Case Title: Kane v. Kane

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1978-04-12T00:00:00Z

Document:
Kane v. Kane1985 WY 150706 P.2d 676Case Number: 84-49, 84-50Decided: 09/26/1985DONNA J. KANE, APPELLANT (DEFENDANT), 

v. 

KENNETH A. KANE, APPELLEE (PLAINTIFF). 

DONNA J. KANE, APPELLANT (PLAINTIFF), 

v. 

KENNETH A. KANE, APPELLEE (DEFENDANT).

Supreme Court of Wyoming
DONNA J. KANE, APPELLANT 
(DEFENDANT), 

v. 

KENNETH A. KANE, APPELLEE 
(PLAINTIFF). 

DONNA J. KANE, APPELLANT 
(PLAINTIFF), 

v. 

KENNETH A. KANE, APPELLEE 
(DEFENDANT).

 
 
Appeal from the District 
Court, SheridanCounty, Leonard McEwan, 
J.

 
 
Thomas C. 
Wilson, Sheridan, and Charles F. Moses, Billings, for appellant.

Tom C. Toner, 
Redle, Yonkee & Arney, Sheridan, and Frank C. 
Richter, Billings, for appellee.

Before THOMAS, C.J., and 
ROSE, ROONEY, BROWN and CARDINE, JJ.

THOMAS, Chief 
Justice.

[¶1.]     In this appeal we are 
asked to decide whether the district court had the authority to modify the 
provisions of a decree of divorce relating to the property of the parties and to 
determine the consequences of the court's division of that property pursuant to 
Rule 60(a), W.R.C.P. In the process we must address the substantive effect of 
our statute relating to equitable distribution of the property of the parties, § 
20-2-114, W.S. 1977. The district court adjusted the decree by ascribing to the 
parties co-ownership of a ranch in Montana during their marriage, at the time the 
divorce complaint was filed, and prior to the decree. It also required the wife 
to pay her share of federal taxes arising out of the sale of the ranch property. 
We hold that the district court had jurisdiction and authority to so modify the 
decree; that as modified it correctly reflects Wyoming law; and the judgment of the district 
court is affirmed.

[¶2.]     In the index to her 
brief in these cases Donna J. Kane raises the following 
issues:

"1. The Lower Court had 
no Jurisdiction to Change Title to Land outside Wyoming.

"2. The District Court 
cannot change the Decree as Modified and Affirmed on 
Appeal

"3. Res Judicata Bars 
this Order and Judgment

"4. The Court cannot 
change a Husband's Right to own Separate Property during a Marriage and Prior to 
a Divorce 

"5. The Internal Revenue 
Service and the Federal Courts had Jurisdiction over this 
Controversy

"6. The Issues Raised 
here may be Moot

"7. The Wyoming Declaratory 
Judgment Statutes Do Not Permit this Action

"8. The Divorce Court 
Reserved Jurisdiction

"9. There are Genuine 
Issues as to Material Facts and Law in Dispute"

[¶3.]     Kenneth A. Kane 
complains that there is not really a statement of issues by the appellant, and 
he then states the issues in this way:

"1. Is Kenneth Kane 
asking the court to act in excess of its jurisdiction by directly affecting 
title to land in Montana?

"2. Does the Wyoming 
District Court have jurisdiction and authority to grant the relief sought under 
either the Uniform Declaratory Judgments Act or under its express reservation of 
jurisdiction in the divorce decree of power to decide disputes arising out of 
that decree?

"3. Do the federal courts 
and the Internal Revenue Service have exclusive jurisdiction over the matter in 
question?

"4. Is the action barred 
by res judicata or mootness.

"5. Did Donna Kane have a 
vested ownership interest in the parties' ranch prior to the decree of divorce 
such that the property division decreed by the court was a recognition of a 
species of common ownership of the marital estate by the wife resembling a 
division of property between co-owners as opposed to a conveyance by the husband 
for the release of an independent obligation owed by him to the 
wife?

"6. Did the court have 
the authority under Wyo.R.Civ.P. 60(a) to make the written decree of divorce 
conform to the court's oral judgment which imposed an obligation upon Donna Kane 
to pay a share of the income tax arising from the sale of the 
ranch?"

