Dale Eugene Mayo v. Annie Maglicyang Mayo ( 2020 )

RENDERED: AUGUST 21, 2020; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2019-CA-000158-MR
DALE EUGENE MAYO APPELLANT
APPEAL FROM GREENUP CIRCUIT COURT
v. HONORABLE JEFFREY L. PRESTON, JUDGE
ACTION NO. 18-CI-00367
ANNIE MAGLICYANG MAYO APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE: CALDWELL, DIXON, AND L. THOMPSON, JUDGES.
DIXON, JUDGE: Dale Eugene Mayo appeals from the findings of fact,
conclusions of law, and decree of dissolution of marriage entered on December 19,
2018, and the order denying his motion for specific findings or, in the alternative,
motion to alter, amend, or vacate said order, entered on January 9, 2019, by the
Greenup Circuit Court. Following review of the record, briefs, and law, we affirm.
FACTS AND PROCEDURAL BACKGROUND
The parties were married in June 2009. At that time, Dale was
employed with the Veterans’ Administration (VA) Hospital in Huntington, West
Virginia, and Annie was a full-time college student who was also employed. Prior
to the parties’ marriage, Dale purchased a parcel of land upon which he built a
home. At the time of the parties’ marriage, the home mortgage was $76,305.
Thereafter, Dale refinanced the home and used the borrowed funds to pay over
$20,000 of Annie’s student debt. Annie’s name was also added to the home’s
deed. Over the course of the marriage, Dale became disabled and began receiving
disability benefits in 2014, while Annie obtained various professional degrees,
improving her employment status. The parties had a joint checking account in
which they deposited their paychecks, but Dale maintained control of the finances.
Annie fixed up the yard, leveling the ground and planting grass, and had a concrete
pad poured for an outdoor patio. In 2012, the home was valued at $135,000, and in
2018, the home was appraised at $154,000. At the time of separation, the house
was under a mortgage of approximately $80,000, the parties owned two vehicles
free of debt, and Annie had no outstanding student loan debt.
Annie left the marital residence, taking no furniture or household
items. Because she did not have a separate checking account from which to pay
her bills, she withdrew $16,000 of the $17,000 in the parties’ joint account and
-2-
used approximately $7,000 to furnish an apartment. Annie also sent $5,000 to her
family in the Philippines. In August 2018, a hearing on the use of those funds was
held, and the trial court, finding that Annie may be in need of money, did not
require her to return any of the funds taken from the joint account. Thereafter,
Annie loaned $1,500 each to two friends.
After a final hearing in which both parties testified, the court entered
its findings of fact, conclusions of law, and decree of dissolution of the parties’
marriage. The court found: Annie did not dissipate marital funds; the amount of
equity Annie had in the marital residence was offset by the funds she withdrew
from their joint account; Dale’s payment of Annie’s student loans did not entitle
him to maintenance; and Dale was not otherwise entitled to maintenance. Dale
moved the trial court for specific findings or, in the alternative, to alter, amend, or
vacate its decree. The motion was denied, and this appeal followed.
STANDARD OF REVIEW
The standard of an appellate court’s review of a trial court’s findings
of fact is well-settled.
The trial court heard the evidence and saw the
witnesses. It is in a better position than the appellate
court to evaluate the situation. Gates v. Gates, [412
S.W.2d 223 (Ky. 1967)]; McCormick v. Lewis, [328
S.W.2d 415 (Ky. 1959)]. The court below made
findings of fact which may be set aside only if clearly
erroneous. Hall v. Hall, [386 S.W.2d 448 (Ky. 1964)];
-3-
CR[1] 52.01, 7 Kentucky Practice, Clay 103. We do not
find that they are. They are not ‘manifestly against the
weight of evidence.’ Ingram v. Ingram, [385 S.W.2d 69
(Ky. 1964)]; Craddock v. Kaiser, [280 Ky. 577, 133
S.W.2d 916 (1939)]. A reversal may not be predicated
on mere doubt as to the correctness of the decision.
Buckner v. Buckner, [295 Ky. 410, 174 S.W.2d 695
(1943)]. When the evidence is conflicting, as here, we
cannot and will not substitute our decision for the
judgment of the chancellor. Gates v. Gates, supra;
Renfro v. Renfro, [291 S.W.2d 46 (Ky. 1956)].
Wells v. Wells, 412 S.W.2d 568, 571 (Ky. 1967) (emphases added). Accordingly,
the crux of this case is whether the trial court’s findings of fact are supported by
substantial evidence. After careful review, we hold that they are; therefore, we
must affirm.
DISSIPATION OF THE MARITAL ESTATE
On appeal, Dale contends the trial court erred by finding that Annie
had not dissipated $8,000 in marital funds by sending $5,000 to her family and
loaning $3,000, collectively, to two friends. In support, Dale cites to Brosick v.
