Chawla v. Chawla , 2014 Ohio 1188 ( 2014 )

[Cite as Chawla v. Chawla, 2014-Ohio-1188.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
Rakesh R. Chawla, :
Plaintiff-Appellant/ :
Cross-Appellee,
: No. 13AP-399
v. (C.P.C. No. 10DR-03-1335)
:
Jyoti R. Chawla, (REGULAR CALENDAR)
:
Defendant-Appellee/
Cross-Appellant. :
D E C I S I O N
Rendered on March 25, 2014
Gary J. Gottfried Co., L.P.A., Gary J. Gottfried, and Eric M.
Brown, for appellant/cross-appellee.
Wolinetz Law Offices, LLC, and Barry H. Wolinetz, for
appellee/cross-appellant.
APPEAL from the Franklin County Court of Common Pleas,
Division of Domestic Relations
SADLER, P.J.
{¶ 1} Plaintiff-appellant/cross-appellee, Rakesh R. Chawla, appeals from a
judgment of the Franklin County Court of Common Pleas, Division of Domestic Relations,
granting a divorce and terminating his marriage to defendant-appellee/cross-appellant,
Jyoti R. Chawla. For the reasons that follow, the trial court's judgment is affirmed.
I. BACKGROUND
{¶ 2} The parties were married on April 29, 2000, and three children were born
as issue of the marriage. The children's respective dates of birth are February 24, 2003,
No. 13AP-399 2
December 23, 2005, and January 3, 2008. Appellant filed a complaint for legal
separation on March 25, 2010, and appellee's answer and counterclaim for divorce was
filed on April 15, 2010. The trial court appointed a guardian ad litem ("GAL") to represent
the interests of the minor children during the proceeding.
{¶ 3} Appellant and appellee are both physicians, and, at the time of trial,
appellant, an interventional cardiologist, was employed by Cardiovascular Consultants of
Cleveland, Inc. Appellant's primary residence was in Solon, Ohio, but appellant
maintained a small apartment in Dublin, Ohio to facilitate parenting time with the
children. Appellee, a doctor of internal medicine, held two part-time positions, one as an
emergency facility physician and one as a hospitalist. Temporary orders in this case were
first issued on July 27, 2010. As is pertinent to this appeal, both parents were designated
temporary residential parents and legal custodians of the three children, and the parties
were provided with a possession schedule. Additionally, appellant was ordered to pay
child support in the amount of $3,600 per month and spousal support in the amount of
$4,000 per month, including all associated processing charges.
{¶ 4} Appellant filed various motions to modify the temporary orders, which
resulted in the modification order of May 9, 2011. The primary modifications in the order
pertained to child and spousal support amounts. Specifically, the May order provided
that, from August 10, 2010 to May 9, 2011, appellant's child support obligation was
$253.97 per child per month. From May 9, 2011 and ongoing, depending upon whether
private health insurance was in effect, the child support obligation was either $712.93 or
$698.72 per child per month. From August 10, 2010 to May 9, 2011, the spousal support
obligation was determined to be $1,000 per month. From May 9, 2011 and ongoing, the
spousal support obligation was determined to be $3,000 per month.
{¶ 5} The matter came for trial in early January 2013. On April 16, 2013, the trial
court issued its judgment entry and decree of divorce that granted a divorce and
addressed the disputed issues between the parties. The trial court concluded the dates of
the marriage were from April 29, 2000 to January 9, 2013, and assets and liabilities were
valued as of September 30, 2012. Though the trial court divided all of the parties' assets
and liabilities, this appeal concerns the trial court's decision regarding (1) a condominium
in Louisiana, (2) a PNC line of credit, (3) appellee's alleged financial misconduct with
No. 13AP-399 3
respect to real estate in Mississippi, (4) marital funds expended on appellee's father's legal
defense in an unrelated matter, (5) child support computation, and (6) an award of
attorney fees.
{¶ 6} The condominium, located in New Orleans, Louisiana, was purchased by
appellee and her brother in 1992. The trial court determined appellee's 50 percent
interest in the condominium was appellee's separate property upon which no marital
funds were expended, and, therefore, none of appellee's equity in the real estate was
subject to division as a marital asset.
{¶ 7} The PNC line of credit relates to appellant's business interest in his former
practice, Cardiovascular Care Unlimited. Appellant testified this line of credit was used to
pay for the balance owed on the practice when he purchased it. The trial court
determined the PNC line of credit with a balance of $57,636.92, and for which appellant is
personally liable, was a marital liability.
{¶ 8} During these proceedings, appellant also alleged appellee engaged in
financial misconduct with respect to real estate located in Mississippi that was purchased
by appellee's parents in 1998. Several years prior to the initiation of this domestic matter,
a 33 percent interest in the real estate was transferred to appellee from her parents.
Appellee admittedly expended marital funds on the real estate without appellant's
knowledge. According to appellant, he was unaware of appellee's investments in the
property until mid-2004. Because of appellant's displeasure with the investment, in
October 2004, the property was transferred into VCR I, LLC. In 2007, appellee's parents
gave appellee $115,000 for the purchase of her home. According to appellee, the
$115,000 was to compensate her for her interest in VCR I, LLC that she transferred to her
parents seven months later. Despite appellant's urging to the contrary, the trial court did
not find appellee engaged in financial misconduct or that appellant was otherwise entitled
to equitable relief with respect to this property.
