No. 92-277 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1993 

IN RE THE MARRIAGE OF 

STEPHEN W. TAYLOR, 

Petitioner and Appellant, 

and 

JUDITH A. TAYLOR, 

Respondent and Respondent. 

APPEAL FROM: District Court of the Tenth Judicial District, 

In and for the County of Judith Basin, 

The Honorable Peter L. Rapkoch, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Ward N. Ernst, Attorney at Law, Stanford, Montana 

For Respondent: 

Marcia Birkenbuel, Attorney at Law, Great Falls, 

Montana 

Filed: 

Submitted on Briefs: September 4, 1992 

Decided: February 25, 1993 
Justice William E. Hunt, Sr., delivered the opinion of the Court. 

Appellant Stephen Taylor appeals from a decree of dissolution 

fromthe Tenth Judicial District, Judith Basin County, dividingthe 

marital property of the parties. 

We affirm. 

We present the issues on appeal in the following order: 

1. Was the District Court's division of the stock clearly 

erroneous? 

2. Was the District Court's valuation of Stephen's shares of 

stock clearly erroneous? 

3. Did the District Court err by ordering a cash settlement 

in lieu of distributing Taylor Honey, Inc., shares of stock to 

Judith? 

4. Did the District Court err by awarding attorney fees when 

they were not pled and no evidence was submitted to determine if 

attorney fees were required? 

The parties were married on May 13, 1974, in Reno, Nevada. 

Neither party brought assets to the marriage. Two children were 

born into the marriage. On February 22, 1991, Stephen filed a 

petition for dissolution. The parties' only disputes in this case 

concern the value of Stephen's stock in the honey business and the 

award of attorney fees to Judith. 

At the time of the dissolution, Stephen was 40 years old and 

had a high school education. Judith was 36 years old, had a high 

school education, and had attended a vo-tech school for one year. 

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Throughout their marriage, Judith was primarily responsible for 

raising the children and maintaining the home. She worked 

part-time as a waitress and worked in the family honey business. 

For the past three years, she was employed by the United States 

Forest Service, earning approximately $13,750 a year. 

In 1982, Stephen's parents formed Taylor Honey, Inc., for the 

purpose of producing honey. Stephen worked in the business 

throughout the marriage. It is undisputed that over the years 

Stephen's parents gifted stock in the business to Stephen and his 

brother for estate planning purposes. Stephen received a total of 

8969 shares, or 25.9 percent of the corporate stock. Stephen never 

received any dividends from the stock and earns a yearly salary of 

approximately $27,000. Only Stephen, his parents, and his brother 

are shareholders in the business. Stephen and his brother actually 

run the day-to-day affairs of the business, while the parents work 

as advisors. At the time of trial, Stephen was president of the 

corporation. 

At trial, Stephen testified that the stock he received was 

worthless. Stephen's father testified with some uncertainty that 

the value of the corporation ranged from $250,000 to $800,000. 

Both Stephen and his father testified as to their future business 

concerns regarding government regulations, and troubles with mites 

and African bees which could affect the viability of the business. 

On the other hand, Stephen's expert testified that the net 

value of the business was between $458,878 and $646,878. He 

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discounted Stephen's share of the stock by 20 percent because it 

was a minority share, and valued the stock from $95,000 to 

$134,033. Judith's expert witness valued the business between 

$900,000 to $950,000 and valued the stock between $230,000 to 

$245,000. Financial statements entered into evidence valued the 

business over the last five years between $1,000,000 and 

$1,400,000. 

In its decree, the District Court valued the corporation at 

approximately $917,000. The court concluded that as a result, 

Stephen's 25.9 percent share of stock amounted to $237,500. The 

court determined that the stock was marital property and awarded 

Judith a $109,483 cash settlement for her share of the marital 

estate. The court allowed Stephen the option of paying Judith's 

share of the marital estate in a cash settlement of four annual 

installments of $25,000 each, with 10 percent interest and $25,000 

down. The court allowed Judith to encumber Stephen's stock if the 

need arises. The court allowed Stephen to offset his payments on 

the parties' home mortgage against the $109,483. The court also 

ordered Stephen to pay Judith's attorney fees. Stephen appeals the 

decree. 

