Case Title: Dice v. Dice

Citation: 

Docket Number: 87-9

State: wyoming

Court: Wyoming Supreme Court

Date: 1987-09-11T00:00:00Z

Document:
Dice v. Dice1987 WY 125742 P.2d 205Case Number: 87-9, 87-10Decided: 09/11/1987Supreme Court of Wyoming
Gerald 
Lee DICE, Appellant (Defendant)

 
 
v.

 
 
Beverly 
Ann DICE, Appellee (Plaintiff); Beverly Ann DICE, Appellant (Plaintiff), v. 
Gerald Lee DICE, Appellee (Defendant)

 
 

Dallas J. 
Laird for Gerald Lee Dice.

 
 
Richard 
H. Peek for Beverly Ann Dice.  

 
 
Before 
Brown, C.J., and Thomas, Cardine, Urbigkit, and Macy, JJ.  

 
 
URBIGKIT, 
J.

 
 
[¶1.]     Cross appeals are 
presented questioning divorce-decree settlement of property interests and award 
of child support. The husband contests the amount of child support as excessive, 
and considers tax-related problems in the immediate cash payment of the property 
settlement granted to the wife. The wife contests an amendment to the judgment 
which recognized the bankruptcy of Associated Grocers of Colorado, Inc. as 
causing a reduction in marital estate value.

 
 
[¶2.]     We affirm the 
child-support award, affirm the judgment-decree amendment, and remand for 
consideration of cash-settlement payment method in consideration of federal 
income tax problems and net values resulting therefrom.

 
 
[¶3.]     Gerald Dice founded and 
operated Jerry's Food Market, Inc. in Casper as a retail grocery enterprise. In the 
better days in Casper, the business was profitable, affording 
a good living, cash accumulation, and deposits to a retirement account in his 
name. Those good days no longer are to be found in Casper merchandising.1

 
 
[¶4.]     Gerald was married to 
Beverly Ann in 1969, and a daughter, Rebecca Lynn, is now 13. Irreconcilable 
differences developed in part because of demands on Gerald's time in operation 
of the competitive grocery business in a recessive and troubled economic market; 
Beverly Ann developed an interest in roller skating, engendered to their 
daughter, so that the pathways of the parties developed different directions. 
The divorce proceeding, after nearly 17 years of marriage, was filed by the wife 
although undesired by the husband, and was accompanied by a change in her 
circumstance by moving to Greeley, Colorado, and engagement with her parents in a 
roller skating business. 

 
 
[¶5.]     Faced by the trial 
court was the usual almost unanswerable quandary of how to divide and then leave 
the parties with an ability to pick up the pieces. This appeal brings to us the 
court's decision for an abuse-of-discretion inquiry.

 
 
I. CHILD 
SUPPORT

 
 
[¶6.]     The amount awarded is 
obviously a serious burden on the father, considering Casper economic 
conditions. We would hold that as of the date of trial there was sufficient 
evidence to sustain the award made, justified apparently not from enterprise 
draw amounts but basic business income. If continued deterioration of economic 
status should occur, such that a substantial change in circumstances could be 
found, some future modification on that basis could be available. See Cubin v. Cubin, 
Wyo., 685 P.2d 680 (1984). Determination of amount of child support is vested in the 
sound discretion of the court. Manners v. 
Manners, Wyo., 706 P.2d 671 (1985). Our rule for 
analysis of exercised discretion is carefully stated in Martin v. State, 
Wyo., 720 P.2d 894, 897 (1986):

 

"Judicial 
discretion is a composite of many things, among which are conclusions drawn from 
objective criteria; it means a sound judgment exercised with regard to what is 
right under the circumstances and without doing so arbitrarily or 
capriciously."

