No. 85-577
IN THE SUPREME COURT OF THE STATE OF MONTANA
1986
IN RE THE MARRIAGE OF
HARVEY C. SWANSON,
Petitioner and Appellant,
and
NANCY E. SWANSON,
Respondent and Respondent.
APPEAL FROM: District Court of the Eleventh Judicial District,
In a.nd for the County of Flathead,
The Honorable Frank I. Haswell, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
George B. Best, Kalispell, Montana
For Respondent :
Stephen C. Berg, Kalispell, Montana
Submitted on Briefs: Feb. 26, 1986
Decided: April 3, 1986
APR 3 - $986
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Clerk
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of
the Court.
Harvey Swanson appeals the August 26, 1985, decree of
the Eleventh Judicial District Court, County of Flathead,
dissolving the marriage of the parties, distributing the
marital estate, establishing child custody and child support,
and awarding maintenance to Nancy Swanson. We affirm the
decree.
Harvey a-nd Nancy Swanson began living together in 1971
while Harvey was attending medical school. They were married
June 2, 1973, and remained together until June of 1983.
During the course of the marriage, Harvey finished
medica, school, completed his internship and. practiced
medicine in at least three different locations. In 1980, the
couple moved to Kalispell, Montana. In 1981, Harvey took
over the practice of a deceased Kalispell doctor. He also
works in the emergency room of the Kalispell hospital.
Nancy is college educated in marine biology. In recent
years, she has primarily worked in the home and waitressed.
A son was born prematurely in the fall of 1975. He has
undergone intestinal surgery, open heart surgery and two eye
surgeries. He still experiences neurological difficulties,
learning disabilities and motor control. problems. Since his
birth, most of Nancy1s time and energies have been directed
toward her son. When her husband left in 1983, Nancy began
plans to operate a greenhouse out of her home. The business
has not yet opened, but will eventually provide Nancy with a
means of support.
Harvey's medical practice has blossomed. In 1384 his
gross income, after paying his employees, was $109,000. He
also has Keogh and IRA accounts totalling over $58,000. The
medical- practice was valued at $127,200; $76,700 of which is
goodwill.
In a well-rea.soned. and detailed decree, the District
Judge valued the marital estate as of the date of dissolution
at $254,374. After awarding Nancy $48,000, the amount of her
inheritance directly traceable to present day assets, the
trial judge divided the remainder of the estate equally
between the parties. Nancy's share consists of: 1) a
$17,000 lump sum payment from Harvey due September 15, 1985;
2) the unpaid principle balance on the family home, $46,200,
which is to be paid by Harvey; and 3) $10,000 annual payments
commencing in November of 1987 and running until Harvey's
obligation to Nancy is fulfilled. The decree also awarded
Harvey and Nancy joint custody of their son, Colin, with
Nancy designated as the primary residential parent. Harvey
was ordered to make $890 a month child support payments and
$300 a month education fund payments to Nancy. In addition,
maintenance payments from Harvey to Nancy were ordered as
follows:
1) the monthly $568 payment on the family home
through December 15, 1986; and
2) commencing, January 15, 1987, and continuing
for five years from the date of the decree, $450 a
month maintenance payments.
Finally, the trial judge ordered Harvey to pay Nancy $3,400
for attorney's fees.
In his appeal of the decree, Harvey asserts that the
District Judge abused his discretion in the following
respects:
1. In requiring Harvey Swanson to pay Nancy Swanson
$890 a month child support and $300 a month toward Colin's
education fund.
2. In awarding maintenance to Nancy Swanson.
3. In valuing the marital estate as of the d.ate of
dissolution rather than the date of separation.
4. In valuing the good-will of Harvey's practice at
$76,700.
5. In awarding $3,400 in attorney's fees to Nancy
Swanson.
CHILD SUPPORT
Contrary to Harvey's contentions in his brief on
appeal, the statute governing child support is S 40-4-204,
MCA. Section 40-4-202, MCA, relied on by Harvey, pertains to
the distribution of the marital estate between the parties.
Section 40-4-204 (1), MCA, requires the trial judge to
consider the financial resources of the child and the
custodial parent, the standard of living the child would have
enjoyed had the parties remained married, the physical and
emotional condition of the child, his educational needs and
the financia.1 resources and needs of the noncustodial parent.
These factors were each given in-depth consideration by the
trial judge.
The trial judge was well aware of Nancy's and Colin's
financial resources as their only resources are those awarded
Nancy in the dissolution decree.
Since his father's income exceeds $100,000 a year, Colin
would have obviously enjoyed a very high standard of living
had his parents remained married. Conclusion of law number
three notes the judge's consideration of this fact.
Findings of fact numbers five and 23 concern Colin's
physical problems and Learning difficulties. Finding of fact
23 and conclusion of law number five refer to the special
educational needs of Colin.
Finally, the trial judge in findings of fact numbers 19
and 20 notes Harvey's financial situation. The contingent
nature of Harvey's work in the emergency room is irrelevant.
He was earning money from that job at the time of the decree.
The trial judge was required to consider that income.
Section 40-4-204 (1) (e), MCA.
The child support and educational fund a.wards are
clearly supported by the evidence before the trial judge.
Colin's needs are more specialized than the normal ten year
old. He requires language therapy and physical therapy.
