In Re the Marriage of Meeks

NO. 95-154
IN THE SUPREME COURT OF THE STATE OF MONTANA

1996

IN RE THE MARRIAGE OF
LINDA B. MEEKS,
Petitioner and Appellant,
and
ALAN R. MEEKS,
Respondent and Respondent.

APPEAL FROM: District Court of the Eighth Judicial District,
In and for the County of Cascade,
The Honorable Joel G. Roth, Judge presiding.

COUNSEL OF RECORD:
For Appellant:
Don A. LaBar, Church, Harris, Johnson & Williams,
Great Falls, Montana
For Respondent:
J. Kim Schulke, Linnell, Newhall & Martin, Great
Falls, Montana

Submitted on Briefs: August 17, 1995
Decided: April 23, 1996
Filed:
Justice William E. Hunt, Sr. delivered the Opinion of the Court

Appellant Linda B. Meeks (Linda) appeals the order of the
Eighth Judicial District Court, Cascade County, which dissolved her

marriage to Respondent Alan R. Meeks (Alan) and divided the marital

property between the two parties.

Affirmed in part, reversed in part and remanded.

ISSUES

Linda alleged twenty-five separate errors in the District
Court's division of the marital estate. The following restated

issues are dispositive of this appeal:

1. Did the District Court err in granting Alan's motion for

partial summary judgment, which excluded from the marital estate

Alan's interest in a testamentary trust established by his father?

2. Did the District Court err in excluding from the marital

estate the value of Alan's accrued vacation and sick leave?

3. Did the District Court err in adopting the farm appraisal

offered by Alan's expert?
4. Did the District Court abuse its discretion by refusing to

allow the record to remain open for the testimony of a rebuttal

witness?
5. Did the District Court err by not including in the marital

estate an additional thrift plan contribution made by Alan between
September 30, 1994, and November 17, 1994, the date of trial?

6. Did the District Court err in ordering that the parties'

legal fees and costs be paid out of the marital estate before

division?

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 7. Did the District Court err in allocating the Me&s' farm

to Alan, rather than dividing the farm between the parties?

8. Was the District Court's distribution of the marital

property in this case clearly erroneous?

FACTS

Linda and Alan were married in 1968 and have one adult son.

For the past 22 years, Alan has worked as a farm appraiser, while

Linda has worked as a legal secretary, bookkeeper, tax preparer,

and in several banks. Over the course of their 26-year marriage,

the parties generated a marital estate worth approximately
$1,000,000.

In 1994, Linda filed a petition to dissolve the marriage.

Alan moved for partial summary judgment, asking the District Court
to exclude from the marital estate his interest in a testamentary

trust established by his father. This motion was granted.
After a further hearing in late 1994, the District Court

issued its findings of fact, conclusions of law, and order

dissolving the marriage and dividing the marital estate. Linda

appealed the District Court's grant of summary judgment on the

issue of the testamentary trust, as well as its division of the

marital estate. Other facts will be provided as necessary.

STANDARD OF REVIEW

The distribution of marital property in a dissolution action

is governed by § 40-4-202, MCA, which provides in part:

In a proceeding for dissolution of a marriage, legal
separation, or division of property following a decree of
dissolution . the court [shall], without regard to
marital misconduct, finally equitably apportion between

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 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 husband or wife or
both. . . .

Section 40-4-202(I), MCA.

A district court's findings of fact regarding the division of

marital property will be upheld unless the findings on which the
division are based are clearly erroneous. In re Marriage of Dewitt
(Mont. 19951, 905 P.2d 1084, 1087, 52 St.Rep. 1089, 1091. If a

district court's judgment is supported by substantial credible

evidence, it will not be disturbed absent an abuse of discretion.

In re Marriage of Griffith (Mont. 1996), - P.2d , 53

St.Rep. 28, 30 (citing In re Marriage of Maedje (1994), 263 Mont.

262, 868 P.2d 580).
The test for abuse of discretion is "whether the trial court

acted arbitrarily without employment of conscientious judgment or

exceeded the bounds of reason resulting in substantial injustice."

