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L.R.S. v. C.A.S.

Court of Appeals of Missouri, Eastern District, First Division

August 15, 2017

L.R.S., Respondent,
C.A.S., Appellant.

         Appeal from the Circuit Court of St. Louis County 14SL-DR05439 Honorable Kristine A. Kerr


         C.A.S. ("Husband") appeals from the trial court's Findings of Fact, Conclusions of Law, Order, Judgment and Decree of Dissolution ("Judgment") and subsequent judgment nunc pro tunc. Husband claims the trial court erred in issues related to the division of marital property, maintenance, and an award of attorney's fees on appeal. We affirm in part, reverse in part, and remand for further proceedings consistent with this opinion.[1]

         I. BACKGROUND

         A. The Evidence Adduced at Trial

         L.R.S. ("Wife") filed her petition for dissolution of marriage on September 16, 2014, and Husband filed a cross-petition for dissolution on October 7, 2014. A bench trial was conducted on October 5, October 6, October 30, and November 16, 2015, revealing the following facts.

         Husband and Wife were married on October 9, 1992.[2] It is undisputed the parties enjoyed substantial financial resources throughout the marriage, and that they grew accustomed to a certain standard of living. Therefore, much of the evidence adduced at trial related to Husband's multiple sources of income and to the parties' spending patterns, which we summarize below.

         Throughout the marriage, Husband was involved in the following business ventures that provided him with sources of income. First, Husband owned a fifty percent interest in W.C. Motor Company d/b/a West County Volvo ("West County Volvo"). Husband was also employed as the President of West County Volvo, and from this employment he earned a salary of $140, 926.12 in 2014, along with many benefits. Second, Husband owned a twenty-four and one-half percent interest in Suntrup Ford, Inc. d/b/a Suntrup Ford Westport ("Suntrup Ford Westport") and was paid distributions based on his ownership interest, such distributions totaled $96, 016.08 in the five years before trial. Third, Husband is the sole owner of Duke Reinsurance, LTD, which sells aftermarket financial products (warranties) to customers of West County Volvo. Between 2009 and 2014, Husband received a total of $598, 233.40 from Duke Reinsurance, LTD. Fourth, Husband and Wife wholly owned two limited liability companies, 7196 LLC and 14400 Manchester, LLC ("the real estate entities), which owned property that was leased to West County Volvo. 7196 LLC generated approximately $3, 450 per month in income and 14400 Manchester, LLC generated approximately $3, 000 per month. Finally, the trial court also found Husband received income from Heart Dealer Financial Services, LLC ("Heart Dealer Financial"), a third-party administrator of financial products for West County Volvo. In the five years prior to trial, Husband received a total of $169, 269.64 from Heart Dealer Financial.

         Calculations associated with the parties' joint tax returns indicate their gross income was $452, 557 in 2014. Husband also received $113, 204 from Duke Reinsurance, LTD in 2014 that was not included on Husband's tax return. When totaled together, then divided by twelve, the court found that Husband's gross income was $47, 146.75 per month.

         Early in the marriage, Wife was employed as a model, make-up artist, and in a sales position. However, Wife stopped working when the parties had children, and has not worked outside the residence since 1998. Wife received help caring for the parties' children and maintaining the marital residence; the couple employed an au pair when the children were young and then employed a cleaning lady and a part-time worker to do the family's laundry. Based on the report of a vocational expert, the trial court imputed income to Wife in the amount of $2, 167 per month as her potential employment income.

         Significant testimony was elicited regarding alleged marital and financial misconduct. During the marriage and prior to the parties' separation, Husband suffered from alcohol addiction, cocaine addiction, and engaged in sexual relationships with massage therapists. The foregoing misconduct all occurred while the minor children were still residing in the home, and Wife testified that Husband's actions affected the children. In 2013, Husband went to Sober Living by the Sea, a rehabilitation facility for approximately thirty days. Husband has remained sober since he left the rehabilitation facility. Additionally, the trial court found Husband violated St. Louis County Local Court Rule 68 (effective May 1, 2010) ("Local Rule 68")[3] by spending a substantial amount of marital funds on his girlfriend, or elsewhere which he cannot account for, while the dissolution proceedings were pending.

         Wife admitted to using cocaine with Husband because she felt it "was about the only way I could get to do anything with him." Wife also admitted that after Husband cancelled her credit card in December 2014, she removed approximately $11, 000 from the marital bank account, transferred the money to her separate bank account, and spent it. However, the trial court found Wife's alleged financial misconduct was "dwarfed" by that of Husband.

         B. The Trial Court's Judgment and Other Relevant Procedural Posture

         On February 18, 2016, the trial court issued its Judgment, and on March 10, 2016 the court issued a judgment nunc pro tunc, correcting mathematical or clerical errors.[4] In its Judgment, inter alia, the trial court ordered the following regarding the division of property and maintenance.

         The trial court made findings as to the value of each of Husband's business interests, and found the total value of the marital estate to be $1, 589, 735.51. Based in part on Husband's misconduct and on the fact Husband was the party with greater earning capacity, the trial court determined a property division of sixty percent to Wife and forty percent to Husband was just, equitable, and appropriate. Husband was awarded: the entirety of his various business interests, valued at $1, 133, 500 total; the marital Morgan Stanley account with a balance of $34; and $12, 325 of the equity from the sale of the marital residence. Wife was awarded the West County Volvo 401(K) plan valued at $66, 302.51 and equity from the sale of the marital residence in the amount of $93, 939.[5] Husband was then ordered to pay Wife a first equalization payment of $658, 601 to reach the sixty-forty property division. Husband was also ordered to pay Wife a second equalization payment of $70, 815 "to equalize assets in light of each party's use of marital funds in violation of Local Court Rule 68."[6]

         The trial court also awarded Husband as his separate property, a BMW 401(K) plan in the amount of approximately $2, 000 and his interest in a family trust, which holds assets comprised of real estate and cash, in the approximate value of $5, 500, 000. As to the marital debt, Husband was ordered to pay ninety percent of the parties' tax debt, while Wife was ordered to pay the remaining ten percent. Husband was also ordered to bear responsibility for repaying a promissory note Husband owes to his brother.

         The proceeds from the sale of the marital residence were first used to pay $100, 000 to each party's attorney's fees. Then, the court split the remaining home equity according to the sixty-forty property division, deducted all litigation expenses from Husband's side and Wife's additional attorney's fees and advances from her side, and distributed the remainder to Husband and Wife in the amounts previously stated.

         Husband was ordered to pay Wife $14, 617 per month in modifiable maintenance beginning on December 1, 2015. In support of its award of maintenance, the trial court listed with particularity each of the parties' income and reasonable expenses.[7] In lieu of retroactive maintenance, Husband was ordered to pay Wife's outstanding credit card debt in an amount not to exceed $57, 556.12. Additionally, Husband was ordered to pay for the children's schooling, and to pay Wife $500 in child support for each month the youngest child is home from college.

         On March 18, 2016, Husband filed a motion to amend the Judgment, or alternatively, for a new trial, which was subsequently denied by the trial court. Husband then filed his notice of appeal on May 20, 2016.

         On September 22, 2016, Wife filed a motion requesting attorney's fees on appeal. Husband filed written objections to the motion for attorney's fees on October 10, 2016, and the trial court held a hearing off the record the next day. The trial court subsequently granted Wife's motion and ordered Husband to pay $25, 000 of Wife's attorney's fees on appeal. Husband appeals.


         Husband raises eight points on appeal, which we will discuss in the following order. In his eighth point on appeal, Husband argues the trial court erred in ordering him to pay Wife an equalization payment of $80, 100 as part of the division of marital property. Then, in Husband's first through sixth points on appeal, he asserts the trial court erred in ordering Husband to pay Wife $14, 617 in monthly maintenance. And in his seventh point on appeal, Husband contends the trial court erred in ordering him to pay Wife $25, 000 for attorney's fees on appeal.

         A. General Standard of Review

         As with any court-tried case, our review of a dissolution of marriage action is guided by the standards set forth in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). Alabach v. Alabach, 478 S.W.3d 511, 513 (Mo. App. E.D. 2015) ("Alabach I"). Accordingly, the dissolution judgment will be affirmed unless it is not supported by substantial evidence, it is against the weight of the evidence, it erroneously declares the law, or it erroneously applies the law. Id.

         Matters such as the weight of evidence, the credibility of witnesses, and the resolution of conflicting evidence are for the trial court to resolve and will not be reviewed by this Court. Hollida v. Hollida, 131 S.W.3d 911, 915 (Mo. App. S.D. 2004).

Appellate courts defer to the trial court on factual issues because it is in a better position not only to judge the credibility of witnesses and the persons directly, but also their sincerity and character and other trial intangibles which may not be completely revealed by the record. The appellate court's role is not to re-evaluate testimony through its own perspective.

In re Estate of L.G.T., 442 S.W.3d 96, 100 (Mo. App. S.D. 2014) (quoting White v. Director of Revenue, 321 S.W.3d 298, 308-09 (Mo. banc 2010)) (internal citations and emphasis omitted). The trial court is free to believe all, none, or part of a witness's testimony, and may disbelieve even uncontradicted testimony. Hollida, 131 S.W.3d at 915-16. Additionally, when the trial court has made no specific findings on a factual issue, such findings are interpreted as having been found in accordance with the trial court's judgment. Ivie v. Smith, 439 S.W.3d 189, 200 (Mo. banc 2014); Rule 73.01(c).[8]

         Moreover, in reviewing a court-tried case, an appellate court is primarily concerned with the correctness of the trial court's decision rather than the route taken to reach it. O'Gorman & Sandroni, P.C. v. Dodson, 478 S.W.3d 539, 543 (Mo. App. E.D. 2015). "Therefore, we are obliged to affirm if we determine that the trial court reached the correct result, regardless of whether the trial court's proffered reasons are wrong or insufficient." Id.

         B. Whether the Trial Court Erred in Ordering Husband to Pay Wife the Second Equalization Payment

         In his eighth point on appeal, which we discuss first for ease of analysis and to provide relevant background, Husband argues the trial court erred in ordering him to pay Wife the second equalization payment of $80, 100 as part of the division of marital property. We disagree.

         1. Standard of Review and General Law Relating to Property Division

         The trial court is vested with broad discretion in dividing marital property. Coleman v. Coleman, 318 S.W.3d 715, 719 (Mo. App. E.D. 2010); Woodard v. Woodard, 201 S.W.3d 557, 561 (Mo. App. E.D. 2006). "A division of marital property need not be an equal division, but must only be fair and equitable given the circumstances of the case." Workman v. Workman, 293 S.W.3d 89, 96 (Mo. App. E.D. 2009). The trial court's division of property will be disturbed only if the division is so heavily weighted in favor of one party as to amount to an abuse of discretion. Rallo v. Rallo, 477 S.W.3d 29, 38 (Mo. App. E.D. 2015); Woodard, 201 S.W.3d at 561. Further, we presume the division of property is correct, and the party challenging the property division bears the burden of overcoming the presumption. Woodard, 201 S.W.3d at 561. Even if the evidence could have supported a different division, we defer to the trial court's findings, because it is in the best position to determine the sincerity and credibility of witnesses, weigh conflicting evidence, and judge other trial intangibles not revealed by the transcript. Hatchette v. Hatchette, 57 S.W.3d 884, 890 (Mo. App. W.D. 2001).

         In determining a fair and equitable division of marital property, the trial court is statutorily required to consider, among other factors, "[t]he conduct of the parties during the marriage." Lindsey v. Lindsey, 336 S.W.3d 487, 496 (Mo. App. E.D. 2011) (quoting section 452.330.1(4) RSMo 2000[9]); see also Franklin v. Franklin, 213 S.W.3d 218, 226 (Mo. App. E.D. 2007). The trial court may order an unequal division of property based upon a party's misconduct when such misconduct changes the balance so that the other spouse was burdened with a greater share of the partnership load. Lindsey, 336 S.W.3d at 496. Misconduct that causes or contributes to the breakup of a marriage is considered an added burden. Id. The courts consider misconduct in dividing marital property as an attempt to recognize "that significant misconduct, of whatever kind, negatively affects the marital relationship and places burdens, even if not economic burdens, on the other party to the relationship." Hatchette, 57 S.W.3d at 890.

         2. Husband's Arguments, the Trial Court's Findings, and Analysis

         Before delving into the merits of Husband's claim, we find it necessary to clarify Husband's arguments and the scope of our analysis. Husband's eighth point relied on reads, "[t]he [t]rial [c]ourt erred in ordering [Husband] to pay $80, 100 to [Wife] as a second equalization payment as the [t]rial [c]ourt's order was an abuse of discretion as [Wife] spent indiscriminately during the pendency of the case, thereby penalizing [Husband] for spending marital funds was an abuse of discretion." Despite limiting his point relied on to the propriety of the equalization payment, Husband further contends in the argument portion of his brief that the trial court erred in ordering Husband to pay the equalization payment along with requiring him to pay a portion of Wife's credit card debt.[10] However, issues raised only in the argument portion of a parties' brief are not preserved for appellate review. Hollida, 131 S.W.3d at 916 n.6. Thus, we will limit our analysis on this point to determining whether the trial court erred in ordering Husband to pay Wife the second equalization payment, and decline to address whether the trial court erred in ordering Husband to pay Wife's credit card debt.

         We also find it important to note an ambiguity in Husband's claim. As previously noted, Husband's eighth point relied on challenges the trial court's action in "ordering [Husband] to pay $80, 100 to [Wife] as a second equalization payment." (emphasis added). However, our review of the record reveals the second equalization payment awarded to Wife was in the amount of $70, 815.[11] This payment was awarded "to equalize assets in light of each party's use of marital funds in violation of Local Court Rule 68." From what we can glean from the record and the Judgment, the $80, 100 figure comprises the portion of the value of Duke Reinsurance, LTD Husband shall pay Wife as part of the first equalization payment, which was ordered to reach the sixty-forty property division between the parties. Because Husband refers to the "second equalization payment" in his point relied on, and because this second equalization payment was ordered by the trial court to account for the violations of Local Rule 68 (which Husband's argument in this point on appeal relates to), we review Husband's argument as if it properly challenges the propriety of the second equalization payment of $70, 815.

         Having noted the parameters of our analysis, we proceed to Husband's argument on this point. Husband asserts the trial court abused its discretion in awarding Wife an equalization payment based on Husband's financial misconduct during the pendency of the dissolution proceedings. Husband maintains he was unfairly penalized for his misconduct while Wife was found not to have committed financial misconduct based on her credit card spending.

         a. Local Rule 68 as it Relates to Husband's Claim

         Relevant to our discussion of this point is Local Rule 68.3, which provides in part:

(F) In any dissolution, . . . neither party shall close or borrow against any bank or investment account, certificate of deposit or IRA or retirement account, nor shall either party dissipate, sell, remove, assign, transfer, dispose of, lend, mortgage, or encumber any property of a party, real or personal, except in the ordinary course of business or for the necessary expenses of the parties' family under the circumstances unless ordered by the [c]ourt or unless consented to in writing by both parties.
(G) In any dissolution, . . . neither party shall incur extraordinary credit card or other debt except in the ordinary course of business or for the necessary expenses of the parties' family under the circumstances unless ordered by the [c]ourt or unless consented to in writing by both parties.

         Local Rule 68.3(2)(F) and (G). Pursuant to the rule, the trial court has authority to find the violating party in contempt and order fines or sanctions based upon the violation. Local Rule 68.3(4).

         During the pendency of the proceedings in the lower court, Wife filed a motion for contempt, alleging Husband behaved contemptuously in removing money from the marital Morgan Stanley checking account, terminating an Ameriprise life insurance policy, and dissipating said funds. The trial court addressed Wife's motion for contempt in its Judgment, entering findings of fact and conclusions of law on the matter. The court found that although the Morgan Stanley account held a balance of $99, 320.62 at the time Wife filed her petition for dissolution in September 2014, Husband credibly testified at trial the current balance of that account was $34.00. Moreover, Husband received approximately $29, 814.19 in cash from terminating the life insurance policy.

         The trial court found, "[w]hile some of Husband's spending from these sums went to legitimate litigation expenses, mortgage payments, tuition payments or documented credit card payments, the [c]ourt finds that Husband spent considerable amounts of marital cash/assets on his girlfriend (furniture, clothing, nails, gas for her car, jewelry) or elsewhere, which he cannot otherwise account for, in contravention of [Local] Rule 68." Further, "Wife offered credible evidence to show that Husband denied Wife access to the [Morgan Stanley] account, hid some spending by writing cash checks to himself, without further ability to account for same, suggesting that he was acting with ill-intent or at least with a purpose to deprive Wife of some of the parties' marital assets." Although the court concluded Husband violated Local Rule 68.3, at least with some of his expenditures, the court exercised its discretion to find Husband was not in contempt and decided to recapture the marital assets under the division of property instead.

         Based on the trial court's actions in concluding Husband violated Local Rule 68.3 but not holding him in contempt, we consider the court's findings and conclusions relating to Husband's financial misconduct in violation of the local rule as part the trial court's larger consideration of "[t]he conduct of the parties during the marriage" as required by section 452.330.1(4). See Lindsey, 336 S.W.3d at 496; Franklin, 213 S.W.3d at 226.

         b. Additional Trial Court ...

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