The trial court also considered marital funds appellee contributed to her father's legal
defense.1 The trial court concluded appellee, without appellant's knowledge,
1In a separate action in the state of Georgia, appellee's father was indicted and convicted for the contract
murder of his granddaughter's mother.
No. 13AP-399 4
contributed approximately $224,931 to her parents for her father's legal bills. While
expressly declining to consider this financial misconduct, the trial court did find appellant
was entitled to equitable relief and deemed these funds to be appellee's asset for purposes
of property division.
II. ASSIGNMENTS OF ERROR
{¶ 9} Appellant appeals and assigns four assignments of error for our review:
[I.] The trial court erred and abused its discretion in
calculating Appellant's child support obligation effective
January 1, 2013.
[II.] The trial court erred and abused its discretion in failing
to make a finding of financial misconduct with respect to
Appellee's transaction(s) regarding her investment in real
estate in Mississippi.
[III.] The trial court erred and abused its discretion in
concluding that Appellee had proven by a preponderance of
the evidence that the condominium in Louisiana was her
separate property.
[IV.] The trial court erred and abused its discretion when it
awarded $40,000 in legal fees to Appellee.
III. CROSS-ASSIGNMENTS OF ERROR
{¶ 10} Appellee filed a cross-appeal and asserts the following assignments of error
for our review:
I. The trial court erred and abused its discretion when it
found that the balance of the PNC line of credit subject to
marital distribution is $57,636.92.
II. The trial court erred and abused its discretion when it
included $224,931 given to wife's parents as an asset to wife.
IV. DISCUSSION
A. First Assignment of Error
{¶ 11} In his first assignment of error, appellant challenges the trial court's
calculation of child support. The trial court determined that effective January 1, 2013,
appellant's child support obligation was $3,055.56 per child, per month, plus 2 percent
processing charge for a total of $9,350.01 per month. In arriving at this amount, the trial
No. 13AP-399 5
court reviewed in detail appellant's employment history since 2008 and imputed an
annual income of $550,000 to appellant. According to appellant, the trial court erred in
imputing income and awarding an amount of child support in excess of the calculated
guideline amount.
{¶ 12} A trial court has considerable discretion in the calculation of child support,
and, absent an abuse of discretion, an appellate court will not disturb a child support
order. Pauly v. Pauly, 80 Ohio St. 3d 386 (1997). A trial court abuses its discretion when
it acts in an unreasonable, arbitrary or unconscionable manner. Blakemore v.
Blakemore, 5 Ohio St. 3d 217, 219 (1983). There is no abuse of discretion where there is
some competent, credible evidence supporting the trial court's decision. Ross v. Ross, 64
Ohio St. 2d 203 (1980).
{¶ 13} It is undisputed that the parties' combined gross income exceeds $150,000.
Under such circumstances, the court must calculate the child support obligation on a
case-by-case basis and must consider the needs and the standard of living of the children
and of the parents in doing so. Guertin v. Guertin, 10th Dist. No. 06AP-1101, 2007-Ohio-
2008, ¶ 4. R.C. 3119.04(B) provides that "[i]f the combined gross income of both parents
is greater than one hundred fifty thousand dollars per year, the court, with respect to a
court child support order, * * * shall determine the amount of the obligor's child support
obligation on a case-by-case basis and shall consider the needs and the standard of living
of the children who are the subject of the child support order and of the parents." The
statute further provides that "[t]he court * * * shall compute a basic combined child
support obligation that is no less than the obligation that would have been computed
under the basic child support schedule and applicable worksheet for a combined gross
income of one hundred fifty thousand dollars, unless the court * * * determines that it
would be unjust or inappropriate and would not be in the best interest of the child,
obligor, or obligee to order that amount." The statute mandates that should the court
make "such a determination, it shall enter in the journal the figure, determination, and
findings."
{¶ 14} Thus, in cases where the parties' combined income exceeds $150,000, the
court is bound by three requirements. The court must: (1) set the child support amount
No. 13AP-399 6
based on the qualitative needs and standard of living of the children and parents,
(2) ensure that the amount set is not less than the $150,000-equivalent, unless awarding
the $150,000-equivalent would be inappropriate (i.e., would be too much), and (3) if it
decides the $150,000-equivalent is inappropriate or unjust (i.e., awards less), then
journalize the justification for that decision. Kuper v. Halbach, 10th Dist. No. 09AP-899,
2010-Ohio-3020, ¶ 84, citing Zeitler v. Zeitler, 9th Dist. No. 04CA008444, 2004-Ohio-
5551, ¶ 8.
{¶ 15} Appellant does not dispute either that the trial court conducted a case-by-
case determination as required by R.C. 3119.04(B) or that the trial court expressly
considered the statutory factors of R.C. 3119.23.2 Rather, appellant contends the trial
court abused its discretion in awarding child support in excess of the calculated guideline
amount without "any such express finding" that the guideline amount of child support
would be "unjust and inappropriate and not in the best interest of the children."
(Appellant's brief, 26.)
{¶ 16} In support of his proposition that such finding was required, appellant relies
on Wolfe v. Wolfe, 10th Dist. No. 04AP-409, 2005-Ohio-2331. In that case, child support
was calculated under R.C. 3119.04, and the trial court utilized the statutory factors of R.C.
3119.23. The trial court also made findings under R.C. 3119.22, i.e., that the guideline
amount of child support was unjust, inappropriate, and not in the best interest of the
children when it awarded child support in an amount in excess of the guideline amount.