In re Marriage of Tonne (19871, 226 Mont. 1, 3, 733 P.2d 1280, 1282

(quoting In re Marriage of Rolfe (1985), 216 Mont. 39, 45, 699 P.2d

79, 83). Moreover,

A District Court has broad discretion in determining the
value of property in a dissolution. Its valuation can be
premised on expert testimony, lay testimony, documentary
evidence, or any combination thereof. The court is free
to adopt any reasonable valuation of marital property
which is supported by the record. As long as the
valuation of property in a dissolution is reasonable in
light of the evidence submitted, we will not disturb the
finding on appeal.

In re Marriage of Robinson (1994), 269 Mont. 293, 296, 888 P.2d

895, 897 (citations omitted)
 While the above is the general standard of review in marital

estate division cases, other standards of review will be set out as

is necessary to address the issues raised.

DISCUSSION

1. Did the District Court err in granting Alan's motion for
partial summary judgment, which excluded from the marital estate
Alan's interest in a testamentary trust established by his father?

Alan's father William A. Meeks, Sr. died in 1986, leaving a

will which established a testamentary trust for the benefit of his

wife (Alan's mother), and which named Alan and his brother as co-

trustees. According to the terms of the will, the trustees have

the power to invade the corpus only "if there are no other sources
of funds reasonably available" for the maintenance of Alan's

mother, and then only to the extent necessary "for her care,

maintenance and support." Upon the death of Alan's mother, the

trust will terminate and will be distributed in equal shares to

Alan, his brother, and his sister.

The will also contains a spendthrift clause regarding the
trust, which provides:

No title in the trust or trusts created in and by this
will, or in the income therefrom, shall vest in any
beneficiary, and neither the principal nor the income of
any such trust estate shall be liable for the debts of
any beneficiary, and no beneficiary shall have any power
to sell, assign, transfer, encumber or in any other
manner to anticipate or dispose of his or her interest in
any such trust estate created by the terms of this will
or the income produced thereby by the Co-Trustees to said
beneficiary.
Based on the foregoing language, Alan moved for partial summary

judgment, claiming that he has only a contingent remainder in the

trust, and his interest therefore should not be considered part of
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the marital estate. The District Court agreed and granted the
motion, excluding Alan's remainder interest in the trust from the
marital estate.

Summary judgment is proper if no genuine issues of material
fact exist and the moving party is entitled to summary judgment as

a matter of law. Rule 56 (cl , M.R.Civ.P.; Vincelette v.

Metropolitan Life Ins. Co. (Mont. 1995), 903 P.Zd 1374, 52 St.Rep.

1035. In reviewing a grant of summary judgment, this Court's

standard of review is identical to that of the trial court and, in

determining whether summary judgment was appropriate, we will use
the same criteria employed by the trial court. Vincelette, 903
P.2d at 1376 (citations omitted).

Linda contends the grant of partial summary judgment in this

case was in error. While she does not argue that a genuine issue

of material fact exists, she contends the District Court erred as

a matter of law in concluding that Alan's remainder in the trust is

contingent. Linda maintains that Alan has a vested remainder in

the testamentary trust which should be considered part of the

marital estate and divided accordingly.

A contingent remainder is a right to property which may or may

not vest in possession at some future date. Generally, a remainder

will be considered contingent if the recipient is unknown or if the

interest will only vest upon the occurrence of an event which is

not certain to happen. A remainder will not be considered

contingent if it can fairly be construed to be vested. 23 Thompson
on Real Property, Thomas Edition (David A. Thomas, ed., 1994), 314
(citations omitted)
[Al vested remainder is one which is limited to an
ascertained person in being, whose right to the estate is
fixed and certain, and does not depend on the happening
of any future event, but whose enjoyment and possession
is postponed to some future time. . [Al vested
remainder is not rendered contingent by the fact that it
may never vest in possession.

23 Thompson on Real Property, 325-26 (citations omitted).
Alan is an ascertainable person in being whose right to a

share of the remainder of the testamentary trust is not dependent

upon the occurrence of some future event. Rather, he is sure to

inherit so long as two given events do not occur. Alan will lose
his remainder interest if he dies before his mother, or if the

entire trust corpus is used for his mother's maintenance and care

before her death. Only these events will serve to divest him of
his remainder interest.

It therefore follows that, absent additional conditions,

Alan's interest in the testamentary trust would be classified as a

vested remainder, subject to divestment. Such classifications,

however, are not necessarily controlling regarding how a remainder

interest should be treated. When such interests are created by a

will, the testator's intent also must be considered.

When construing a will, the cardinal rule is that the intent

of the testator must be effected if it is not contrary to the law

or to public policy. Matter of Estate of Bennett (Colo.App. 1989),

789 P.2d 446. See also Allen v. Shea (Idaho 1983), 665 P.Zd 1041;
In re Estate of Larsen (Utah 1982), 649 P.2d 31; In re Question

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Submitted by U.S. Ct. of App., Tenth Cir. (Cola. 1976), 553 P.Zd
382; McGinley v. McGinley (Pa.Super. 1989), 565 A.2d 1220. The
testator's intent, if clearly articulated, can preserve as

contingent a remainder which otherwise would be deemed to have

vested. McGinley, 565 A.2d at 1225.
[Wlhether a remainder is vested or contingent depends
entirely upon the testator's intention, and where the
testator has indicated with reasonable certainty the
intention that it shall not vest until a particular time,
it will not vest until that time arrives, and then only
in those who are in esse and capable of taking at that
time.

23 Thompson on Real Property, 341 (citations omitted).

Appellant cites several cases in support of her position that

an interest in a testamentary trust is vested and should be

included in the marital estate. In re Marriage of Kis (1982), 196

Mont. 296, 639 P.2d 1151; In re Marriage of Buxbaum (19841, 214

Mont. 1, 692 P.2d 411; In re Marriage of Hill (1982), 197 Mont.

451, 643 P.2d 582; Rolfe, 699 P.2d 79. These cases are easily

distinguished, however.

Rolfe and K& address the valuation of a party's interest in

a pension fund, not a testamentary devise. Accordingly, there is
no "testator" in these cases whose intent might contravene the

general classifications. While u and Buxbaum deal with

testamentary devises, in neither case was the intent of the

testator inconsistent with a finding that the interest in question

was vested and properly included in the marital estate.

In the case at bar, Alan's father by his will declared that

'I [nlo title in the trust . or in the income therefrom shall

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vest . prior to actual distribution." In so doing, he
unequivocally expressed his intent that his children's interests in

the trust remain contingent until such time as the corpus of the

trust is in fact distributed. In Montana,

a decree of distribution is conclusive upon the rights of
devisees under a will, subject only to be reversed, set
aside or modified on appeal. A decree of distribution
has the same force and effect as does a final judgment.

Hill
-I 643 P.2d at 586.

Since Alan's father's will provided that Alan's interest in
the testamentary trust remain contingent until actual distribution,

the District Court did not err in refusing to classify the interest

in a manner contrary to the testator's express intent. Alan has a
contingent remainder in his family testamentary trust, which was
properly excluded from the marital estate. Therefore, the District

Court did not err in granting Alan's motion for partial summary

judgment.

2. Did the District Court err in excluding from the marital
estate the value of Alan's accrued vacation and sick leave?
1n the 22 years Alan has worked at his present job, he has

accrued over 1,900 hours of sick leave and vacation. Upon his

retirement, these hours will be added to his term of service for

purposes of calculating his pension. Alan may use the leave as

necessary before retirement, but it cannot be cashed out at any

time. Its only value after retirement is to extend his term of

service and consequently increase his pension.

The District Court provided that Alan's pension would be

divided according to the "time rule formula," which is set out in

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In re Marriage of Rolfe (1988), 234 Mont. 294, 298, 766 P.2d 223,

226. See also In re Marriage of Truax (1995), 271 Mont. 122, 894

P.2d 936. The time rule formula provides for the division of a

pension as follows:

Years of service during marriage monthly
x benefit x H
(after taxes)
Total years of service

Linda alleges that the time rule formula in this case "should

be amended to include not only the number of months [actually]

worked by Alan but also the number of accrued hours of sick leave."

Because, as we have noted above, any unused sick leave will be

added to Alan's total months of service upon retirement, that

amount will be taken into account in computing the pension in which

Linda will share.

Any sick leave or vacation time which remains unused at Alan's

retirement is to be added to his total term of service when his

pension is computed. Moreover, any sick leave or vacation which

Alan uses between the time of the divorce and his retirement should

be debited against vacation or sick leave earned after the divorce.

This will prevent unnecessary "drawing down" of the vacation and

sick leave which was earned during the marriage and in which Linda

has a legitimate, if contingent, interest.

However, adding the vacation and sick leave only to the

denominator of the equation would serve to lessen Linda's

proportionate share by reducing the fraction. For this reason, the

sick leave and vacation which accrued during the marriage should

also be added to the numerator of the fraction so that the fraction

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remains proportionately the same. Accordingly, the fraction in
this case should consist of the years worked during the marriage
plus the vacation and sick leave accrued during the marriage as the

numerator, and the total years worked plus the total vacation and

sick leave accrued as the denominator.

The District Court, in specifying that Alan's leave is to be

used in computing his pension, considered it to be part of the

marital estate, not "the same as" a pension but rather as part of

the pension. Linda fails to raise any cogent argument that the

inclusion of the leave in the pension itself is erroneous;
instead, she alleges only that the manner of inclusion is unclear,

and we have rectified that problem. We therefore do not address

the issue of whether vacation and sick leave may, under certain

circumstances, be considered a distinct marital asset. That

question is beyond the scope of this appeal.

Since Linda will receive her proportionate share of the

benefit of Alan's leave, and since Alan cannot convert his sick

leave or vacation to cash at any time, we find no abuse of

discretion in the District Court's refusal to classify Alan's sick

leave and vacation as a separate marital asset.

3. Did the District Court err in adopting the farm appraisal
of Alan's expert?

1n order to assist the District Court in the valuation of the

Meeks' farm, Alan presented testimony from an appraiser, John E.

Wicks. Linda too called upon an appraiser, Dave Anderson, who also

testified to the value of the farm. The District Court rejected
Anderson's appraisal but adopted Wicks', using Wicks' valuation

when allocating the farm.
Linda alleges several errors in Wicks' appraisal, including

his evaluation of bushel capacity, his valuation of a land option,
and his valuation of the farm itself. She also alleges that the
District Court ignored assumptions underlying Wicks! appraisal
while adopting contrary assumptions underlying Anderson's appraisal

"out of context." In light of these alleged errors, Linda asserts

that the District Court erred in accepting and using Wicks'

appraisal in its findings of fact.
This Court will not substitute its judgment for that of the

trial court regarding the credibility of witnesses or the weight to

be given to their testimony. In re the Seizure of $23,691 in U.S.

Currency (Mont. 1995), 905 P.2d 148, 155, 52 St.Rep. 1063, 1065

(citing Matter of B.T.B. (1992), 254 Mont. 449, 840 P.2d 558).

Moreover,

the determination of property valuation is a factual
issue which is within the province of the trial court to
decide. When reviewing findings of fact, this Court is
precluded from substituting its judgment for that of the
trier of fact, and cannot set aside the findings of a
court sitting without a jury unless the findings are
'clearly erroneous.' Rule 52(a), M.R.Civ.P.

Trustees of Washington-Idaho-Montana Carpenters-Employers

Retirement Trust Fund v. Galleria Partnership (19911, 250 Mont.

175, 184, 819 P.2d 158, 163.

Linda quarrels with the methodology employed by Wicks in his

evaluation as well as with the conclusions he reached regarding the

value of the farm. But the District Court set out specific reasons

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why Wicks' appraisal was adopted and Anderson's rejected, including
Wicks' expertise and thoroughness. Every argument Linda raises and
every flaw she alleges was also heard by the District Court, which

nevertheless found Wicks' testimony to be more persuasive than
Anderson's, Linda makes no new argument on appeal which might
persuade this Court that the District Court's adoption of the

appraisal was erroneous. Because Linda has failed to show that the

District court Is adoption of Wicks' appraisal was clearly

erroneous, the findings of fact which are based upon the Wicks'

appraisal are affirmed.
4. Did the District Court abuse its discretion by refusing to
allow the record to remain open for the testimony of a rebuttal
witness?

In arguing for a higher valuation for the farm, Linda sought

to compare the appraisals given by Anderson and Wicks to the price
paid by a neighbor who had purchased a "comparable" farm. Wicks

testified, however, that the neighbor's farm was not comparable

because it included a pond and land for grazing as well as

cropland--advantages the Meeks' farm did not have. Therefore,

Wicks asserted, this farm naturally would have a higher value and

could not be compared to the Meeks' farm.

To rebut Wicks' testimony, Linda sought to present testimony

from the owner of the neighboring farm. Linda claimed the owner

would have testified that he bought his farm without consideration

of the pond or the grazing land, and that, in his opinion, the farm

still retained its higher value even if those assets were factored

out. This owner, however, was not present in court and had not

13
been served with a subpoena to appear; Linda therefore moved the
District Court to hold the record open until the neighbor could

testify.

The District Court denied her motion, finding that the witness
could have been subpoenaed earlier if Linda wanted to assure his

presence. Linda, however, claimed that she had not secured the

neighbor's appearance because she had not anticipated Wicks'

testimony and was "surprised II by his declaration that the two farms

were not comparable. Therefore, Linda asserted that she should

have been afforded the opportunity to hold the record open until
the neighbor could testify.

The standard of review of evidentiary rulings is whether the

district court abused its discretion. A district court has broad
discretion to determine if evidence will be admitted and, absent an

abuse of discretion, this Court will not overturn a district

court's determination. Seizure of $23,691 in U.S. Currency, 905
P.2d at 153.

Even if Linda was in fact surprised by Wicks' refusal to

compare the Meeks' farm to the neighbor's farm, we fail to see the

probative value of the neighbor's testimony. Wicks was hired to do
a professional appraisal of the Meeks' farm; in so doing, he

looked at several comparable sales. The neighbor, on the other

hand, is a farmer who even Linda admits could only have testified
to his own willingness to pay a high price for his own farm, even

if, hypothetically, it did not have some of the advantages which it

does in fact have.

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 This opinion testimony, even if allowable, could not prove
that Wicks was incorrect in his declaration that the farms are not

comparable for appraisal purposes. The testimony of an expert,
whose opinion is based on fact, could not be adequately rebutted by

the testimony of a layman whose opinion is based on a hypothetical

scenario which does not exist. The District Court did not abuse

its discretion by refusing to allow the record to remain open for
the addition of testimony which could not substantively assist it

in its fact-finding task.
5. Did the District Court err by not including in the marital
estate an additional thrift plan contribution made by Alan between
September 30, 1994, and November 17, 1994, the date of trial?

In valuing Alan's thrift plan, the District Court used the

valuation provided in the plan's last quarterly statement, dated

September 30, 1994. Linda alleges that the District Court should

have valued the thrift plan as of the time of trial, six weeks
later, and that its failure to do so was reversible error.
Generally, marital assets should be valued at or near the time
of the dissolution hearing, unless the district court, at its

discretion, decides a different date is necessary to achieve an

equitable result. In re Marriage of Lopez (1992), 255 Mont. 238,
244, 841 P.2d 1122, 1125. Apparently, Linda wants this Court to
declare that, in this case, six weeks previously is not "near"

enough. We decline to do so. The District Court used the most

recent quarterly report available in valuing this asset, giving it

a value commensurate with the latest documented evidence. Linda's

allegation of error is without merit.

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 6. Did the District Court err in ordering that the parties'
legal fees and costs be paid out of the marital estate before
division?
The District Court found the amount of attorney fees and costs

incurred by the parties to be "roughly equal." It therefore
ordered that the fees and costs of the divorce should be paid out

of the marital estate before is was divided. Linda alleged that
such an arrangement constituted an abuse of the District Court's

discretion because it did not comply with the applicable statute

governing the awarding of attorney fees.

Section 40-4-110, MCA, provides in part:
The court from time to time, after considering the
financial resources of both parties, may order a party to
pay a reasonable amount for the cost of the other party
in maintaining or defending any proceeding under chapters
1 and 4 of this title and for attorney's fees, including
sums for legal services rendered and costs incurred prior
to the commencement of the proceeding or after entry of
judgment.
"in award of attorney fees under this statute must be based on

necessity, must be reasonable, and must be based on competent

evidence." In re Marriage of Barnard (1994), 264 Mont. 103, 109,

870 P.2d 91, 95 (quoting In re Marriage of Zander (1993), 262 Mont.

215, 227, 864 P.2d 1225, 1233).