Brosick, 974 S.W.2d 498 (Ky. App. 1998). Therein, the Court held:
The concept of dissipation requires that a party used
marital assets for a non-marital purpose. The spouse
alleging dissipation should be required to present
evidence establishing that the dissipation occurred. Once
the dissipation is shown, placing the burden of going
forward with the evidence on the spouse charged with the
dissipation is reasonable because that spouse is in a better
position to account for these assets. This analysis
1
Kentucky Rules of Civil Procedure.
-4-
pertaining to the shifting of the burden of going forward
with the evidence, using the preponderance of the
evidence standard, is in accord with the practice
implicitly followed in Barriger v. Barriger, [514 S.W.2d
114 (Ky. 1974)].
Id. at 502. In Brosick, the husband spent and gave over $1,000,000 to his mistress
while he was still married. In Barriger, the husband converted approximately
$25,000 of the parties’ savings into cash and then dissipated it through “reckless
extravagance.” 514 S.W.2d at 114-15. The husband testified that he took a
Caribbean cruise, gambled in Las Vegas, and entertained a series of women.
This case is certainly factually distinguishable from Brosick and
Barriger in that, here, Annie was able to account for the $8,000. Annie testified
that Dale had not let her spend money during their marriage or send money to her
family. She testified that she worked hard over the course of the marriage and
should be allowed to help her family. Another panel of our Court held:
a party is free to dispose of his marital assets as he sees
fit so long as such disposition is not fraudulent or
intended to impair the other spouse’s interest such that it
may properly be classified as a dissipation of the marital
estate. See Brosick v. Brosick, 974 S.W.2d 498 (Ky.
App. 1998) (finding of dissipation requires showing the
money was expended for non-marital purpose, was done
in anticipation of divorce, and was done to deprive other
party of his or her interest).
While giving away valuable assets may almost
assuredly cause marital strife—and for that reason alone
is generally avoided by those who wish to remain happily
-5-
or peacefully married—we cannot conclude in this
instance that the transfer was inappropriate . . . .
Ensor v. Ensor, 431 S.W.3d 462, 472-73 (Ky. App. 2013).
Here, Dale offered no proof—let alone proof sufficient to meet his
burden by a preponderance of the evidence—that Annie defrauded him or acted
with intent to deprive him of his share of marital property. Substantial evidence
supported the court’s finding that Annie did not dissipate marital funds; thus, we
must affirm as to this issue.
INCREASE IN VALUE OF MARITAL RESIDENCE
Dale also argues that because no evidence was offered to explain the
increase in value of the marital residence, except for general economic conditions,
the increase in value is considered nonmarital property under KRS2 403.190(2)(e),
which provides “[t]he increase in value of property acquired before the marriage to
the extent that such increase did not result from the efforts of the parties during
marriage” is nonmarital property. However, in the case before us, this is not borne
out by the record. Annie testified that while no significant improvements were
made to the interior of the house, she made improvements to the yard and patio.
Although she testified that she had no idea how much these improvements
increased the value of the home, in the absence of proof from Dale to the contrary,
2
Kentucky Revised Statutes.
-6-
the court was not only permitted to infer that the improvements increased the value
but required to do so.
As another panel of our Court observed:
The burden of proof is on the party claiming that
the increase in value is to be considered nonmarital, and
he must satisfy that burden by “clear and convincing”
evidence. Brosick v. Brosick, 974 S.W.2d 498 (Ky. App.
1998). “KRS 403.190(3) . . . creates a presumption that
any such increase in value is marital property, and
therefore, a party asserting that he or she should receive
appreciation upon a nonmarital contribution as his or her
nonmarital property carries the burden of proving the
portion of the increase in value attributable to the
nonmarital contribution. By virtue of the KRS
403.190(3) presumption, the failure to do so will result in
the increase being characterized as martial [sic]
property.” Travis v. Travis, 59 S.W.3d 904, 910-11 (Ky.
2001).
KRS 403.190(2)(e) carves out an exception to
what is considered “marital property” for “[a]n increase
in value of property acquired before the marriage to the
extent that such increase did not result from the efforts of
the parties during marriage.” (Emphasis added).
Therefore, conversely an increase in value of property
that did result from the efforts of the parties during
marriage should be considered marital property. In
Goderwis v. Goderwis, 780 S.W.2d 39 (Ky. 1989), the
Kentucky Supreme Court held that if nonmarital property
increases in value during the marriage, the trial court
must determine the reason for the increase. If the
increase is attributable to general economic conditions, it
is considered nonmarital. However, “[a]n increase in
value of nonmarital property during marriage which is
the result of a joint effort of the parties establishes the
increase in value of the nonmarital property as marital
property.” Id. at 40.
-7-
Croft v. Croft, 240 S.W.3d 651, 653-54 (Ky. App. 2007).
The improvements to the home described and performed by Annie
cannot be discredited as reasons for the increase in value. “The Court requires
only a showing that the increase in value of the property was not solely attributable
to general economic conditions, but was a result of the joint efforts of the parties in
order to qualify property as marital property.” Id. at 654. Thus, in the case herein,
the court did not err in determining the increase in value of the parties’ marital
home was marital property.