Individualized instruction in various sports which emphasize
coordination could also prove helpful. Colin's father has
the financial ability to provide this education for his son.
We find no abuse of discretion by the trial judge.
MAINTENANCE
Section 40-4-203, MCA, governs when maintenance should
be awarded. Harvey's major objection appears to be over the
length of the award, five years. Section 40-4-203(2), MCA is
thus particularly relevant:
(2) The maintenance order shall be in such amounts
and for such periods of time as the court deems
just, without regard to marital misconduct, and
after considering all relevant facts including:
(a) the financial resources of the party seeking
maintenance, including marital property apportioned
to him, and his ability to meet his needs
independently, including the extent to which a
provision for support of a child living with the
party includes a sum for that party as custodian;
(b) the time necessary to acquire sufficient
education or training to enable the party seeking
maintenance to find appropriate employment;
(c) the standard of living established during the
marriage;
(d) the duration of the marriage;
(e) the age and the physical and emotional
condition of the spouse seeking maintenance; and
(f) the ability of the spouse from whom
maintenance is sought to meet his needs while
meeting those of the spouse seeking maintenance.
Again, each of these factors was considered by the trial
judge. Harvey relies heavily on Nancy's testimony that in
two to three years she will be able to support herself with
monies earned through opera.tion of the greenhouse. In fact,
Nancy testified that she hoped to be netting $5,000 annually
from the greenhouse in two to three years. This testimony
was hopeful speculation. Even if Nancy succeeds in this
goal, $5,000 a year certainly will not allow Nancy to live
within the standard established during her marria.ge.
A large amount of Nancy's share in the estate is
non-liquid. Over S38,000 of the $48,000 recognized as her
inheritance is tied up in her house. The majority of the
other lump sum payments have gone to the greenhouse. The
$10,000 annual payments do not start until November of 1987.
Even then, Nancy's standard of living will be far lower than
that to which she has grown accustomed. The trial judge did
not abuse his discretion in awarding Nancy maintenance for
five years.
VALUATION OF THE MARITAL ESTATE
Time of Valuation
The general rule provides that the value of the marital
estate should be determined at or near the time of
dissolution. Vivian v. Vivian (1978), 178 Kont. 341, 344,
583 P.2d 1072, 1074. In In re the Marriage of Wagner (Kont.
1984), 679 P.2d 753, 758, 41 St.Rep. 409, 416, however, this
Court recognized "that unique circumstances of marital
relationships can mod.ify this generally-accepted date of
valuation of assets." The trial judge found no "unique
circumstances" in this case to justify valuing the estate as
of the date of separation. Neither do we.
Harvey argues that he should not be penalized for
investing his money in retirement funds during the separation
if Nancy is not penalized for investing her money in the
greenhouse. However, Harvey has sources of income other than
the retirement funds. Nancy's sole source of income outside
her marriage is the greenhouse. We find no abuse of
discretion by the trial judge.
Goodwi11
Harvey Swanson also objects to the consideration by the
trial judge of the goodwill associated with his medical
practice. Harvey contends that his practice has no goodwill.
The trial judge valued the goodwill of the practice at
$76,700 and included this amount in the marital estate. Once
again we find no abuse of discretion.
This Court recognized the existence of the goodwill of a
professional practice and included it in the marital estate
in In re the Marriage of Hull (Mont. 1986), 712 P.2d 1317, 43
St.Rep. 107. In Hull, the trial judge relied on the
testimony of a certified public accountant (CPA) hired by the
wife in determining the value of the goodwill of an
anesthesiologist's practice. Likewise, here the trial judge
relied on the testimony of a CPA hired by the wife. We find
no error. The CPA had recent experience in valuing the
goodwill of medical practices. She had access to all
relevant records from the medical practice. The method of
valuation was reasonable and essentially unrebutted.
Harvey's expert on the subject was not even aware that
goodwill is recognized in Montana. Nor did he have access to
Harvey's accounts receivable. The CPA's testimony was
"understandable, substantial in nature, and reasonable."
Hull, 712 P.2d at 1323, 43 St.Rep. at 114.
Valuation of the Retirement Funds
Harvey objects to the failure by the District Court to
consider his tax obliga.tionson the retirement funds. There
is no evidence that Harvey intended to 1iquida.te those funds
to pay his marital obligation. The current value of those
funds is not affected by taxes. Therefore, there is no error
in the Court's refusal to consider tax consequences at this
time .
ATTORNEY'S FEES
Harvey's last contention is that the trial judge erred
in ordering him to pay Nancy $3,400 in attorney's fees. The
order is valid pursuant to 5 40-4-110, MCA.
Costs - attorney's fees. 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 to the other party of
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. The court
may order that the amount be paid directly to the
attorney, who may enforce the order in his name.
The award of attorney's fees under this statute is "largely
discretionary with the District Court, and we will not
disturb its judgment in the absence of an abuse of that
discretion." In re the Marriage of Milanovich (Mont. 1985) ,
697 P.2d 927, 929, 42 St.Rep. 436, 439, quoting Talmage v.
Gruss (1983), 202 Mont. 410, 412, 658 P.2d 4191 420-
The decision of the District Court is affirmed in all
aspects.
We concur: