Court Opinion

ID: 2721209
Source: CourtListenerOpinion
Date Created: 2014-08-27 14:03:33.202143+00
Date Added: 2024-06-11T12:18:17.272841
License: Public Domain

IN THE COURT OF APPEALS OF IOWA

                                  No. 13-1236
                             Filed August 27, 2014

IN RE THE MARRIAGE OF SANDI K. MEURER
AND CHARLES H. MEURER

Upon the Petition of
SANDI K. MEURER,
      Petitioner-Appellee,

And Concerning
CHARLES H. MEURER,
     Respondent-Appellant.
________________________________________________________________

      Appeal from the Iowa District Court for Scott County, Nancy S. Tabor,

Judge.

      Respondent appeals the economic provisions of a decree of dissolution of

marriage. AFFIRMED AS MODIFIED.

      Michael J. McCarthy of McCarthy, Lammers & Hines, Davenport, for

appellant.

      Maria Waterman and Melinda Eshbaugh, Davenport, for appellee.

      Heard by Danilson, C.J., and Potterfield and McDonald, JJ. Tabor, J.,

takes no part.
                                         2

MCDONALD, J.

       Charles Meurer appeals the decree dissolving the marriage between him

and his former spouse Sandi Meurer. On appeal, Charles argues the district

court improperly included as marital property and divided two separate

inheritances he received during the course of the marriage. He also challenges

the district court’s award of spousal support and attorney’s fees.

                                         I.

       We review dissolution of marriage proceedings de novo. See Iowa R.

App. P. 6.907; In re Marriage of McDermott, 827 N.W.2d 671, 676 (Iowa 2013).

We examine the entire record and decide anew the issues properly preserved

and presented for appellate review. See id. While we give weight to the findings

of the district court, those findings are not binding.      See Iowa R. App. P.

6.904(3)(g); McDermott, 827 N.W.2d at 676.             We afford the trial court

considerable latitude in determining spousal support awards. See In re Marriage

of Benson, 545 N.W.2d 252, 257 (Iowa 1996). We will disturb the district court’s

ruling only where there has been a failure to do equity. Id. We review an award

of attorney fees for an abuse of discretion. In re Marriage of Sullins, 715 N.W.2d

242, 255 (Iowa 2006).

                                         II.

                                         A.

       “Upon    every   judgment    of   annulment,    dissolution,   or   separate

maintenance, the court shall divide the property of the parties . . . .” Iowa Code
                                        3

§ 598.21(1) (2011). As a general rule, the court shall divide all property of the

parties equitably between the parties. See Iowa Code § 598.21(5). However,

      [p]roperty inherited by either party or gifts received by either party
      prior to or during the course of the marriage is the property of that
      party and is not subject to a property division . . . except upon a
      finding that refusal to divide the property is inequitable to the other
      party or to the children of the marriage.

Iowa Code § 598.21(6). This provision “does not demand that property acquired

by gift or inheritance must always be set aside to the donee and omitted

altogether from consideration in the division of property.      To avoid injustice

property inherited by or given to one party may be divided.” In re Marriage of

Muelhaupt, 439 N.W.2d 656, 659 (Iowa 1989).

      We look at several factors in determining whether inherited or gifted

property should be divided.    “The intent of the donor and the circumstances

surrounding the inheritance control whether the inheritance is to be set off in the

dissolution.” In re Marriage of Higgins, 507 N.W.2d 725, 727 (Iowa Ct. App.

1993). We also consider:

      (1) contributions of the parties toward the property, its care,
      preservation or improvements;
      (2) the existence of any independent close relationship between the
      donor or testator and the spouse of the one to whom the property
      was given or devised;
      (3) separate contributions by the parties to their economic welfare
      to whatever extent those contributions preserve the property for
      either of them;
      (4) any special needs of either party;
      (5) any other matter which would render it plainly unfair to a spouse
      or child to have the property set aside for the exclusive enjoyment
      of the donee or devisee.

Muelhaupt, 439 N.W.2d at 659. The length of the marriage is also an “important

factor.” See In re Marriage of Hoffman, 493 N.W.2d 84, 89 (Iowa Ct. App. 1992).
                                        4

       There are two inheritances at issue in this proceeding. The first: in 1993,

Charles inherited $178,000 from his uncle Herbert Frick. The district court found

the Frick inheritance should not be excluded from the property division, which

Charles contends was improper.        After considering all relevant factors, we

conclude it would be inequitable to exclude the Frick inheritance from the marital

property subject to division.

       From the time of its receipt, the Frick inheritance was comingled with

assets Charles and Sandi had accumulated as a couple.            A portion of the

inheritance was used to satisfy the couple’s mortgage.       Charles testified the

remaining money was not segregated because “our marriage was rock solid. I

never anticipated that we would ever divorce.”       Other than payment on the

mortgage, neither party could trace the use of the Frick inheritance. The fact the

inheritance was used as marital property to provide for Charles, Sandi, and their

children for an extended period of time without segregation of the funds would

render any other disposition inequitable:

              Our obligation to respect and give effect to the wishes of
       those who convey gifts and bequeath inheritances demands of us
       that those wishes not be rendered nugatory by the mere fact that
       the intended recipient happens to be married.
              On the other hand, as time goes on, the benefits of such
       property are enjoyed by the married couple; it is both natural and
       proper for the expectations of the other spouse to rise accordingly.
       A sudden substantial rise in the couple’s standard of living made
       possible by a gift or inheritance to the husband or the wife will
       naturally and reasonably lead the other spouse to anticipate that
       that standard of living will be maintained, particularly if it is
       sustained over a lengthy period of time. Changes in habit, in dress,
       in associates and friends, in manners, in leisure activities, in work
       or study aspirations—in short, in one’s entire life-style—can be
       brought about by significant improvements in one's access to
       substantial financial resources. With time such changes become
                                              5

       ever more deeply ingrained, and eventually it becomes virtually
       impossible to return to a world long since renounced and forgotten.

In re Marriage of Wallace, 315 N.W.2d 827, 831 (Iowa Ct. App. 1981); see In re

Marriage of Goodwin, 606 N.W.2d 315, 320 (Iowa 2000) (stating “where the

parties have enjoyed, over a lengthy period of time, a substantial rise in their

standard of living as the result of gifts or inheritances, then any division of

property should enable the parties to continue that lifestyle, even if that goal

requires the division of gifted property”).

       The second inheritance: one year prior to the parties’ dissolution trial,

Charles inherited approximately $282,000 from his stepmother Eda.              The

inheritance was comprised of cash and 2000 shares of Exxon stock. Initially,

Charles held the inheritance in Charles’ and Sandi’s joint brokerage account, but

Charles almost immediately transferred the stock to his individual brokerage

account. The trial court awarded the Exxon stock to Charles without division as

inherited property. However, the trial court determined the cash portion of the

inheritance, plus interest and dividends earned on the inheritance, should be

considered marital property and divided equally between the parties.         Sandy

does not cross-appeal the award of Exxon stock to Charles. Charles contends

the district court erred in concluding the cash portion of the inheritance was

marital property subject to division. We agree with this contention.

       Unlike the Frick inheritance, the inheritance from Eda was received shortly

prior to the dissolution of the parties’ marriage. While it is true the inheritance

was temporarily held in a joint account, Charles quickly transferred the

inheritance from that account. Thus, unlike the Frick inheritance, the funds were
                                        6

not comingled and used to support the standard of living of the family.

Nonetheless, Sandi contends it was proper to divide the cash component of the

inheritance because she had a close relationship with Eda. There is no doubt

that Sandi enjoyed a close relationship with Eda and Charles a poor one. After

Charles’ dad died and left his money to Eda, Eda changed the executor of her

will. According to Sandi, Charles “fully expected that he was not going to inherit

anything. He thought for sure that she had changed the will and he was out.”