Moreover, although the mortgage was higher at the end of the parties’
marriage due to refinancing than at the beginning of the marriage, it is undisputed
that marital funds were used to pay the mortgage. This further supports the trial
court’s finding that at least some of the increased value of the residence was
marital property. See id. at 654-55.
MAINTENANCE
Dale further argues the trial court erred in finding that his payment of
over $20,000 of Annie’s student loans was a gift and refusing to compensate him
for this contribution to the acquisition of her professional degree in the form of
maintenance. At the final hearing, Dale admitted he voluntarily paid these loans
out of good will for his wife. Annie also testified these payments were gifts.
-8-
An award of maintenance comes within the sound discretion of the
trial court; however, a reviewing court will not uphold the award if it finds that the
trial court abused its discretion or based its decision upon findings of fact that are
clearly erroneous. Perrine v. Christine, 833 S.W.2d 825, 826 (Ky. 1992).
Additionally, an award of maintenance must satisfy the statutory provisions of
KRS 403.200, which provides:
(1) In a proceeding for dissolution of marriage or legal
separation, or a proceeding for maintenance following
dissolution of a marriage by a court which lacked
personal jurisdiction over the absent spouse, the court
may grant a maintenance order for either spouse only if it
finds that the spouse seeking maintenance:
(a) Lacks sufficient property, including marital
property apportioned to him, to provide for
his reasonable needs; and
(b) Is unable to support himself through
appropriate employment or is the custodian
of a child whose condition or circumstances
make it appropriate that the custodian not be
required to seek employment outside the
home.
(2) The maintenance order shall be in such amounts and
for such periods of time as the court deems just, and after
considering all relevant factors 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
-9-
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.
Dale cites to KRS 403.190(1)(d)3 to support his contention that the
court is permitted to consider the economic circumstances of the parties in dividing
3
KRS 403.190(1) provides:
(1) In a proceeding for dissolution of the marriage or for legal
separation, or in a proceeding for disposition of property following
dissolution of the marriage by a court which lacked personal
jurisdiction over the absent spouse or lacked jurisdiction to dispose
of the property, the court shall assign each spouse’s property to
him. It also shall divide the marital property without regard to
marital misconduct in just proportions considering all relevant
factors including:
(a) Contribution of each spouse to acquisition of the
marital property, including contribution of a spouse
as homemaker;
-10-
marital property. According to Annie’s tax return for 2017, she earned $78,183.
By contrast, for the same year, Dale received $20,712 from Social Security and
$4,493 in VA benefits. However, Dale was awarded the marital residence, its
furnishings, and at least one vehicle, while Annie was awarded the $16,000 she
previously withdrew from the parties’ joint account, as well as a few limited items.
Hardly a windfall. Nevertheless, Dale further contends that KRS 403.200
authorizes the court to consider the economic circumstances of the parties in
determining maintenance, including the fact that one spouse acquired a
professional degree with the help of the other.
As noted, to properly award maintenance under KRS 403.200, a court
must find the spouse seeking maintenance (1) lacks sufficient property, including
the marital property apportioned to him or her, to provide for his or her reasonable
needs, and (2) is unable to support himself or herself through appropriate
employment. Herein, the court considered the bills presented by Dale, which
(b) Value of the property set apart to each spouse;
(c) Duration of the marriage; and
(d) Economic circumstances of each spouse when
the division of property is to become effective,
including the desirability of awarding the family
home or the right to live therein for reasonable
periods to the spouse having custody of any
children.
-11-
included amounts for services he had performed in the past—with no apparent
difficulty according to Annie—such as mowing, power-washing the home, and
washing/waxing the vehicles. Dale’s projected monthly expenses were calculated
based on mowing weekly, power-washing the house monthly, and washing and
waxing two vehicles monthly. Per those estimated expenditures, Dale claimed a
deficit of $25 per month in paying his bills. The trial court found Dale’s income
sufficient to pay his monthly expenses and properly take care of himself.
Similarly, Dale was awarded sufficient property to provide for his reasonable
needs.
Kentucky does not have a set formula for “reimbursement alimony.”
Schmitz v. Schmitz, 801 S.W.2d 333, 336 (Ky. App. 1990). The solution depends
upon the facts of the case. Id. Here, the trial court specifically stated it “carefully
considered the expenses of both parties, the income of both parties and the lifestyle
in which they were accustomed in arriving at this decision on the issue of
maintenance.” This determination was supported by the record, well within the
discretion of the trial court, and will not be easily set aside. Therefore, we hold
that the court did not abuse its discretion in denying maintenance.
CONCLUSION
Therefore, and for the foregoing reasons, the orders entered by the
Greenup Circuit Court are AFFIRMED.
-12-
ALL CONCUR.
BRIEF FOR APPELLANT: BRIEF FOR APPELLEE:
James W. Lyon, Jr. R. Stephen McGinnis
Greenup, Kentucky Erin N. Hall
Greenup, Kentucky
-13-