Court Opinion

ID: 3172171
Source: CourtListenerOpinion
Date Created: 2016-01-26 16:04:51.786213+00
Date Added: 2024-06-11T12:02:09.734900
License: Public Domain

MAINE SUPREME JUDICIAL COURT                                         Reporter of Decisions
Decision: 2016 ME 21
Docket:   Cum-15-48
Argued:   September 16, 2015
Decided:  January 26, 2016

Panel:       SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and
             HUMPHREY, JJ.

                                 ELENA WECHSLER

                                           v.

                                  JOHN P. SIMPSON

HJELM, J.

         [¶1] John P. Simpson appeals from a judgment of divorce from Elena

Wechsler entered in the District Court (Portland, Powers, J.), after it adopted and

modified the report of a referee. Simpson argues that the judgment is affected by

error because the referee did not give proper weight and consideration to statutory

factors when (1) determining primary residence for the parties’ minor children,

see 19-A M.R.S. § 1653(3) (2015), and (2) dividing the marital estate,

see 19-A M.R.S. § 953(1) (2015). We affirm the judgment.

                                  I. BACKGROUND

         [¶2] By agreement of the parties, the court (Kelly, J.) appointed a referee to

recommend a judgment in this divorce matter. See 19-A M.R.S. § 252 (2015);

M.R. Civ. P. 53, 119. After a hearing, the referee found the following facts, which
2

are based on competent evidence in the record and which the court adopted in full

with one modification, as discussed below. See Raisen v. Raisen, 2006 ME 49, ¶ 2,

896 A.2d 268.

      [¶3] Elena Wechsler and John P. Simpson were married in May 2008 and

are the parents of two minor children, who were born in July 2009 and

November 2011. The family resided in a house in Cumberland Foreside that

Simpson had purchased in 2004 for $550,000. In 2011, during the marriage,

Simpson refinanced the house and conveyed it to himself and Wechsler as joint

tenants. At that time, the house had an appraised value of $690,000.

      [¶4]   Simpson earned advanced degrees in business and law before his

marriage to Wechsler. From 1996 until 2012, he ran a successful company, but he

was forced to go out of business in 2012 due to a costly lawsuit. He then passed

the Maine bar examination and began working part-time for a local attorney, while

also searching for more stable employment. Wechsler was gainfully employed as a

radiologist throughout the marriage.

      [¶5] In September 2013, Wechsler moved out of the family home and filed

a complaint for divorce. The parties agreed to residential arrangements for their

children during the pendency of the divorce action. Wechsler moved for the

appointment of a guardian ad litem, see 19-A M.R.S. § 1507(1) (2015); M.R.

Civ. P. 107(a)(2), and the court (Najarian, M.) granted her motion in
                                                                                                        3

November 2013. Later, in July 2014, the court (Kelly, J.) granted the parties’ joint

motion to appoint a referee, see 19-A M.R.S. § 252; M.R. Civ. P. 53, 119, and

ordered the referee to prepare a report setting forth findings of fact and conclusions

of law on “all issues raised by the pleadings.” The parties reserved the right to

object to the report but agreed that if there were no objections, the court could

enter a judgment on the report as filed. See M.R. Civ. P. 53(e)(2).

        [¶6] The referee held a one-day hearing in August 2014, where both parties

and the guardian ad litem testified.1 Wechsler requested that she be awarded

primary residence of the children, asserting that she had been the children’s

primary caretaker and that Simpson had contributed minimally to the children’s

care.      In contrast, Simpson requested “shared primary residential care,”

19-A M.R.S. § 1653(2)(D)(1) (2015), and maintained that he had played a

significant role in the children’s upbringing.

        [¶7] During the hearing, the guardian ad litem’s report was admitted in

evidence without objection. The report substituted for his testimony on direct

examination, and he then presented oral testimony and was subject to examination

by the parties. In the report and in his testimony, the guardian ad litem stated that

although Simpson worked from home, he rarely interacted with his children during

   1
     Although the hearing before the referee was not recorded, the referee filed an extensive statement of
the evidence, which is a part of the record on appeal pursuant to M.R. App. P. 5(d).
4

the daytime and that two nannies cared for the children almost exclusively until

Wechsler returned from work, when she would assume the responsibilities of

primary caregiver for the children.     In his report, the guardian ad litem also

considered “well-established principles of child development” bearing on

residence and parent-child issues as applied by the state of Washington. Those

principles recommend primary, rather than shared, residence for young children.

