NO. 93-355
IN THE SUPREME COURT OF THE STATE OF MONTANA
1994
IN RE THE MARRIAGE OF
PATRICIA HALSE NORDBERG,
n.k.a. PATRICIA HALSE,
Petitioner, Appellant,
and Cross-Respondent,
and
DEAN V. NORDBERG,
Respondent, Respondent,
and Cross-Appellant.
APPEAL FROM: District Court of the Fifth Judicial District,
In and for the County of Madison,
The Honorable Frank M. Davis, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Bonnie Swandal and Brenda R. Cole, Swandal,
Douglass, Frazier & Cole, Livingston, Montana
For Respondent:
W. G. Gilbert, Jr., and W. G. Gilbert, 111,
Attorneys at Law, Dillon, Montana
Submitted on Briefs: March 24, 1994
Decided: June 21, 1994
Filed:
Justice William E. Hunt, Sr., delivered the opinion of the Court.
Appellant Patricia Halse Nordberg appeals from final judgment
and decree entered June 29, 1993, in the Fifth Judicial District,
Madison County, dissolving her marriage to Dean Nordberg and
dividing the marital estate. Respondent cross-appeals the District
Courttsdivision of the marital estate.
We affirm in part, reverse in part, and remand.
Appellant raises the following issues on appeal:
1. Did the District Court err in declaring the judgment from
the dissolution of the partiest first marriage "null and voidvv
where the judgment required periodic installment payments from
respondent to appellant for her interest in the ranch assets
acquired during the partiesq first marriage?
2. Did the trial court err in failing to compensate
appellant for her interest in the parties1 ranching operation
developed during their second marriage?
Respondentts issue on cross-appeal is:
Did the District Court err in its valuation and distribution
of the marital estate?
~atriciaHalse Nordberg (now known as Patricia Halse) and Dean
Nordberg were first married on May 5, 1981, in Sheridan, Montana.
Prior to the time the parties married, Patricia was a homemaker and
Dean was an ironworker. He later worked in cattle operations. No
children were born of this marriage, although both parties have
adult children from other marriages. Patricia was formerly widowed
and brought the following assets to the first marriage: a family
business, a homestead with a house and 19 acres, bonds from
inheritance, life insurance proceeds, and various properties.
Dean's assets consisted of gold coins and personal property, and
part ownership of a home. During this marriage the parties
accumulated real property and livestock, farm and ranching
equipment, and machinery. At the time of the present dispute,
Patricia was 59 years of age and worked part-time at a sewing shop,
and Dean was 58 years of age and operated his ranching business.
On April 21, 1987, with each party represented by their own
attorney, the marriage was dissolved and the parties8 submitted
property settlement agreement was incorporated into the final
decree. The settlement granted the couple all property
individually acquired before the marriage. Patricia received the
two rental properties acquired during the marriage. Dean was
granted the livestock, valued at $75,320, and ranch vehicles,
equipment, tools, and machinery, valued at $39,800. As part of the
property settlement of the cattle and machinery, Dean agreed to pay
to Patricia $80,000 as full settlement of her claim to the
property. Pursuant to the terms of the agreement, Dean paid
$30,000 upon execution of the agreement. Dean was to pay the
remaining $50,000 in the following manner: the first installment
of $25,000 was due one year from the agreement date, and the second
installment of $20,000 was due two years from the agreement date;
Dean was to execute two promissory notes for $10,000, with one note
having a security interest in Dean's cattle, and the other secured
by a title lien interest in his two pickups; and an additional
$5,000 certificate of deposit was due two years from the agreement
date. Dean never executed the documents nor did he pay the
installment payments.
The parties were remarried approximately seven months later on
September 30, 1987. This subsequent marriage was dissolved on
June 29, 1993. During this second marriage the couple obtained
rental property and purchased more cattle. Patricia contributed
her separately-owned real property for running the ranching
operation and infrequently participated in the operation during
this marriage. Dean maintained and managed the ranching operation.
On April 13, 1992, Patricia filed for dissolution of her
marriage to Dean. The parties1 relationship during the dissolution
proceedings was hostile and both disputed the distribution of the
assets. On April 21, 1992, prior to the entry of the final decree,
Dean sold 52 cow/calf pairs. In June 1992, the court ordered the
proceeds of the sale divided equally between the parties and
granted $58,940 to each.
