No. 13364 IN THE SUPREME COURT OF THE STATE OF MONTANA 1977

WILLIAM R. MORSE, Plaintiff and Appellant,

-vsBETTY J. MORSE, Defendant and Respondent.

Appeal from: District Court of the Thirteenth Judicial District, Honorable M. James Sorte, Jud-qepresiding. Counsel of Record. : For Appellant: Anderson, Symmes, Forbes, Peete and Brown, Billings,

Montana Weymouth D. Symmes argued, Billings, Montana For Respondent: Hon. Michael Greely,Attorney General, Helena,

Montana Allen B. Chronister, Assistant Attorney General,

appeared, Helena, Montana Berger, Anderson, Sinclair and Murphy, Billings,

Montana Arnold A. Berger argued, Billings, Montana

Submitted: January 25, 1977 Decided:

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# 1gn Filed:

### Mr. 

### JusticeDaniel J. 

### Shea delivered the Opinion of the Court:

The husband appeals from a judgment of the District Court, Stillwater County, awarding certainproperty to the wife in a property distributiondecree following dissolution of marriage. The husband raises several issues relating to the Uniform Marriage and Divorce Act

### and further claims the court failed to consider several factors inmaking 

### its award of the marital property. One of the issues under the Uniform Marriage and Divorce Act

### ishis claim that the court didnot consider the wife's inheritance as a marital asset. Because the DistrictCourt

was not specific in its 

### dispositionof the inheritance, we

are compelled to reverse and remarid for a hearing on the disposition of the inheritance. As

### to his remaining contentions, we findno error. First, we

### willdiscuss the various other issues raised by the husband, and discuss last the issue of the wife's $200,000 inheritance. Both the husband and wife were granted a divorceby the court on October 23, 1974. A 

### trialon property disposition

was held December 9 and 10, 1975. The court issued findings of fact, conclusions of law and order apportioning the marital property on January 19, 1976. The husband contends the correct law under which the court divided the propertywas that which existed atthe time the trial

was held on that matter, and hence prior to the effective date of the Uniform Marriage and Divorce Act inMontana, January 1, 1976. However, section 48-341, R.C.M.1947, of thatAct, states:"(2) This act applies to allpending actions and proceedings commenced prior to 

### its effective datewith respect to issues on which a judgment has not been entered

# **

# *

"(4) In any action or proceeding inwhich an appeal was pending or a new trialwas ordered prior tothe effective date of this act, the law in effect atthe time of,theorder sustaining the appeal or the new trialgoverns the appeal, the new trial, and any subsequent trialor appeal." Here, the trialcourt did not enterjudgment on the property divisionuntilJanuary 19, 1976, eighteen days after the effective date of the Uniform Marriage and Divorce Act. Section 48-341(4) of thatAct specifies the exclusive circumstances under which

an actionwould fallunder pre-existing law--cases inwhich a judgment has already been entered or a new trialordered. Subsection (4) plainly does not apply to this case as ajudgment had not been entered when the Uniform Marriage and Divorce Act went into effect. We might add, however, that inthe area of property division, the Uniform Marriage and Divorce Act provisions

are similar to case law predating that Act. Biegalke v. Biegalke, Mont

# . ,564 P.2d 987, 34 St.Rep. 401, 405 (1977). Therefore the husband lostno substantial rights by coming under the Uniform Marriage and Di.vorce Act. The basis for dividing property upon dissolution of marriage is 

### set out in section 48-321, R.C.M. 1947. It provides in relevant part that the court: 

# "**

# * without regard tomarital misconduct, shall 

# ** * finally equitably apportionbetween the parties the property and assetsbelonging to either orboth however and whenever acquired, and whether the title thereto 

### is inthe name of the husband or wife orboth. 

# * * *'' (Emphasis supplied.)The statute also 

### sets out factors which the court must consider inthe apportionment of the property, including: 

### "*

# ** amount and sources of income

# ** * needs of each of the parties [and] whether the apportionment 

### is inlieu of or inaddition tomaintenance 

# *

# * **It Concerning property acquired by either spouse before marriage

orby gift, bequest, devise or descent, the statuteprovides the court shall:

