previously observed, in the context of an equitable distribution of
marital property, a trial court has the authority to divide the award
as the equities presented in the particular case may require.
Mercatell [v. Mercatell], 854 A.2d [609,] 611 [(Pa. Super.
2004)]. “In determining the propriety of an equitable distribution
award, courts must consider the distribution scheme as a whole.
We measure the circumstances of the case against the objective
of effectuating economic justice between the parties and achieving
a just determination of their property rights.” Morgante v.
-3-
J-A26014-18
Morgante, 119 A.3d 382, 387 (Pa. Super. 2015) (quoting Biese
v. Biese, 979 A.2d 892, 895 (Pa. Super. 2009)). “[A] master’s
report and recommendation, although only advisory, is to be given
the fullest consideration, particularly on the question of credibility
of witnesses, because the master has the opportunity to observe
and assess the behavior and demeanor of the parties.” Moran v.
Moran, 839 A.2d 1091, 1095 (Pa. Super. 2003).
Cook v. Cook, 186 A.3d 1015, 1025-26 (Pa. Super. 2018).
We begin this Court’s review of Wife’s issues on appeal by centering on
her third issue. In Husband’s brief, he acknowledges that he still owes Wife
$3,500.00 toward her counsel fees. Additionally, he recognizes that pursuant
to the trial court’s distribution of the Prudential account, he was awarded
$4,085.62 more than Wife. Therefore, he suggests that he owes Wife
$2,042.81, which is half of the $4,085.62 amount, in addition to the $3,500.00
still owing on the counsel fees award. Thus, the total amount due from
Husband to Wife is $5,542.81. After reviewing the record, we must agree
with Husband’s statement of the trial court’s calculation error and, therefore,
we vacate the trial court’s order to that extent and remand to allow the trial
court to make this correction.
With regard to Wife’s first two issues, we have reviewed the certified
record, the briefs of the parties, the relevant law, and the analysis provided
by the Honorable Christopher J. St. John, Senior Judge of the Court of
Common Pleas of Mercer County in his Rule 1925(a) opinion, dated June 6,
2018. On pages 4 through 7 of that opinion, Judge St. John correctly disposes
of Wife’s issues #1 and #2 concerning the reduction in value of the Florida
real estate by the costs of sale and the distribution of the Prudential account.
-4-
J-A26014-18
Therefore, we adopt that portion of Judge St. John’s opinion as our own and
affirm that portion of the court’s order on that basis.
Decree/Order affirmed in part and vacated in part. Case remanded.
Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 1/23/2019
-5-
Circulated 12/28/2018 09:12 AM
115- RULE 1925 OPINION OF 6.618
FILED IN MEKCfR
COUHlY �
2018 JUN -6 AH 9: 19
RUTH A. o:cE
PROTHOWJT,\r� Y
IN THE COURT OF COMMON PLEAS OF MERCER COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
TROY R. PRESTON,
Plaintiff
v. No. 2014 - 2141
DEBRA PRESTON,
Defendant
RULE 1925 OPINION
This is a divorce action following a marriage that only lasted 19 months. The
parties were unable to resolve their economic differences, so a series of equitable
distribution hearings were held before the court appointed Master. The Family Law
Master made various Findings of Fact, Conclusions of Law and set forth a Proposed
Schedule of Distribution addressing both non-marital and marital property which
ultimately proposed distributing the marital property on a 50-50 basis. Appellee
husband filed 17 separately numbered exceptions, but subsequently withdrew
exception numbers 13 and 16. Appellant wife filed two exceptions to the Proposed
Schedule of Distribution and Findings of Fact both of them dealing with an
accumulation of scrap metal and its purported value and distribution. Both parties
submitted briefs in support of their exceptions, but Appellant wife's attorney did not
115 - RULE 1925 OPINION OF 6 .. 18
address any of the Appellee husband's exceptions in her brief. Furthermore, the
transcript and various exhibits submitted at the equitable distribution hearing were
confusing and sometimes inadequate which led the Master to make Finding of Fact
No. 69 noting that the "source of funds used by the parties is confusing and
co-mingled and various accounts from the parties, the business and other
pre-marital investments" were difficult to digest. It is also worth noting that the
record developed at the Master was not expanded and/or supplemented by either
party after they filed their exceptions.
After reviewing the record and the parties' brief, the trial court denied
Appellant wife's two exceptions with regard to the scrap metal as set forth in this
Court's Memorandum Opinion on pages four through six. Appellant wife does not
challenge the denial of her two exceptions by the trial court as they are not listed in
her Statement of Matters Complained of on Appeal.
Furthermore, the trial court granted several exceptions of the Appellee
husband and found certain errors with the Master's Report and assessments
pertaining to marital property. non-marital property and the Proposed Schedule of
Distribution. The trial court, however, accepted the Master's recommendation of a
50-50 division of the marital property (except as to Prudential account 3088), and
the assessment of attorney fees against Appellee husband. The trial court issued
an Order and Decree of Distribution on April 2, 2018 along with a Memorandum
Opinion and supporting schedules listing non-marital property, marital property and
a distribution list of marital assets and credits between them with the intent of
carrying out a 50-50 division of almost all of the assets. Appellant wife filed a timely
2
115 - RULE 1925 OPINION OF 6.6 18
appeal therefrom and submitted a Statement of Matters Complained Of listing the
following issues:
1. The trial court abused its discretion by:
(a) automatically reducing the marital value of the Florida
real estate for costs of sale) and;
(b) determining the reduced value by applying a percentage
of costs of sale suggested in plaintiffs brief on exceptions without any
evidence of record or support in the law. (Order and Opinion of April
2. 2018, p. 9-11)
2. The trial court erred in finding:
(a) the parties' joint Prudential account was not entirely
marltal property;
(b) crediting Wife's $10,487.30 share to Husband; and
(c) awarding Husband a greater share of the marital
account to pay undefined taxes on his pre-marital business in an
amount for which there is no evidence of record. (Order and Opinion
of April 2, 2018, p, 13-17).
3. The trial court's equal division of marital assets totaling
$130,924.80 is inconsistent with the Schedule of Distribution which
awards assets in the amount of $67,505.21 (51.56 per cent of the total
marital estate) to Husband and $63,419. 59 (48.44 per cent of the total
marital estate) to Wife. (Order and Opinion of April 2, 2018,
Schedule C, p, 24).
4. After finding Wife to be entitled to $10,000 in counsel
fees and costs per the Master's recommendation (Order and Opinion
of April 2, 2018, p. 3-4), the trial court erroneously ordered Wife to pay
$4,085.62 to Husband to equalize the 50/50 distribution when, in fact,
Wife's distribution was already $4,085.62 less than the distribution to
Husband. (Order and Decree of Distribution of April 2, 2018,
paragraphs 2 and 7).
5. The trial court erred in awarding Husband a credit of
$6,500 for money Husband had voluntarily paid to Wife in
reimbursement for his financial misconduct at separation. (Order
and Decree of Distribution of April 2, 2018, paragraph 7).
3
115 - RULE 1925 OPINION OF 6.6 18
1. Whether the trial court abused its discretion by:
(a) automatically reducing the marital value of the
Florida real estate for costs of sale} and;
(b) determining the reduced value by applying a
percentage of costs of sale suggested in plaintiffs brief on
exceptions without any evidence of record or support in the law.
(Order and Opinion of April 2, 2018, p. 9-11)
Appellant wife takes issue with the trial court's reduction of the marital value
of husband's Florida property. Both parties came into the marriage owning
pre-marital real estate. Various appraisals were placed into the record in an
attempt to establish the values on the date of marriage and the date of separation.
None of those appraisals, nor any other record evidence, established the cost of
sale which the Court is required to consider pursuant to 23 Pa. C.S. § 3502(10.2).
Appellant correctly points out the record is devoid of what the cost of sales for a
Florida lot would be.
Nonetheless, this Court addressed the cost of sale including commissions
and transfer taxes of 8.5% of the sale price in order to determine the true equity of
the property and whether either party's non-marital real estate property would then
have increased in value during this 19 month marriage. The trial court discussed
this issue on both the Florida property and Appellant's farm in Mercer County,
Pennsylvania in discussing Plaintiff's exception numbers 5 and 6 found on pages 8
through 11 of the Memorandum Opinion. Thus, in effect, the trial court took judicial
notice of the routine transfer taxes that are published every year, and real estate
commissions in Mercer County commonly assessed, and applied it to both
properties and determined that there was no increase in value of either party's
non-marital real estate during the marriage. Accordingly, this Court suggests that
4
115- RULE 1925 OPINION OF 6.618
the issues raised in Item 1 (a) and (b) be denied and that the Court's finding on these
issues be affirmed.
2. Whether the trial court erred in finding:
(a) the parties' joint Prudential account was not entirely
marital property;
(b) crediting Wife's $10,487.30 share to Husband; and
(c) awarding Husband a greater share of the marital
account to pay undefined taxes on his pre-marital business in an
amount for which there is no evidence of record. (Order and
Opinion of April 2, 2018, p. 13-17).
Appellee husband owned and operated a business known as Preston
America that was 100% pre-marital. Appellee husband then sold the inventory of
the company at auction netting $31,903.61 to Appellee husband which the Master
and the trial court both determined were not marital property. See Master Finding
of Fact No. 66. Notably, Appellant wife does not challenge this finding.
