IN THE SUPREME COURT OF THE STATE OF MONTANA 

No. 81-50 

IN RE THE MARRIAGE OF: 

KAY JOY PETERSON, 

Petitioner and Appellant, 

VS. 

RAYMOND P. PETERSON, 

Respondent and Respondent. 

ORDER 

PER CURIAM: 

IT IS HEREBY ORDERED that the opinion of this Court dated 

October 22, 1981, be corrected in the following manner. The 

fourth paragraph on page 2 which begins "Both ranches were 

substantially encumbered. . ." should read as follows: 

"Both ranches were substantially encumbered. 

The District Court found the home ranch to have 

a negative value of $74,625 after deducting all 

liabilities from its fair market value of 

$402,500. The court found the fair market value 

of the Albee Ranch to be $2,003,000 and total 

liabilities to be $1,324,761.30. The court 

awarded the appellant the stock sale proceeds, 

furniture from the home ranch, a horse, horse 

trailer, jewelry and one-half of $9000 in lease 

fees owed to the Petersons for grazing rights on 

the home ranch. The respondent was awarded the 

home ranch, cattle valued at $52,924, three 

horses, farm machinery, personal property, 

$4500 in lease fees and $9000 from the sale of 

a caterpillar tractor." 

DATED thispday of November, 1981. 

Justices 
No. 81-50 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1981 

IN RE THE MARRIAGE OF 

KAY JOY PETERSON, 

Petitioner and Appellant, 

and 

RAYMOND P. PETERSON, 

Respondent and Respondent. 

Appeal from: District Court of the Fifth Judicial District, 

In and for the county of Beaverhead. 

Honorable Frank Blair, Judge presiding. 

Counsel of Record: 

For Appellant: 

Datsopoulos,~MacDonald & Lind, Missoula, Montana 

For Respondent: 

Corette, Smith, Pohlman & Allen, Butte, Montana 

Filed: 

Submitted on briefs: July 30, 1981 

Decided: at 
Mr. Justice Frank B. Morrison, Jr., delivered the Opinion of 

the Court. 

Kay Peterson appeals from a judgment of the Fifth 

Judicial District, Beaverhead County, apportioning marital 

assets, denying child support and maintenance, and awarding 

custody of one child to the respondent. 

Kay and Raymond Peterson were married September 23, 

1960. They have three children: two sons, Guy, age 18, and 

Jade, age 17, and one daughter, Andrea, age 15. 

The appellant and respondent accumulated substantial 

property during their marriage. They owned a 1400-acre 

cattle ranch where they resided, livestock, farm machinery 

and other personal property. Prior to September 1980, 

appellant and respondent each owned ninety shares which 

represented fifty percent of an incorporated 12,000-acre 

ranch near Wisdom, Montana, called the Albee Ranch. The 

remaining fifty percent was owned by Mr. and Mrs. Tom Ford. 

The appellant sold her ninety shares to the Fords for 

$230,000 before trial. The respondent was not involved in 

the sale and retained his ninety shares at the time of 

trial . 

Both ranches were substantially encumbered. The 

District Court found the home ranch to have a negative value 

of $74,625 after deducting all liabilities from its fair 

market value of $402,500. The court found the fair market 

value of the Albee Ranch to be $2,003,000 and total 

liabilities to be $1,324,761.30. The court equally divided 

the stock sale proceeds between the parties and ordered the 

shares owned by the respondent sold and the proceeds equally 

divided within thirty days or individually reissued in equal 

amounts to the parties. The home ranch, three horses and 
farm machinery were awarded to the respondent. Petitioner 

was awarded furniture, jewelry, a horse and a horse trailer. 

The remainder of the marital estate, which included cattle 

valued at $52,924, was equally apportioned. 

The appellant raises the following issues in this 

appeal: 

1. Whether the District Court accurately determined 

the net worth of the marital estate. 

2. Whether the District Court abused its discretion 

in apportioning the marital estate. 

3. Whether the District Court erred in denying child 

support and maintenance. 

4. Whether the District Court erred in granting the 

respondent custody of the minor daughter. 