 
 
II. 
RECOGNITION OF THE BANKRUPTCY OF ASSOCIATED GROCERS OF COLORADO, INC., AND 
AMENDED JUDGMENT

 
 
[¶7.]     In its original decree, 
the trial court had awarded the wife a cash settlement of $ 206,175 for property 
division. Through present counsel, a motion under Rule 59, W.R.C.P. for a new 
trial and/or amendment of judgment was made within ten days of the decree date, 
in behalf of the husband, on the basis that the decree divisional value of the 
business of $ 378,000 included $ 78,395 as valued in a cash participation 
certificate with the grocer wholesaler, Associated Grocers of Colorado, Inc. 
After trial on September 19, 1986, a decision letter was submitted October 6, 
with the decree to be prepared by counsel for the wife, which decree was then 
entered on October 30, including a net cash value at par for the participation 
certificate. On October 10 Associated Grocers filed bankruptcy, and on October 
30 the husband was advised by the bankrupt that all credits were frozen but that 
in any event the redemptive value of the certificate without bankruptcy would 
not have exceeded $ 15,931.

 
 
[¶8.]     In responding to this 
motion, the trial court by order deleted the Associated Grocers redemption 
certificate marital estate value of $ 78,395, and correctly provided for equal 
division of proceeds if and when received. The justice of the amendment order is 
self-evident, with the wife's contest being procedurally directed, challenging 
whether amendatory power remained with the trial court.

 
 
[¶9.]     This court applies the 
clearly applicable criteria for amendatory action pursuant to Rule 59, W.R.C.P., 
as well as Rule 60(b), W.R.C.P., and criteria stated in Walton v. Texasgulf, Inc., Wyo., 634 P.2d 908, 913 
(1981):

 

"* * * * 
The party seeking a new trial on the basis of newly discovered evidence must 
satisfy the court that: (1) the evidence has come to his knowledge since the 
trial; (2) it was not owing to the want of due diligence that it did not come 
sooner; and (3) it is so material that it would probably produce a different 
verdict if a new trial were granted; and (4) it is not cumulative, viz, speaking 
to facts in relation to which there was evidence at 
trial."

 
 
We 
affirm the trial court's exercised discretion and decision in recognition with 
the trial court that in justice you cannot fairly divide numbered dollars which 
no longer exist or at least may never be. Martin 
v. State, supra; Mini Mart, Inc. v. Wordinger, Wyo., 719 P.2d 206 
(1986); Brasel and Sims Construction Co. v. 
Neuman Transit Co., Wyo., 378 P.2d 501 
(1963).

 

III. 
PROPERTY SETTLEMENT CASH-PAYMENT REQUIREMENT

 
 
[¶10.]  The complicated appeal issue is the 
husband's question of federal income-tax attributes involved in the division and 
divorce-decree payment requirement being "abusive, arbitrary and confiscatory." 
He does not challenge the amount, but seeks help on appeal for modification of 
the manner of payment. Jerry's Food Market, Inc. was incorporated without the 
issuance of stock, and was treated by the litigants and the court as if husband 
and wife each owned an equal one-half interest in the corporate business. 
Balance sheets reflected two asset items in controversy, the Associated Grocers 
participation certificate of $ 75,876 earlier discussed, and an accumulated cash 
amount of about $ 180,000. Financial reports indicated that breaking even in 
current operations was made possible primarily by investment income earned on 
that savings, and not in grocery sale profits.

 
 
[¶11.]  Also involved in the cash division decree 
settlement was a profit-sharing plan in the name of the husband of $ 50,710, 
which was likewise equally divided in decree computation and payment order. 
Appellant does not complain about the right of his divorced wife to receive a 
value equal to one-half the retirement account provided that with a division of 
corporate asset value, a realistic process and adequate time is afforded so that 
a continued operative capacity of the corporation and the decree income-tax 
attributes would be given fiscal consideration.

 
 
[¶12.]  He phrased the argument as 
follows:

 

"The 
uncontroverted testimony at the trial of this matter was that the cash in the 
corporation, Jerry's Food Market, Inc., would be subject to Federal income tax 
should Appellant declare a dividend to himself. Mr. Dice also testified that if 
all the cash were taken out of the corporation, the corporation could not 
operate.