While the Wolfe decision mentioned that the trial court made such findings, the decision
did not hold that in cases concerning combined incomes exceeding $150,000 and child
support being calculated pursuant to R.C. 3119.04(B), findings under R.C. 3119.22 were
required. What is more, this court has explicitly held that "R.C. 3119.04(B) 'does not
require any explanation of [the trial court's] decision unless it awards less than the
amount awarded for combined incomes of $150,000.' " Guertin at ¶ 6, quoting Cyr v.
Cyr, 8th Dist. No. 84255, 2005-Ohio-504, ¶ 56. See also Lanham v. Mierzwiak, 197 Ohio
App.3d 426 (6th Dist.2011) (because the amount of child support established under R.C.
2"While the trial court was not required to consider the factors pursuant to R.C. 3119.23, it is not an abuse
of discretion to do so in addition to computing the child support obligation on a case-by-case basis in
accordance with R.C. 3119.04(B)." Wolfe v. Wolfe, 10th Dist. No. 04AP-409, 2005-Ohio-2331, ¶ 28.
No. 13AP-399 7
3119.04(B) was not less than the $150,000 equivalent, the trial court was not required to
make any findings).
{¶ 17} Appellant also argues that, despite the trial court's findings to the contrary,
the evidence reflects the parties did not live an extravagant lifestyle prior to the divorce
and the children's lifestyles were not affected by the divorce proceedings or the parties'
separation. The trial court's decision reflects that the court considered the needs and
standard of living of the children and the parties in calculating the child support
obligation. The trial court noted that appellee will bear the primary cost of the children's
extracurricular activities, and "incurs significant in-kind contributions to maintain the
children in the lifestyle they would have enjoyed had their parents remained married,"
such as work at a Hindu temple, chess club, piano lessons, and sports. (Decree, 38.)
{¶ 18} Further, the trial court concluded that, while the parties have both lived
"relatively frugal lifestyles despite their significant incomes," the children "have lived a
very comfortable life and have experienced the full benefit of living in an upper middle
class neighborhood and excellent educational and extracurricular opportunities."
(Decree, 38.) The trial court also noted the children were enrolled in private school at the
time of the parties' separation, but have since been removed due to appellant's refusal to
continue to contribute to the expense. The trial court concluded, "[t]he children would
have likely remained in private schools but for the parties' divorce." (Decree, 39.) Each of
the trial court's findings are supported by the record.
{¶ 19} Appellant also suggests the trial court established appellant's child support
obligation in order to "equalize the parties' incomes" and award de facto spousal support.
(Appellant's brief, 29.) According to appellant, this is demonstrated by the fact that the
temporary orders provided for child support and spousal support to continue until
January 1, 2013, at which time the court ordered appellant to pay no spousal support, but
a significantly increased amount of child support.
{¶ 20} While a court must take care not to award child support as a substitute for
spousal support when the latter terminates, the termination of spousal support does
factor into the child support calculation because, in computing the child support
obligation, the trial court must deduct spousal support from the income of the obligor and
include it as income for the obligee. Ellis v. Ellis, 7th Dist. No. 08 MA 13, 2009-Ohio-
No. 13AP-399 8
4964, ¶ 69, citing Wright v. Wright, 8th Dist. No. 91026, 2009-Ohio-128, ¶ 30.
Additionally, this case presented a scenario in which the parties' combined incomes well
exceeded $150,000, such that the trial court was not bound by the child support
worksheets and was required to assess appellant's child support obligation on an
individual, case-by-case basis. Additionally, the parties' circumstances at the time the
court issued temporary orders were different than they were at the time of divorce,
including appellant's income, the termination of spousal support, and the respective
amounts of parenting time and obligations. Upon review of the record, we discern no
abuse of discretion in the trial court's order of child support in an amount in excess of the
calculated guideline amount.
{¶ 21} Next under this assigned error, appellant contends the trial court abused its
discretion in imputing an annual income of $550,000 to appellant when there was no
evidence that he was voluntarily underemployed.
{¶ 22} A trial court must determine the parents' income in order to calculate child
support. Pursuant to R.C. 3119.01(C), income for purposes of determining child support
includes the gross income of the parents and any "potential income" of a parent if that
parent is voluntarily unemployed or underemployed. Apps v. Apps, 10th Dist. No. 02AP-
1072, 2003-Ohio-7154, ¶ 46. Whether a parent is voluntarily unemployed or
underemployed is a determination within the trial court's discretion and will not be
disturbed absent an abuse of discretion. Banchefsky v. Banchefsky, 10th Dist. No. 09AP-
1011, 2010-Ohio-4267, ¶ 8, citing Rock v. Cabral, 67 Ohio St. 3d 108, 112 (1993).
{¶ 23} Before a trial court may impute income to a parent, the court must make a
finding that the parent is voluntarily unemployed or underemployed. Apps at ¶ 48, citing
Leonard v. Erwin, 111 Ohio App. 3d 413, 417 (4th Dist.1996). Once a party is determined
to be voluntarily unemployed or underemployed, the potential income to be imputed to
that party must be determined in accordance with the considerations listed in R.C.