Then the parties opened a joint account with Prudential and the remaining
balance of the auction proceeds were deposited into this joint account during the
marriage and the Master and the trial court properly found that constitute a gift to the
marriage and was therefore marital property. Part of the dispute arises as to the
increase in value of this account after the initial deposit which was from 100%
pre-marital assets and whether the entire account should be distributed between the
parties 50-50 or at a different ratio because it was entirely from Appellee's
pre-marital asset (Preston America). Appellee husband testified that the reason
the proceeds were placed into a joint account was so that Appellant would have
cash reserves to pay the anticipated tax consequences of the sale of the business
5
115 M RULE 1925 OPINION OF 6.6 18
because of his bad health. See Findings of Facts 41-46. Unfortunately, the
record was not developed as to what those tax consequences would be.
In issue 2(a) Appellant wife claims that the trial court found the joint
Prudential account was not entirely marital property. However, this misconstrues
the trial court's explanation as set forth in the discussion of Appellee's Exception No.
10 found on pages 13 through 17 of the Memorandum Opinion. In addition, on
Schedule "A" attached to the Memorandum Opinion, the Court listed in No. 9 the
auction proceeds of Preston America as being non-marital which merely applied to
those funds that were not deposited into the joint Prudential account. Furthermore,
on Schedule "B" attached to the Memorandum Opinion the Court in No. 18 identified
the entire Prudential joint account as a marital asset. Thus, issue 2(a) has no
merit.
Issue 2(c) refers to this Prudential account as a marital account but takes
issue with the trial court not dividing the entire account on a 50-50 basis. The trial
court noted in the Memorandum Opinion that 23 Pa. C.S.A. § 3502(a)(7) directs the
Court to consider the source of the contribution to the Prudential fund as between
the parties in order to effectuate economic justice. That is what the trial court did in
this instance particularly because there were anticipated tax consequences for the
sale of Preston America and all of the Prudential account came from the auction of
Appellee's long-time pre-marital business. None of the money in the Prudential
account came from Appellant wife. Accordingly, in order to carry out its duty of
economic justice, the trial court deemed that Appellant wife should only be entitled
to claim a 25% interest in the net proceeds of the auction that eventually were
deposited into the Prudential account number 3088, but that she should be entitled
6
115 - RULE 1925 OPINION OF 6 .. 18
to a 50-50 share of the increase rn value of that account. Thus, the Court submits
that it was just and proper in light of all of the circumstances surrounding the various
assets in this entire short-term marriage that Appellee husband should be entitled to
keep a greater share of the proceeds from the sale of his long-time business.
Accordingly, the Court suggests that issue 2(c) be overruled and that the trial court
be affirmed on exercising its discretion in its finding of less than a 50% share to
Appellant wife on the Prudential account in question. Notably, all other marital
assets were divided 50-50.
The final issue as to the joint Prudential account is that Appellant claims that
the Court erred in allowing Appellee husband to keep the entire balance in the
Prudential joint account including Appellant wife's share of $10.478.30 in the
Schedule of Distribution. Trial courts, however, are given broad discretion in terms
of distributing the remaining assets out of a divorce to the parties in any feasible
way. Thus, the trial court did not abuse its discretion in crediting husband with
wife's share of this Prudential account in the greater scheme of all of the assets just
like the trial court permitted the wife to keep all of the scrap metal instead of dividing
it up between the parties. Moreover, the distribution of her share of this asset
reduced the amount she would owe Appellee because there were insufficient assets
available to divide equally between them.
3. Whether the trial court's equal division of marital
assets totaling $130,924.80 is inconsistent with the Schedule of
Distribution which awards assets ln the amount of $67,505.21
(51.56 per cent of the total marital estate) to Husband and
$63,419.59 (48.44 per cent of the total marital estate) to Wife.
(Order and Opinion of April 2, 2018, Schedule C, p. 24).
7
115 - RULE 1925 OPINION OF 6.J.18
Appellant wife argues that Schedule "C", Distribution of Marital Assets and
Credit, on page 24 of the Memorandum Opinion does not constitute a 50-50 division
between the parties. Obvrously the difference in the total between the parties of
assets distributed to each of them shows on its face that Appellant wife appears to
be shorted by the amount of $4,085.62.
However, Schedule "C" is merely a list of those assets to be distributed to
each party where there are assets, including cash, that are great enough to make a
50-50 distribution from the marital assets and credits alone, without either party
having to come up with additional cash to equalize a 50-50 split. Accordingly,
Schedule "C'' simply indicates that there were insufficient assets and/or credits that
the Court could use on Schedule "C" for the 50-50 division.