[¶4.]     This case has been 
before this court on two previous occasions. Kane v. Kane, Wyo., 577 P.2d 172 (1978); Kane v. Kane, 
Wyo., 616 P.2d 780 (1980). It appears that the reason for 
this appeal is the assertion of inconsistent positions by the Internal Revenue 
Service of the Department of Treasury of the United States of America with respect to payment 
of taxes arising out of the sale of the ranch property in Montana to Shell Oil 
Company. If the effect of the divorce decree was that at that time a sale 
occurred from Kenneth A. Kane to Donna J. Kane of an undivided one-half interest 
in the ranch property in exchange for a release of her marital rights then the 
transaction would result in all of the taxes being paid by Kenneth Kane. On the 
other hand, if the decree of divorce effected a division of property between 
co-owners then upon the sale each of the parties would pay one-half of the 
taxes.

[¶5.]     When this issue arose 
Kenneth A. Kane filed a motion in the divorce case seeking modification of the 
decree pursuant to Rule 60(a), W.R.C.P.1 Apparently out of an abundance of 
caution he also filed a separate declaratory judgment action in which he sought 
a construction of the decree which would ascribe to it the effect of a division 
of property between co-owners. The district court combined the two cases for 
hearing and entered an Order and Judgment which provided in material part as 
follows: 

"IT IS, THEREFORE, 
ORDERED, ADJUDGED AND DECREED, that Kenneth A. Kane and Donna J. Kane were 
during their marriage at the time the divorce complaint was filed, and prior to 
the decree of divorce, co-owners of the Montana ranch property purchased by Shell Oil 
Company regardless of in whose name the ranch was titled.

"IT IS FURTHER ORDERED, 
ADJUDGED AND DECREED, by the court that Donna J. Kane is to pay her respective 
share of the federal income taxes arising out of the sale of the ranch property 
to Shell Oil Company as though she was a co-owner of the ranch property during 
the marriage to Kenneth A. Kane."

[¶6.]     We do not address the 
applicability of the Wyoming Declaratory Judgments Act, § 1-37-101 et seq., W.S. 
1977, to the situation. Donna Kane argues that it is not applicable, and Kenneth 
Kane does not seek to defend that position. It is not necessary to treat with 
the Declaratory Judgment Act because the district court had jurisdiction 
pursuant to Rule 60(a), W.R.C.P. to treat with the matter as it did. We think 
that proposition was settled in Kane v. 
Kane, supra, 616 P.2d  at 782.

[¶7.]     The district court 
retained jurisdiction to correct errors in the decree, and it is well 
established that we can uphold a trial court if there is any proper basis on 
which that can be done. Mentock v. 
Mentock, Wyo., 638 P.2d 156 (1981); ABC Builders, Inc. v. Phillips, Wyo., 632 P.2d 925 (1981). A correction to make a written 
judgment conform to an oral pronouncement properly may be accomplished under 
Rule 60(a), W.R.C.P. Kane v. Kane, supra, 616 P.2d  at 782; Estate of Kimball, Wyo., 583 P.2d 1274 
(1978). The first sentence of Rule 60(a), W.R.C.P., is identical to Rule 37 
W.R.Cr.P., and we have held with respect to the criminal rule the judgment is 
distinguishable from a record of the judgment and if the record or written 
judgment is incorrect, the trial judge has a duty to correct it. Lane v. State, Wyo., 663 P.2d 175 (1983), citing Fullmer v. Meacham, Wyo., 387 P.2d 1007 (1964). The length of time between 
the correction in this instance and the original decree is not as long as that 
approved in Estate of Kimball, supra. In this instance, the district 
court orally pronounced that any tax liability should be shared equally. This 
court referred to that statement twice as if it had been in the decree. Kane v. Kane, supra, 577 P.2d  at 174. 
The language, however, was not included in the original decree, and it is proper 
for the decree to be modified to reflect that actual 
judgment.

[¶8.]     Principles reflected in 
earlier cases in this court manifest the propriety of the district court 
requiring the payment of any equal share of the taxes. We have held that a loan 
repayment provision is part of the equitable division of property. Prentice v. Prentice, Wyo., 568 P.2d 883 
(1977). It is proper to provide for payment by one spouse of attorney's fees for 
the other as part of the property settlement. Bereman v. Bereman, Wyo., 645 P.2d 1155 (1982); Paul v. Paul, Wyo., 616 P.2d 707 (1980); Klatt v. Klatt, Wyo., 654 P.2d 733 (1982); Karns v. Karns, 
Wyo., 511 P.2d 955 (1973). In Bereman v. 
Bereman, supra, we also held that cancellation of a debt from one spouse to 
another, which in effect awards that spouse a sum of money, is a proper 
provision in a property settlement. In Karns v. Karns, supra, fees of 
appraisers were properly included in a property settlement. In Klatt v. Klatt, supra, we said that any 
other financial matters should also be considered in making a just and equitable 
disposition of the family assets.