'I* 

# *

# * consider thos3contributions of the other spouse to the marriage

# **

# * the extent towhich such contributions have facilitated the maintenance of thisproperty and whether ornot the property disposition serves as an alternative tomaintenance arrangements. II The husband asks this Court todisregard the specific language of the statuteprohibiting consideration of marital misconduct indistributing marital property, The statuteexpressly forbids a consideration of marital misconduct in apportioning the marital estate. Since the intent 

### is clearwe take the statuteaswe find it. In the Matter of West Great Falls Flood Control and Drainage District, 159Mont. 277, 287, 496 P.2d 1143 (1972). It 

### is equally clear that the husband would fareno better under the law pre-existing the Uniform Marriage and Divorce Act. Before thatAct, "fault" was considered only in the context of a party's right to alimony and could not be the basis for depriving either party of property interestsupon divorce. Johnson 

### v. Johnson, 137Mont, 

### 11, 

### 17, 349 P.2d 310 (1960). The husband also contends that thewife quitclaimed certain property to him before the dissolutionof the marriage and accordingly, the court should not consider that property aspart of the marital estate. He claims it was the intent of the wife to deliver the property tohim and this was manifested by the

### execution, delivery, and filing of the deeds. However, section 48-321provides that a district courtmay equitably divide property "however and whenever acquired" and therefore the question of title is not controlling. Thiswas also the lawbefore the enactment of the UniformMarriage and DivorceAct. LaPlant v. LaPlant, Mont

# . ,551 P.2d 1014, 33 St.Rep. 580 (1976); Downsv. Downs, Mont

# . ,551 P.2d 1025, 33 St.Rep. 576

(1976); Cook v. Cook, 159Mont. 98, 102,103,495 P.2d 591 (1972). The husband contends the prospective assets and liabilities of the parties shouldbe considered in a property division. While it is true that section 48-321requires the court,among other things, to consider "the opportunity of each for future acquisition of capital assets and income", here there was no sufficient foundationestablished for the reasonable likelihood of acquiring future assets. As to future debts or liabilities of the parties, such evidence is normally too speculative,and in this case there

was no reliable evidence by which the court could determine future liabilities. For the same reason,we cannot consider the possibility thewife will receive an inheritance fromher mother sometime in the future. Because of the ambiguity of the District Court's findings

on .thewife's inheritance of $200,000 before the dissolution of the marriage,we are compelled to remand the cause for a hearing and specific findings. 

### It is clear under section 48-321, "property and assets belonging to either or both however and whenever acquiredl',thatthe $200,000 inheritancewas properly an asset of the marital estate at the time of dissolution. The husband contendsgnce the wife was awarded the entire $200,000 inheritance, that he shouldhave received a correspondingbenefit from the remainder of the marital property.In his findings the trialjudge noted that thewife didhave

an inheritance of $200,000. However, thejudge failed to dispose of that inheritance inany way which would clearly show his intent. The order of distribution listed certain property awarded to the wife, and the remainder to the husband. Since the wife was not specifically awarded the $200,000, it could be argued the husband

was to receive the $200,000 inheritance of thewife. But there 

### is

no evidence the husband asked for allor any portion of the wife's inheritance. Neither 

### is there any indication from the evidence, findings and conclusions that the court intended to award allor any portion of the wife's inheritance tothe husband. Moreover,

on appeal to this Court both parties treat the inheritance ashaving been awarded to the wife. The confusion indicated by the record and the position of the parties can only be resolved by a rehearing on the issue of the inheritance. We stresshere that, as inalldecrees of property distribution, there 

### isno definite formula that must be followed and each case must be treated on an individual basis. Biegalke 

### v. Biegalke

## , supra. The wife contends the decree should be modified so that property awarded toher can be taken from the husband's indirect control. This 

### is a matter for theDistrict Court toconsider upon remand of this case, and it need not be discussed here. The wife also contends thejudgment should be set asidebecause the record did not disclose the true net worth of the husband. She did not cross-appeal on this issue, but raised it for the firsttime inher brief on appeal. Accordingly, she 

### isprecluded from raising this issue on appeal. Johnstone v. Svejkovsky, Mont, 

# - -9 554 P.2d 1329, 

### 33 St.Rep. 954 (1976); Spencer v. Robertson, 151Mont. 507,

### 511, 

### 455 P.2d 

### 48 (1968). We vacate the judgment of the district court and remand it for further proceedings consistent with this Opinion.