After the matter was heard before a Special Master on
December 28-29, 1992, the Special Master issued findings of fact
and conclusions of law. Both parties filed objections to these
findings which were denied. On June 29, 1993, the District Court
issued a judgment confirming the Special Master's findings, denying
the parties1 objections, and declaring the February 3, 1987,
judgment from the prior dissolution decree I1null and void.I1
Patricia appeals the District Court's findings distributing the
property and voiding the prior dissolution judgment, and Dean
cross-appeals the division of the marital estate.
ISSUE 1
Did the District Court err in declaring the judgment from the
dissolution of the parties' first marriage I1null and voidt1where
the judgment required periodic installment payments from respondent
to appellant for her interest in the ranch assets acquired during
the parties1 first marriage?
The first dissolution settlement agreement between the parties
granted Dean the livestock and ranch vehicles, equipment, tools,
and machinery. As part of the property settlement of the cattle
and machinery, Dean agreed to pay to Patricia $80,000 as full
settlement of her claim to the property. Dean paid $30,000 upon
execution of the agreement. The remaining installments were never
paid. Dean argues that the judgment from the prior dissolution
settlement forthe ranching operation was satisfied by his payments
for property taxes on Patricia's separate properties, by his
payments for the parties1 income taxes, and also, by his
contribution of physical labor to improve her separate property.
Unlike the first dissolution where the parties entered into a
settlement agreement, they agreed that a Special Master would
assist in the proceedings for division of the marital estate for
the second dissolution. The District Court adopted the Special
Master's findings. In Finding of Fact No. 7, the court states:
Neither party has performed or complied with the terms of
the prior Property Settlement Agreement and Decree. The
Court finds that both parties are estopped from asserting
any rights under the previous decree and agreement. Both
parties should be discharged from any obligation under
that judgment.
In the judgment, t h e court further s t a t e d that If[t]he previous
decree in Madison County Cause No. 7449 entered between these
parties is declared null and void."
Prior to the time a property settlement is approved and merged
into a decree, 40-4-201, MCA, allows the court to determine
whether the agreement is unconscionable. In Hadford v. Hadford
(l98l), 194 Mont. 518, 523, 633 P.2d 1181, 1184, this Court stated:
Under section 40-4-201(2), MCA, the courts are bound by
a property settlement agreement signed by both parties
unless the court then finds the agreement to be
unconscionable. Under this statute, the court can
determine the question of conscionability on its own
motion, or either of the parties can raise this issue
before the agreement is merged into a decree and becomes
final. [Emphasis added].
After the trial court determines that the property settlement is
not unconscionable, 5 40-4-201, MCA, provides in part:
(4)(a) unless the separation agreement provides to
the contrary, its terms shall be set forth in the decree
of dissolution . ..and the parties shall be ordered to
perform them; or
....
(5) Terms of the agreement set forth in the decree
are enforceable by all remedies available for enforcement
of a judgment, including contempt, and are enforceable as
contract terms.
In the present case, the trial court found the partiesq
settlement agreement was not unconscionable and the settlement was
merged into the dissolution decree. The judgment became final when
no appeal was taken by either party before the appeal time expired
under Rule 5 , M.R.App.P.
In order to modify or revoke a final property disposition,
§ 40-4-208, MCA, requires in pertinent part:
(3) The provisions as to property disposition mav
not be revoked or modified bv a court. except:
(a) upon written consent of the parties; or
(b) if the court finds the existence of conditions
that iustifv the reopenina of a iudsment under the laws
of this state. [Emphasis added].
Rule 60(b), M.R.Civ.P., upon motion by a party or a party's
legal representative, for several enumerated reasons, allows relief
from a final order, judgment, or proceeding. Since neither party
filed a motion for relief in this matter, we consider the residual
clause of Rule 60(b) which allows the filing of an independent
action based on equitable grounds, stating in pertinent part:
This rule does not limit the power of a court to
entertain an independent action to relieve a party from
a judgment, order, or proceeding, or to grant relief to
a defendant not actually personally notified as may be
required by law, or to set aside a judgment for fraud
upon the court.