The guardian ad litem wrote, however, that while Washington’s guidelines and the

underlying theories of child development are instructive, “we live in the state of

Maine, the laws of Washington are not applicable to our laws, and our state should

not and cannot follow the laws or guidelines of another state.” Either directly or in

substance, the guardian ad litem applied each of Maine’s best interest factors,

see 19-A M.R.S. § 1653(3), and on that basis recommended that in light of the

children’s young ages and Wechsler’s historically greater contributions to their

care, they should reside primarily with her.

      [¶8] In October 2014, the referee filed her report with the court, adopting

the guardian ad litem’s findings and recommendation that the children should

primarily reside with Wechsler. The referee further recommended that the parties

share parental rights and responsibilities, and that Simpson have rights of contact

with the children at his residence approximately two days each week. Based on the

parties’ agreement, the referee recommended that Simpson would not be
                                                                                                     5

responsible for child support, but to set a baseline for future modifications, the

referee found that Wechsler earned $216,000 annually and imputed Simpson’s

income to be $30,000 annually.

       [¶9] Regarding the division of the marital estate, the referee found that

Wechsler had contributed more toward the acquisition of marital property than

Simpson. See 19-A M.R.S. § 953(1)(A). Nevertheless, because of Wechsler’s

stronger financial position arising from her income and the value of her nonmarital

property, see id. § 953(1)(B)-(C), the referee recommended that Simpson receive

more than half of the value of the marital estate. Among other things, the referee

awarded Simpson the marital residence, which was valued at $690,000 with a

mortgage balance of $351,492, leaving equity of approximately $340,000. The

referee also assigned Simpson $90,000 in marital credit card debt, which Simpson

had accumulated “in part trying to save his business and in part on his living

expenses” after the parties separated.

       [¶10] The referee awarded Wechsler, as nonmarital property, the sum of

$93,542 from a USAA savings account. Wechsler owned this account before the

marriage, and this was the approximate balance as of the date of the marriage.2

The account remained in Wechsler’s name alone during the marriage, and as the

   2
      Although the referee found that Wechsler’s USAA savings account had a balance of $93,716.75 at
the time of the marriage, Wechsler requested that a slightly smaller amount—$93,542—be set aside to her
as nonmarital property, and this is the amount that the referee awarded.
6

referee noted, Wechsler testified that the balance never fell below the premarital

value.     The referee further found that the value of the account increased by

approximately $164,000 over the course of the marriage, and that the increase was

entirely marital in nature. Of the marital portion of the account, the referee set

aside $100,000 to Simpson and the balance to Wechsler. Finally, the referee found

that although Simpson had $90,000 in cash when the parties married, he was not

entitled to an award in this amount as nonmarital property, because the money had

“been spent.” In the end, the referee recommended that Simpson receive marital

assets and debts with a net value of more than $462,000, and that marital assets

with a value of approximately $361,000 be awarded to Wechsler.

         [¶11] Simpson filed a timely objection to the referee’s report after it was

filed with the court, challenging the referee’s primary residence determination and

division of the marital estate. See M.R. Civ. P. 53(e)(2). After a hearing, the court

(Powers, J.) entered an order in January 2015 denying Simpson’s objection but

modifying the report by adding a sentence stating that “shared residence” was not

in the children’s best interests. See 19-A M.R.S. § 1653(2)(D)(1). The court

adopted the report as modified as a final divorce judgment, from which Simpson

timely appealed. See 14 M.R.S. § 1901 (2015); M.R. App. P. 2(b)(3).
                                                                                   7

                                 II. DISCUSSION

      [¶12]    Simpson appeals from aspects of the divorce judgment affecting

parental rights and responsibilities and the division of the marital estate. With the

exception of his claim of error in the court’s modification of the referee’s report,

his arguments consist of challenges to recommendations made by the referee and

adopted by the court. “When a trial court accepts a report of a referee, the findings

of the referee become the trial court’s findings, and we review those findings

directly.”    Warren v. Warren, 2005 ME 9, ¶ 19, 866 A.2d 97; see also

M.R. Civ. P. 52(c). On appeal, a referee’s factual findings and choice of remedies

based on those findings are entitled to the same degree of deference as those of a

trial court. Alexander, Maine Appellate Practice § 424 at 288 (4th ed. 2013). The

referee’s findings are “entitled to very substantial deference because [the referee

was] able to appraise all the testimony of the parties and their experts.” Grant v.