We Concur:

Justices.Mr. JusticeJohn Conway Harrison concurring inpart and dissenting in part: This Court inBdegalke v. Biegalke, 

# - Mont. 

# , 564 P.2d 987, 34 St.Rep. 401 (1977), established inMontana that incases, such as the instant one, the provisions of Chapter 3, Title48, sections 48-301 through 48-341, R.C.M. 1947, Montana's Uniform Marriage and Divorce Act, apply. However, inapportioning the property of the parties here, under the provisions of section48-321, I disagree with the majority. Here, under the facts until 1964, when the wife moved to England, away from the marital domicile, such a divisionwould, inmy opinion, have been just, for up to that time both equally contributed to the acquisition of the property. As I view the evidence, itwas the defendant wife who wanted the English experience, and it was the plaintiff husband who reluctantly went along with her demands. It was plaintiff husband who had to purchase the home in England and maintain his family there. From 1964 to 1972, with the exception of quarterly visits, and because of the wife's insistence on living inEngland, plaintiff's children grew up without his close supervision and guidance and he was denied thejoy and satisfaction of seeing their daily development for some eight years. Under these facts one would

assume the children would be in support of their mother, but here, because of her conduct, she has lost the support of allfive children. They have returned from England to the family home in Absarokee and support their father's position in these proceedings. He has become both father and mother to them and it 

### is tohim they have looked to for fiscal and emotional support these last sixyears. Even under the findings of the trialcourt, it wasfound that aftermoving toEngland the wife contributed little

ornothing toplaintiff father's earning capacity. During the marriage the parties accumulated the following property: 

### 1. Family dwelling inAbsarokee, with garage (average appraised value) 2. Law officebuilding 3. Morse apartments 4. Rumaino acreage 5. Airplane and hanger 6. Contract proceeds (total) 7. 

### Morse-Edmonds-Henrickson contract 

### 8. Pickup and vehicles (agreed value) 9. Home furniture (plaintiff's estimate) 10. Notes and mortgages receivable 

### 11. Value due on lumber 12. Accounts receivable (excluding those with doubtful collection possibilities) 13. Insurance (cash surrender value) 14. Savings Account 

# - Livingston, Montana 15. Checking Account 16. Bank account

# - Red Lodge 

### 17. Morse Apartments Account 18. Bonds (including $2,500 belonging to wife attime of marriage) 

### 19. Library and equipment

# - law office 20. Morse Apartments

# - furniture, fixtures 21. Plaintiff's apartment furniture 22. Wife's inheritance from father, L.B. Kratz The liabilities of the parties consist primarily of outstanding mortgages: 

### 1. Federal Land Bank Mortgage $25,207 2. U.S. Bank, Red Lodge 37,195 3. Estimated back tax liability

# - IRS (1971-1975) 54,000. InJune 1972, defendant returned toMontana and took up residence with her parents. The divorce proceedings commenced shortly thereafter. Within two years, but prior to the divorce, her father died leaving her approximately $200,000 and in addition she received $9,740 as executrix of the estate. She occupies the family home and has fulluse of two family automobiles. While speculative in amount, she

### willinherit a substantial estate from her mother who 

### is 82 years old.In spite of the above facts, the trialcourt made this distribution of property: "A. TO THE DEFENDANT: (1) Family dwelling

# .... together with the attached shed or.garage

# .

# .. (2) Allfurniture and personal property located in the family home other than that,claimed by the third party intervenor, and plaintiff'