3119.01(C)(11). Id. Consideration of the factors set forth in R.C. 3119.01(C)(11) is
mandatory, and the trial court's failure to consider these factors constitutes an abuse of
discretion. Id., citing Badovick v. Badovick, 128 Ohio App. 3d 18, 23 (8th Dist.1998). A
trial court must weigh the facts and circumstances of each particular case in determining
No. 13AP-399 9
whether a parent is voluntarily underemployed. Bruno v. Bruno, 10th Dist. No. 04AP-
1381, 2005-Ohio-3812, ¶ 16, citing Rock.
{¶ 24} As provided in R.C. 3119.01(C)(11):
"Potential income" means both of the following for a parent
who the court pursuant to a court support order, or a child
support enforcement agency pursuant to an administrative
child support order, determines is voluntarily unemployed or
voluntarily underemployed:
(a) Imputed income that the court or agency determines the
parent would have earned if fully employed as determined
from the following criteria:
(i) The parent's prior employment experience;
(ii) The parent's education;
(iii) The parent's physical and mental disabilities, if any;
(iv) The availability of employment in the geographic area in
which the parent resides;
(v) The prevailing wage and salary levels in the geographic
area in which the parent resides;
(vi) The parent's special skills and training;
(vii) Whether there is evidence that the parent has the ability
to earn the imputed income;
(viii) The age and special needs of the child for whom child
support is being calculated under this section;
(ix) The parent's increased earning capacity because of
experience;
(x) The parent's decreased earning capacity because of a
felony conviction;
(xi) Any other relevant factor.
(b) Imputed income from any nonincome-producing assets of
a parent, as determined from the local passbook savings rate
or another appropriate rate as determined by the court or
No. 13AP-399 10
agency, not to exceed the rate of interest specified in division
(A) of section 1343.03 of the Revised Code, if the income is
significant.
{¶ 25} Appellant contends the trial court summarily imputed income to him
without expressly finding that he was voluntarily underemployed at the time of trial and
without consideration of the "any other relevant factor" of R.C. 3119.01(C)(11)(a)(xi).
According to appellant, had the trial court considered the "any other relevant factor," it
would have considered that appellant's $550,000 employment offer had unmet
contingencies and that appellee had previously sabotaged appellant's employment offers.
{¶ 26} The trial court devoted four pages of its 60-page divorce decree to
determining the incomes and relative earning abilities of the parties. The bulk of the trial
court's discussion pertained to appellant because of the variations in his income
throughout the last several years of the parties' marriage. The trial court detailed the
evidence pertaining to appellant's employment from 2008 through 2012, including a
March 2010 employment offer, which appellant accepted, that included an annual income
of $550,000. The trial court also recognized the employer's withdrawal of this offer due
to appellee's interference with said employment prospect. Thus, contrary to appellant's
assertion, the trial court expressly recognized appellee's previous attempts to sabotage
appellant's ability to change employment, particularly in 2009 and 2010. In relevant part,
the trial court stated:
Fortunately, as indicated above, [appellant] appears to have
weathered this storm and is successfully exploring other
employment opportunities in northern Ohio, Cleveland, Ohio
and in Indiana. In fact, [appellant] has applied for and been
granted licenses for medical practice privileges and to
distribute narcotics in Indiana, where he now has an offer
pending for full time employment for $550,000. Therefore
considering the [appellant's] prior employment experience
and earning history, his education, the availability of
employment in the geographic area which the [appellant]
resides and within approximate same distance from the
children's residence, the fact that [appellant] has historically
sought employment in other geographic areas, the prevailing
salary levels in Ohio and neighboring states, the [appellant's]
special skills and training, the evidence supporting the fact
that [appellant] has the ability, is currently offered the
No. 13AP-399 11
imputed income and the [appellant's] increased earning
capacity because of his experience, the Court finds that
[appellant's] earning ability as of January 1, 2013 is $550,000.
(Decree, 33-34.)
{¶ 27} In support of his position that the trial court abused its discretion by
making no explicit finding that he was voluntarily underemployed, appellant relies
primarily on Banchefsky, Apps, and Bruno. In those cases, and as mentioned previously
in this decision, this court has stated that, before a trial court imputes income to a parent,
it must first find that the parent is voluntarily unemployed or underemployed.
{¶ 28} In Apps, this court held that the trial court abused its discretion in imputing
income to the appellant where the trial court summarily imputed an $18,000 gross
income without an explicit finding of voluntary underemployment or unemployment,
without any consideration of the factors set forth in R.C. 3119.01(C)(11), and without any
rationale for imputing the $18,000 gross income. Similarly, in Bruno, not only was an
express finding of voluntary underemployment absent from the trial court's order, but,
also, this court found there was no evidence in the record to support a finding of voluntary
underemployment.
{¶ 29} Unlike Apps and Bruno, the record before us demonstrates that the trial
court clearly considered the requisite factors of R.C. 3119.01(C)(11) and provided its
rationale for the imputed income of $550,000. Additionally, the trial court's discussion of
appellant's employment history reveals a 2008 business income of $786,028, and a 2011
to 2012 employment contract with Cardiovascular Consultants of Cleveland providing for
a $350,000 salary for the first year and a $35,000 possible bonus for each $100,000
earned over $900,000, plus shareholder eligibility and automobile, home, and cell phone
expenses. The trial court also discussed appellant's 2010 employment offer of $550,000
to work in Montana and the subsequent withdrawal of the offer due to appellee's
interference. The trial court concluded from appellant's 2010 and 2011 tax returns that
his income for those years was $204,987 and $226,303, respectively. Appellant did not
produce tax returns, 1099s or W2s for 2012 and, according to the trial court, was "not
forthcoming with accounts receivables he may have received during 2012." (Decree, 31.)
