96-669
No. 96-669
IN THE SUPREME COURT OF THE STATE OF MONTANA
1997
IN RE THE MARRIAGE OF
DEANNA K. SCOTT,
Petitioner and Appellant,
v.
GEORGE M. SCOTT,
Respondent and Respondent.
APPEAL FROM: District Court of the Eighteenth Judicial District,
In and for the County of Gallatin,
The Honorable Larry W. Moran, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Richard Larson, Chronister, Moreen & Larson, Helena, Montana
For Respondent:
James D. McKenna, Walsh & McKenna, Bozeman, Montana
Submitted on Briefs: March 20, 1997
Decided: June 17, 1997
Filed:
__________________________________________
Clerk
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Justice William E. Hunt, Sr., delivered the Opinion of the Court.
Appellant Deanna K. Scott (Dee) appeals the decision of the Eighteenth
Judicial
District Court, Gallatin County, dissolving her marriage to Respondent George M.
Scott
(George) and dividing their marital estate. We affirm in part, reverse in part and
remand.
ISSUES
Dee raises the following issues on appeal:
1. Did the District Court abuse its discretion in its valuation of
miscellaneous
personal property in the marital estate?
2. Did the District Court abuse its discretion in vacating a previously
entered
conclusion of law which granted Dee an "equalization payment" of $5,582?
3. Did the District Court abuse its discretion in vacating a previously
entered
conclusion of law which required George to compensate Dee for lost rental income?
FACTS
This Court previously remanded this case in the unpublished decision In re
Marriage of Scott (Mont. No. 95-003, decided August 24, 1995) (Scott I). In Scott I,
George raised seven issues on appeal. Of the seven, this Court affirmed four and
remanded three. Two of the three issues remanded in 1995 are faced by this Court
again
in this appeal because Dee contends that the District Court, in addressing the two
issues,
did not comply with this Courtþs order of remand. Dee also contends the District
Court
erred by revisiting an issue which was affirmed by this Court in Scott I.
After the partiesþ separation, George continued to exercise control over the
marital
home by living there intermittently, storing his personal property there, and
allowing
certain relatives to live there, all without Deeþs consent. In Scott I, the
District Court
determined that Georgeþs actions prevented Dee from renting the home to a third
party,
and awarded her $11,830 in lost rental income. George appealed and this Court
determined that the District Court lacked sufficient facts to support such an
award. We
noted that the District Court did not state the time period the house should have
been
rented; the times when either or both parties were using the house; or if Georgeþs
relatives who lived there paid rent and, if so, in what amount. In short, we
concluded
that "there [was] an insufficient record for us to determine how the District Court
made
its decision." Slip Op. at 6-7. We therefore remanded this issue to the District
Court.
In Scott I, George also appealed the District Courtþs valuation of the marital
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property. The parties agree that the valuations contained in the District Courtþs
findings
of fact in Scott I were inconsistent with the valuations contained in its
conclusions of law.
This discrepancy apparently arose because the District Court adopted one partyþs
property
valuations in its findings of fact and the other partyþs property valuations in its
conclusions of law. Not surprisingly, the numbers did not match. Therefore, this
Court
in Scott I remanded and directed the District Court "to correct the discrepancy in
property
values between its findings of fact and its conclusions of law." Slip Op. at 7.
Also in Scott I, this Court affirmed several aspects of the property
division
which George had asserted were erroneous. In particular, the District Court had
awarded
Dee a payment of $5,582 to "equalize more closely the cost of maintaining marital
property," in recognition of the fact that she had been responsible for maintaining
much
of the estate during the marriage. George appealed this monetary award and this
Court
affirmed it without comment.
In this appeal, Dee revisits the above issues and takes exception to how the
District
Court responded to this Courtþs order of remand. First, the District Court
reconciled the
property valuations in a manner Dee contends was erroneous. Second, since the
courtþs
revaluation of the marital estate resulted in Dee receiving a larger share of the
estate, the
District Court also vacated its earlier equity award of $5,582. Dee contends the
disallowance of this award was also erroneous since the award had been specifically
affirmed by this Court in Scott I. Last, the District Court determined that the
issue of
the use of the house was "moot" and declined to award Dee any amount for lost rental
income. Dee contends the District Court erred in this determination as well. We
affirm
in part, reverse in part and remand with directions.
