No. 92-319
IN THE SUPREME COURT OF THE STATE OF MONT
1993
IN RE THE MARRIAGE OF
JAMES S. SPENCE,
Petitioner and Appellant,
and
BARBARA L. SPENCE,
Respondent and Cross-Appellant.
APPEAL FROM: District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable Ed McLean, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Christopher Daly, Attorney at Law,
Missoula, Montana
For Respondent:
Gail M. Haviland, Worden, Thane
& Haines, Missoula, Montana
Submitted on Briefs: December 3, 1992
Decided: March 4, 1993
Filed:
Justice William E. Hunt, Sr., delivered the opinion of the
Court.
Appellant James S. Spence appeals from an order of the Fourth
Judicial District Court, Missoula County, distributing certain
pension benefits, proceeds from out-of-state property, and an award
of maintenance. Respondent Barbara L. Spence cross-appeals the
order, alleging the court erred in its distribution of the marital
estate and erred in failing to award her attorney fees and costs.
We affirm in part and remand.
James raises five issues on appeal while Barbara cross-appeals
with four issues. Because the issues deal primarily with the
distribution of the marital estate, we rephrase the issues as
follows:
1. Did the District Court err in its distribution of the
marital estate?
2. Did the District Court err in ordering $300 in temporary
maintenance?
3. Did the District Court err in awarding Barbara $350 per
month in maintenance for three years?
4. Did the District Court err in failing to award Barbara
attorney fees and costs?
James and Barbara were married on May 20, 1977. At the time
of the hearing, James was 65 years old and Barbara was 43 years
old. James began working for Pacific Northwest Bell and its
successor corporation, U.S. West Communications, in 1947 as a
lineman, and continued working in that position for approximately
40 years until his retirement in 1988. Before taxes, James has a
monthly income of approximately $1800 from social security and his
U.S. West pension. During his employment, James participated in a
savings plan and an Employee Stock ownership Plan (ESOP). However,
he did not have access to those funds until his retirement. James
suffers from diabetes and high blood pressure, and because of his
age and health problems, is unable to work.
Barbara worked as a nurses' aide at the Shrinerls Hospital in
Spokane prior to marrying James. ~uring the marriage, Barbara
earned an Associate of Arts degree in liberal arts and another
Associate of Arts degree in hearing impaired services. Barbara
worked as a deaf interpreter, and also obtained some computer
skills at the University of Montana in Missoula. Throughout most
of the marriage, Barbara maintained the household. From 1988
through 1990, Barbara earned between $3000 and $9000 a year. She
currently lives in Spokane with her brother and is unemployed, with
the exception of performing occasional odd jobs.
The parties separated an July 10, 1991. On July 29, 1991,
Barbara filed a petition for dissolution in Spokane County,
Washington. The summons and petition were served on James in
Missoula on August 12, 1991. On August 7, 1992, James filed for
dissolution in Missoula County. The Superior Court of Washington
dismissed the pending action and changed jurisdiction to Missoula
County.
On February 12, 1992, the District Court orally ordered James
to pay $300 in a one time temporary maintenance award under the
belief that the matter would be decided before the next maintenance
check was due. On May 5, 1992, Barbara petitioned the court for
clarification of the order. The court ordered James to pay
maintenance until the final decree was issued. This resulted in
James having to pay $1200 in back maintenance.
Trial was held on the matter on March 11 and 18, 1992. On
May 29, 1992, the District Court issued its findings of fact,
conclusions of law, and order. On June 19, 1992, James filed his
notice of appeal from the court's decree and the order for
temporary maintenance.
I.
Did the District Court err in its distribution of the marital
estate?
This Court has stated that our standard of review relating to
factual findings of the district court with regard to the division
of marital property is whether the district court's findings are
clearly erroneous. In re Marriage of Danelson (Mont. 1992), 833
P.2d 215, 219, 49 St. Rep. 597, 599. With regard to this Court's
review of conclusions of law made by the district court, we have
stated that ""[wle are not bound by the lower court's conclusions
and remain free to reach our own."" Danelson, 833 P.2d at 219-20
(quoting Schaub v. Vita Rich Dairy (1989), 236 Mont. 389, 391, 770
P.2d 522, 523). In adopting these principles of review in division
of the marital estate, we have stated that:
[Tlhis Court is not in any way discounting the
considerable discretionary power that must be exercised
by district courts in these cases. The courts are
obligated to fashion a distribution which is equitable to
each party under the circumstances. The courts, working
in equity, must seek a fair distribution of the marital
property using reasonable judgment and relying on common
sense. Obtaining this equitable distribution will at
times require the lower court to engage in discretionary
action which cannot be accurately categorized as either
a finding of fact or a conclusion of law. These
discretionary judgments made by the trial court are
presumed to be correct and will not be disturbed by this
Court absent an abuse of discretion by the lower court.
[Citation omitted.]
Danelson, 833 P.2d at 220.
In this instance, James argues that the District Court erred
in determining that the ESOP stock was part of the marital estate,
that the court misstated the total value of the ESOP stock, and
that it miscalculated when dividing the stock between the parties.
Barbara argues that the court erred in distributing the ESOP stock
proceeds which were calculated by a formula that measured the
length of the stock option plan over 40 years, instead of from
1976. Barbara also contends that the court's valuation of the
stock is erroneous.
We must first answer the question of whether the ESOP stock
was properly included in the marital estate. Section 40-4-202(1),
MCA, provides that when dividing a marital estate, the district
court shall 'Iequitably apportion between the parties the property
and assets belonging to either or both, however and whenever
acquired .... In addition, the statute requires that the
district court consider contributions of the other spouse to the
marriage when dividing the marital estate, which includes the
nonmonetary contributions of a homemaker and the extent to which
such contributions have facilitated the maintenance of the
property. Section 40-4-202(1) (a) and (b), MCA. We have stated
that retirement benefits are properly included within the marital
estate and are subject to division. In re ~arriageof Holston
(19831, 205 Mont. 470, 474, 668 P.2d 1048, 1050.
In its findings of fact, the court ruled that during most of
the partiesv 14-year marriage Barbara maintained the home, her
contributions as a homemaker contributed to the marital estate, and
the stock was earned in a community property state. The domestic
services provided by Barbara enabled James to continue working at
his place of employment and contribute to his savings plans.
Moreover, if James had passed away before receiving the stock, the
benefits would have gone to Barbara. With the exception of the
purchase of some lithographs, James used proceeds from the sale of
stock to purchase jointly held marital property. Therefore, we
conclude that the District Court properly included the stock as a
marital asset.
Even though the stock was considered part of the marital
estate, the District Court erred in the valuation and distribution
of the stock. The court, in its conclusions, valued the total sale
of the stock at $49,109. After the vesting of the retirement plans
in 1988, James sold between $16,000 and $19,000 to purchase a
pickup truck which was held jointly by the parties. In 1990, the
parties sold additional stock for approximately $12,000 to $13,000
and used the proceeds to make a down payment on a home in Missoula
and to purchase furniture for the home. After the date of
separation, but prior to the dissolution, James sold the remaining
stock for $30,109 and used $10,500 for the purchase of 35
lithographs. Although the total value of the stock was apparently
not stated by the parties, testimony concerning the proceeds from
the sale of the stock leads to the conclusion that the District
Court failed to take into account stock sold for the down payment
on the home and the furniture when valuing the estate. We remand
to the ~istrict Court for reconsideration of the value and
distribution of the stock. Any additional concerns the parties may
have relating to the distribution of the stock may be raised with
the District Court.
James also contends that the District Court should not have
included the Idaho property in the marital estate. Both parties
argue that the division of the proceeds resulting from the sale of
the property is incorrect. James argues that the property was
purchased on a ten-year contract in 1970, seven years prior to the
marriage, the property was paid off within three years of the
marriage, and only taxes were paid on the property from 1980 to
1991. James declares that although payments came out of the
parties1 joint checking account, no evidence was produced by
Barbara to show that she contributed to that account. Citing In re
Marriage of Scott (Mont. 1992), 833 P.2d 710, 49 St. Rep. 634,
James contends that property division in a Montana dissolution is
not governed by community property laws of another state,
We reiterate that to divide property acquired prior to
entering into a marriage contract, the District Court must examine
the factors set out in 5 40-4-201(1) (a) and (b), MCA. We have
stated that in Montana, property division need not be equal, but
instead, must be equitable. Scott, 833 P.2d at 712. James and
Barbara conveyed a one-half interest in the property to James' son
and daughter-in-law. The owners later sold their interest in the
property. Jamesf and Barbara's share was $9657. Barbara testified
that they were paying on the property prior to the marriage.
Barbara further testified that they had considered the property as
a place to retire. The record shows that Barbara's name appears on
a 1977 warranty deed that was executed to convey interest in the
property to James' son and daughter-in-law. Barbara signed the
buy-sell agreement as seller of the property. In addition. she
testified that the monthly payments and taxes on the property were
paid out of the parties1 joint checking account. That statement
was not contradicted by James. Therefore, it was proper for the
District Court to include the Idaho property in the marital estate.
