Opinion ID: 2621569
Heading Depth: 1
Heading Rank: 5

Heading: Inherited Assets

Text: [¶ 8] Husband claims the trial court erred in the division of the Breitenstine marital property. He contends that the gifts and inheritance from his parents should not have been awarded to Wife. Husband argues that in dividing the marital estate the trial court ignored a material factor deserving significant weight, i.e., the party through whom the property was acquired. Citing McCulloh v. Drake , ¶ 15, Husband further asserts in Wyoming, property inherited or gifted to one spouse is awarded to the spouse who received it. We disagree. [¶ 9] The division of marital property is controlled by Wyo. Stat. Ann. § 20-2-114 (LexisNexis 2001): In granting a divorce, the court shall make such disposition of the property of the parties as appears just and equitable, having regard for the respective merits of the parties and the condition in which they will be left by the divorce, the party through whom the property was acquired and the burdens imposed upon the property for the benefit of either party and children. A reading of the statute indicates that the party through whom the property was acquired is one of the multiple factors the trial court considers in determining the appropriate division of property. In McCulloh, we made it clear that property inherited by one party can be awarded to the party by whom it was inherited or given. McCulloh, at ¶ 15. But we did not hold that property inherited by one spouse must always be awarded to the spouse that received it. Before the McCulloh decision, we said no hard and fast rules govern property divisions. Moore v. Moore, 809 P.2d 261, 265 (Wyo.1991) (citing Dennis v. Dennis, 675 P.2d 265 (Wyo.1984); Klatt v. Klatt, 654 P.2d 733 (Wyo.1982); Paul v. Paul, 616 P.2d 707 (Wyo.1980)). We continue to adhere to that principle. We have never established bright line rules for the disposition of a gift or inheritance, and we do not do so now. Instead, we review whether the trial court considered the appropriate factors in making the disposition. The particular circumstances of the case dictate the property distribution. Bricker v. Bricker, 877 P.2d 747, 750 (Wyo.1994) (citing Biggerstaff v. Biggerstaff, 443 P.2d 524, 526 (Wyo. 1968)). [¶ 10] In its findings of fact, the trial court stated [t]he gifts from the Defendant's parents and the proceeds therefrom account for substantially all of the marital estate subject to division by this Court. Clearly, this statement indicates the district court considered through whom the property was acquired. Nothing in the statute or our case law would then require the district court to award this entire amount to Husband. The district court also has to weigh other appropriate factors. [¶ 11] For instance, consideration must be given to the respective merits of the parties. The district court's findings of fact, all of which are supported by the record, include consideration of this factor. The district court found that Husband was able to account for $11,092,316 of income into the marital estate and only $3,545,048.78 in disbursements. Yet, Husband claimed he was worth only $1.5 million. Because Husband offered no evidence to account for where all the assets went, the judge was free to conclude that he still had them. During the course of the marriage, the couple created a trust account for each child (children's trusts) with a $500,000 initial deposit for each trust. Husband regularly withdrew money from the children's trusts and converted at least a portion of the funds to his own use necessitating his removal as trustee. Husband took substantial steps to secrete his assets in protection trusts and various corporations. Husband never produced a proper accounting of these trusts and corporations. Instead, Husband left the district court to guess at their purpose and value. [¶ 12] Furthermore, Wife gave up work and moved to the Bahamas to help Husband avoid taxes. This can be said to contribute to the value of the assets. For a time, the move to the Bahamas made home schooling necessary, and Wife took care of those duties. For tax minimization reasons, the couple returned to Ohio on only a limited basis. Wife assisted in this strategy by staying offshore away from family and friends. The couple also invested together; they used his name, her name, both names, and the kids' names. For all intents and purposes the money was treated as marital property once it was received. [¶ 13] The district court also considered the conditions in which the parties may be left after the divorce. As the district court recognized and the record reveals, the couple had little property that was not either inherited or gifted assets or purchased with such assets. This was due in part to the fact that immediately after the sale of the landfill both Husband and Wife stopped working and decided to live on the sale proceeds and income from investments made with the proceeds. Under the circumstances, the district court could reasonably conclude that Wife should not be left without any property. Likewise, Wife resumed teaching after the separation, but she and the children now live in a diminished lifestyle. Husband, on the other hand, is unemployed and still enjoys his considerable wealth. [¶ 14] Additionally, Wife was awarded custody of the children. Up until the point of the property division, Husband had not paid any child or spousal support though ordered to do so. The district court was well within its discretion to contemplate Husband's reluctance to pay alimony and child support in the past and burden the assets for the benefit of Wife and the children. We find, therefore, that the court considered and weighed all the appropriate factors. [¶ 15] Furthermore, we disagree with Husband's assertion that Wife received all of the marital assets. Wife was awarded one-half of the marital estate. The district court's judgment did order assignment to Wife of all the property and assets of Husband, but read fully, such assignment was only to the extent necessary to satisfy the judgment, provide for alimony, and provide for child support. Once the judgment and orders of the court are complied with, Wife has no claim to Husband's remaining assets. The district court's action was to aid in collection, which is entirely appropriate given Husband's lack of compliance up until that point. Likewise, we consider that a portion of Wife's share of the marital estate included the property in Jackson. Based on the purchase price and renovation costs, the district court therefore deducted $2 million from the amount Husband owed Wife. However, some testimony indicated that this property was only worth $950,000. Should the $950,000 valuation turn out to be accurate, Wife will actually receive less than one-half of the estate. [¶ 16] Considering the above-mentioned facts, nothing in the property distribution of this case shocks the conscience of the court. As such, we do not find the division to be unjust or inequitable. The district court considered the appropriate criteria and did not therefore abuse its discretion.