No. 13AP-399 12
Nonetheless, from an earning statement, the trial court deduced appellant's income was
approximately $251,923.13.
{¶ 30} Additionally, this record contains evidence to support a finding of voluntary
underemployment. Appellant testified at trial that he was earning only $200,000
annually. From the trial court's detailed discussion of appellant's employment history,
though the specific words "voluntarily underemployed" were not used, the trial court
clearly concluded such based on the evidence appellant was indeed voluntarily
underemployed. Thaher v. Hamed, 10th Dist. No. 09AP-970, 2010-Ohio-5257 (specific
words "voluntarily underemployed" not required where it is clear the trial court concluded
that, based on the evidence, the obligor was voluntarily underemployed); Snyder v.
Snyder, 5th Dist. No. 2008CA00219, 2009-Ohio-5292 (no magic language requirement
in deciding whether one is voluntarily underemployed/unemployed); Winkleman v.
Winkleman, 11th Dist. No. 2008-G-2834, 2008-Ohio-6557 (implicit in the trial court's
decision was that the parent was voluntarily unemployed).
{¶ 31} Appellant also asserts the trial court failed to consider "any other relevant
factor" of R.C. 3119.01(C)(11)(a)(ii) because the court did not consider the "contingencies"
associated with the current $550,000 employment offer in Indiana. A review of
appellant's testimony, however, indicates appellant did not testify as to these alleged
contingencies. At trial, appellant testified that he had in his possession a written offer
from an Indiana hospital for a permanent full-time position offering a $550,000 annual
salary with the potential for amounts above that. Appellant was not forthcoming about
the specifics regarding the offer, and when asked if he would be producing the
employment contract, appellant replied "no." (Tr. Vol. III, 693.)
{¶ 32} After a thorough review of the record, we do not find that the trial court
abused its discretion in calculating appellant's child support obligation effective
January 1, 2013. Accordingly, we overrule appellant's first assignment of error.
B. Second Assignment of Error
{¶ 33} In his second assignment of error, appellant contends the trial court abused
its discretion in failing to find appellee engaged in financial misconduct regarding her
investment in real estate located in Mississippi.
No. 13AP-399 13
{¶ 34} In divorce proceedings, a trial court must classify property as marital or
separate property. R.C. 3105.171(B). Then, the trial court must divide the marital
property equally or, if an equal division is inequitable, the court must divide the marital
property equitably. R.C. 3105.171(C)(1); Neville v. Neville, 99 Ohio St. 3d 275, 2003-Ohio-
3624, ¶ 5. A trial court has broad discretion in the allocation of marital property, and an
appellate court will not disturb its judgment absent an abuse of discretion. Id.
{¶ 35} A court may find an equal division of marital property inequitable if one
spouse demonstrates that the other has committed financial misconduct. "If a spouse has
engaged in financial misconduct, including, but not limited to, the dissipation,
destruction, concealment, nondisclosure, or fraudulent disposition of assets, the court
may compensate the offended spouse with a distributive award or with a greater award of
marital property." R.C. 3105.171(E)(4). Financial misconduct occurs when one spouse
engages in some type of knowing wrongdoing, by which the spouse either profits or
intentionally interferes with the other spouse's property rights. Taub v. Taub, 10th Dist.
No. 08AP-750, 2009-Ohio-2762, ¶ 33; Heller v. Heller, 10th Dist. No. 07AP-871, 2008-
Ohio-3296, ¶ 27; Hamad v. Hamad, 10th Dist. No. 06AP-516, 2007-Ohio-2239, ¶ 62.
This court has affirmed findings of financial misconduct where a spouse has violated the
court's restraining orders; dissipated marital assets without the knowledge or permission
of the other spouse; stole equipment, inventory, and records of the other spouse's
business so as to interfere with the business's continued operation; cashed an insurance
check and used the proceeds for the spouse's own purposes; and sold stock owned by the
other spouse, without that spouse's knowledge or permission. Id. (listing examples);
Galloway v. Khan, 10th Dist. No. 06AP-140, 2006-Ohio-6637, ¶ 27 (same).
{¶ 36} The complaining spouse bears the burden of proving financial misconduct.
Heller at ¶ 27; Hamad at ¶ 61; Galloway at ¶ 26. The trial court has discretion in
determining whether financial misconduct occurred, and an appellate court will only
reverse that determination if it is against the manifest weight of the evidence. Heller at
¶ 27; Hamad at ¶ 61; Parker v. Parker, 10th Dist. No. 05AP-1171, 2006-Ohio-4110, ¶ 12.
{¶ 37} Oftentimes, the time frame when marital funds are dissipated is a relevant
factor in determining an inference of wrongdoing or misconduct, especially when the
dissipation occurs during the parties' separation. Logan v. Logan, 10th Dist. No. 03AP-
No. 13AP-399 14
225, 2003-Ohio-6559, ¶ 22, citing Hammond v. Brown, 8th Dist. No. 67268 (Sept. 14,
1995). However, every factual scenario is different, and we have not said, as a matter of
law, that a court errs in finding financial misconduct in the unilateral dissipation of
marital funds, which occurred during the marriage and prior to separation. Id.
{¶ 38} In the case at bar, appellant does not dispute that in 1998 appellee's parents
purchased 44.90 acres of land in Mississippi for $1,000,000. The purchase was financed
by a mortgage and loan against the property. According to the record, appellee's parents
transferred a 33 percent interest in the land to appellee in 2004. At that time, appellee
began financially contributing to the property, and appellee admits she did not discuss the
investment with appellant prior to making the financial contributions. Appellant became
aware of appellee's investments, and this issue became a source of contention between the
parties. According to appellee, because of appellant's objection to her involvement with
the property, in October 2004, she and her parents transferred the land into VCR I, LLC.
The evidence at trial established that appellee invested anywhere from $65,000 to
$140,000 in the property.
{¶ 39} In November 2007, appellee's parents gave appellee $115,000 with which to
purchase a home, and in June 2008, appellee assigned her interest in VCR I, LLC to her
parents. The trial court expressly found credible appellee's testimony that the $115,000
from her parents was for any interest appellee had held in VCR I, LLC. All of this activity
took place years prior to appellant initiating this domestic proceeding in March 2010.
After review of the evidence, the trial court stated:
While [appellee] may ultimately inherit or be gifted an
interest in this real estate investment, any such transfer would
be her separate property. The Court has already found that
[appellee] held no legal or equitable interest in this real estate
investment at the time of the parties' instigating this legal
action or at the time of the final hearing.
Having considered all of the evidence presented as to the land
in Mississippi and [appellee's] investment with her parents,
the Court does not find that [appellee] has conducted financial
misconduct or that [appellant] is otherwise entitled to
equitable relief.
(Decree, 18.)
No. 13AP-399 15
{¶ 40} Despite appellant's urging otherwise, we conclude the trial court's finding
that appellee did not engage in financial misconduct with respect to the Mississippi
property is not against the manifest weight of the evidence. Further, we find no abuse of
the trial court's discretion in declining to find appellee engaged in financial misconduct or
in declining to otherwise provide appellant with equitable relief regarding the Mississippi
property. Accordingly, we overrule appellant's second assignment of error.
C. Third Assignment of Error
{¶ 41} In his third assignment of error, appellant contends the trial court abused
its discretion in concluding the condominium located in Louisiana was appellee's separate
property.
{¶ 42} As is relevant here, "marital property" includes "[a]ll real and personal
property that currently is owned by either or both of the spouses * * * and that was
acquired by either or both of the spouses during the marriage," and "[a]ll interest that
either or both of the spouses currently has in any real or personal property * * * and that
was acquired by either or both of the spouses during the marriage." R.C.
3105.171(A)(3)(a)(i) and (ii). "Separate property" includes "[a]ny real or personal
property or interest in real or personal property that was acquired by one spouse prior to
the date of the marriage" and "[p]assive income and appreciation acquired from separate
property by one spouse during the marriage." R.C. 3105.171(A)(6)(a)(ii) and (iii).
{¶ 43} A party who wants an asset classified as separate property bears the burden
of tracing that asset to his or her separate property. Alexander v. Alexander, 10th Dist.
No. 09AP-262, 2009-Ohio-5856, ¶ 24, citing Dunham v. Dunham, 171 Ohio App. 3d 147,
2007-Ohio-1167, ¶ 20, 26 (10th Dist.). When parties contest whether an asset is marital
or separate property, the presumption is that the property is marital, unless proven
otherwise. Id., citing Miller v. Miller, 7th Dist. No. 08 JE 26, 2009-Ohio-3330, ¶ 20. On
appeal, our job is not to reweigh the evidence, but to determine whether there was
competent, credible evidence to support the trial court's findings. Id., citing Dunham at
¶ 27. With this standard in mind, we examine the trial court's designation of the
condominium as appellee's separate property.
{¶ 44} Appellant does not dispute that appellee and her brother purchased the
condominium in 1992. Appellee currently holds a 50 percent interest in the property that
No. 13AP-399 16
is being used as a rental property. The trial court determined the condominium's current
value is $165,000 and that in recent years, appellee's brother has claimed all income and
expenses on his income tax returns. The trial court found appellee "testified credibly that
no marital funds have been invested in the property, that she has not personally expended
any work improving or repairing the property and that the mortgage has been paid by the
cash flow." (Decree, 10.) The court also found that repairs and upgrades to the
condominium were accomplished by using the condominium's equity and the refinancing
of a previous mortgage.
{¶ 45} According to appellant, the evidence established that appellee created a
legal interest in the property for him when she forged his signature on various refinancing
documents and took out funds beyond the amount owed on the mortgage. The trial court
noted appellee's conduct regarding the refinancing and specifically concluded that the
money from the refinancing was used to pay the balance owed on the mortgage with
money "pulled out for repairs and upgrades." (Decree, 10.)
{¶ 46} As noted previously, the trial court found appellee's testimony credible and
concluded the Louisiana condominium was her separate property. In applying a manifest
weight standard of review, we defer to the trial court's decisions regarding the credibility
of the witnesses and the weight to be given the evidence. Alexander at ¶ 29, citing
Seasons Coal Co. v. Cleveland, 10 Ohio St. 3d 77 (1984). A review of the record indicates
the trial court's designation of the condominium as appellee's separate property was
supported by competent, credible evidence and is not against the manifest weight of the
evidence. Accordingly, we overrule appellant's third assignment of error.