STANDARD OF REVIEW
The standard of review of a district courtþs findings of fact is whether the
findings
are clearly erroneous. The standard of review of a district courtþs conclusions of
law is
whether the conclusions are correct. In re Marriage of Cowan (Mont. 1996), 928 P.2d
214, 217, 53 St.Rep. 1250, 1251-52 (citing In re Marriage of Brandon (1995), 271
Mont.
149, 151-52, 894 P.2d 951, 952-53). See also In re Marriage of Bradshaw (1995), 270
Mont. 222, 229, 891 P.2d 506, 510. This Court is not bound by a lower court's
conclusions of law, but remains free to reach its own conclusions. Bradshaw, 891
P.2d
at 510 (citing In re Marriage of Danelson (1992), 253 Mont. 310, 833 P.2d 215).
DISCUSSION
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1.
Did the District Court abuse its discretion in its valuation of
miscellaneous
personal property in the marital estate?
The District Court used one valuation in it findings of fact and another
valuation
in its conclusions of law. This Court remanded the matter to the District Court,
with
instructions to correct the valuation discrepancy. To do so, the District Court on
remand
substantively adopted the property valuations contained in its original findings of
fact.
It did not, however, expressly state that its new findings and conclusions were
based on
the valuations contained in the findings of fact in Scott I.
In asserting that the District Court erred in its valuations on remand, Dee
asserts
three specific errors. First, she asserts that the District Court did not set forth
how it
arrived at its finding that the new valuations left her with $11,736 more than
George.
This figure, however, is taken directly from the Scott I findings of fact, and is
arrived
at by merely subtracting the amount awarded to George from the amount awarded to
Dee.
While the District Courtþs order on remand may have been clearer if this mathematical
computation had been explicitly set forth, a careful reading of the new order,
together
with the old, reveals the District Courtþs analysis.
Second, Dee asserts that the District Court erred by not setting forth the
actual
valuations it used in its new findings of fact. Again, while it might have been less
confusing had the District Court done so, a close reading of the order on remand
reveals
that the valuations adopted by the District Court were those contained in the
findings of
fact in Scott I. Dee does not assert, nor do we conclude, that the use of the
valuations
from the Scott I findings of fact were otherwise erroneous.
Third, Dee asserts that the District Court exceeded its authority on remand by
going beyond this Courtþs directive to "correct the discrepancy in property values"
to
actually reapportion certain assets. This allegation is the basis for Issue 2, and
does not
independently serve to invalidate the District Courtþs decision to use the valuations
contained in the Scott I findings of fact for purposes of valuing the marital
estate. The
adoption of the valuations listed in the Scott I findings of fact as the actual
values of the
items in dispute served to correct the discrepancy which had necessitated a remand.
We
affirm the District Court on Issue 1.
2. Did the District Court abuse its discretion in vacating a previously
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entered
conclusion of law which granted Dee an "equalization payment" of $5,582?
The District Courtþs correction of the personal property values had the
effect of
increasing the dollar value of Deeþs share of the marital estate. After the
valuation
adjustment, the District Court found that Dee received $11,736 more in property than
George. The District Court apparently determined that such a disparity in the
property
award served to meet the courtþs stated goal of giving Dee a proportionately larger
share
of the marital estate in consideration of her proportionally larger contribution to
the
estateþs maintenance. It therefore vacated the additional award of $5,582, which it
had
apportioned to Dee in the original decree in order to equalize the cost of
maintaining the
marital estate. Dee notes that this Court affirmed this disputed award in Scott I,
and
therefore contends that the District Court erred in vacating it on remand.
In asserting that the District Court erred, Dee contends that the courtþs
earlier
decision on this issue was res judicata or, in the alternative, that George is
collaterally
estopped from relitigating it. While we agree that the District Court lacked
jurisdiction
to disturb the previously affirmed award, we base our determination on law of the
case,
not on res judicata or collateral estoppel.