Those parties requesting relief under the 60(b) residual clause may
base their claim upon extrinsic fraud, lack of personal
notification, and fraud upon the court. Brown v. Small (1992), 251
Mont. 414, 420, 825 P.2d 1209, 1213 (citing Salway v. Arkava
(1985), 215 Mont. 135, 695 P.2d 1302). However, here, neither
party sought to modify or revoke the original property settlement
and decree under 5 40-4-208, MCA, nor did either party seek to
reopen the judgment under Rule 60(b), M.R.Civ.P. Pursuant to
5 40-4-208, MCA, the court could not thereafter sua sponte vacate
the judgment without the consent of the parties in writing or
without a hearing. This property settlement was not merged into
the second marriage, and according to the record, Dean still owes
for this judgment. Those assets from the judgment are Patricia's
separate assets.
The District Court did not have jurisdiction to vacate the
prior judgment. We need not discuss whether the court was
justified to vacate the judgment based upon equitable estoppel. We
hold that the District Court erred in declaring the judgment from
the dissolution of the parties' first marriage '*nulland void."
ISSUE 2
Did the trial court err in failing to compensate appellant for
her interest in the parties' ranching operation developed during
their second marriage?
Patricia argues that she was not compensated for her
contribution to the ranching operation and that Dean received more
than a majority of the marital assets resulting in an inequitable
distribution. She asserts that she contributed the greater portion
to the parties' assets by her large financial contributions during
the first marriage when she spent $90,919 of her separate funds to
establish the ranching operation. She also argues that she made
the following additional contributions during the second marriage
without receiving her interest from the ranching operation: the
contribution of $19,375 of her own separate funds to purchase
additional cattle: the contribution of her separate real property
for cattle grazing; and the financial contribution for all the
parties* personal living expenses and most of the property taxes
and insurance.
Dean argues that because the judgment from the prior
dissolution settlement for the ranching operation was satisfied as
argued in the first issue, she received all her interest in the
ranching operation from the first marriage. He also maintains that
she made minimal contributions to the ranching operation during the
second marriage and he made the greater contribution. He contends
that although the District Court granted him the ranching
operation, it fashioned an equitable distribution by adjusting all
the marital assets between the parties, awarding her an interest in
all the marital property, including the ranching operation, when it
granted Patricia the rental properties and ring.
Distribution of the marital estate is determined by the
guidelines in 5 40-4-202(1), MCA, which provides in part:
In a proceeding for dissolution of a marriage ... the
court, without regard to marital misconduct, 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.
This statute grants the district court broad discretion to
apportion the marital estate equitably to each party under the
circumstances. In re Marriage of Zander (Mont. 1993), 864 P.2d
1225, 1230, 50 St. Rep. 1522, 1524.
Our review of marital property divisions is whether the
.
\
district court's findings of fact are clearly erroneous. In re
Marriage of Maedje (1994), 868 P.2d 580, 583, 51 St. Rep. 47, 48
(citing In re Marriage of McLean/Fleury (1993), 257 Mont. 55, 849
P.2d 1012). If substantial credible evidence supports the court's
findings and judgment, this Court will uphold the district court's
decision unless there is an abuse of discretion. Maedie, 868 P.2d
at 583. In the distribution of assets, the District Court upheld
the order granting Patricia one-half the total received for the
interim sale of cattle of $59,940. She received real property
totaling $75,830, a diamond ring valued at $25,000, and debts
totaling $13,500, with a net total of $147 270. She also received
a myriad of personal properties and the following separate property
inherited or owned prior to either marriage to Dean: a family
business; several properties with large amounts of acreage; real
properties and leases; rental properties; checking and savings
accounts; an insurance annuity policy; various investment
interests; several gold kruggerands, maple leafs, and ingots; and
stock.
The court upheld the $59,940 distribution to Dean for the
one-half interest in the interim sale of cattle, and granted him
the ranching operation valued at $130,075 and debts associated with
the operation totaling $35,624.24, along with the $5,500 debt
associated with the diamond ring awarded to Patricia, giving a net
total of $148,890.76. He also received miscellaneous personal
property.
The record shows that the District Court properly considered
the statutory requirements within 5 40-4-202, MCA. The Special
Master, in the memorandum in support of findings, stated:
The Court recognizes that the division of the marital
estate is not equal in this matter. Respondent has
received a slight majority of the marital estate. This
finding is justified by the equities in this action when
considering PATRICIA'S extensive separate properties and
DEAN'S relative lack thereof. It is in the Courtss
discretion to divide the property in this matter.
