- 156 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

Daniel D. Cornwell, appellant and 

cross-appellee, v. Melanie J. Cornwell, 

appellee and cross-appellant.

___ N.W.2d ___

Filed May 7, 2021. No. S-20-530.

1. Divorce: Child Custody: Child Support: Property Division: 

Alimony: Attorney Fees: Appeal and Error. In a marital dissolution 

action, an appellate court reviews the case de novo on the record to 

determine whether there has been an abuse of discretion by the trial 

judge. This standard of review applies to the trial court’s determinations 

regarding custody, child support, division of property, alimony, and 

attorney fees.

2. Evidence: Appeal and Error. In a review de novo on the record, an 

appellate court is required to make independent factual determinations 

based upon the record, and the court reaches its own independent conclusions with respect to the matters at issue.

3. Judges: Words and Phrases. A judicial abuse of discretion exists if the 

reasons or rulings of a trial judge are clearly untenable, unfairly depriving a litigant of a substantial right and denying just results in matters 

submitted for disposition.

4. Property Division: Pensions: Words and Phrases. Under the deferred 

distribution method, the court makes no immediate division of retirement benefits, but determines a percentage share which the nonowning 

spouse will receive when the owning spouse retires and orders that 

the nonowning spouse receive that percentage of every payment check 

which the owning spouse is entitled to receive.

5. ____: ____: ____. Under the immediate offset method, the court determines the present value of a share in the pension of the owning spouse 

and immediately awards the nonowning spouse a lump-sum amount in 

view of that value.

6. Divorce: Attorney Fees. In awarding attorney fees in a dissolution 

action, a court shall consider the nature of the case, the amount involved 

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

05/21/2021 08:09 AM CDT
- 157 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

in the controversy, the services actually performed, the results obtained, 

the length of time required for preparation and presentation of the case, 

the novelty and difficulty of the questions raised, and the customary 

charges of the bar for similar services.

7. Courts: Attorney Fees. Courts have the inherent power to award attorney fees in certain unusual circumstances amounting to conduct during 

the course of litigation which is vexatious, unfounded, and dilatory, such 

that it amounts to bad faith.

Appeal from the District Court for Nance County: Rachel 

A. Daugherty, Judge. Affirmed.

Kathryn D. Putnam, of Astley Putnam, P.C., L.L.O., for 

appellant.

Nathan T. Bruner, of Bruner, Frank, Schumacher & Husak, 

L.L.C., for appellee.

Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, 

Papik, and Freudenberg, JJ.

Heavican, C.J.

I. INTRODUCTION

The Nance County District Court dissolved the marriage of 

Daniel D. Cornwell and Melanie J. Cornwell. In connection 

with its division of the parties’ marital property, the district 

court used the immediate offset method of valuation to value 

the marital portion of Daniel’s pension. The district court then 

awarded the pension to Daniel and ordered him to make a cash 

equalization payment to Melanie, payable over time. Primarily 

at issue on appeal is the use of the immediate offset method to 

value the pension. We affirm.

II. FACTUAL BACKGROUND

Daniel and Melanie were married in 1999. At the time 

of their marriage and for 11 years thereafter, Daniel was 

employed with the Maryland State Police. As the result of a 

workplace accident, Daniel retired in 2010.
- 158 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

Daniel’s pension was a disability pension and placed some 

limitations on his future employment. However, Daniel was able 

to obtain employment, first with Maryland Fire and Rescue and 

later as a government contractor for the Department of Justice, 

working with the Bureau of Alcohol, Tobacco, Firearms and 

Explosives and the Federal Emergency Management Agency. 

That job required him to live within 3 hours of his assigned 

duty location, which was Kansas City, Missouri; thus, Daniel 

and Melanie rented an apartment in the Kansas City area. 

However, they also owned a property in Belgrade, Nance 

County, Nebraska, which they considered to be their permanent home.

At Daniel’s suggestion, Melanie moved to Scottsdale, 

Arizona, in November 2016, because she had health issues 

that the couple hoped would be helped by the warmer weather. 

The parties separated in 2017, with Daniel’s filing for divorce 

in June.

The record suggests that the divorce was contentious, with 

many issues litigated, as is partially reflected by Melanie’s 

cross-appeal regarding the district court’s failure to award her 

attorney fees and costs. However, as noted above, the primary 

issue on appeal is the valuation of Daniel’s retirement plan 

from his employment with the Maryland State Police.

Daniel’s retirement plan is a defined benefit plan that has 

been in pay status since his retirement in 2010. Daniel originally retired on a full service pension, but several months postretirement, the plan was retroactively changed to a disability 

pension. Because the plan is in part a disability pension, Daniel 

pays no taxes on that part of his monthly payout; the plan has 

no lump-sum buyout provision.

The parties have stipulated that 49 percent of the value of 

the pension is marital. Melanie wished to utilize the immediate offset method of valuation to value the pension. Melanie’s 

expert, David Rosenbaum, set the current total value of the 

pension at $2,561,009, with a 49-percent share valued at 

$1,254,894.
- 159 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

Daniel’s expert, Ernest Goss, challenged the accuracy of 

that valuation, suggesting that the valuation was speculative on 

various bases. Instead, Daniel sought to divide the pension via 

a domestic relations order (DRO).

Following a trial, the district court accepted Rosenbaum’s 

valuation for purposes of valuation of the entire marital estate. 

It then awarded the pension to Daniel and divided the estate 

in half. Daniel was ordered to make an equalization payment 

to Melanie in the amount of $403,892, to be payable annually 

in the amount of $100,000 per year until paid in full. In addition, though noting that Daniel had perhaps engaged in some 

“‘game playing’” at the mediation, the court ordered each 

party to pay its own fees and costs.

Daniel appeals, and Melanie cross-appeals.

III. ASSIGNMENTS OF ERROR

Daniel assigns that the district court erred in using the 

immediate offset method to value his pension.

On cross-appeal, Melanie assigns that the district court erred 

in not awarding her attorney fees and costs.

IV. STANDARD OF REVIEW

[1-3] In a marital dissolution action, an appellate court 

reviews the case de novo on the record to determine whether 

there has been an abuse of discretion by the trial judge. 1 This 

standard of review applies to the trial court’s determinations 

regarding custody, child support, division of property, alimony, 

and attorney fees. 2 In a review de novo on the record, an 

appellate court is required to make independent factual determinations based upon the record, and the court reaches its own 

independent conclusions with respect to the matters at issue. 3

A judicial abuse of discretion exists if the reasons or rulings of 

a trial judge are clearly untenable, unfairly depriving a litigant 

1 Higgins v. Currier, 307 Neb. 748, 950 N.W.2d 631 (2020).

2 Id.

3 Id.
- 160 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

of a substantial right and denying just results in matters submitted for disposition. 4

V. ANALYSIS

1. Pension Plan

On appeal, Daniel assigns that the district court erred in 

utilizing the immediate offset method to value and distribute 

his Maryland State Police pension, rather than the deferred 

distribution method effected via the use of a DRO. Daniel 

argues that the process of determining a present value of the 

pension was too difficult and speculative. He also argues that 

the district court failed to examine whether there was “sufficient equivalent property in the estate to satisfy the claim of 

the non-owning spouse without causing undue hardship to the 

owning spouse.” 5

As an initial matter, we turn to Melanie’s assertions (1) that 

Daniel sought a DRO prohibited by Maryland law and (2) that 

he has waived any objection to the immediate offset method by 

failing to object to her expert’s testimony. Both assertions are 

without merit.

(a) QDRO Versus DRO

Throughout his case, Daniel and his counsel sought use 

of the deferred distribution method and a qualified domestic 

relations order (QDRO). And it appears, at least for purposes 

of the Maryland pension plan at issue, that the correct term 

is “domestic relations order.” Still, Melanie’s contention on 

appeal is one of semantics—there is nothing in the record that 

would suggest that a QDRO and a DRO are not functionally 

the same thing. This argument is without merit.

(b) Waiver

We turn to Melanie’s waiver argument. Daniel and Melanie 

differed in their positions regarding how the marital portion 

4 Id.

5 Brief for appellant at 19.
- 161 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

of Daniel’s Maryland State Police pension should be distributed. Melanie offered Rosenbaum’s report and testimony in 

order to value the pension and, by extension, provide a basis 

for use of the immediate offset method. Daniel offered Goss’ 

report and testimony to rebut Rosenbaum’s opinion of valuation and, by extension, support his contention that use of 

the deferred distribution method was preferred because a reliable present value could not be determined. 6 Melanie argues 

that by failing to object to Rosenbaum’s testimony, Daniel 

has waived his objection to the immediate offset method and 

Rosenbaum’s valuation.

We disagree. Daniel’s position throughout has been that 

the district court should use the deferred distribution method 

of valuation rather than the immediate offset method. Daniel 

was not concerned with the admissibility of Rosenbaum’s evidence or with the court’s ability to hear and consider testimony 

regarding the immediate offset method; rather, he was concerned with the weight granted that theory by the district court. 

While a party must object to questions of admissibility or risk 

waiving them, no such objections are required with respect 

to the weight accorded such evidence. 7 Melanie’s contention 

regarding waiver is without merit.

(c) Merits

We turn to the merits of Daniel’s appeal, pausing first to 

note that the parties at times describe Daniel’s Maryland State 

Police pension as a “disability pension.” Prior opinions from 

this court and the Nebraska Court of Appeals have suggested 

there may be circumstances under which disability pension 

6 See 2 Brett R. Turner, Equitable Distribution of Property § 6:41 (4th ed. 

2020).

7 Cf., Reiber v. County of Gage, 303 Neb. 325, 928 N.W.2d 916 (2019); City 

of Lincoln v. Realty Trust Group, 270 Neb. 587, 705 N.W.2d 432 (2005); 

Tank v. Peterson, 219 Neb. 438, 363 N.W.2d 530 (1985).
- 162 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

benefits are properly classified as nonmarital property. 8 We 

need not address that question here, however, because the 

parties have stipulated that 51 percent of Daniel’s disability 

pension is nonmarital. Because no party challenges the proper 

classification of these pension benefits, we confine our analysis 

to whether there was error in the district court’s evaluation or 

distribution of the marital portion of those benefits.

Under Neb. Rev. Stat. § 42-366(8) (Reissue 2016), a pension 

is part of the marital estate. In Reichert v. Reichert,

 9 this court 

interpreted the statute and adopted the rule that “the marital 

estate includes only that portion of the pension which is earned 

during the marriage.” In Shockley v. Shockley,

 10 we stated that 

“[c]ontributions to pensions before marriage or after dissolution are not assets of the marital estate.”

[4,5] This appeal presents a choice between two major 

competing methods of division, each with its own rules of 

valuation: 11 the deferred distribution method and the immediate 

offset method.

[Under the] “deferred distribution method” . . . the court 

makes no immediate division of retirement benefits, but 

determines a percentage share which the nonowning 

spouse will receive when the owning spouse retires and 

orders that the nonowning spouse receive that percentage of every payment check which the owning spouse 

is entitled to receive. . . . This is in opposition to the 

“immediate offset method” where the court determines 

8 See, e.g., Shearer v. Shearer, 270 Neb. 178, 700 N.W.2d 580 (2005); 

Parde v. Parde, 258 Neb. 101, 602 N.W.2d 657 (1999); Kramer v. Kramer, 

252 Neb. 526, 567 N.W.2d 100 (1997); Bandy v. Bandy, 17 Neb. App. 97, 

756 N.W.2d 751 (2008); John v. John, 1 Neb. App. 947, 511 N.W.2d 544 

(1993).

9 Reichert v. Reichert, 246 Neb. 31, 35, 516 N.W.2d 600, 604 (1994).

10 Shockley v. Shockley, 251 Neb. 896, 899, 560 N.W.2d 777, 780 (1997).

11 2 Turner, supra note 6, § 6:30 (discussing methods for distributing 

retirement benefits—defined benefit plans in general).
- 163 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

the present value of a share in the pension of the owning 

spouse and immediately awards the nonowning spouse a 

lump-sum amount in view of that value. 12

The Court of Appeals noted in Polly v. Polly 13 that the deferred 

distribution method is the most widely accepted method of 

dividing retirement benefits; still, the immediate offset method 

remains a viable method under Nebraska law. 14 Contrary to 

Daniel’s implication, while the deferred distribution method is 

perhaps the most widely accepted, such does not make it the 

preferred method of division for retirement benefits.

The district court’s use of the immediate offset method of 

valuation was not an abuse of discretion. Having reviewed 

the record, we determine it is clear, as we have noted, that 

the parties’ divorce was contentious. One of the benefits of 

the immediate offset method is that it effectuates a complete 

and immediate, albeit slightly deferred, split of the retirement 

account at question, which in the case of Daniel and Melanie 

would be advantageous. 15

Relatedly, the immediate offset method is useful in cases 

where there is a likelihood of manipulation of the retirement 

account. 16 The record contains an allegation that Daniel made 

changes to his pension without notifying Melanie. When this 

is considered in tandem with the general contentiousness of 

this divorce, such supports the use of the immediate offset 

method and as clean a break between Daniel and Melanie 

as possible.