I. 

Was the District Court's division of the stock clearly 

erroneous? 

Our standard of review regarding the division of the marital 

estate has recently changed to the following: 

4 
In the past, this Court has employed an abuse of 

discretion standard in reviewing a lower court's 

determination of the appropriate division of the marital 

estate. This Court has recently clarified that our 

standard of review in regard to the factual findings of 

the district court relating to the division of martial 

property is whether the district court's findings are 

clearly erroneous. 

In re Marriage of Danelson (Mont. 1992), 833 P.2d 215, 219, 49 St. 

Rep. 597, 599. 

Section 40-4-202 (1) (a) - (b) , MCA, requires the court to 

consider the nonmonetary contributions of a spouse when dividing 

the marital estate and whether such contributions facilitated the 

maintenance of the property. The statute also mandates that the 

court examine whether the division of the marital estate serves as 

an alternative to maintenance. Section 40-4-202(1)(c), MCA. 

Stephen contends that he did not make monetary contributions 

to the stock, nor did he facilitate the maintenance of the stock. 

He contends that, as a result, it would have been impossible for 

Judith to contribute to the value of the stock, and the stock 

should not be included as part of the marital property. We 

disagree. 

There is substantial evidence to support the court's finding 

that both Stephen and Judith contributed to the maintenance of the 

honey business stock. Stephen is a minority shareholder in the 

company with only four employees. He works 16 hour days, seven 

days a week, in making the business a going concern. Stephen also 

takes the bees to ~alifornia in the fall of each year for 
approximately two months to pollinate certain crops. In addition, 

he is the president of the company. 

Judith's contributions were of equal importance. She 

maintained the household and took care of the children for 17% 

years. The record reflects that on occasion she also worked for 

the company. Judith's nonmonetary contributions as a homemaker 

facilitated the maintenance of the honey business because Stephen 

would not have been able to devote the considerable time and effort 

the business required were it not for Judith's caring for the 

children and the home. The court did not grant Judith a 

maintenance award and the division of the marital property served 

as an alternative to maintenance. We hold that the District 

Court's division of the marital property was not clearly erroneous. 

11. 

Was the District Court's valuation of Stephen's shares of 

stock clearly erroneous? 

Stephen attacks the District Court valuation of the honey 

business stock at $237,500. In our review of a district court's 

valuation of marital property, we have established several 

principles which guide us. When there is a dispute over property 

in a marriage dissolution, the district court may assign any value 

that is within the range of values presented into evidence. In re 

Marriage of Kramer (1987), 229 Mont. 476, 747 P.2d 865. However, 

if the values are widely conflicting, then the district court must 
state its reasons for determining a certain value. In re Marriage 

of Glass (1985), 215 Mont. 248, 697 P.2d 96. 

In this instance, the evidence of the value of Taylor Honey, 

Inc., ranged from practically zero to $1,400,000. The evidence 

indicated the value of Stephen's shares ranged from zero to 

$245,000. The court valued Stephen's shares at $237,500. 

Apparently, the District Court averaged the high and low figures 

offered by Judith's expert to arrive at $237,500. This value falls 

within the ranges presented at trial. 

In addition, the court gave its reasons for its valuation, 

stating that it believed the family's fear of African bees and 

mites was merely speculation and did not pose a current threat 

which would reduce the value of the business. In addition, the 

court stated that it also considered the company's financial 

statements, which presented a higher valuation of the corporation 

than those presented by the parties' expert witnesses. 