In Fiscus v. Beartooth Electric Cooperative, Inc. (1979), 180 Mont. 434, 591
P.2d
196, this Court defined the interrelated theories of res judicata, collateral
estoppel, and
law of the case. We noted that res judicata is a final judgment which, when
rendered on
the merits, is an absolute bar to a subsequent action between the same parties or
those
in privity with them, upon the same claim or demand. Fiscus, 591 P.2d at 197
(quoting
Western Montana Prod. Credit Assþn v. Hydroponics, Inc. (1966), 147 Mont. 157, 161,
410 P.2d 937, 939). See also Hollister v. Forsythe (1996), 277 Mont. 23, 27, 918
P.2d
665, 667. We defined collateral estoppel as a final judgment which bars the
parties, or
those in privity with them, from relitigating matters which were previously
necessarily
litigated and determined, even if the claim or demand in the subsequent action is
different. Fiscus, 591 P.2d at 197 (quoting Western Mont. Prod. Credit Assþn, 410
P.2d
at 939). See also Estate of Eide v. Tabbert (1995), 272 Mont. 180, 183-84, 900 P.2d
292, 295. In other words, res judicata is "an absolute bar to a subsequent action,"
while
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collateral estoppel "prevents the parties from relitigating only those matters that
were
determined." Fiscus, 591 P.2d at 197. Res judicata, therefore, also properly is
referred
to as "claim preclusion," while collateral estoppel also properly is referred to as
"issue
preclusion." Brault v. Smith (1984), 209 Mont. 21, 26, 679 P.2d 236, 238.
In contrast, the law of the case doctrine "expresses the practice of courts
generally
to refuse to reopen what has been decided. It expresses the rule that the final
judgment
of the highest court is the final determination of the parties' rights." Fiscus,
591 P.2d
at 197 (quoting Blackþs Law Dictionary (Rev. 4th Ed.1968)). This Court has stated
that
[t]he rule is well established and long adhered to in this state that where
upon an appeal, the Supreme Court, in deciding a case presented states in
its opinion a principle or rule of law necessary to the decision, such
pronouncement becomes the law of the case, and must be adhered to
throughout its subsequent progress, both in the trial court and upon
subsequent appeal.
Fiscus, 591 P.2d at 197 (quoting Apple v. Edwards (1949), 123 Mont. 135, 139-40, 211
P.2d 138, 140). See also State v. Black (1990), 245 Mont. 39, 44, 798 P.2d 530, 533.
Here, the parties appear in a second appeal of the same case which was
reviewed
by this Court previously. The parties and issues are identical to those addressed
in Scott
I. In that previous decision, this Court determined that only three issues warranted
remand; we affirmed without comment all other issues raised on appeal, including the
propriety of the $5,582 award to Dee in consideration of her maintenance of the
marital
estate. Having conclusively ruled on the propriety of that award, our determination
became the law of the case so far as that specific issue was concerned, and the
District
Court lacked jurisdiction to exceed the scope of this Courtþs order of remand to
revisit
and vacate the award.
Further, we note that the District Court in Scott I justified awarding this
additional
amount to Dee on the grounds that she had expended more time and effort in
maintaining
the marital estate during the time of the marriage. This rationale cannot be
invalidated
simply by the District Courtþs subsequent correction of property valuations; to do so
would mean that Dee should now be deemed to have done less to conserve the marital
estate. In any event, this Courtþs affirmation of the award in Scott I became the
law of
the case, which the District Court was without authority to disturb. The District
Courtþs
order vacating the $5,582 payment to Dee is reversed.
3. Did the District Court abuse its discretion in vacating a previously
entered
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conclusion of law which required George to compensate Dee for lost rental income?