In addition, reasons to use the deferred distribution method 

are not present. For example, we have evidence of present 

12 Koziol v. Koziol, 10 Neb. App. 675, 692-93, 636 N.W.2d 890, 906 (2001). 

See, also, 2 Turner, supra note 6, §§ 6:30 to 6:32.

13 Polly v. Polly, 1 Neb. App. 121, 487 N.W.2d 558 (1992).

14 Cf. Koziol v. Koziol, supra note 12.

15 See 2 Turner, supra note 6, §§ 6:31 and 6:36.

16 See id., § 6:36.
- 164 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

value. 17 Also, because Daniel’s pension was in pay status, 

the amount of his benefits was not unusually speculative. 18

And both Daniel and Melanie have nonmarital property and 

income, so the need for a steady retirement income that 

would result from the deferred distribution method is not obviously present. 19

Daniel alleges that the parties’ limited marital estate supports the use of the deferred distribution method. Daniel contends that the marital estate does not include sufficient property 

that he could liquidate in order to make payment to equalize 

the estate.

But contrary to Daniel’s implication, this was not a limited marital estate. Together, Daniel and Melanie had significant assets, including three homes and multiple investment 

accounts. Daniel had access to significant funds outside of the 

marital estate, including at least 2 years’ pension payments 

received during the pendency of the divorce of which Melanie 

received none. Moreover, the district court created a plan for 

the equalization payment, allowing Daniel to pay it off over 

multiple years.

Having reviewed the record de novo, we cannot say that the 

district court’s decision to use the immediate offset method of 

valuation and to accordingly value and divide the estate as it 

did was an abuse of discretion. There is no merit to this assignment of error.

2. Attorney Fees

On cross-appeal, Melanie assigns that the district court erred 

in not awarding her attorney fees and costs. She argues that 

Daniel’s actions throughout the divorce process “frustrated and 

impeded at nearly every step.” 20

17 See id.

18 See id.

19 See id.

20 Brief for appellee on cross-appeal at 41.
- 165 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

As an initial matter, Daniel argues that Melanie has failed to 

comply with this court’s rules regarding the filing of a crossappeal, because she does not have a separate title page indicating her cross-appeal. But Neb. Ct. R. App. P. § 2-109(D)(4) 

(rev. 2014) provides not that the brief and the brief on crossappeal must each have separate title pages, but that “[w]here 

the brief of appellee presents a cross-appeal, it shall be noted 

on the cover of the brief and it shall be set forth in a separate 

division of the brief.” Both of these criteria were met in this 

case, with Melanie’s cross-appeal separately indicated on the 

cover of her brief on appeal. Daniel’s argument to the contrary 

is without merit.

[6,7] We now turn to the merits of Melanie’s cross-appeal. 

In awarding attorney fees in a dissolution action, a court shall 

consider the nature of the case, the amount involved in the controversy, the services actually performed, the results obtained, 

the length of time required for preparation and presentation of 

the case, the novelty and difficulty of the questions raised, and 

the customary charges of the bar for similar services. 21 In addition, courts have the inherent power to award attorney fees in 

certain unusual circumstances amounting to conduct during the 

course of litigation which is vexatious, unfounded, and dilatory, such that it amounts to bad faith. 22

As we did with respect to the valuation of the pension plan 

and division of the marital estate, we review de novo on the 

record to determine whether there has been an abuse of discretion by the trial judge in the award of attorney fees. 23 A 

judicial abuse of discretion exists if the reasons or rulings of 

a trial judge are clearly untenable, unfairly depriving a litigant 

21 Dycus v. Dycus, 307 Neb. 426, 949 N.W.2d 357 (2020).

22 Leners v. Leners, 302 Neb. 904, 925 N.W.2d 704 (2019), disapproved 

on other grounds, State on behalf of Kaaden S. v. Jeffery T., 303 Neb. 

933, 932 N.W.2d 692 (2019); Fetherkile v. Fetherkile, 299 Neb. 76, 907 

N.W.2d 275 (2018).

23 See Higgins v. Currier, supra note 1.
- 166 -

Nebraska Supreme Court Advance Sheets

309 Nebraska Reports

CORNWELL v. CORNWELL

Cite as 309 Neb. 156

of a substantial right and denying just results in matters submitted for disposition. 24

In this case, the record supports the district court’s decision 

to not award attorney fees. As noted above, while the record 

demonstrates that this divorce was contentious, the record also 

shows that both sides at times prolonged the process. Given 

this conflict, we cannot say the decision to not award fees and 

costs was an abuse of discretion.

VI. CONCLUSION

The decision of the district court is affirmed.

Affirmed.

24 Id.