Opinion ID: 2513883
Heading Depth: 4
Heading Rank: 2

Heading: The Stony River Lodge

Text: The trial court valued the Stony River Lodge at $450,000. This was the value attributed to the lodge in an appraisal that James received approximately a year before Dolores filed for divorce. The appraisal had been prepared at James's request by an acquaintance, Rick Richter, for use in connection with a bankruptcy proceeding. In the divorce proceedings, Dolores relied on Richter's appraised value; but James called Richter as a witness to establish that the lodge's actual value was lower than that stated in his earlier appraisal. Richter confirmed the appraisal's estimate that the lodge had a market value of $450,000. But he attempted to qualify this estimate, testifying that the appraisal's reference to market value indicated a value based on the customary financing terms prevalent in the rural Alaskan real estate marketa ten to twenty percent down payment with seller financing. To arrive at the lodge's present cash value, Richter explained, it would be necessary to deduct an additional forty to sixty percent from the market value stated in his original appraisal. Using this cash discount theory, Richter estimated the lodge's present value at forty to sixty percent of $450,000. The superior court rejected this testimony, finding the lodge's value to be $450,000, as stated in Richter's original appraisal. On appeal James contends that this finding is clearly erroneous. [18] He argues that market value is a term of art and that the trial court improperly disregarded Richter's unrefuted expert testimony concerning its meaning. Citing McQueary v. McQueary for the proposition that proper valuation of marital assets requires the reduction of streams of future payments to present value, [19] James maintains that the trial court should have assigned a present cash value to the lodge by applying Richter's cash discount method. Yet the record establishes that the trial court fully considered Richter's testimony. Although accepting Richter's premise that it needed to determine the lodge's present cash value, the court rejected his proposed method of calculating that value. In the court's view, Richter's original appraisal already incorporated adjustments to reflect present cash value and therefore required no further reduction. While the court recognized that Richter disagreed with this conclusion, it expressly found that he was not a credible witness, describing his testimony as that of an advocate choosing arguments for a preconceived result, not an objective expert. [20] Furthermore, the court noted, Richter's trial testimony concerning an additional discount was completely contradicted by the very words that Mr. Richter put in the appraisal itself. The record supports this finding of contradiction. While Richter insisted at trial that an additional discount of forty to sixty percent would be needed to make his original appraisal's estimate of market value reflect the lodge's present cash value, the appraisal itself expressly defined market value as a term that reflected a sale occurring under conditions whereby ... payment is made in terms of cash in U.S. dollars, or in terms of financial arrangements comparable thereto. [21] Richter did not attempt to reconcile this definition with his apparently contradictory position at trial that the appraisal's use of market value reflected a value based on long-term seller financing. Because [i]t is the function of the trial court, not of this court, to judge witnesses' credibility and to weigh conflicting evidence, [22] we have consistently recognized that appellate review of trial court rulings based on testimonial credibility must give due regard to the opportunity of the trial court to judge the credibility of the witnesses. [23] Having reviewed the record with due regard for the trial court's unique ability to assess the credibility of testimony, we hold that the court's valuation of the Stony River Lodge was not clearly erroneous.