 
 
"Unfortunately 
for the Appellant, the District Court did not take into account, at all, the 
Appellant's personal income tax liability if he were to withdraw money from his 
corporation and profit sharing account. In order to comply with the lower 
court's decree, Appellant will have to liquidate approximately $ 300,000.00 
worth of his corporate assets in order to pay Appellee $ 166,977.41. * * * 
*.

 

"The 
lower court's requirement of a cash payment under these circumstances is not 
just and equitable and did not leave proper consideration of the horrible 
condition in which Mr. Dice will be left by this Divorce Decree. Wyo. Stat. § 20-2-114 (1982) and Paul v. Paul, Wyo., 
616 P.2d 707 (1980). In fact the Court should have ordered the 
sale of the business and the proceeds equally split between the parties. 
Klatt v. Klatt, Wyo., 
654 P.2d 733 (1982)."

 
 
[¶13.]  He further contends that take-home pay of 
$ 467 per week, as a business withdrawal, could not support the $ 500 monthly 
child-support obligation and repayment of a loan of $ 166,977 with interest, as 
would be required to fund the cash-settlement directive of the divorce 
decree.

 
 
[¶14.]  In recognition of the withdrawal penalty, 
as well as income-tax factors, the retirement account obviously does not have a 
present withdrawal cash value equal to the face amount. This may be the unusual 
case under our recent consideration in Broadhead 
v. Broadhead, Wyo., 737 P.2d 731 
(1987), where the wife might be granted a 50 percent interest in the IRA 
account, to be received by her as and when proceeds were available by 
retirement, husband's death or premature withdrawal, in the same fashion as she 
is now entitled to receive whatever may be paid on the Associated Grocers 
participation certificate. Possibly the account could be frozen in present 
status with divided ownership. Again, tax attributes would require counsel and 
trial-court review as, for example, whether the husband could establish another 
separately owned account. Conversely, on remand, the court may want to determine 
the cash-out value after considering the penalty and income-tax amounts and 
withdrawal costs, and accord a present cash value of that computable amount as 
an obligation for present payment by the husband. We only determine that 
withdrawal after tax cash value should be reflected in divorce-decree division 
if an immediate cash payment is required. In divorce settlement, exercised 
discretion by the trial court requires federal income-tax assessment. Martin v. State, 
supra; Malman, Unfinished Reform: The Tax Consequences of Divorce, 
61 N.Y.U. L. Rev. 363 
(1986).

 
 
[¶15.]  This leaves for resolution the cash-out 
decree order for corporate value as a shareholder obligation. Clearly, the 
liquidation value for division purposes, when in effect the husband is required 
to purchase the stock of the wife, requires income-tax-funding assessment. 
Again, it is axiomatic that he has to get money to give money and is in one 
fashion or another faced with after-tax dollars from which payment must be made. 
The extensive literature on divorce settlement and corporate reorganization 
affords diverse choices available in the method, process and timing. See, for 
example, 2 McCahey, Valuation and Distribution of Marital Property, § 41.14. It 
would be inappropriate for this court to assume discretional responsibilities 
which are better performed in ingenuity, research and persuasion of trial 
counsel, and comprehensive factual analysis of the trial court. Certainly we all 
must recognize that what is not realistic or reasonably possible is not 
necessarily accomplished because it is included in a court decree. Broadhead v. Broadhead, supra. Cf. Rubeling 
v. Rubeling, Wyo., 
406 P.2d 283 (1965). Likewise, if the husband's grocery 
business is destroyed, the child-support payment is endangered by changed 
circumstances which likely would engender a petition for modification. Cubin v. Cubin, 
supra.

 
 
[¶16.]  The amended order changing status of the 
Associated Grocers participation certificate is affirmed. The child-support 
order is affirmed. The case is remanded for a hearing to reconsider 
property-settlement provisions of the divorce decree in accord herewith. 

 
 
[¶17.]  Affirmed in part, reversed in part, and 
remanded.

 
 
FOOTNOTES

 
 

1Recent newspaper reports of grocery 
store closings in Casper, and the significant 
change in the relative cost-of-living index for Casper afford expressive evidence of the 
declining profit in the grocery business.