Finally, both Barbara and James complain that the District
Court erred in its calculation when distributing the proceeds of
the sale of the Idaho property. The court awarded Barbara
two-thirds of the one-half interest ($9657) of the proceeds from
the sale of the property. ~ccording to the ~istrict Court,
Barbara's share was $3235. We remand to the District Court to
correct this mathematical error. With the exception of the
mathematical error, we hold that the District Court equitably
divided the Idaho property between the parties.
11.
Did the District Court err in ordering a $300 temporary
maintenance award?
On February 12, 1992, the District Court held a hearing to
determine whether Barbara should be entitled to temporary
maintenance. The court orally ordered James to pay a one time
maintenance award of $300, under the belief that the case would be
decided the following month. The court minutes stated that James
was responsible for a $300 monthly temporary maintenance payment.
James paid the temporary maintenance in February, but did not pay
any maintenance during the remaining months preceding the court's
decision. On May 5, 1992, Barbara filed a motion requesting that
the court clarify its order regarding maintenance. On May 20,
1992, the District Court ordered James to pay $300 a month until
the court rendered a decision. James appeals this order.
We previously stated that 5 40-4-121(7)(a) and (b), MCA,
grants considerable authority to make a temporary maintenance award
retroactive. "It was well within the District Court's power after
hearing on the matter of . . . maintenance, to make the order
retroactive." In re Marriage of Revious (1987), 226 Mont. 304,
312, 735 P.2d 301, 306.
A hearing was conducted by the court regarding temporary
maintenance and it found that there should be a $300 payment each
month from February. We hold that the District Court did not err
in ordering retroactive temporary maintenance payments.
111.
Did the ~istrictCourt err in awarding Barbara $350 per month
in maintenance for three years?
We have stated in the past that our standard of review to
determine whether the award of maintenance is proper is whether the
district courtls findings of fact are clearly erroneous. In re
Marriage of Eschenbacher and Crepeau (Mont. 1992), 831 P.2d 1353,
49 St. Rep. 393. The district court may award maintenance after
the marital property has been equitably distributed and the court
has properly applied the criteria of § 40-4-203, MCA. Also, the
district court may grant an award of maintenance for either spouse
if the court finds that the spouse requesting maintenance "lacks
sufficient property to provide for his reasonable needst1and "is
unable to support himself through appropriate employment .... IS
Section 40-4-203 (1)(a) and (b), MCA.
In its findings, the court believed that Barbara had not
actively sought employment and her only income came from temporary
maintenance and odd jobs. The court stated that for Barbara to be
employed as a deaf interpreter she would need to take additional
classes. Her expenses were $1075 per month, not including the cost
of any further education. If she earned either minimum wage, or
the wage she received at her previous employment, neither would
cover her current expenses. The court considered her age, length
of marriage, her standard of living during the marriage, her
physical and emotional condition, and James1 ability to meet his
needs while assisting Barbara for a reasonable period of time. As
a result of these findings, the court concluded that Barbara was
eligible for maintenance of $350 a month for three years. The
court properly considered the factors set out in 5 40-4-203(1),
MCA. We hold that the District Court did not err in the award of
maintenance.
IV
Did the District Court err in failing to award Barbara
attorney fees and costs?
Barbara claims that the District Court erred in not awarding
her attorney fees. Section 40-4-110, MCA, states that the district
court may, after considering the financial resources of the
parties, order a party to pay reasonable attorney fees and costs.
t his is a permissive, not a mandatory statute. We have stated that
absent an abuse of discretion, this Court will not overturn the
district court's decision denying attorney fees. In re Marriage of
Manus (1987), 225 Mont. 457, 733 P.2d 1275. It is clear from the
District Court's extensive findings that the financial resources of
the parties were considered and Barbara has a sufficient cash award
to pay her attorney fees. We hold that the District Court did not
abuse its discretion in failing to award Barbara attorney fees.
Affirmed in part and remanded to the District Court for
reconsideration of the value and distribution of the stock and to
correct a mathematical error regarding the distribution of the
proceeds from the sale of the Idaho property.
I
We concur: i
March 4, 1993
CERTIFICATE OF SERVICE
1 hereby certify that the following order was sent by United States mail, prepaid, to the
following named:
Chris topher Daly
Attorney at Law
101 E. Broadway, Ste. 200
Missoula, MT 59802
Gail Haviland
Worden, Thane & Haines
P.0. Box 4747
Missoula, MT 598G6
ED SMITH
CLERK OF THE SUPREME COURT
STATE QF MONTANA