Sandi believes if she had told Eda she was leaving Charles, Eda would have

changed her will to leave the money to Sandi instead of Charles. That is simply

speculation. Like the district court, we find and conclude Eda devised the stock

and cash to Charles, despite their poor relationship, to honor Charles’ father’s

wishes. The Exxon stock and cash was earned by Charles’ father, and it was his

desire it be passed to his children.

       While the district court found the cash portion of the inheritance was

comingled with other assets and not traceable, that is inconsistent with Charles’

testimony that all of the funds in brokerage account ***9199 were solely from the

inheritance. The district court’s conclusion the funds were comingled and not

traceable is also inconsistent with the property division in the decree.      The

decree specifically identifies the cash portion of the inheritance plus accumulated

interest or dividends as $107,549.40 and equally divides the same, $53,774.70 to

each party.      Although neither party did exemplary work in providing

documentation regarding their financial accounts, on de novo review, we are able

to conclude all of the funds in brokerage account ***9199 derived solely from the
                                         7

inheritance. Accordingly, the decree is modified to award Charles an additional

$53,774.70, which represents the remainder of the inheritance improperly

awarded to Sandi.

                                        B.

       Spousal support is a stipend paid to a former spouse in lieu of the legal

obligation to provide financial assistance. See In re Marriage of Anliker, 694

N.W.2d 535, 540 (Iowa 2005).       A party does not enjoy an absolute right to

spousal support after dissolution of the marriage. See Iowa Code 598.21A(1)

(providing that “the court may grant an order requiring support payments to either

party”); Anliker, 694 N.W.2d at 540. The criteria for determining the entitlement

to, and the amount of support, if any, include, but is not limited to, the length of

the marriage, the age and health of the parties, the property distribution, the

parties’ educational level, the earning capacity of the party seeking support, the

feasibility of that party becoming self-supporting at a standard of living

comparable to that enjoyed during the marriage, and the length of time

necessary to achieve this goal. Id.

       The determination of the need for spousal support and the amount of any

such support cannot be reduced to a mathematical formula; the facts and

circumstances of each case are too varied for the support determination to be

reduced to a table or grid. See In re Marriage of Brown, 776 N.W.2d 644, 647

(Iowa 2009) (stating precedent is of little value because the decision to award

support and the determination of the amount of such support is based on the

unique facts and circumstances of each case). Instead, the court must equitably
                                          8

balance the spouses’ respective prospective needs and means viewed in the

light of the standard of living they enjoyed while married. See In re Marriage of

Tzortzoudakis, 507 N.W.2d 183, 186 (Iowa Ct. App. 1993) (stating “the ability of

the one spouse to pay should be balanced against the needs of the other

spouse”); In re Marriage of Hayne, 334 N.W.2d 347, 351 (Iowa Ct. App. 1983)

(stating a party is entitled to receive support only in an amount sufficient to

maintain the standard of living previously enjoyed without destroying the other

party’s right to enjoy a comparable standard of living).          “A trial court has

considerable latitude when making an award of spousal support.” In re Marriage

of Schenkelberg, 824 N.W.2d 481, 486 (Iowa 2012). “Therefore, we will only

disturb the trial court's award of spousal support if it fails to do equity between the

parties.” Id.

       The district court awarded Sandi spousal support in the amount of $3000

per month until she turns sixty-two or first becomes eligible for social security, at

which point the amount of alimony would be reduced to $2500 per month. On de

novo review, considering all of the relevant factors, we conclude the spousal

support award does not do equity between the parties. Sandi and Charles had

been married for over thirty-four years. At the time of the decree, Charles was

sixty-three years old and in good health. Charles is employed as a chemical

engineer, earning approximately $110,000 per year in addition to bonus

opportunity. Sandi was fifty-five years old and suffers from a myriad of health

conditions, some resulting in lifting and twisting work restrictions that will one day

require further surgery.    Although Sandi has a postsecondary education, the
                                            9

parties agreed she would remain at home as the primary caretaker of the parties’

now adult children. While she has a license as a certified nail technician, she

has not been successful in making that a profitable business endeavor. Sandi

currently works at PetSmart making approximately $569 per month.

        We conclude the award of spousal support should be reduced to $2000

per month until Sandi deceases or remarries or Charles deceases, whichever

occurs first.     Relevant considerations supporting this modification include

Charles’ decreased future income as he approaches retirement age. In addition,

Sandi    will   receive   a   substantial   property   settlement   of   approximately

$635,445.04.      The property settlement combined with the adjusted alimony

award will place her in the position of enjoying approximately the same standard

of living she enjoyed prior to the dissolution of the parties’ marriage without

denying Charles the same opportunity.

        We address an additional concern. Charles requests the decree make

clear his alimony obligations terminate at his death. Sandi requests the alimony

obligation extend beyond Charles’ life, if necessary, due to her limited income

and future needs. “The general rule followed in Iowa is that alimony payments

are presumed to terminate at the death of the payor.”               In re Marriage of

Weinberger, 507 N.W.2d 733, 736 (Iowa Ct. App. 1993).               However, section

598.21A “is broad enough to permit alimony payments after death.” Id.; see Iowa

Code § 598.21A(1) (providing “the court may grant an order requiring support

payments to either party for a limited or indefinite length of time”).           After

considering the ages of the parties and the amount of property awarded to Sandi,
                                          10

we conclude it would be equitable for Charles’ alimony obligation to terminate

upon death and not pass to his estate but to require Charles to purchase and

maintain an insurance policy insuring his life with a death benefit of at least

$100,000 naming Sandi as beneficiary until such time as his obligation to pay

alimony terminates. See, e.g., In re Marriage of Bonnichsen, No. 13-0436, 2014

WL 251905, at *3 (Iowa Ct. App. Jan. 23, 2014) (affirming alimony award and life

insurance requirement).

                                          C.

       Charles challenges the district court’s award of attorney’s fees to Sandi.

“An award of attorney fees rests in the sound discretion of the [district] court and

will not be disturbed on appeal in the absence of an abuse of discretion.” In re

Marriage of Romanelli, 570 N.W.2d 761, 765 (Iowa 1997). Whether attorney

fees should be awarded depends on the parties’ respective abilities to pay, and

any fees awarded must be fair and reasonable. See In re Marriage of Guyer,

522 N.W.2d 818, 822 (Iowa 1994). Here, we cannot conclude the district court

abused its discretion in awarding fees.

       With respect to appellate costs, “[a]ll appellate fees and costs shall be

taxed to the unsuccessful party, unless otherwise ordered by the appropriate

appellate court.”   Iowa R. App. P. 6.1207.     Appellate fees and costs do not

include appellate attorney fees. We direct that each party be responsible for their

own costs. See Lewis Elec. Co. v. Miller, 791 N.W.2d 691, 696-97 (Iowa 2010)

(affirming it is an “abuse of discretion to divide costs equally between the parties
                                        11

when one party was fully successful on appeal”). Likewise, we direct that each

party be responsible for their own appellate attorney fees.

                                        III.

      For the foregoing reasons, the decree of dissolution of marriage is

affirmed as modified. Specifically, the inheritance Charles received from Eda

should not be considered marital property and is excluded from division. This

results in Charles receiving additional cash property from account ending ***9199

in the amount of $53,774.70. Charles shall pay to Sandi spousal support in the

amount of $2000 per month until Sandi deceases or remarries or Charles

deceases. Further, Charles shall purchase and maintain an insurance policy

insuring his life with a death benefit of at least $100,000 naming Sandi as

beneficiary until such time as his obligation to pay alimony terminates.

      AFFIRMED AS MODIFIED.