Lastly, Dee argues that the District Court erred in vacating on remand its
award
to her for lost rental on the marital home. In Scott I, the District Court
determined that
Georgeþs "failure to rent the house in Bozeman while neither he nor [Dee] were
occupying it amounts to a lost income opportunity, effectively a dissipation of the
marital
estate," justifying an award of lost rental income to Dee. George appealed this
finding,
and this Court noted that the District Court record was insufficient to allow
meaningful
review and that, consequently, this Court lacked sufficient facts to determine
whether or
not the award was justified. We therefore remanded the matter to the District
Court "for
reconsideration of its award of lost rental income to [Dee]." We further ordered the
District Court to "receive further evidence and then enter appropriate findings of
fact and
conclusions of law supporting its decision to either award or not award such rent."
Scott
I, Slip Op. at 7.
On remand, the District Court determined that George had in fact occupied the
marital home during the period in dispute. It therefore concluded that Dee was not
entitled to lost rental income because there was no period during which the house was
truly empty and available for rental. Dee appeals, asserting that the District
Court abused
its discretion by disallowing the lost rental payments.
In Scott I, this Court made an affirmative, final determination regarding the
disputed maintenance award to Dee, as discussed above. In contrast, we declined to
make such a final determination regarding the issue of lost rent. Instead, we
directed the
District Court to revisit the issue de novo and to set forth facts sufficient to
support its
determination. Our intention that the District Court address the issue anew is
embodied
by this Courtþs order on remand, which directed the District Court to "enter
appropriate
findings of fact and conclusions of law supporting its decision to either award or
not
award such rent." (Emphasis added.) Therefore, contrary to Deeþs assertion, the
issue
before the District Court on remand was not simply what amount of rent was due to
Dee,
but whether any rent was due at all.
In challenging the District Courtþs determination on remand that she was not
entitled to any payment for the lost opportunity to rent the marital home, Dee
argues that
"since sufficient evidence was presented concerning the rental proceeds that could
have
been realized, and since there was no dispute that George in fact precluded Dee from
renting the house, the district courtþs disallowance of lost rental payments amount
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to an
abuse of discretion." We disagree.
The crucial question in resolving this issue was whether or not George
continued
to occupy the marital home during the period before the divorce, when Dee contends it
could have been rented. Contrary to Deeþs assertion, the District Court could not
disregard the issue of whether George was in fact occupying the house and merely
confine itself to whether the house could have been rented had he been absent and,
if so,
for what amount. By this rationale, any party to a divorce who vacates the marital
home
could demand lost rent from the party who remains in the home, simply on the theory
that the house could be rented if the remaining party vacated as well. Dee cites no
authority to support such a broad proposition, nor have we been able to discover any.
The initial and crucial determination that George prevented Dee from renting
the
house and thereby dissipated the marital estate was premised on the finding that
neither
he nor Dee were occupying the house during the period in question. On remand, the
District Court found that George had in fact continued to occupy the home and,
consequently, it was never available to rent to a third party. Such a reversal is
not
inherently erroneous. When this Court directs the District Court to revisit a given
issue
and indicates that it should do so de novo, the District Court is not constrained to
finding
the same way it did initially. Were it so constrained, there would be no point in
ordering
a remand.
The question to be reviewed by this Court, therefore, is whether the District
Courtþs finding that George continued to occupy the home during the period in
question
was clearly erroneous. During the hearing on remand, George testified that he came
home to the house approximately every two weeks during the first three years of the
five
years in dispute. He further testified that he returned to the house every few
months
thereafter, whenever his job allowed him to return home. He continued to use the
house
as his residence and to claim it as his residence on his driverþs license and car
registrations. In light of this testimony, which was uncontroverted, we cannot say
that
the District Courtþs finding that George continued to occupy the house was clearly
erroneous. The District Court did not abuse its discretion in concluding that the
house
was not available for rent during the disputed period. We affirm Issues One and
Three. We reverse Issue Two and remand this matter to the District Court for entry
of
judgment in accordance with this opinion.
/S/ WILLIAM E. HUNT, SR.
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We Concur:
/S/ J. A. TURNAGE
/S/ JIM REGNIER
/S/ W. WILLIAM LEAPHART
/S/ JAMES C. NELSON
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