No. 91-465
IN THE SUPREME COURT OF THE STATE OF MONTANA
1992
IN RE THE MARRIAGE OF
CHARLENE KAY SCHMITZ,
Petitioner and Appellant,
-vs-
ROGER KEITH SCHMITZ,
Respondent and Respondent.
APPEAL FROM: District Court of the Fifteenth Judicial District,
In and for the County of Sheridan,
The Honorable M. James Sorte, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Gary Ryder, Attorney at Law, Sidney, Montana
For Respondent:
Loren J. OIToole, OiToole & O'Toole, Plentywood,
Montana
Submitted on Briefs: June 11, 1992
Filed: &/ smitA
CLERK OF SUPREME C O U m
1
.
.a. Decided: November 5, 1992
STATE OF MONTANA
Justice Fred J. Weber delivered the Opinion of the Court.
The petitioner, Charlene Kay Schmitz, appeals from the
property distribution in this marital dissolution action as
determined by the District Court of the Fifteenth Judicial
District, Sheridan County. We affirm in part and reverse in part.
The restated issues are as follows:
1. Was the notice of appeal timely filed?
2. Did the District Court err by including petitioner's
workers' compensation benefits in the marital estate?
3. Did the District Court err in its findings of fact and
conclusions of law?
Roger Keith Schmitz and Charlene Kay Schmitz were married on
June 18, 1971. Neither party brought any substantial assets to the
marriage. Prior to the marriage, Roger served in the military and
completed one year of automotive schooling. Charlene had recently
graduated from high school.
In 1976, Roger purchased, by means of a contract for deed, a
50% interest in farm/ranch property in Sheridan County, Montana
from his uncle. Roger's father, Joe Schmitz owns the other 50%
interest. Both Charlene and Roger were active in farming and
ranching during the 19 1/2 years of their marriage. The contract
for deed was paid off in 1990. Charlene was very active in all
aspects of the farm/ranch operation until the time of her injury.
The parties also raised two sons during this time.
Charlene began working in 1984 as a part-time nurses-aide at
the Culbertson Nursing Home. In February 1986, Charlene suffered
2
a work-related back injury which prevented her from working at the
nursing home and limited her activities on the ranch. In the
spring of 1986, Charlene was classified as permanently totally
disabled for workers1 compensation purposes and began receiving
monthly compensation payments of $358.76. These payments continued
throughout the time of trial. Because the payments are subject to
a 10-year limitation, Charlene will no longer qualify for workers1
compensation benefits after May 1996.
Charlene presently attends Idaho State College with assistance
provided under a plan for displaced homemakers. Roger has
continued to operate the farm/ranch operation.
In addition to the real property purchased from Roger's uncle,
the parties accumulated livestock, farm and ranch equipment, and
numerous other items of personal property. The parties were
essentially debt-free until 1987, when they borrowed $80,005.00
from Security State Bank in Plentywood to construct a new residence
on the farm. In its Findings of Fact, Conclusions of Law and Order
dated May 23, 1991, the District Court awarded most of the marital
property to Roger. Roger received the real property, the house
located on his father's land, which was built by the parties, all
livestock, all farm equipment, and numerous other items of personal
property. Charlene received $25,000.00 in cash, a 1982 Citation
valued at $800.00, and her workers' compensation benefits with a
present value of $21,127.80, as of the trial date. Roger was
ordered to pay the debts associated with the property he received
and Charlene was ordered to pay $4,400.00 in debts she incurred as
living expenses after leaving the family home and prior to the
trial. Roger was awarded physical custody of the one minor child,
who is now 18 years of age.
Was the notice of appeal timely filed?
Roger contends that the notice of appeal in this case was not
filed on time. The resolution of this issue hinges upon the
initial period under Rule 59(b), M.R.Civ.P., which provides:
Time for motion. A motion for a new trial shall. be
served not later than 10 days after service of notice of
the entry of the judgment.
Because notice of entry of judgment was served by mail, three
days are added under Rule 6 ( e ) , M.R.Civ.P, which provides:
Additional t i m e after service by mail. Whenever a party
has the right or is required to do some act . ..
within
a prescribed period after the service of a notice . . .
and the notice or paper is served upon the party by mail,
3 days shall be added to the prescribed period.