Hamm, 2012 ME 79, ¶ 6, 48 A.3d 789 (quotation marks omitted). Because the

court accepted the referee’s report and incorporated its findings and conclusions

into its judgment, we review the referee’s factual findings for clear error, and her

recommendations regarding parental rights and the division of the marital estate for

an abuse of discretion. See Young v. Young, 2015 ME 89, ¶¶ 5, 13, 120 A.3d 106

(describing the standard by which this Court reviews a trial court’s findings and
8

conclusions); Warren, 2005 ME 9, ¶¶ 44-47, 866 A.2d 97 (applying the same

standard of review to the findings and conclusions of a referee).

A.    Primary Residence

      [¶13] Simpson challenges the provisions in the judgment awarding primary

physical residence to Wechsler, arguing that (1) the guardian ad litem’s report was

tainted by use of an improper best interest standard; (2) the denial of his request for

shared primary residential care was erroneous; and (3) the court erred by

supplementing the referee’s report with language required by statute when a

parent’s request for shared primary residential care is denied. We consider these

arguments in turn.

      1.     Standard Applied by the Guardian ad Litem

      [¶14] Simpson first contends that the guardian ad litem’s analysis, which

was adopted by both the referee and the court, was improperly premised on

Washington law and guidelines, rather than on Maine’s statute prescribing the best

interest analysis. See 19-A M.R.S. § 1653(3).

      [¶15] Pursuant to 19-A M.R.S. § 1507(4) (2015), a “guardian ad litem shall

use the standard of the best interest of the child as set forth in section 1653” when

reporting findings and recommendations to a court.           Contrary to Simpson’s

contentions, the guardian ad litem fully complied with this requirement. During

his testimony, the guardian ad litem stated that Washington’s guidelines are
                                                                                  9

informative on child development and are relevant in this action only to the extent

that they address factors included in Maine’s statute. Further, in his report, the

guardian ad litem explicitly stated that “our state should not and cannot follow the

laws or guidelines of another state.” The guardian ad litem thereby expressly

demonstrated a clear understanding that his analysis was to be governed by the best

interest standard established in Maine law.

      [¶16] The substance of the guardian ad litem’s analysis also demonstrates

his faithfulness to Maine law. His detailed seriatim findings methodically follow

the best interest factors enumerated in section 1653(3), with particular emphasis

placed on section 1653(3)(B) because the children had come to depend chiefly on

Wechsler as their primary caretaker for their “care and security,” and on section

1653(3)(E) because primary rather than shared residential care would provide the

most stable living arrangement given the children’s ages and developmental needs.

      [¶17] We have noted that “the most effective challenge to the quality,

completeness, or competence of a guardian ad litem’s work will be accomplished

through cross-examination of the GAL at trial.” Adoption of T.D., 2014 ME 36,

¶ 18, 87 A.3d 726. Here, at the hearing before the referee, Simpson had an

opportunity to cross-examine the guardian ad litem on any and all aspects of his

recommendations. The referee was then responsible for evaluating the guardian ad

litem’s testimony, which had been subject to challenge on cross-examination, to
10

determine the weight she felt it deserved. Neither the evidentiary process nor the

referee’s treatment of the guardian ad litem’s report and recommendations was

affected by error.

      2.     Denial of Shared Primary Residential Care

      [¶18] Simpson next argues that the referee erred by failing to find or explain

why shared primary residential care was not in the children’s best interests, and

that the judgment, which adopts the referee’s analysis, is therefore deficient.

      [¶19] Title 19-A M.R.S. § 1653(2)(D)(1) authorizes an award of shared

primary residential care and also sets out the requirements that a court must follow

when denying a party’s request for such an award:

      An award of shared parental rights and responsibilities may include
      either an allocation of the child’s primary residential care to one
      parent and rights of parent-child contact to the other parent, or a
      sharing of the child’s primary residential care by both parents. If
      either or both parents request an award of shared primary residential
      care and the court does not award shared primary residential care of
      the child, the court shall state in its decision the reasons why shared
      primary residential care is not in the best interest of the child . . . .

The statute does not define “shared primary residential care” or explain how it

might differ from an award of primary residence to one parent with rights of

contact to the other parent that would occur at that parent’s residence, which is

what the judgment here provided and allowed. Because the court construed the
                                                                                                       11

referee’s report as rejecting shared primary residential care, we proceed on that

assumption for purposes of our analysis.3

        [¶20] Here, the referee’s report did not expressly set out a finding that

shared primary residential care was not in the children’s best interests. The referee

did, however, rely on and adopt the findings of the guardian ad litem, which, as we

have discussed, applied the best interest standard established in Maine law. Based

on that framework, the guardian ad litem concluded that the children’s best

interests would be promoted if they were to reside primarily with one parent and

that, because of her historical role as the children’s primary caretaker, that parent

should be Wechsler. See 19-A M.R.S. § 1653(3)(B), (E). This is an express

conclusion that the grant of the children’s primary physical residence to Wechsler

is in the children’s best interests, and an implicit explanation of the reasons why

shared primary residential care is not in their best interests.

        [¶21]     The guardian ad litem’s analysis therefore demonstrates that his

recommendation arose directly from consideration of the proper statutory

considerations and is sufficient to explain the reasoning underlying the parental

rights determination, see Grant, 2012 ME 79, ¶ 13, 48 A.3d 789, including the

   3
     If the residence and contact provisions of this particular divorce judgment are, in effect, a form of
“shared primary residential care,” then Simpson’s challenges based on 19-A M.R.S.
§ 1653(2)(D)(1) (2015) necessarily fail. We need not reach that predicate question, however, because
even if the judgment’s parenting provisions are different from “shared primary residential care,”
Simpson’s challenges are not persuasive.
12

implicit denial of Simpson’s request for shared primary residential care of the

children. The record as a whole is therefore sufficient to support the referee’s

recommendation that the children live primarily with Wechsler and have contact

with Simpson approximately two days each week. Accordingly, the referee’s

recommendation for the children’s primary physical residence, which the court

adopted, was well within the bounds of her discretion.

       3.      Modification of the Referee’s Report

       [¶22]     Simpson makes a related argument that the court erred by

supplementing the referee’s report with language required by 19-A M.R.S.

§ 1653(2)(D)(1) to explain the denial of Simpson’s request for shared primary

residential care, without first receiving, or instructing the referee to receive, further

evidence to determine whether that arrangement was in the children’s best

interests.

       [¶23] When a party files a timely objection to a referee’s report, “the court

after hearing may adopt the report or may modify it or may reject it in whole or in

part or may receive further evidence or may recommit it with instructions.”

M.R. Civ. P. 53(e)(2). “If the [trial court] modifies the referee’s report, we review

the evidence to see whether it supports the referee’s finding, or the court’s

modification.” Hennessy v. Fairley, 2002 ME 76, ¶ 18, 796 A.2d 41 (quotation

marks omitted).
                                                                                    13

      [¶24]   Here, Simpson filed an objection to the referee’s report.          After

holding a hearing on the objection, the court adopted the report in full and added

one sentence: “[Simpson’s] request for shared residence is denied and is not in the

children’s best interest, and primary residence with [Wechsler] is in their best

interest based on the GAL’s recommendation and the facts supporting it as

outlined earlier in this paragraph.” When seen in the context of the report, this

sentence is merely a way of characterizing the express finding already made by the

referee—that it would be in the children’s best interests if they were to live

primarily with Wechsler, which itself implies that shared residence is not in their

best interests. But see supra n.3. As the court correctly noted, “It is clear what the

referee intended.” The added sentence therefore is fully supported by the referee’s

findings and was not erroneous, see Hennessy, 2002 ME 76, ¶ 18, 796 A.2d 41,

and it was unnecessary for the court to receive further evidence or recommit the

matter to the referee before adding the explanatory language.

B.    Equitable Division of Marital Property

      [¶25] Simpson next challenges the division of the marital estate, arguing

that in her report, the referee failed to fashion a “just” division of marital property

because she did not consider “all relevant factors” including each spouse’s

“contribution . . . to the acquisition of the marital property,” the “value of the

property set apart to each spouse,” and the parties’ “economic circumstances.”
14

19-A M.R.S. § 953(1). We review the division of marital property and allocation

of marital debt for an abuse of discretion and “will vacate a judgment only if no

competent evidence exists in the record to support it.” Young, 2015 ME 89, ¶ 13,

120 A.3d 106 (quotation marks omitted); see also Warren, 2005 ME 9,

¶¶ 21, 46-47, 866 A.2d 97.

         1.      Contribution to the Marital Estate

         [¶26]    Simpson first argues that in the referee’s recommended property

division, she failed to consider his contribution to the marital estate of the family

home and $90,000 in cash, which were his nonmarital assets.                             Pursuant to

19-A M.R.S. § 953(1)(A), “[t]he contribution of each spouse to the acquisition of

the marital property” must be considered when creating an equitable division of the

marital estate.

         [¶27] Contrary to Simpson’s contentions, the referee adequately considered

his contribution of nonmarital property to the marital estate. The referee found that

before the marriage, Simpson had purchased what became the family home for

$550,000 and that he conveyed the house to himself and Wechsler as joint tenants

in 2011, when it was appraised at $690,000.4 The referee also acknowledged that

     4
      Simpson acknowledges, as he must, that because he conveyed the house to himself and Wechsler
jointly during the marriage, he no longer owns a nonmarital interest in it, even though he purchased the
house with separate funds before the marriage. See Burrow v. Burrow, 2014 ME 111, ¶ 14,
100 A.3d 1104 (“[W]hen real estate owned by one spouse before the marriage [is] placed into joint title
                                                                                                                15

Simpson had $90,000 in cash when the parties married and that the entire amount

had been spent during the course of the marriage.5 Although the referee did not

analyze these contributions in detail, her reference to the premarital value of the

home and the consumption of the $90,000 in cash are sufficient to demonstrate that

in her overall analysis, she considered Simpson’s contribution of these assets.

        [¶28] Similarly, the referee found that Wechsler’s contributions toward the

acquisition of marital property during the marriage exceeded Simpson’s, which is a

second way the referee acknowledged that Simpson had made a contribution. This

finding was supported by competent evidence in the record, including Wechsler’s

testimony that she paid “the lion’s share” of household expenses and Simpson’s

acknowledgement that he contributed less overall. The referee’s recognitions of

Simpson’s contributions of his separate property to the marital estate, and her

treatment of it when she recommended a property division to the court, do not

constitute an abuse of discretion.

        [¶29] Simpson further contends that in comparison to his interests, the

referee gave more favorable treatment to Wechsler’s contributions of nonmarital

by that spouse, the real estate [is] marital . . . .” (quotation marks omitted)). It is therefore clear that all of
the equity in the house is marital in nature.
   5
      Simpson does not argue that the use of his nonmarital cash to acquire property during the course of
the marriage renders those items nonmarital, see Levy, Maine Family Law § 7.6[4][b][i] at 7-38 to 7-39
(8th ed. 2013), and in any event the record does not clearly reveal how that cash was spent. Rather, he
argues that the division of the marital estate does not sufficiently account for the beneficial effect arising
from the disposition of his nonmarital cash.
16

assets to the marital estate.              Specifically, Simpson notes that the referee

“careful[ly]” set apart the premarital portion of Wechsler’s USAA savings account

as her nonmarital property, but did not engage in the same analysis with respect to

the marital residence or the $90,000 in cash that Simpson brought to the marriage.

Wechsler, however, maintained the USAA savings account in her name throughout

the marriage, and she further testified that while the parties were married the value

of that account did not fall below its balance as of the date of the marriage. As a

result, there was sufficient evidence for the referee to conclude that the premarital

balance in the account was never converted into marital property.6 See Levy,

Maine Family Law § 7.6[2] at 7-28 to 7-30 (8th ed. 2013); cf. Spooner v. Spooner,

2004 ME 69, ¶ 29, 850 A.2d 354. By adopting this finding, the court was therefore

required to set that portion of the account aside to Wechsler as her separate

property. See Long v. Long, 1997 ME 171, ¶ 9, 697 A.2d 1317. In contrast,

Simpson conveyed the house to himself and Wechsler as joint tenants, thereby

transmuting the entire asset into marital property.                    See Burrow v. Burrow,

2014 ME 111, ¶ 14, 100 A.3d 1104. Simpson also concedes that $90,000 in cash

     6
     The referee appropriately classified as marital property the entire increase in value of Wechsler’s
USAA savings account that accrued over the course of the marriage, see 19-A M.R.S. § 953(2)(E)(2)(b)
(2015), and awarded Simpson $100,000 of that amount, whereas Wechsler only received approximately
$64,000.
                                                                                    17

that he had before the marriage had been spent, leaving nothing for the referee to

set aside to him as nonmarital property.

         [¶30] Therefore, the referee’s categorizations of marital and nonmarital

property do not suggest that the referee placed greater emphasis on Wechsler’s

contributions to the marital estate than Simpson’s, and her analysis does not reveal

error.

         2.      Property Set Apart to Each Spouse and Economic Circumstances

         [¶31] Simpson argues that the referee’s recommended property division was

inequitable because she failed to account for the significant amount of the debt

assigned to him. Pursuant to 19-A M.R.S. § 953(1)(B)-(C), when creating a “just”

division of marital property, a court, and therefore a referee, must consider “[t]he

value of the property set apart to each spouse” and each spouse’s “economic

circumstances . . . at the time the division of property is to become effective.”

         [¶32]    Contrary to Simpson’s contentions, the referee’s recommended

property division implemented her stated objective to award Simpson more than

half of the value of the marital estate, even considering the debt assigned to him.

The net value of the marital property awarded to Simpson exceeds $462,000. In

contrast, the value of the marital property allocated to Wechsler, although it did not

include any debt, is less than $362,000. Therefore, the property division was
18

actually favorable to Simpson by more than $100,000 and, under the circumstances

in this case, was not unjust.

      [¶33]    Simpson further argues that the referee failed to consider his

individual “economic circumstances,” id. § 953(1)(C), because he will be unable to

make payments toward or refinance the $351,492 mortgage on the marital

residence based on his imputed annual income of $30,000. As the trial court

observed, however, when it denied Simpson’s objection to the referee’s report, he

has the option to sell the house—which is the most significant marital asset and

was his to begin with—to gain “access [to] its significant equity.” The award of

the house to him therefore did not place him in an untenable financial situation and

does not represent an abuse of discretion.

      [¶34]    Because the referee’s findings were not clearly erroneous and

addressed all factors relevant to the equitable distribution of the marital estate, the

recommended property division was within the bounds of her discretion.

                                III. CONCLUSION

      [¶35] We conclude that contrary to Simpson’s contentions, the referee’s

recommendation concerning the children’s primary residence and the equitable

division of the marital estate, which the court ultimately adopted in its final divorce

judgment, arose from careful consideration of applicable statutory factors,
                                                                              19

see 19-A M.R.S. §§ 953(1), 1653(3), and was not affected by error or any abuse of

discretion.

        The entry is:

                           Judgment affirmed.

On the briefs:

        Karen Frink Wolf, Esq., and Jonathan M. Dunitz, Esq., Verrill
        Dana, LLP, Portland, for appellant John P. Simpson

        Margaret C. Lavoie, Esq., and Elizabeth J. Scheffee, Esq.,
        Givertz, Scheffee & Lavoie, PA, Portland, for appellee Elena
        Wechsler

At oral argument:

        Karen Frink Wolf, Esq., for appellant John P. Simpson

        Margaret C. Lavoie, Esq., for appellee Elena Wechsler

Portland District Court docket number FM-2013-983
FOR CLERK REFERENCE ONLY