### s business records. (3) The Morse Apartments 

# ... (4) The furniture and fixtures in the Morse Apartments. (5) Allof the money's payable and allright, titleand interest of the plaintiff in and to the property described as the

### Morse-Edmonds-Hendrickson Contract, the sum being $15,360.83, or, in the alternative, a cash payment of $15,360.83. (6) One half of the United States Savings Bonds (if and when found). "B. TO THE PLAINTIFF: (1) Allof the property of the parties not awarded to defendant as evidenced from the exhibits and the testimony and brought out during the course of the trial. (2) The Plaintiff shallpay alloutstanding indebtedness on the mortgages that secure a loan on any property that was awarded to the defendant herein." Considering the facts of the instant case, such a distribution of property 

### is, inmy opinion, an inequitable distribution to the wife. No mention 

### ismade by the trialcourt of the $200,000 plus inheritance in the court'

### s disposition formula contained in 

### its conclusion of law. Totaling the values of the properties taken by the respective parties in such case, would yield this result: TO THE HUSBAND $173,482 (totalvalue) less 62,400 (Outstanding mortgage liabilities) 111,082 less 24;000 (conservative estimate of predivorce tax liability) 

### $ 87,082.The husband received no house or living arrangements other than the ability torent an apartment owned by the wife by virtue of the decree. He 

### is, as 

### is apparent, responsible for allof the liabilities of the marriage, a factor to be considered under the express language of section 48-321. TO 

### THE 

### WIFE $81,621 plus 200,000 (inheritance funds) plus 9,700 (executrix fee) $291,321 In addition, the wife received the family home, which she now rents to others, despite the court having found as a fact that she 

### is entitled to the use and occupancy of the Kratz home. Section 48-321 

### is a statuteof broad applicability. It speaks of consideration of "all property however and whenever acquired" and expressly refers to inheritances. Other factors tobe balanced, which would find applicability in this case are: amount and sources of income, needs of the parties, and opportunities for future acquisitions of capital. Other courts have held that, due toa.shortterm marriage

or other like circumstances, a spouse seeking apportionment of a large sum eitherbrought into the marriage or acquired early in the marriage by the other spouse, whether by inheritance or otherwise, does not have the same "interest1' in the sum as 

### in

cases where the marriage 

### is of long duration. Here, the marriage lasted approximately 

### 29 years. To deny the husband a share of the wife's inheritance would stand on the same footing as denying the wife a share of a large sum inwindfall profits from the husband's business or investments acquired just prior to the divorce. 

# - I1

# -To consider inheritances per se asbeing beyond the language or intent of section 48-321, would be, in a sense, to cause Montana tobecome a de factocommunity property state in this regard. Inmy opinion, this 

### isnot the intent of section 48-321. Here, while the husband has a better future earning potential than the wife for obvious reasons a fact which must be weighed inthe balance, the wife does have a strong potential for future acquisition of capital. Both are factors which relate to the futureneeds of the parties. The trialjudge inhis findings of fact recognized the wife stands toreceive large sums from her mother upon her death. The mother 

### is presently 82 and invery poor health. The facts indicate a strong likelihood of such inheritance, due to the fact

### Mr. and 

### Mrs. Kratz maintained a joint 

### will. I find the holding in Smyth v. Smyth, (Okla.1947), 179 P.2d 923, persuasive here. There the court said: "'Next to the fortune of which he 

### is already possessed, consideration should be given to

# ** * future prospects and probable acquisition of wealth from any source whatever.* 

# * *'I' See also: Smith v.'Smith, (Okla.1957), 311P.2d 229; Kessinger v. Kessinger, 360 Mich. 528, 104N.W.2d 192 (1960). Inaddition, I find the trialcourt's decision to saddle plaintiff husband with the obligation of allthe pre-existing tax liabilitiestobe inequitable. Both owe the obligation, both have the ability topay the obligation, and both should share inpayment. Considering the entirerecord here, 

### I would reverse due towhat, bution. inmy opinion, an unconscionable property distrie"- t

Justice

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