Roger contends that adding three days to the prescribed period
under Rule 5 9 ( b ) increases the time to a total of thirteen days
and, therefore, the exclusion of Saturdays, Sundays and holidays
provided for under Rule 6 (a), M.R. Civ.P I , cannot apply, Rule 6 (a),
M.R.Civ.P., provides:
In computing any period of time prescribed or allowed by
these Rules, ... the day of the act, event ...
is not
to be included. . ..
When the period of time prescribed
or allowed is less than 11 days, intermediate Saturdays,
Sundays and holidays shall be excluded in the
computation.
We conclude that the prescribed period referred to in the
foregoing Rule includes the ten day period allowed for filing a
motion under Rule 59(b), M.R.Civ.P., with the result that
intermediate Saturdays, Sundays and holidays are excluded from the
computation. The District Court granted Charlene and Roger Schmitz
a dissolution on May 23, 1991. Roger mailed a notice of entry of
judgment to Charlene's attorney on May 29, 1991. In civil cases,
the notice of appeal must be filed within thirty days of the date
of the entry of judgment. Rule 5(a), M.R.App.P. Charlene filed a
motion for new trial and a motion to amend the court's findings
under Rules 59 (a) and 60 (b), M.R. Civ.P. , which extends the time for
filing the appeal.
Rule 59 (b), M.R.Civ.P., provides that a Rule 59 (a) motion for
a new trial must be filed within 10 days after service of notice of
entry of judgment. Here the notice of entry of judgment was mailed
on May 29, 1991. Charlene filed her Rule 59(a) motion for a new
trial on June 17, 1991. The day of mailing is excluded under Rule
6(a), M.R.Civ.P. The combined total of days allowed under Rule
59(b), M.R.Civ.P. and Rule 6(e), M.R.Civ.P. is thirteen days.
Counting from May 30 and excluding the intervening Saturdays and
Sundays, we determine that the last day for filing a Rule 59(a)
motion was June 17, 1991, the date Charlene filed her motion for a
new trial.
We conclude that Charlene filed her appeal on time.
11.
Did the District Court err by including petitioner's workers'
compensation benefits in the marital estate?
Charlene receives $358.76 per month in workers1 compensation
benefits for an injury classified as a "permanent total
disability." She will receive these payments until May 1996.
Roger presented testimony by a certified public accountant that the
present value of Charlenels future benefit payments at the time of
trial was $21,127.80. This figure was included as marital property
and distributed to Charlene.
Charlene contends that to include her future workers'
compensation benefits as marital property is error. She argues
that to include the figure in the marital estate is speculative
because the payments could terminate if she completes the education
program or if her physical condition improves.
Charlene presented no evidence at the trial to support any
likelihood that she might complete her education program early or
that her physical condition could improve. Charlene further
contends that her benefits should not be included as part of the
marital estate because they are intended to replace her wages. She
also argues that including workerst compensation benefits as a
marital asset characterizes them as an assignment of the proceeds
and therefore is against public policy.
Property which may be properly included in the marital estate
is governed by 5 40-4-202, MCA, which provides that district courts
"shall ... finally equitably apportion between the parties the
property and assets belonging to either or both, however and
whenever acquired and whether the title thereto is in the name of
the husband or wife or both." (Emphasis supplied.) When the
parties are unable to amicably settle their disputes, 1 40-4-202,
MCA, provides the district courts with equitable powers to divide
their property and assets.
In In re the Marriage of Blankenship (1984), 210 Mont. 31, 682
P.2d 1354, we concluded that a workers' compensation award could be
a marital asset. In two subsequent cases, where a workers1
compensation settlement had been commingled in marital funds we
included the same in a marital estate. See In re the Marriage of
Bos (1989), 238 Mont. 267, 776 P.2d 841: and In re the Marriage of
Jones (1987), 229 Mont. 128, 745 P.2d 350. In In re the Marriage
of Cooper (1990), 243 Mont. 175, 179, 793 P.2d 810, 812, we
concluded that disability benefits can properly be included in the
marital estate as they clearly come within the definition of
property "however and whenever acquired." Workers' compensation
payments are disability payments. In Coo~er, the disability
payments were included in the marital estate and awarded to the
person receiving the same as is true in the present case.
While 5 39-71-743, MCA, prohibits attachment or assignment of
workers' compensation benefit payments, we conclude those
provisions do not bar classification of workers' compensation
awards as marital property.
We hold that the District Court did not err by including the
present value of Charlene's future workers' compensation payments
as marital property.
111.
Did the District Court err in its findings of fact and
conclusions of law?
The District Court adopted Roger's proposed findings of fact
and conclusions of law verbatim. Roger received the couple's
entire one-half interest in the farm/ranch property, all farm
equipment, all livestock, the family home and miscellaneous items
of personal property. Charlene received a 1981 Chevrolet citation
valued at $800.00, $25,000.00 in cash payable within six months of
the trial, and her future workers1 compensation payments. Roger
has responsibility for the bulk of the parties' debts although
Charlene was ordered to pay debts in the amount of $4,400.00.
Charlene contends that the property valuation and the determination
of the amount of debt are not supported by the record and result in
an inequitable distribution of the marital estate.
The appropriate standard of review for this issue is whether
the ~istrictCourt's findings of fact are clearly erroneous, as in
Interstate Production Credit Assn v. DeSaye (1991), 250 Mont. 320,
323, 8 2 0 P.2d 1285, 1287, and cited with approval in In re the
Marriage of Eschenbacher and Crepeau (Mont. 1992), 831 P.2d 1353,
49 St.Rep. 393, 394. The standard is the same whether the District
Court prepared its own findings or adopted the findings of one of
the parties. The wholesale adoption of one party's proposed
findings and conclusions is not by itself an automatic basis to
vacate a judgment. In re the Marriage of Merry (19841, 213 Mont.
141, 149, 689 P.2d 1250, 1254.
Interstate Production Credit Assn sets forth a three-part test
to determine whether the district court's findings are clearly
erroneous: (1) the Court will review the record to see if the
findings are supported by substantial evidence; (2) if the findings
are supported by substantial evidence, the Court determines if the
trial court has misapprehended the effect of the evidence; and (3)
if substantial evidence exists and the effect of the evidence has
not been misapprehended, the Court may still find that "a finding
is clearly erroneous when, although there is evidence to support
it, a review of the record leaves the court with the definite and
firm conviction that a mistake has been committed." Interstate
Production Credit Assn, 820 P.2d at 1287.
Substantial evidence is defined as "evidence that a reasonable
mind might accept as adequate to support a conclusion; it consists
of more than a mere scintilla of evidence but may be somewhat less
than a preponderance." Barrett v. Asarco, Inc. (1990), 245 Mont.
196, 200, 799 P.2d 1078, 1080, citing Black's Law Dictionary 1281
(5th Ed. 1979); Stanhope v. Lawrence (1990), 241 Mont. 468, 471,
787 P.2d 1226, 1228-29. Charlene specifically contends that the
District Court erred by incorrectly calculating the marital debts,
by adopting Roger's expert's valuations of specific property, and
by failing to properly consider maintenance.
1. The marital debts.
The District Court found that Charlene's debt to Security
State Bank was $3,000.00, and that her total personal debt was
$4,400.00. By piecing together the fragmented testimony about the
bank loans and other debt, it is clear that the District Court's
finding is incorrect and that Charlene's personal debt which she
incurred for living expenses prior to trial is $8,900.00--$4,500.00
more than the amount in the District Court's finding.
The District Court also found that Roger owed his father, Joe
Schmitz, $22,600.00 for a tractor and a combine which Roger used as
trade-ins on new equipment purchased during the marriage. Roger
and his father testified as to the claimed loans. Roger s
testimony was inconsistent as to the amount of the loan. He
claimed the loan was approximately $22,000.00 and later
contradicted that statement. Joe Schmitz testified he thought the
loan amount was about $28,000.00 or even more but that he had never
made any demand for the money. So far as any payment date is
concerned, Roger only testified that there was a verbal agreement
that he would pay his father "in due time." The father testified
that he had not made a demand for the money and if Roger did not
pay it, it would eventually come out of his estate.
In In re the Marriage of Malquist (1987), 227 Mont. 413, 739
P.2d 482, we addressed a similar situation. In Malsuist, the wife
attempted to include loans from her mother amounting to $42,000,00
as part of the marital debt. We refused to include the debt on the
basis of oral testimony alone, stating:
There is no other evidence in the record, such as a loan
agreement, promissory note, canceled checks, or any form of
receipt to substantiate the amount, existence or terms of the
loans from [the wife's] mother. Proposed findings of fact and
conclusions of law must be sufficiently comprehensive to
provide a basis for the trial court's decision, and must be
supported by the evidence presented.
Malauist, 739 P.2d at 484-85, citing In re the Marriage of
Benner (1985), 219 Mont. 188, 193, 711 P.2d 801, 805.
The facts in this case are comparable to Malcruist. No
evidence was presented of a loan agreement, note, check, form of
receipt, or existence or terms of loans.
We therefore conclude that the computation of marital debts
was substantially incorrect in that the debt owed by Charlene was
$8,900.00 as compared to the $4,400.00 awarded by the court. In
addition, we conclude that the amount of $22,600.00 could not
properly be included as a debt owed by Roger to Joe Schmitz.
2. The ~ropertyvaluations.
Charlene contends that the District Court erred in adopting
Roger's valuations as set forth in his proposed findings of fact.
We have reviewed the record with regard to the valuations placed
upon the farm and ranch equipment, real property and the home and
have concluded that there is substantial evidence in the record to
support the District Court's valuation of those items.
In a similar manner, while there is conflicting evidence, we
conclude there is substantial evidence to support the District
Court's evaluation of the cattle.
A significant portion of the personal property owned by the
parties was not valued by the District Court. The findings only
referred to these assets as l~miscellaneousitems of personal
property with no established value, being household goods, etc."
Both parties introduced evidence relating to this personal property
and its values. There is a substantial list of property including
such things as a Conklin dealership, Cenex and Nemont stock,
capital credits or patronage dividends in GTA, Sheridan Electric
Coop and Nemont, a satellite dish, and a water treatment system.
Because of the necessity for a remand because of our previously
stated conclusions on changes in marital debt owed, we conclude
that it will be appropriate on remand for the District Court to
more specifically review the items of personal property and value
the same. Because of the apparent inability of the parties to
divide these assets, we therefore remand so that the District Court
may determine the distribution to be made of such personal
property.
3. Maintenance.
In view of our remand for redetermination resulting from the
change in debt, we conclude that it will be appropriate for the
court to reconsider the property distribution and the presence or
absence of a need for maintenance on the part of Charlene. Such a
determination should be made in accordance with 540-4-203, MCA.
In connection with that maintenance determination, we point
out that the record indicates that Charlene may be unable to
support herself in the near future. In addition to the debt of
$8,900.00 as previously described, Charlene has shown an obligation
of $10,479.20 for lawyer's professional services and out-of-pocket
expenses in connection with this divorce proceeding. As a result,
Charlene apparently has approximately $5,000.00 from the cash
distribution to assist in application for her needs. We therefore
remand to the District Court for reconsideration of the maintenance
question at the time it considers the other issues in the
proceeding.
We affirm the findings and conclusions of the District Court
with the exception of the items specifically mentioned above and
w i t h t h e exception of a p o t e n t i a l maintenance award. We remand f o r
f u r t h e r consideration of these items consistent w i t h this o p i n i o n .
November 6, 1992
CERTIFICATE OF SERVICE
1 hereby certify that the following order was sent by United States mail, prepaid, to the following
named:
Gary Ryder
Attorney at Law
P.O.Box 1172
Sidney, MT 59270
Loren J. O'Toole
O'Toole & O'Toole
P.O. Box 529
Plentywood, MT 59254-0529
ED SMITH
CLERK OF THE SUPREME COURT
STATE-OF MONTANA