Stephen also maintains that the District Court did not take 

into account all of the company's liabilities. Specifically, he 

charges that the court failed to take into account tax liabilities 

that he would incur because he would be forced to sell his shares 

of stock in order to make the necessary cash payments for Judith's 

share of the marital estate. We held in In re Marriage of Lee 

(1991), 249 Mont. 516, 519, 816 P.2d 1076, 1078, that the court 

must take into account tax liabilities for a court ordered 

distribution which results in a taxable event that precipitates a 

7 
"concrete and immediate tax liability." Unlike Lee, no evidence 

was introduced at trial relating to a concrete and immediate tax 

liability that Stephen might incur if he were to sell his shares of 

stock. In addition, there was no evidence introduced at trial that 

Stephen would have to sell his stock in order to pay any cash award 

to Judith, nor was he ordered to do so by the court. 

Stephen also contends that the District Court did not properly 

discount the value of his stock because he is a minority share 

holder. Stephen's expert witness discounted Stephen's shares of 

stock 20 percent because he was a minority shareholder. On the 

other hand, Judith's expert did not apply any discount to the value 

of the stock. The expert explained that he did not apply a 

discount to Stephen's shares because he was basing his values on 

the corporation's underlying assets and not on the market value of 

the stock. We have stated that it would be inappropriate to 

discount stock when the value of the corporation was arrived at by 

determining the market value of the underlving assets. In re 

Marriage of Buxbaum (1984), 214 Mont. 1, 8, 692 P.2d 411, 414. 

Finally, Stephen argues that the court failed to take into 

account the debentures issued to Stephen's parents as a formal debt 

of the corporation. The record indicates that the debentures were 

not consistently reported in financial statements, nor did the 

corporation pay these debts on a regular basis. Therefore, they 

did not constitute a formal debt of the corporation. We hold that 
the District Court's valuation of Stephen's shares of stock in 

Taylor Honey, Inc., was not clearly erroneous. 

111. 

Did the District Court err by ordering a cash settlement in 

lieu of distributing Stephen's shares of stock to Judith? 

Stephen assails the District Court's order requiring a cash 

settlement. He contends that after paying child support, he is 

left with only $14,796 to meet the rest of his obligations under 

the order, as well as his own living expenses. The record reveals 

that Taylor Honey, Inc., is a closely held family corporation. 

Only Stephen, his brother, and their parents have shares in the 

corporation. Stephen and his brother control the day-to-day 

operation of the business, plus they also determine when to pay 

dividends to stockholders. The corporation has not paid dividends 

since its inception, nor is it expected to pay dividends in the 

future. If Judith were to receive an in-kind distribution of 

stock, she would not likely receive any benefits. In In re 

Marriage of Johnson (1986), 223 Mont. 383, 726 P.2d 322, we were 

faced with a similar factual situation. In that case, we held that 

itwas proper for the District Court to award a cash settlement in 

lieu of an in-kind distribution of stock where the spouse was part 

of a closely held family corporation. Johnson, 726 P.2d at 324. 

We hold that the District Court did not err by ordering a cash 

settlement in lieu of distributing shares of stock. 
IV. 

Did the District Court err by awarding attorney fees when they 

were not pled and no evidence was submitted to determine if 

attorney fees were required? 

Stephen maintains that the court's award of attorney fees was 

in error because Judith did not request attorney fees in the 

pleadings and no evidence was presented to determine if an award of 

attorney fees was necessary. 

Section 40-4-110, MCA, grants the district court the 

discretion to award reasonable attorney fees after considering the 

financial resources of both parties. Absent an abuse of 

discretion, this Court will not overturn the district court's 

decision denying attorney fees. In re Marriage of Manus (1987), 

225 Mont. 457, 733 P.2d 1275. We have stated that although the 

statute does not specifically require that attorney fees be pled, 

it would be good practice to so. In re Marriage of Johnsrud 

(1977), 175 Mont. 117, 572 P.2d 902. 

Judith did not request attorney fees in her pleading. 

However, at the end of her complaint she did request "for such 

further relief as the Court deems just and proper." In a recent 

case, we held that such language allowed the District Court to 

grant a larger maintenance award than that pled by the wife. In re 

Marriage of Eide (1991), 250 Mont. 490, 821 P.2d 1036. We 

concluded that Rule 54(c), M.R.Civ.P., provided: 
Except as to a party against whom a judgment is entered 

by default, every final judgment shall grant the relief 

to which the party in whose favor it is rendered is 

entitled, even if the party has not demanded such relief 

in his pleadings. 

t Eide 821 P.2d at 1039. Rule 54(c), M.R.Civ.P., grants the 

district court discretion which must be viewed according to the 

circumstances of the case. Eide, 821 P.2d at 1039. 