We have carefully reviewed the record before us and 

find the judgment must be reversed and the case remanded for 

complete findings regarding the true net worth of the 

marital estate and the awarding of child custody. Further, 

it is obvious that the District Court failed to adequately 

follow the applicable statutory mandates and case law in 

apportioning the marital estate and in denying child support 

and maintenance. 

Net Worth of the Marital Estate 

The appellant contends the District Court abused its 

discretion first by omitting marital assets proven at trial 

and second in its determination of the value of assets 

included by the court. 

The first omission complained of arises from the sale 

by respondent of 160 cattle to one Andrew Leep in December 
1979. The respondent testified the total sales price was 

$76,000 which was applied to a promissory note to State Bank 

and Trust Company of Dillon, Montana, the holder of the 

security interest in the cattle. 

The appellant contends the sales price was actually 

$96,000 paid to the respondent in two checks; a downpayment 

of $20,000 made payable to the respondent individually and a 

second check of $76,000 made jointly payable to respondent 

and the bank. In support of her allegation appellant 

offered testimony of a Department of Livestock investigator, 

the canceled $20,000 check, copies of the bank's deposit 

records and loan notations, and the official findings of the 

Montana Board of Livestock investigation relating to Leep' s 

livestock dealer's license. The District Court refused to 

admit the Board of Livestock findings. Rule 803(8), 

Mont .R.Evid. 

The District Court did not make a finding regarding 

this matter. Appellant presented substantial credible 

evidence in support of her contention that the respondent 

received $96,000 for the cattle and may have attempted to 

conceal the $20,000 payment. Respondent first testified 

that he could not remember the total sales price but later 

testified if he had received the second check for $20,000 

that he deposited that check with the bank. Respondent did 

not present any documentary evidence in support of his 

contention. Upon the evidence found in this record, we hold 

the District Court abused its discretion by ignoring this 

contested issue in its findings. On remand the District 

Court must make a finding regarding this claim. 

Appellant next contends the District Court erred by 
failing to include prepaid grazing fees in the marital 

estate. The respondent paid a Washington landowner $18,000 

in anticipation of pasturing one hundred cattle; however, 

only forty-six cattle were actually pastured. The testimony 

of respondent supports the appellant's contention regarding 

the unused prepaid fees. Respondent testified the lessor 

would rebate approximately $9,000 on demand. No contrary 

evidence appears in the record. The District Court did not 

include this asset in its findings and conclusions. This 

was error. On remand the District Court must add the 

prepaid fees to the valuation of the estate. 

The final omissions claimed as error are a $6,000 

payment received by respondent for gravel taken from the 

home rancn and a $1,400 mineral lease payment. Receipt of 

these payments was admitted by the respondent. However, the 

record does not contain the time they were received. The 

respondent testified he applied all the proceeds to expenses 

of the ranch. Appellant contends she is entitled to a full 

accounting. 

In Lippert v. Lippert (1981), - Mont. , 627 

P.2d 1206, 1209, 38 St.Rep. 625, 629, we held, "spouses 

possess mutual powers, obligations and interests which 

endure until lawfully modified or terminated. One of those 

powers is the power to freely contract with others regarding 

marital property. Section 40-2-301, MCA." 

Absent modification either spouse is free to act with 

marital property. In this case the marital power to freely 

contract was lawfully modified. On March 25, 1980, a 

temporary order was granted by the District Court prohibiting the respondent from "transferring, encumbering, con- 
cealing or otherwise disposing of any real or personal 

property of [sic] any interest therein during the pendency 

of this proceeding." This relief was in accordance with our 

statutes. Section 40-4-106(2)(a), MCA. A subsequent order 

modifying the temporary order was entered June 2, 1980. The 

modification removed the total prohibition against the 

respondent but required the respondent to "account for all 

monies from this date to the date of the hearing on the 

Petition for Dissolution." On remand the respondent must 

disclose when he received the disputed payments. If they 

were received after March 25, 1980, or remained in the 

marital estate after that date, the respondent must account 

to the appellant for their disbursement. 

In addition to omissions, the appellant claims the 

District Court erred in its valuation of the home ranch, the 

Albee Ranch, farm machinery, and the number of horses owned 

by the parties. 