"* * * A division of the 
marital estate of necessity involves an assignment of assets and liabilities." 
Paul v. Paul, Wyo., 
616 P.2d 707, 715 (1980).

Under the theory 
of these cases the authority of the district court to provide for an equal 
payment of a federal income tax liability is well established, and we have no 
question as to the authority of the court to modify the decree to encompass its 
articulated intention to accomplish that end.

[¶9.]     Because of the concern 
of the parties in this instance we also address the nature of marital property 
in Wyoming and 
the effect of divorce proceedings thereon. Pursuant to § 20-2-114, W.S. 1977, 
the property the trial judge is authorized to distribute has been described with 
different labels. We have alluded to the marital estate in Storm v. Storm, Wyo., 470 P.2d 367 (1970) and Paul v. Paul, supra, and to the family 
assets in Klatt v. Klatt, 
Wyo., 654 P.2d 733 (1982) and Paul v. Paul, 
supra. The label, however, is not important because it is clear that the 
property of the parties which is subject to distribution by the court includes 
not only jointly owned property but also property owned by either spouse 
separately. Klatt v. Klatt, supra; Paul v. Paul, supra; Craver v. Craver, Wyo., 601 P.2d 999 
(1979); Karns v. Karns, supra. In Storm v. Storm, supra, 470 P.2d  at 371, 
we approved inclusion of "all property which the wife had a part of 
accumulating, including property if any and proceeds therefrom, which may have 
been owned by either party at the time of the marriage." To the same effect see 
Karns v. Karns, 
supra.

[¶10.]  Our statutes specifically reserve the 
right of each spouse to own and convey his or her separate property. Sections 
20-1-201 and 20-1-202(a), W.S. 1977. That right, however, is adjusted upon the 
filing of a complaint for divorce. At that juncture the jurisdiction of the 
district court is invoked to provide for an equitable distribution of the 
property of the parties in accordance with § 20-2-114, W.S. 1977. We conclude 
that the effect of our statute is quite similar to the effect ascribed to the 
Kansas statute in Cady v. Cady, 224 Kan. 339, 581 P.2d 358 
(1978). That court held that prior to the filing of the divorce petition a 
spouse had only an inchoate interest in property held in the name of the other 
spouse. When the divorce complaint is filed, however, that inchoate interest 
vests subject to definition and determination by the divorce court. At that 
juncture a species of common or co-ownership is identified, but that property is 
not then divided until the ultimate decree of the court. Other courts have 
reached a similar conclusion with respect to equitable distribution statutes. Marriage of Brown, 179 Mont. 417, 587 P.2d 361, 365 (1978); Imel v. United 
States, 184 Colo. 1, 
517 P.2d 1331 (1974); Imel v. 
United States, 523 F.2d 853 (10 Cir. 1975); Collins v. Oklahoma Tax Commission, Okla., 446 P.2d 290 
(1968); Collins v. C.I.R., 412 F.2d 211 (10th Cir. 1969).

[¶11.]  In this regard then we hold that even 
though property is owned separately by one spouse, as in this case, at the time 
the complaint in the divorce action is filed the other spouse acquires a 
co-ownership interest in that property which is not defined until the entry of 
the decree which articulates the property settlement. The inchoate interest of 
the spouse in separate property of the other spouse is vested at the time the 
divorce action is filed and at that time is converted into a species of common 
or co-ownership. When the decree is entered it divides property which is held by 
the parties as co-owners. In any instance in which, as here, the trial court 
grants each party a one-half interest in a given property, the co-ownership 
continues until disposition of the property. If the trial court awards all of a 
given property to one party, that award is also a disposition of property held 
by co-owners, but the party awarded the property then owns it as an individual. 
Because of our prior opinions in this case we have no difficulty in extending 
this concept to the ranching property which was situated in Montana.

[¶12.]  Other issues which were briefed and 
argued by the parties in this case we conclude have been settled by the previous 
opinions in this court. The judgment of the district court is 
affirmed.

1 Rule 60(a), W.R.C.P., 
provides as follows:

"(a) Clerical mistakes. - 
Clerical mistakes in judgments, orders or other parts of the record and errors 
therein arising from oversight or omission may be corrected by the court at any 
time of its own initiative or on the motion of any party and after such notice, 
if any, as the court orders. During the pendency of an appeal, such mistakes may 
be so corrected before the appeal is docketed in the Supreme Court, and 
thereafter while the appeal is pending may be so corrected with leave of the 
Supreme Court."