Alan argues that the District Court's order that the attorney
fees and costs be paid from the marital estate before division

means that such fees were not "awarded" to one party over another,

but, rather, that the fees are merely a marital "liability" which

is properly charged to the estate. He notes that such an

arrangement has been approved by this Court in In re Marriage of

Cole (1986), 224 Mont. 207, 729 P.2d 1276.
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 In Cole, however, we recognized that an arrangement where all

fees are lumped together and the debt then equally divided is to
the benefit of the party with the most expenses, and translates

into the other party being charged with a disproportionate share of

the fees. Such an arrangement amounts to one party paying part of

the other party's costs. Therefore, the statutory requirements of

§ 40-4-110, MCA, must be met by the District Court. We

specifically noted in Cole that the District Court had found "that

Wife was without means to pay her attorney's fees," which is
precisely the type of finding of financial need that is a

prerequisite for an award of attorney fees under 5 40-4-110, MCA.
Cole
-t 729 P.2d at 1276.

Alan incurred fees of over $11,000 and Linda incurred fees of
less than $8,000. If these amounts were consolidated and then

divided, each party would be required to pay approximately $9,500.

Linda would therefore have to pay all her own fees as well as
$1,500 of Alan's fees. This obviously translates into an award of
fees to Alan.

The District Court did not find that Alan was without means to

pay the entirety of his own fees, and we note again, in passing,
that the parties are dividing an estate valued at roughly a million

dollars. Since such a finding is a statutorily mandated
prerequisite for the awarding of fees and costs, the District Court

abused its discretion in allowing Alan to recover any part of his

fees from Linda's share of the marital estate. On this issue, we

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reverse the District Court and remand for entry of judgment on

attorney fees in accordance with this opinion.

7. Did the District Court err in allocating the Meeks' farm
to Alan, rather than dividing the farm between the parties?

Linda alleges that the District Court erred in allocating the

entire farm to Alan, rather than dividing it and giving each party

half. Specifically, she contends that the District Court's finding
that 'I [ilt [was] not economically prudent to split the farm" is

erroneous.
As noted above, the District Court's findings of fact will not

be set aside unless clearly erroneous. Dewitt, 905 P.2d at 1087.

Moreover, this Court has repeatedly recognized the long-standing

public policy in Montana of keeping farms intact, if possible.

Tonne, 733 P.2d 1280; In re Marriage of Glass (1985), 215 Mont.

248, 697 P.2d 96.

Alan expressed a desire to farm full-time after he retires

from his job and, someday, to leave the farm to his son. Linda

does not require the farm for her continued financial security, nor

does the District Court's refusal to partition this asset prevent

her from receiving an equitable portion of the marital estate. The

District Court did not abuse its discretion in refusing to divide

the farm.

8. Was the District Court's division of the marital property
in this case clearly erroneous?

Linda alleges numerous other errors in the District Court's

division of the marital estate. She disputes the allocation of

innumerable items of personal property, from art to farm and lawn

18
equipment, from a $25 "shop vact' to $500 worth of canned, dried,
and frozen food. We find nothing in the record that indicates that
the District Court abused its discretion. "District courts working

in equity, must seek a fair distribution of marital property using

reasonable judgment and relying on common sense." In re Marriage
of Kimm (1993), 260 Mont. 479, 483, 861 P.2d 165, 168 (citing In re
Marriage of Danelson (1992), 253 Mont. 310, 833 P.2d 215). While
Linda may not agree with how the District Court allotted the

marital estate, she has not shown that the allocation was

erroneous.
As noted above, the District Court's provision for the payment

of attorney fees did not comply with § 40-4-110, MCA, the statute

which controls such awards. Accordingly, that portion of the order
is reversed. In all other respects, the order of the District
Court is affirmed.

Affirmed in part, reversed in part and remanded for entry of
judgment in accordance with this opinion.

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