D. Fourth Assignment of Error
{¶ 47} In his fourth assignment of error, appellant contends the trial court erred in
awarding $40,000 in attorney fees to appellee. The trial court stated that, except as
otherwise ordered, the parties would be responsible for their own fees associated with the
action.
{¶ 48} "In an action for divorce, * * * a court may award all or part of reasonable
attorney's fees and litigation expenses to either party if the court finds the award
equitable. In determining whether an award is equitable, the court may consider the
parties' marital assets and income, any award of temporary spousal support, the conduct
No. 13AP-399 17
of the parties, and any other relevant factors the court deems appropriate." R.C.
3105.73(A). "An award of attorney fees is generally within the sound discretion of the trial
court and not to be overturned absent an abuse of discretion." Wagenbrenner v.
Wagenbrenner, 10th Dist. No. 10AP-933, 2011-Ohio-2811, ¶ 19, citing Shirvani v.
Momeni, 10th Dist. No. 09AP-791, 2010-Ohio-2975, ¶ 22.
{¶ 49} In awarding appellee $40,000 in attorney fees, the trial court's decision
reveals the court considered the marital assets, the parties' incomes, the temporary orders
providing for spousal support, the conduct of the parties, and the reasonableness of the
fees. Appellant first argues the trial court erred in referring to the $75,715.08 appellee
incurred in attorney fees through February 21, 2013 because this amount does not reflect
the amount of attorney fees outstanding. According to appellant, if the amount
outstanding were known, then it would be known what amount of attorney fees appellee
paid with marital income. R.C. 3105.73(A) does not require use of an outstanding
balance, nor has appellant provided any legal support or citation for his proposition that
the trial court should have only considered the amount of attorney fees not yet paid.
Additonally, the $75,715.08 amount did "not include costs and fees incurred subsequent
to [February 21, 2013], including the extraordinary preparation time required by
[appellant's] last minute inclusion of an out of state real estate appraiser during the
course of the trial." (Decree, 46.) Thus, we find no abuse of discretion in the trial court's
utilization of the $75,715.08 amount.
{¶ 50} Appellant next argues that, because the trial court equitably divided the
parties' assets and liabilities in its final order, the court was "arguably precluded" from
considering the factors of R.C. 3105.73 in favor of either party. Again, appellant provides
no support for this assertion. As indicated above, R.C. 3105.73(A) establishes that "[i]n an
action for divorce, * * * a court may award all or part of reasonable attorney's fees and
litigation expenses to either party if the court finds the award equitable. In determining
whether an award is equitable, the court may consider the parties' marital assets and
income, any award of temporary spousal support, the conduct of the parties, and any
other relevant factors the court deems appropriate." This is precisely the action
undertaken by the trial court in this case, as the trial court expressly considered R.C.
3105.73(A) and, thereafter, concluded an award of attorney fees was warranted.
No. 13AP-399 18
{¶ 51} Appellant also contends the attorney fees award is not equitable in light of
the division of the parties' assets and liabilities and in light of the fact that appellee
engaged in misconduct that caused both parties to incur increased attorney fees. In
considering the conduct of the parties, the trial court noted appellant's late or failed
attendance for court appearances, failure to pay the GAL, change of counsel "several
times" during the course of the action, multiple continuance requests, and his untimely
and lacking discovery responses. The trial court also recognized that appellee was "not
without fault" and referred to her attempts to damage appellant's professional career and
obtain employment.
{¶ 52} Nonetheless, appellant argues the trial court failed to give sufficient
consideration to appellee's conduct. " 'Because a court addresses an award of attorney
fees through equitable considerations, a trial court properly can consider the entire
spectrum of a party's actions, so long as those actions impinge upon the course of the
litigation.' " Wehrle v. Wehrle, 10th Dist. No. 12AP-386, 2013-Ohio-81, ¶ 50, quoting
Padgett v. Padgett, 10th Dist. No. 08AP-269, 2008-Ohio-6815, ¶ 17; see also Wolf-
Sabatino v. Sabatino, 10th Dist. No. 10AP-1161, 2011-Ohio-6819, ¶ 105; Farley v. Farley,
10th Dist. No. 99AP-1103 (Aug. 31, 2000) (stating the trial court was in a better position
to determine the extent to which one party's conduct was responsible for increasing
litigation expenses).
{¶ 53} Upon review of the trial court's detailed analysis pertaining to R.C.
3105.73(A), we do not discern an abuse of the trial court's discretion in awarding $40,000
in legal fees to appellee. Accordingly, we overrule appellant's fourth assignment of error.
E. First Cross-Assignment of Error
{¶ 54} In her first cross-assignment of error, appellee asserts the trial court erred
and abused its discretion when it determined $57,636.92 of the balance owed on the PNC
line of credit was subject to marital distribution.
{¶ 55} Appellant testified the PNC line of credit was used to pay for the balance
owed on the practice, Cardiovascular Care Unlimited, when he purchased it. The original
outstanding balance in 2008 was $200,000, but there was no documentation regarding
the balance owed as of the sale of the practice in July 2011 or on September 30, 2012. The
trial court stated:
No. 13AP-399 19
Despite agreement that the $30,000 deposit from sale [of the
practice] would be held in [appellant's] attorney trust account,
[appellant] testified that he received the money (after filing a
Motion for Release from Restraining Order) and claims to
have paid this towards the outstanding balance. [Appellant]
has never verified that these funds were deposited into his
attorney's trust account, or provided an accurate accounting
of the distribution of these funds. The evidence shows that
the balance as of January 11, 2012 (the earliest documentation
presented) was $57,636.92. * * * This same document shows
a payment of $30,124.51 paid on the account on December 24,
2011. [Appellant] testified that this was the $30,000 paid
from his attorney's trust account, but failed to explain the
$124.51. In any event, the Court finds that the [appellant]
received $30,000 pursuant to the terms of the Asset Purchase
Agreement * * * and has paid that amount towards the PNC
business line of credit which was a marital liability.