Before distributing the marital property the court determined
the value of the marital properties and debts, and found that the
parties contributed to the marital assets either in the form of
money or labor and management decisions. The court determined the
contributions to be of equal value. The court also properly
considered the source of the partiess assets. In her argument that
she should receive an interest in the ranching operation because
she invested her separate assets in the operation, Patricia
attempts to lump together all the monetary contributions she made
during the partiess first marriage and second marriage. As
discussed above in the first: issue, the marital assets in the first
marriage were settled by the partiess agreement. In the second
dissolution, the District Court properly determined that the
marital assets acquired only during the second marriage were to be
considered marital assets.
Patricia argues that In re Marriage of Brown (1978), 179 Mont.
417, 587 P.2d 361, supports her argument that she should receive an
interest in the ranch. In Brown, the husband received by
inheritance the family ranch valued at $350,000 - $450,000. The
District Court awarded the wife $25,000 as her interest in the
ranch. This Court held that the award to the wife was an
inequitable division of the marital estate given that the length of
the marriage was 14 years, that the ranch was the whole of the
marital estate, and that the appreciation of the.ranchss
value was
due to both partiess efforts. However, in the present case, the
ranching operation does not constitute the entire marital estate,
as was the case in Brown. After finding that the parties'
contributions to the marital properties were equal, the court then
moved on to distribute all of the marital property in an equitable
manner. Patricia received the parties' two real estate rental
properties and the diamond ring, plus numerous personal property
and her own separate property. Dean received the ranching
operation and personal property.
The rule is settled that an equitable distribution does not
require a 50/50 distribution of the marital assets. In re Marriage
of Bowman (1987), 226 Mont. 99, 734 P.2d 197. It is equity, not
equality that guides a court's discretion in dividing the marital
estate. In re Marriage of Fitzmorris (1987), 229 Mont. 96, 745
P.2d 353. We find that substantial credible evidence supports the
findings, and the District Court did not abuse its discretion by
awarding the ranching operation to Dean.
ISSUE 3
Did the District Court err in its valuation and distribution
of the marital estate?
Dean argues that the District Court erred by not computing the
net worth of the parties before distributing the marital property
pursuant to 5 40-4-202, MCA.
After the Special Master issued the findings concerning the
division of assets, Dean did not object to the absence of net
worth, but only objected to personal property he did not receive.
This Court will not find error in a district court's ruling or
procedure where the appellant acquiesced, participated, or did not
object. In re Marriage of Smith (1990), 242 Mont. 495, 501, 791
P.2d 1373, 1377. Moreover, an exact net worth finding is not
required when the relevant factors are considered and adequately
set forth by the court. In re Marriage of Skinner (1989), 240
Mont. 299, 304, 783 P.2d 1350, 1353 (quoting In re Marriage of
Hunter (1982), 196 Mont. 235, 245, 639 P.2d 489, 494). Our review
of the court's findings reveals that the total marital estate value
was $350,785, debts totaled $54,624.24, leaving a net worth of
$296,160.76.
Dean also argues that Patricia's property was undervalued and
much of her property was improperly omitted from the marital
estate. After the time for discovery was over, the Special Master
denied Dean's motion for production of documents, stating that the
motion was untimely, and that the parties had been granted ample
time for discovery and raising the new issues at the close of
evidence would necessitate an unwarranted continuance of the
hearing. Further, the court addressed the substance of the motion
stating that the evidence was clear and convincing that Halse
Enterprises was Patricia's separate asset and that Dean did not
facilitate the maintenance of the asset. Those assets belonging to
a spouse prior to a marriage, or acquired by gift, bequest, devise,
or descent during the marriage are not part of the marital estate
unless the spouse made contributions in the preservation or
interest in that property. In re Marriage of Smith (Mont. 1994),
871 P.2d 884, 51 St. Rep. 277.
We affirm the District Court's valuation and distribution of
the marital assets. We reverse and remand to the District Court to
reinstate the prior judgment and for further proceedings to
determine the balance owed to Patricia from the judgment.
We concur:
.
June 21. 1994
CERTIFICATE OF SERVICE
I hereby certify that the following certified order was sent by United States mail, prepaid, to the
following named:
Brenda Riley Cole, Esq.
Swandal, Douglass, Frazier & Cole
206 E. Callender
Livingston, MT 59047
W.G. GILBERT, JR.
W.G. GILBERT, 111
Attorneys at Law
P.O.Box 345
Dillon, MT 59725-0345
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA