Court Opinion

ID: 4149751
Source: CourtListenerOpinion
Date Created: 2017-03-02 17:09:43.771756+00
Date Added: 2024-06-11T14:19:35.102407
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                                 FILED
regarded as precedent or cited before any                         Mar 02 2017, 9:12 am
court except for the purpose of establishing                          CLERK
the defense of res judicata, collateral                           Indiana Supreme Court
                                                                     Court of Appeals
                                                                       and Tax Court
estoppel, or the law of the case.

ATTORNEY FOR APPELLANT                                   ATTORNEYS FOR APPELLEE
Joshua Flowers                                           Andrew Z. Soshnick
Indianapolis, Indiana                                    Teresa A. Griffin
                                                         Indianapolis, Indiana

                                          IN THE
    COURT OF APPEALS OF INDIANA

Kevin L. King,                                           March 2, 2017
Appellant-Petitioner,                                    Court of Appeals Case No.
                                                         29A02-1601-DR-34
        v.                                               Appeal from the Hamilton
                                                         Superior Court
Mary E. King,                                            The Honorable Steven R. Nation,
Appellee-Respondent                                      Judge
                                                         The Honorable David K. Najjar,
                                                         Magistrate
                                                         Trial Court Cause No.
                                                         29D01-1305-DR-4454

Altice, Judge.

                                         Case Summary

Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017        Page 1 of 16
[1]   Nearly four years have passed since Kevin L. King filed his petition for

      dissolution of his marriage to Mary E. King. During that time, Kevin has

      engaged in a campaign of subterfuge in an attempt to dissipate the marital

      estate and secrete property from Mary and their two minor children, whom he

      has essentially disowned. Additionally, Kevin has been found in contempt for

      failing to pay child support and for disposing of marital property in direct

      contravention of the trial court’s orders. On appeal, Kevin challenges certain

      aspects of the trial court’s distribution of assets and debts.

[2]   We affirm.

                                         Facts & Procedural History1

[3]   Mary and Kevin began dating in October 2006 and moved in together the

      following month, along with Mary’s five-year-old son and daughter (the

      Children). From the start, the couple agreed that Mary would stop working to

      take care of the family and assist with Kevin’s various businesses. Kevin was

      going through a divorce at the time, which was finalized in November 2007,

      and he was granted the marital home. After he and Mary remodeled and

      completely redecorated the home, they moved into it in February 2008 and

      were married on July 24, 2008. Shortly after the marriage, Kevin adopted the

      1
       Kevin provides one short paragraph of facts, and the few facts that are provided are not stated in a light
      most favorable to the trial court’s judgment. This is wholly insufficient. See Ind. Appellate Rule 46(A)(6) (an
      appellant’s statement of facts “shall describe the facts relevant to the issues presented for review” and “shall
      be stated in accordance with the standard of review appropriate to the judgment or order being appealed”).

      Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017                 Page 2 of 16
      Children. The family lived a lavish lifestyle until debt, much of which Kevin

      brought into the marriage, caught up with them. Throughout the marriage,

      marital expenses, which initially averaged $80,000 monthly but decreased to

      $20,000 monthly in 2013, were paid out of his various business accounts.

[4]   On May 15, 2013, Kevin filed a petition for dissolution of marriage, but he

      remained in the marital home with Mary and the Children. Mary filed several

      petitions for protective orders in January 2014, and Kevin followed with a

      motion for temporary restraining order and for order of possession of the

      marital residence on February 3, 2014. At a hearing the following week, the

      parties informed the trial court that they had come to an agreement. The

      agreement provided: (1) both parties would remain in the marital residence, (2)

      they would each return any property previously removed, (3) Kevin would

      provide Mary with $200 per week in spending money; (4) the marital residence

      would be listed for sale (a short sale) with cooperation of both parties; and (5)

      Kevin would continue to pay ordinary bills.

[5]   Within days of the hearing, Kevin moved Mary’s belongings from the master

      bedroom and bathroom and installed deadbolts on doors to several rooms,

      including the master bedroom, office, theater room, and storage room. He

      locked property, including toiletries and daily essentials, in these rooms and

      away from Mary and the Children. The police were called by Mary on

      numerous occasions, and she had to damage doors to get to her property.

      Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 3 of 16
[6]   Kevin moved out of the home in mid-March 2014 and, without Mary’s

      knowledge or consent, took almost everything with him, including furniture,

      mirrors, fixtures, televisions, speakers, cleaning supplies, and silverware. He

      even removed built-in appliances, cabinets, and desks, resulting in damage to

      the home. Mary and the Children were ultimately left with beds, a chair, and a

      patio set in their 8000 square foot home. He also had the home’s boat dock

      with lift station on Geist Reservoir removed from the property. Kevin’s actions

      significantly lowered the value of the marital residence.

[7]   After moving out, Kevin did not regularly pay the utility bills and mortgage,

      cancelled the homeowners and car insurance, and refused to contribute to most

      expenses for the Children. He moved into a rental home on Geist Reservoir

      costing $5000 a month and generally continued his expensive lifestyle. His rent

      was paid by his mother through the Inner Printing, Inc. corporate bank

      account. This company was nominally in his mother’s name. In early 2014,

      the Inner Printing bank account had a balance of $90,000.

[8]   In light of Kevin’s actions, Mary filed an emergency motion for a provisional

      order, and a hearing on that motion commenced on April 21, 2014. Kevin

      denied many of the allegations made by Mary and accused her of not returning

      certain property. At the conclusion of the hearing on May 30, 2014, the trial

      court granted Kevin parenting time with the Children and, after imputing

      income to both parties, ordered him to pay $350 per week in child support. The

      court also ordered Kevin to restore the utilities to the home and keep the

      payments current. With respect to personal property, the court directed the

      Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 4 of 16
       parties to each make a list of any items they believed had been removed or

       secreted from the marital residence. They were then directed to exchange their

       lists and, within 30 days, return any such property either to the marital

       residence or a storage facility for proper accounting.

[9]    Mary complied with the trial court’s order and returned the limited property she

       had removed from the residence. Kevin, however, defied the order at nearly

       every turn. He did not pay any child support, and he filed a separate action

       attempting (unsuccessfully) to void his adoption of the Children. Additionally,

       he did not consistently pay the utility bills and did not return any of the

       property he had taken from the home. In fact, after the hearing, Kevin sold

       much of the furniture and other property at a consignment shop or through

       other avenues.

[10]   At a contempt hearing on September 29, 2014, the trial court found Kevin in

       contempt for nonpayment of child support and for disposing of marital property

       in violation of the provisional order. The court found this to be “a classic case

       of underemployment in order to avoid paying child support.” Transcript at 222.

       The court continued:

               The history over the course of this marriage…indicates that you
               are certainly capable of making lots more than that. The
               evidence that is also before the Court with regard to your
               spending habits at the country club also would indicate that you
               are able, certainly, to afford a lot more than what you are
               indicating to the Court….

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 5 of 16
                  With regard to the personal property…, the evidence that is
                  before the Court is that some 24 hours after my order went out, a
                  bunch of that missing property suddenly showed up at a
                  consignment store. Curious.

                  Mr. King, you are in contempt there as well. As a sanction for
                  your contempt, sir, because I’m not quite sure that you
                  understand that the Court does mean what it says, I’m going to
                  order that you serve 30 days in the Hamilton County Jail. There
                  will be a cash bond in the amount of the outstanding balance of
                  your child support arrears in the amount of $6,950.

       Id. at 223-24. The trial court then provided Kevin with 24 hours to pay the

       arrearage and avoid jail. Kevin was also directed to comply with the

       provisional order regarding personal property by returning the items and/or

       reporting to the court those items that cannot be returned to the marital home.

       Kevin paid the arrearage as ordered by the court, but he did not return the vast

       majority of the marital property or account for any sold property.

[11]   The final hearing took place on April 13 and August 10, 2015. A real estate

       broker testified that the marital residence had been listed in July 2014 for $1.65

       million, and there was a current offer pending for $1 million. The home was

       sold in a short sale by the bank2 after the first day of the final hearing, and Mary

       and the Children moved into a rental.

       2
           Kevin had a foreclosure judgement against him in the amount of $1.6 million for the marital residence.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017                 Page 6 of 16
[12]   Kevin testified that he had a substantial amount of personal debt (over $2

       million excluding the foreclosure judgment) and no assets aside from about

       $5000 in household furnishings and possessions. Kevin conceded that the

       majority of his debt was incurred prior to his and Mary’s marriage. 3 He

       indicated that he wanted Mary to share in certain credit card debt (totaling

       approximately $254,000) but acknowledged that these cards were used for both

       personal and business expenses. Additionally, he testified that the unsold items

       at the consignment shop had been returned to Mary but that all other furniture

       and belongings were either still in his possession or had been sold. Kevin

       claimed annual income of only about $30,000, all from Inner Printing – a

       company of which he owned 99% and his mother owned 1%. Although Kevin

       did not make regular child support payments, his mother made several lump

       sum payments on his behalf.

[13]   Mary testified that throughout the marriage she worked for Kevin’s various

       businesses without pay, as well as maintained their home. The family’s

       personal debts were regularly paid with corporate funds. Kevin started several

       of his businesses in other family member’s names, including Mary’s, due to his

       lack of credit. Mary testified that on January 28, 2014, there was a corporate

       bank account with over $90,000 in it.

       3
        For example, Kevin had $1.42 million in debt related to one boat and $470,000 for another boat, both of
       which were purchased prior to the marriage.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017             Page 7 of 16
[14]   In January 2015, Mary obtained full-time employment making $28,000 a year.

       Mary’s family stepped in during the dissolution proceedings to help pay bills, as

       Kevin did not regularly pay utility bills or child support as directed by the court.

       Mary documented approximately $39,000 in ordinary household expenses she

       incurred during the dissolution action.

[15]   With respect to personal property, Mary testified that Kevin had returned only

       a sofa and four chairs. She estimated, conservatively, that the garage-sale value

       of the property taken by Kevin and never returned was $100,000. Additionally,

       Mary testified that she did not dispose of and had returned all of the property

       (rugs, wine, and sports memorabilia) she had removed from the marital

       residence as ordered by the trial court.

[16]   On October 5, 2015, the trial court entered its decree of dissolution of marriage

       (the Decree). With respect to child support, the court found that Kevin was

       voluntarily underemployed with the education, experience, and ability to earn

       at least $100,000 per year. The court observed that Kevin continued “to

       operate much of his life in a lifestyle commensurate with such income.”

       Appellant’s Appendix at 27. Kevin was ordered to pay $337 per week in child

       support, as well as an arrearage of $4500.

[17]   Particularly relevant to this appeal, the Decree provided the following with

       respect to property:

               19. The Court finds that there is a great disparity in the testimony
               regarding the property of the marital estate. Both parties have

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 8 of 16
        testified that the other party has removed or secreted property
        from the other.

        20. The Court finds that [Kevin] has engaged in actions to reduce
        the size of the marital estate, specifically, that he has sold and
        given away marital property, and allowed family members to do
        the same. This Court ordered [him] to return items to the marital
        residence…. [Kevin] has not complied, nor has he completed an
        accounting of such items as previously ordered.

        21. The Court finds that there existed a business account with a
        balance of approximately $90,000 as of February 2014. The
        Court finds that this is a marital asset and should be divided
        equally….

        22. The Court will further order [Kevin] to return all of the
        personal property listed on Respondent’s Exhibit A (attached) to
        [Mary] within ten (10) days of this Order. The Court finds that
        the value of such items is not less than $85,000.00. Should
        [Kevin] not return the items of property, he shall be obligated to
        pay to [Mary] the sum of $85,000.00.

        23. The Court finds that [Mary] paid a number of expenses
        related to the marital residence or the children, for which [Kevin]
        was obligated. The Court finds that [Kevin] should reimburse
        [Mary] for these expenses in the sum of $39,248.71….

        24. [Kevin] shall have as his sole property the assets and debts
        related to [all of his businesses]….

                                               ****

        27. Except as specifically noted above, [Kevin] shall retain as his
        sole property the personal property currently in his possession….

Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 9 of 16
        28. Except as specifically noted above, [Mary] shall retain as her
        sole property the personal property currently in her possession….

        29. [Kevin] shall be responsible for any debts and any credit cards
        issued in his name.

        30. [Mary] shall be responsible for any debts, payment of her
        student loans, and any credit cards issued in her name.

                                               ****

        32. The Court notes that Indiana law presumes an equal division
        of the marital estate. The Court, however, finds that this
        presumption has been rebutted in this case due to a number of
        factors. Specifically, the Court finds that, historically, [Kevin]
        has had a far greater earning potential than [Mary].
        Additionally, during the course of this litigation, the Court has
        found that [Kevin] has engaged in actions to dissipate the marital
        estate, to secret [sic] property away from [Mary], and has failed
        to abide by Court orders to preserve the marital estate. Although
        the Court does not have sufficient information from which to
        determine the exact value of the marital estate, and cannot
        therefore determine whether each party has an equal share, the
        Court does find that the totality of the circumstances in this case
        justify an unequal distribution of the marital estate in favor of
        [Mary].

                                               ****

Id. at 30-32.

Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 10 of 16
[18]   After an unsuccessful motion to correct error, Kevin initiated this appeal

       challenging certain aspects of the property distribution. We will provide

       additional facts below as needed.

                                           Discussion & Decision

[19]   On appeal, Kevin challenges the trial court’s award of $85,000 to Mary for

       personal property removed from the marital residence, the division of marital

       debt, and the division of funds in a corporate bank account. His arguments on

       appeal are poorly developed and essentially boil down to improper requests for

       us to reweigh the evidence and judge witness credibility.

[20]   When reviewing a challenge to the trial court’s division of marital property, we

       determine whether the evidence supports the findings, and then whether the

       findings support the judgment. Goodman v. Goodman, 754 N.E.2d 595, 599

       (Ind. Ct. App. 2001). We review such a challenge for an abuse of discretion,

       and consider only the evidence favorable to the judgment. Id. Due regard will

       be given to the opportunity of the trial court to judge the credibility of the

       witnesses. Steele-Giri v. Steele, 51 N.E.3d 119, 123 (Ind. 2016). We will reverse

       only if the trial court’s judgment is clearly against the logic and effect of the

       facts and the reasonable inferences to be drawn from those facts. Goodman, 754

       N.E.2d at 599.

[21]   In Indiana, there is a well-established preference for granting latitude and

       deference to our trial courts in family law matters. Steele-Giri, 51 N.E.3d at 124.

       As an appellate court, we are in a poor position to look at a cold transcript of

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 11 of 16
       the record, and conclude that the trial court, who saw the witnesses, observed

       their demeanor, and scrutinized their testimony as it came from the witness

       stand, did not properly understand the significance of the evidence. Id. It is not

       enough that the evidence might support some other conclusion, but it must

       positively require the conclusion contended for by appellant before there is a

       basis for reversal. Id.

[22]   The trial court’s discretion in the disposition of marital property is subject to a

       statutory presumption in favor of equal distribution. Goodman, 754 N.E.2d at

       599. Ind. Code § 31-15-7-5, however, provides that this presumption may be

       rebutted by evidence that an equal division would not be just and reasonable,

       including evidence of the following factors:

               (1) The contribution of each spouse to the acquisition of the
               property, regardless of whether the contribution was income
               producing.

               (2) The extent to which the property was acquired by each
               spouse:

                       (A) before the marriage; or

                       (B) through inheritance or gift.

               (3) The economic circumstances of each spouse at the time the
               disposition of the property is to become effective, including the
               desirability of awarding the family residence or the right to dwell
               in the family residence for such periods as the court considers just
               to the spouse having custody of any children.

               (4) The conduct of the parties during the marriage as related to
               the disposition or dissipation of their property.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 12 of 16
               (5) The earnings or earning ability of the parties as related to:

                       (A) a final division of property; and

                       (B) a final determination of the property rights of the
                       parties.

       Id. “The party challenging the trial court’s property division must overcome a

       strong presumption that the court complied with the statute and considered

       evidence of statutory factors.” Goodman, 754 N.E.2d at 599 (quoting Newby v.

       Newby, 734 N.E.2d 663, 669 (Ind. Ct. App. 2000)).

[23]   We initially address Kevin’s brief argument that the trial court abused its

       discretion by failing to consider each of the statutory factors in determining that

       an unequal division of assets was just and reasonable. Specifically, he contends

       that the trial court failed to consider that he brought the majority of assets (i.e.,

       the marital residence and furnishings) into the marriage. It is true that the trial

       court did not address this factor in the Decree, but a trial court’s exclusion of a

       factor from its written findings does not mean that it did not consider the factor.

       See Eye v. Eye, 849 N.E.2d 698, 703 (Ind. Ct. App. 2006); Shumaker v. Shumaker,

       559 N.E.2d 315, 318 (Ind. Ct. App. 1990). The court addressed a number of

       the statutory factors and ultimately determined that the totality of the

       circumstances justify an unequal distribution in favor of Mary. The trial court’s

       conclusion in this regard is supported by the record, and Kevin’s claim that one

       factor would have altered this determination rings hollow, especially in light of

       the amount of debt he brought into the marriage.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 13 of 16
[24]   With respect to dissipation of assets, Kevin acknowledges the evidence of his

       contemptuous behavior and selling of marital property but asserts that he also

       presented evidence that Mary failed to return certain property. Mary directly

       disputed his claims. Thus, contrary to Kevin’s assertion that the trial court

       ignored the evidence he presented, it is apparent that the trial court simply did

       not believe him. As the trier of fact, this was well within the trial court’s

       province. See DeSalle v. Gentry, 818 N.E.2d 40, 44 (Ind. Ct. App. 2004) (“it falls

       solely within the province of the trial court to determine the witnesses’

       credibility and to weigh the evidence from their testimony”). We reject Kevin’s

       bald invitation for us to reweigh the evidence. Accordingly, Kevin has failed to

       establish an abuse of discretion regarding the award to Mary of $85,000 for

       unreturned personal property.

[25]   Kevin next challenges the trial court’s division of marital debt, in which the trial

       court made each party responsible for any debts or credit cards issued in their

       individual name. Kevin claims that this resulted in him taking on “an

       exhorbatant [sic] amount of debt”, some of which Mary benefitted from and

       was incurred during the marriage. Appellant’s Brief at 11. Again, this amounts

       to an improper request for us to reweigh the evidence. The evidence favorable

       to the judgment establishes that the majority of the debt was brought into the

       marriage by Kevin, and he actively dissipated assets during the marriage.

       Moreover, as Mary observes, she did not leave the marriage debt free, as the

       trial court assigned to her all expenses related to the Palace Premier Timeshare,

       indebtedness related to personal property in her possession, and credit card and

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 14 of 16
       student loan debt in her name. Kevin has failed to establish that the trial court

       abused its broad discretion when assigning marital debt between the parties.

[26]   Finally, Kevin makes a bizarre argument related to the trial court’s equal

       division of funds in one of his corporate bank accounts for Inner Printing. In

       essence, he contends that the $90,000 in this account was improperly included

       in the marital estate because “[t]here was no mention by [Mary], nor the court

       about piercing a corporate veil in order to gather the funds located in the

       corporate bank account.” Appellant’s Brief at 15. He continues, “[b]ecause no

       action was taken to request to pierce the veil, the veil remains.” Id.

[27]   Kevin apparently does not understand the concept of piercing the corporate

       veil, and we do not endeavor to educate him here. 4 The evidence favorable to

       the judgment reveals that throughout the marriage Kevin owned a number of

       companies and regularly paid personal and marital expenses with corporate

       funds. In early 2014, one corporate bank account had a balance of $90,000.5

       This was an account for Inner Printing, a company nominally placed in his

       mother’s name and of which he was a 99% shareholder. Additionally, there

       4
         A corporate veil protects shareholders from being “held personally liable for acts attributable to the
       corporation.” See Aronson v. Price, 644 N.E.2d 864, 867 (Ind. 1994) (emphasis supplied).
       5
         Kevin did not dispute this fact at trial or present any evidence related to these funds. To the extent Kevin
       attempts to challenge the valuation of this asset in his reply brief, we note that new arguments may not be
       asserted for the first time in a reply brief. See I.A.E., Inc. v. Hall, 49 N.E.3d 138, 153 (Ind. Ct. App. 2015),
       trans. denied. In his opening brief, he argued only that the funds were not a marital asset subject to division
       because Mary could not pierce the corporate veil.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017                    Page 15 of 16
       was evidence presented from which one could reasonably infer that Kevin was

       secreting money through Inner Printing.

[28]   We agree with Mary that Kevin’s contention that the corporate veil must be

       pierced in order for Mary to receive a share of the account is a red herring.

       Thus, Kevin has made no showing on appeal that the trial court erred in equally

       dividing the funds between the parties.

[29]   Judgment affirmed.

[30]   Riley, J. and Crone, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 29A02-1601-DR-34 | March 2, 2017   Page 16 of 16