At trial the parties presented conflicting evidence 

regarding the value of the home ranch. Appellant offered 

the testimony and appraisal report of a professional 

certified appraiser who concluded the value of the home 

ranch to be $750,000 as of September 1980. The respondent 

offered the testimony of a local rancher and real estate 

buyer. He valued the ranch at $402,500. The District 

Court, without stated reasons, accepted the lower figure. 

The District Court is free to follow one appraisal and 

reject another. However, here there is a wide disparity in 

valuation, and we are unable to review for abuse of 

discretion in the absence of findings by the trial court 

supporting the valuation selected. 
Respondent cites Biegalke v. Biegalke (1977), 172 

Mont. 311, 564 P.2d 987, for the rule that "the trier of the 

facts has the discretion to give whatever weight he sees fit 

to the testimony of the expert from 0 to loo%." 564 P.2d at 

990. We think Bieqalke is distinguishable. In Biegalke, 

the parties agreed to the court appointment of a single 

appraiser, stipulated to his qualifications, and generally 

accepted his appraisal without objection. On appeal, we 

held the court properly exercised its discretion in determining valuation. In the instant case the parties secured 

different appraisers, who presented widely conflicting 

valuations. Upon review of the record, we cannot say the 

District Court properly exercised its discretion in 

selecting the value it did without some indication of its 

reasons for doing so. 

Appellant next contends the District Court erred in 

its valuation of the Albee Ranch. Appellant's appraiser 

testified that a rejected offer of $2,600,000 from a prospective buyer was a reasonable valuation. The respondent's 

appraiser testified the total market value of the Albee 

Ranch was $2,005,550. The District Court found "the market 

value of that ranch from the testimony of Jack Hirschy to be 

in the sum of $2,003,000." It appears the District Court 

has made a clerical error which should be corrected. In 

addition, the court should state its reasons for determining 

valuation. A rejected offer of $2,600,000 might well 

indicate the trial court abused its discretion in assigning 

a value of only $2,003,000. However, we will uphold a 

proper exercise of discretion by the trial court and if a 

reasonable explanation exists for adopting the lower value, 
it should be stated. 

With regard to appellant's challenge to the court's 

findings of valuation of farm machinery and the number of 

horses, we once again find substantial disparity in the 

evidence presented by the parties but no reasoning given by 

the court for its adoption of the lower values. On remand 

tne court should explain the reasons employed. 

Apportionment, Maintenance and Child Support 

True net worth of the marital estate must be 

accurately determined before the issues of equitable apportionment, maintenance and child support can be resolved; 

however, we have included appellant's claims regarding these 

issues to provide guidance to the District Court. 

Appellant contends the District Court failed to apply 

the mandates of section 40-4-202, MCA, in the division of 

the marital property. We agree. The determinations made 

must be measured against the statute. In apportioning the 

marital estate the District Court must follow the requirements of section 40-4-202(1), MCA, and our case law. Smith 

v. Smith (1981), - Mont. , 622 P.2d 1022, 38 St.Rep. 

146; Tefft v. Tefft (1981), - Mont . , 628 P.2d 1094, 

38 St.Kep. 837. In deciding the issue of maintenance, the 

court must follow the guidelines found in section 40-4-203, 

MCA. Bowman v. Bowman (1981), Mont. - P.2d 

, 38 St.Rep. 1515. Finally, the issue of child support 

must be determined in accordance with section 40-4-204, MCA. 

The District Court must, at the very least, consider and 

apply the enumerated statutory factors which control the 

exercise of its discretion. This was not done in this case. 
Child Custody 

The final issue we can properly review at this time 

is the challenge to the custody award. In accordance with 

an agreement of the parties, the District Court interviewed 

the minor children to determine their custodial preferences. 

In awarding custody the District Court made no specific 

findings. Appellant contends the award should be reversed 

because of such failure, citing section 40-4-212, MCA; In Re 

Marriage of Kaasa (1979), - Mont . , 591 P.2d 1110, 36 

St.Rep. 425; and In Re Marriage of Kramer (1978), 177 Mont. 

61, 580 P.2d 439. We agree and hold the custody award was 

deficient for failure to make proper findings. 

In summary we hold the District Court did not find 

the true net worth of the marital estate and inadequately 

considered the statutes controlling apportionment, maintenance, child support and child custody awards. This cause 

is reversed and remanded for further proceedings consistent 

We concur: 

dhief Justice