No. 14282 

IN THE SUP- CCUKC OF THE STATE OF MONTANA 

1978 

IN RE THE MARRIAGE OF' 

E. G. BALSAM, J3.t 

Petitioner and Respondent, 

Respondent and Appellant. 

Appeal fran: District Court of the Thirteenth Judicial District, 

Homrable Charles Luedke, Judge presiding. 

Counsel of Record: 

For Appellant: 

Berger, Anderson, Sinclair & Murphy, Billings, Mntana 

James J. Sinclair argued, Billings, Pbntana 

For Respondent: 

I;ongan & Holmstrcan, Billings, Montana 

James C. Capser argued, Billings, Mntana 

Submitted: November 15, 1978 

Filed: $m f. 5 1979 
Mr. Justice Daniel J. Shea delivered the Opinion of the Court. 

Wife appeals from judgment of the Yellowstone County 

District Court finally distributing marital assets after 

dissolution of her marriage to respondent-husband. 

The parties were married in January 1964. During their 

thirteen year marriage, they had three children. The husband 

petitioned for dissolution which was granted on March 9, 

1977. Custody, support, visitation, maintenance and property 

distribution were to be settled later. Mutual agreement was 

reached as to all matters except property division. The wife 

would retain custody of the three minor children. Husband 

was obligated to pay $250.00 per month per child for support 

until each attained the age of majority. No provision was 

made for maintenance; none was pleaded. Only the issue of 

property distribution was presented to the District Court. 

The property before the Court included: 

(1) family home appraised at $92,800.00 

(2) household furnishings and 

personal property in possession 

of wife 17,000.00 

(3) household furnishings and 

personal property in possession 

of husband 3,000.00 

(4) 1972 Mercury station wagon 2,275.00 

(5) 34 shares Balsam, Inc. stock 58,549.36 

(6) 1 share Hornoi Transport, 

Ltd. stock no value 

(7) 215 shares Hornoi Transport, 

Inc. stock 54,487.45 

The marital debts were: 

(1) Unsecured notes from First National 

Bank, Miles City, Montana $19,000.00 

(2) Note payable to Midland, Inc. 

for construction materials used 

in construction of marital home 6,190.00 
On December 9, 1977, the District Court issued its memorandumorder determining the wife's entitlement to the above assets 

and liabilities. The court engaged in a reasoned analysis 

as follows: 

Family Home. Prior to their marriage, husband was 

given a trust fund by his parents. After marriage and 

construction of the marital home, he withdrew monies from 

the trust fund and reduced the construction price of $66,800.00 

by 41%. Documentation of this transaction was received into 

evidence without objection. The court ruled that only 59% of 

the home's present value was includable in the marital 

estate for division. 

Balsam Inc. Stock. Husband was given 19 shares of 

Balsam, Inc. stock and 50 shares of Northern Tank Lines, Inc. 

stock by his parents. Husband later traded the Northern 

Tank Lines, Inc. stock for 15 more shares of Balsam, Inc. 

stock, giving him a total of 34 shares. The court noted no 

increase in the value of this gifted stock discernible from 

the evidence presented and that its value is adversely 

affected by transfer restrictions. The Balsam, Inc. stock 

was not included in division of the marital property. 

Hornoi Transport, -- Ltd. Stock. During the marriage, 

husband and his brother combined the dividends received from 

Northern Tank Lines, Inc. stock and purchased inter-provincial 

authority to transport petroleum products from Canada into 

the United States. The new concern, named Hornoi Transport, 

Ltd., generated substantial income until about a year after 

its inception when the Canadian government imposed a heavy 

export tax on petroleum products thereby causing a complete 

cessation of business. The corporation has produced no 

income since and was considered valueless at marital dissolution. 

Hornoi Transport, -- Inc. Stock. With the funds generated 

while Hornoi Transport, Ltd. was profitable, husband and 
his brother purchased certain Montana-North Dakota intrastate 

authority to haul petroleum products around which they 

formed Hornoi Transport, Inc. Husband held a 50% interest in 

Hornoi Transport, Inc. valued at $54,487.45. The court 

included this amount in the marital estate. 

Ultimately, the assets in which the wife was deemed 

entitled to share included: 

(1) family home to extent of (59%) $54,752.00 

(2) furnishings and personal property 20,000.00 

(3) automobile 2,275.00 

(4) Hornoi Transport, Inc. 54,487.45 

$131,514.45 

Deducting the marital debts ($25,190.00), her one-half 

share was deemed $53,162.22. Out of this figure, the court 

awarded the home furnishings and personal property in wife's 

possession ($17,000.00) and the automobile leaving a balance 

of $33,887.22. The court recommended that if the wife remain 

in the home with the children, an arrangement be made whereby 

when the youngest child attains majority, the home be sold 

and its proceeds divided in proportion to their respective 

interest, i.e., 63.48% to husband, and the balance to the 

wife. 

The issue presented is whether the District Court's 

distribution of the marital property was an abuse of discretion. 

Our standard of review in disputes over a District 

Court's division of marital property is whether in the exercise 

of its discretion the court acted arbitrarily, unreasonably 

or without regard to recognized principles resulting in 

substantial injustice. Porter v. Porter (1970), 155 Mont. 

451, 457, 473 P.2d 538, 541. This case was submitted with 

an agreed statement of record on appeal pursuant to Rule 

9(d), Mont.R.App.Civ.P., hence we confine our inquiry to 

whether there was substantial evidence in that record and 

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the exhibits to support the court's findings and order of 

property disposition. Martinez v. Martinez (1978), Mont . 

Wife argues that her award of $53,162.22 when compared 

to $234,848.49 is manifestly inequitable. Our preliminary 

observation is that the wife's valuation of the marital 

estate is not supported by the record. The $234,848.49 

figure is derived from the chart attached to her brief, 

ostensibly for this Court's convenience. The wife values 

the Balsam, Inc. stock without discount. The uncontraverted 

testimony of husband's certified public accountant was that "if 

value were to be determined by use of book values, then the 

stock in Balsam, Inc. would have to be discounted for minority 

interest." Exhibit 2, fixing the discounted value, was then 

admitted without objection. Likewise, the only evidence on 

value of the Hornoi Transport, Ltd. stock was that it had no 

present value. Since these valuations were accepted by the 

District Court without objection by wife's counsel, we 

cannot consider her recalculations on appeal. Sikorski v. 

Olin and Rolin Mfg., Inc. (1977) , Mont . , 568 P.2d 

571, 574, 34 St.Rep. 1042, 1046 (citing cases). 

Essentially, the wife maintains it is inequitable that 

she has no source of income while the husband does. She 

forsees the eventual exhaustion of property awarded her by 

the time their youngest child attains the age of majority. 

Husband aptly characterizes this as a "maintenance argument", 

which assumes she will never work or remarry. Like the 

valuation she ascribes to the marital assets, wife's contention 

that the amount awarded will not enable her to maintain her 

station in life was not an issue raised in the District 

Court. In view of the fact that the wife had remarried at 

the time of trial, property disposition as an alternative to 

a maintenance was indeed a moot issue. 

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The parties are agreed that section 48-321(1), R.C.M. 

1947, provides the statutory guidelines for distribution 

of marital property at dissolution. The wife contends 

however, the court failed to consider her non-monetary 

contributions in its disposition. We disagree. The court 

acknowledged the wife's non-monetary contribution with 

respect to 59% of the current value of the family home, all 

the home furnishings and personal property, the automobile 

and the Hornoi Transport, Inc. stock. With reference to the 

stock, the court reasoned: 

"Although this asset [Hornoi Transport, 

Inc.] came as a product of the husband's 

gifted stock interest in Northern Tank 

Line, being a dividend associated with 

such stock ownership, its development 

accrued during the marriage and can properly 

be considered a marital asset in which the 

wife would be entitled to some interest." 

The rationale underlying the court's treatment of the 

Balsam, Inc. stock was also outlined in the court's memorandum: 

". . . the gifted stock he now has in 

Balsam, Inc., has not been the product of 

any marital effort by either of them, but 

is purely a gift toward which the wife has 

made no contribution and, therefore, any 

entitlement in her should take this factor 

into account. If there has been any increase 

in the value of the stock over the period of 

the marriage, it is not discernible from the 

evidence before the Court." 

The court thus exercised reasonable discretion in disallowing wife a half interest in the Balsam, Inc. stock. 

In valuing the family residence, the court apparently 

adopted the husband's contention as stated in the court's 

memorandum: 

". . . the amount of gifted trust money 

he put into the family home amounted to 

41% of its construction price so that 41% 

of its present value should be his, exclusive 

of any interest in the wife. In other words, he 

regards 59% of the home to be marital estate 

and suggests that a 50-50 division of that 

interest would be appropriate." 

This formula is troubling in light of a recent case. In Vivian 

v. Vivian (1978), Mont. , 583 P.2d 1072, 1074-75, 

35 St.Rep. 1359, 1362, this Court disapproved deducting an 
inheritance received during marriage, assuming it was 

invested in home improvements, from the value of the marital 

home before dividing the marital assets. It seems the 

appreciated value of the home should be considered a product 

of the marital partnership and therefore includible in the 

marital estate. Vivian is distinguishable from the instant 

case however, because in Vivian no evidence was presented on 

the husband's expenditure for home improvements, and the 

inheritance was received during the marriage. Here, the 

gifted funds were received before marriage and evidence of 

husband's expenditure was clearly presented at trial. We do 

not approve the percentage deduction of monies invested in 

marital assets which have appreciated during marriage. 

In this case, however, we find no abuse of discretion. 

The District Court's memorandum-order disposing of 

marital assets reflects a reasoned application of section 

48-321(1), R.C.M. 1947, to division of the marital estate. 

All the marital assets were before the court. No abuse of 

discretion has been shown. 

The District Court's judgment is affirmed. 

We Concur: 

Chief Justice 

i Justices .