In its findings, the court considered the financial resources 

of the parties and concluded that Stephen should pay Judith's 

reasonable attorney fees. We hold that the District Court did not 

err in awarding reasonable attorney fees to Judith. 

We affirm. 

We concur: 
Justice Terry N. Trieweiler concurring in part and dissenting in 

part. 

I concur with the majority's conclusions that it was 

reasonable to include Stephen's stock in the marital estate and 

divide it between the parties; the District Court's valuation of 

the stock was not clearly erroneous; and the District Court did not 

err by awarding attorney fees, even though they were not 

specifically sought by the pleadings. 

I dissent from the part of the majority opinion which affirms 

the District Court's judgment ordering that a cash settlement be 

paid to Judith in lieu of her share of the marital estate's stock 

in Taylor Honey, Inc. 

I conclude that the only reasonable way to distribute the 

value of the stock is an in-kind distribution. If the stock has a 

marketable value, then Judith can sell it as well as Stephen. If 

the stock is not marketable, then Stephen cannot convert it to cash 

any more than Judith, and there was no evidence that he had any 

other assets, nor sufficient income with which to pay Judith 

$109,000 in cash at the rate of $25,000 per year. 

Excluding the shares in Taylor Honey, Inc., Stephen was 

awarded property from the marital estate with a net value of $2876. 

There was no evidence that he had any other property. 

His net yearly income, after payment of federal and state 

taxes, is $21,538. However, from that income he has a yearly child 

support obligation of $6742, leaving him approximately $14,000 per 

year with which to pay all of his living expenses. 

12 
The family residence was awarded to Judith, so presumably 

Stephen will have to pay for other living arrangements out of the 

remaining disposable income that he has. 

Only four witnesses testified regarding the value or 

transferability of the stock in the family business. Both Stephen 

and his father testified that there was no market for the stock. 

Stephen's expert witness, Dan ~uckovich, testified that he 

doubted the stock was marketable. Even ~udith's expert, ~icholas 

Bourdeau, denied that he had come to any conclusion that the stock 

could be sold. 

The predicament in which Stephen is left by the ~istrict 

Court's judgment is compounded by the fact that the District Court 

accepted the appraisal from Judithf s expert, which was based on the 

value of the business assets. The only way for Stephen to obtain 

the cash with which to satisfy the District Court's decree would be 

to sell the business assets, or some portion of them. There was no 

evidence that the business could continue to generate the kind of 

income which is necessary for Stephen to pay child support and his 

own living expenses if he is forced to sell off some of the assets 

which are necessary to generate business income. 

Maybe the majority and the District Court are aware of some 

means by which Stephen can raise $25,000 a year to satisfy the 

District Court decree and still meet his child support obligation 

and pay his own living expenses. However, I have been unable to 

make that determination from anything that is found in the record 

on appeal. 
Therefore, I conclude that there was no substantial evidence 

to support the District Court's judgment that $109,000 in cash 

should be paid to Judith in lieu of her interest in the stock in 

Taylor Honey, Inc., that was included in the marital estate. I 

would reverse that part of the District Court judgment and remand 

for purposes of amending the decree to award Judith the appropriate 

number of shares in the family corporation. 
February 25, 1993 

CERTIFICATE OF SERVICE 

I hereby certify that the following order was sent by United States mail, prepaid, to the 

following named: 

Ward N. Ernst 

Attorney at Law 

P.O. Box 559 

Stanford, MT 59479 

Marcia Birkenbuel 

Attorney at Law 

613 Strain Bldg. 

Great Falls, MT 59401 

ED SMITH 

CLERK OF THE SUPREME COURT 

STATE OF MONTANA 

BY: 

~eput~( 

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