The Court recognized this problem and explained on page 3 of the Order and
Decree that the "Court recognizes that the distribution requires wife to pay
$4,085.62 ($67 ,505.21 - 63.419.59) to husband to equalize distribution, in as much
as wife has been attributed the value of husband's scrap metal which she has
admitted, or by implication, has liquidated in whole or in part, probably for less than
fair market value." The trial court went on to explain in the next sentence that since
wife would have to come up with cash, and the Court was aware that she claimed to
be short on cash, that the Court went on to provide that husband, "however, shall
receive a credit of $4,085.62 against the amount of attorney fees owed by Plaintiff
[Appellee] pursuant to this Decree." Once again, the trial court believes that a
50-50 division has been made once the entire Decree is reviewed closely and that
no error has been committed. Therefore, issue number 3 should be overruled.
8
115- RULE 1925 OPINION OF 6.618
4. Whether, after finding Wife to be entitled to $10,000
in counsel fees and costs per the Master's recommendation
(Order and Opinion of April 2, 2018, p. 3-4), the trial court
erroneously ordered Wife to pay $4,085.62 to Husband to
equalize the 50/50 distribution when, in fact, Wife's distribution
was already $4,085.62 less than the distribution to Husband.
(Order and Decree of Distribution of April 2, 2018, paragraphs 2
and 7).
This issue deals with attorney fees that the Master and the trial court agreed
should be paid by Appellee husband to Appellant wife in the amount of $101000.00.
Appellant does not challenge the amount on appeal of the attorney fees award, but
asserts that the Appellee husband in the Decree should not have received a credit
towards attorney fees in the amount of $4,085.62 which is the amount of cash
Appellant wife owed to him to equalize the 50-50 distribution which Appellant
recognizes was needed to equalize the 50-50 distribution despite her contention in
issue 3 above.
Since this issue is premised on the argument in number 3 above that she was
shorted by $4,085.62 in the distribution of assets, this issue must similarly fail since
it is based on that false premise. So in effect, the Court simply relieved her from
having to pay Appellee husband the cash she needed to equalize a 50-50
distribution of assets by offsetting that debt to Appellee husband with the separate
amount he owed for her attorney fees. Thus, this issue should likewise be
overruled.
5. Whether the trial court erred in awarding Husband a
credit of $6,500 for money Husband had voluntarily paid to Wife
in reimbursement for his financial misconduct at separation.
(Order and Decree of Distribution of April 2, 2018, paragraph 7).
9
115- RULE 1925 OPINION OF 6 .. 18
In this issue, Appellant wife challenges the credit of $6,500.00 the trial court
gave to Appellee husband towards the attorney fees he owed her. Appellant
seemingly admits that she received this money from Appellee but argues that he
should not receive a credit for this payment because it was "voluntarily paid to wife
in reimbursement for his financial misconduct at separation." In support of this
proposition she cites the Order and Decree dated April 2, 2018 at paragraph 7 which
provides in its entirety as follows:
"[Appellee] shall pay attorney fees to wife in the amount of
$10,000.00 but shall receive a credit from equitable distribution for
$4,085.62, as well as a credit of $6,500.00 previously paid to wife by
husband. Thus, [AppelleeJ has satisfied the obligations regarding
attorney fees. The overpayment by [Appellee] of $585.62, however,
shall be waived because of [Appellee's] inferior financial condition."
Nowhere in paragraph 7 is there any mention of financial misconduct at
separation by Appellee husband or that he paid it voluntarily to her. This Court is
unaware of the source of this averment. Furthermore, the Master made Finding of
Fact No. 54 with regard to this payment and similarly does not mention any financial
misconduct since the Master found that Appellee "paid wife the sum of $6,500.00 on
December 13, 2014 on account and toward an ultimate settlement of marital
property." The Master further noted in Paragraph C of Schedule C that Appellant
already received a credit toward distribution of marital assets of $6,500.00. The
Master also made a recommendation as set forth in Paragraph 3 of the proposed
Order and Decree attached to the Master's Report that Appellee husband receive a
credit for $6,500.00. Appellant wife took no exception with regard to this finding
and/or its application. Accordingly, the issue has been waived.
10
115 - RULE 1925 OPINION OF 6 .. 18
Even if it has not been raised, it is without merit and should be overruled
because Apperlee is entitled to that credit and the only way he could receive it was
by offsetting it against his share of Appellant's attorney fees.
In conclusion. this Court suggests that all of the issues raised by Appellant
wife are either without merit or in the case of issue number 5 was waived and that
the lower court's Order and Decree and Findings should be affirmed.
BY THE COURT
Date: June 6. 2018
rmb
11