(Emphasis sic.) (Decree, 14.)
{¶ 56} According to appellee, the trial court erred because appellant testified that
in August 2010 he drew $49,000 on this line of credit and gave the money to his attorney
to hold in his trust account. Because appellee was unaware of and received none of these
funds, she argues the balance of marital debt should be only $8,636.92, rather than
$57,636.92. Appellant testified the amount given to his attorney in August 2010 was
"[m]aybe 48, 49,000, something like that." (Tr. Vol. II, 451.) Appellant then testified he
could not say exactly what the entire amount was, but that it was "around 48, 49,000 in
total." (Tr. Vol. II, 454.) Appellant also testified the amount was "$45,000 in the fall of
2010," that was "[e]scrowed in one lump sum." (Tr. Vol. II, 456.) The following exchange
occurred with the court:
[The Court]: When you took the $45,000, did that come from
the line of credit?
[Appellant]: The $45,000 came from a salary advance from
the line of credit, correct.
(Tr. Vol. II, 458.)
{¶ 57} Appellant then testified, "Actually, I can't remember if it was paid from the
line of credit or from the checking account from the practice, but it was treated as expense
income from me in that tax year." (Tr. Vol. II, 459.)
No. 13AP-399 20
{¶ 58} Based on this testimony, the trial court's decision states:
[Appellant] took a salary advance of $45,000 and paid his
attorney Sanjay Bhatt an initial retainer fee in 2010. It is not
clear whether this was withdrawn directly from the business
checking account or the PNC line of credit. Moreover, it is not
clear that if it was withdrawn from the checking account that
it caused a shortage which later required withdrawals from
the PNC line of credit.
(Decree, 44.)
{¶ 59} There is no evidence in the record definitively establishing whether the
$45,000 funds came from the line of credit or from a salary advance that affected the
outstanding balance on the PNC line of credit. Accordingly, we find no abuse of discretion
in the trial court's decision not to deduct $49,000 from the documented $57,636.92
balance. Accordingly, we overrule appellee's first cross-assignment of error.
F. Second Cross-Assignment of Error
{¶ 60} In her second cross-assignment of error, appellee contends the trial court
erred and abused its discretion when it included $224,931 given to her parents as an asset
to her. According to appellee, she gave her parents only $187,000 during 2006 and 2007
and that throughout the marriage they financially contributed to appellant's parents,
including giving his mother $150,000 to purchase a new home.
{¶ 61} The trial court's decision states:
[Appellee] has given her parents approximately $224,931
which includes payments to lawyers, direct payments to her
father and payments on the real estate investment noted
above. * * * [Appellee] argues that she has always believed in
her father's innocence and that such support is part of the
parties' culture as is evidenced by the fact that [appellant] also
made financial contributions of marital funds to his mother
including contributions for her retirement and the purchase of
her home. [Appellant] does not dispute [appellee's] testimony
and it is clear that these support/gifts were conducted with
[appellee's] prior knowledge, if not her explicit agreement.
Moreover, [appellee's] siblings also contributed to their
parents during this time period although amounts of their
contributions were not disclosed.
The Court is inclined to believe that the support of parents
and/or extended family is part of the parties' culture and
No. 13AP-399 21
should not under most circumstances be considered per se
financial misconduct. It does not appear that [appellee's] gifts
did not affect the day to day welfare of this family. That said
given their frugal financial dealings, the parties would have
likely invested these funds and they would have been available
for distribution in this divorce. Moreover, as previously
indicated, [appellant] believed that the parties' marital
financial arrangement (albeit not necessarily by agreement)
was for [appellee] to invest her income for their immediate
family's future benefit while [appellant] was responsible for
the family's primary living expenses. [Appellee's] failure to
obtain [appellant's] consent or even to discuss the gifting of
these significant marital funds, (especially knowing his
feelings about her father's indictment) while not considered
financial misconduct shall be given equitable consideration by
this Court.
(Decree, 18-19.)
{¶ 62} Thus, the trial court clearly considered the amounts contributed to
appellee's parents during the relevant time frames, and the trial court took into
consideration financial contributions made to other family members, including those in
appellant's family. Despite appellee's assertion otherwise, the trial court concluded
appellee was aware of the financial contributions made to appellant's family. As stated
earlier, we defer to the trial court's determinations regarding the credibility of the
witnesses and the weight to be given the evidence. Alexander at ¶ 29, citing Seasons Coal
Co.
{¶ 63} Upon review, we cannot conclude the trial court abused its discretion by
including the $224,931 as an asset of appellee. Accordingly, we overrule appellee's second
cross-assignment of error.
V. CONCLUSION
{¶ 64} Having overruled appellant's four assignments of error and appellee's two
cross-assignments of error, the judgment of the Franklin County Court of Common Pleas,
Division of Domestic Relations, is hereby affirmed.
Judgment affirmed.
TYACK and CONNOR, JJ., concur.
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