Court Opinion

ID: 9516360
Source: CourtListenerOpinion
Date Created: 2023-08-06 23:41:19.267296+00
Date Added: 2024-06-11T09:35:12.949108
License: Public Domain

BROSKY, Judge:
The issue before us on this appeal is whether the trial court erred in awarding to appellee, appellant’s former wife, compensation for her contributions to her former husband’s medical education.
The parties were divorced on July 7, 1981 under the terms of the Pennsylvania Divorce Code.1 Pursuant to an order for Pre-Trial Conference, discussion of Mrs. Lehmicke’s request for alimony, equitable distribution of property, counsel fees and costs was held on August 18, 1981. Because no settlement was reached on those issues a special Master was appointed who held hearings late in 1981. The Master recommended that appellee be awarded $1,525 in counsel fees and costs, that alimony be denied, that appellant’s medical degree be considered marital property and that appellee be awarded $64,790.00 as her share of that property. Exceptions were filed to the Master’s Report and the trial court affirmed the recommendations as to alimony, counsel fees and costs and awarded Mrs. Lehmicke $64,-790.00 on equitable principles. This appeal followed.
*562Dr. and Mrs. Lehmicke were married on June 8, 1968. One child was born of the marriage. Dr. Lehmicke graduated from college shortly before the marriage. He was drafted in January, 1969 and served in the Army for approximately seventeen months during which time the parties resided in Baltimore, Maryland where Dr. Lehmicke was stationed. In July, 1970 the couple moved to Ohio where Dr. Lehmicke embarked on a three year accelerated program at Ohio State Medical School.
Mrs. Lehmicke testified that while her husband attended medical school she worked as a waitress five or six nights a week, earning between $30 and $40 a night. In the summers she also was employed as Recreational Assistant. Previous to the marriage she had worked as a nurse’s aide. The monies Mrs. Lehmicke earned were used to support the family and possibly to some extent, to pay certain medical school tuition and expenses of her husband.
Dr. Lehmicke testified that while he was in medical school he received $240.00 per month in G.I. benefits. This money was used to make monthly payments on a car the couple had purchased. Dr. Lehmicke also borrowed $8,600 to help finance his education and received a $1,000 scholarship and $1,000 as payment for research projects he performed.
Dr. Lehmicke graduated from medical school in June, 1973 at which time the parties moved to Philadelphia where he began an internship. While the couple lived in Philadelphia Mrs. Lehmicke did not have a paying job.
The parties had been having marital difficulties since Dr. Lehmicke’s second year in medical school and in May, 1974 they separated.
In September 1976 Mrs. Lehmicke began a two year nursing program at Philadelphia Community College. Her tuition and books were paid for by financial aid and scholarships. After she graduated Mrs. Lehmicke continued her education and in May, 1980 received a Bachelor’s Degree in nursing.
*563At the time of the hearing Mrs. Lehmicke worked 3 or 4 days a week as a registered nurse. She and her son live in an apartment in Philadelphia. Dr. Lehmicke is a Board Certified pediatrician in private practice.
During their marriage the parties did not accumulate any significant property. Mrs. Lehmicke urges us to find, however, that the value of her former husband’s medical degree and the consequent increase in earning capacity it promises should be divided between them based on equitable principles or in the alternative viewed as marital property subject to equitable distribution.
We will first address the question of whether Dr. Lehmicke’s degree or future earning capacity is an assignable asset subject to equitable distribution.
Our research discloses that most jurisdictions that have considered the question have concluded that neither an advanced degree nor increased earning capacity is actually “property.” For example, in In re Marriage of Graham, 194 Colo. 429, 574 P.2d 75, 77 (1978) the Colorado Supreme Court opined and we agree that:
An educational degree, such as an M.B.A., is simply not encompassed even by the broad views of the concept of “property.” It does not have an exchange value or any objective transferable value on an open market. It is personal to the holder. It terminates on death of the holder and is not inheritable. It cannot be assigned, sold, transferred, conveyed, or pledged. An advanced degree is a cumulative product of many years of previous education, combined with diligence and hard work. It may not be acquired by the mere expenditure of money. It is simply an intellectual achievement that may potentially assist in the future acquisition of property. In our view, it has none of the attributes of property in the usual sense of that term.
In Mahoney v. Mahoney, 91 N.J. 488, 453 A.2d 527 (1982) the New Jersey Supreme Court while noting that “[rjegarding equitable distribution, this Court has frequently held that an “expansive interpretation [is] to be given to the *564word ‘property’ (Id. at 495, 453 A.2d at 531), nevertheless the court observed also that it “has subjected to equitable distribution an asset whose future monetary value is as uncertain and unquantifiable as a professional degree or license.” Id. at 496, 453 A.2d at 531.
The Court concluded that equitable distribution of the value of a degree or increased earning capacity would be improper. The Court noted the following problems: A professional license or degree is a personal achievement of the holder. It cannot be sold and its value cannot readily be determined. (Id. at 495, 453 A.2d at 531); Equitable distribution of a professional degree would similarly require distribution of “earning capacity” — income that the degree holder might never acquire. (Id. at 497, 453 A.2d at 532); Moreover, any assets resulting from income for professional services would be property acquired after the marriage; the statute restricts equitable distribution to property acquired during the marriage. (Id. at 497, 453 A.2d at 532);2 Valuing a professional degree in the hands of any particular individual at the start of his or her career would involve a gamut of calculations that reduces to little more than guesswork and even if such estimates could be made, there would remain a world of unforeseen events that could affect the earning potential of the degree holder. (Id. at 497, 453 A.2d at 532). See also Hughes v. Hughes, Fla. App., 438 So.2d 146 (1983); Lira v. Lira, 68 Ohio App.2d 164, 428 N.E.2d 445 (1980).3
Most recently this Court in Hodge v. Hodge, 337 Pa.Super. 151, 486 A.2d 951 (1984) held that increased earning capacity is neither real nor personal “property” in the usual *565sense of the word. While we concluded that our Legislature did not intend increased earning capacity to be a divisible asset, we nonetheless were able to consider the increased earning capacity of one spouse in determining the amount and duration of alimony to be paid the other spouse. See Section 501 of the Divorce Code; 23 P.S. § 501.4
Other jurisdictions have likewise considered the support given by one spouse in awarding alimony or maintenance payments. See e.g. Zohler v. Zohler, Conn., 8 Fam.L.Rep. 2694 (1982); In Re Lundberg, 107 Wis.2d 1, 318 N.W.2d 918 (1982); Lira v. Lira, supra; Graham v. Graham, supra.
In this case, however, Mrs. Lehmicke did not contest the denial of her request for alimony and we are not in a position to make such an award.
The trial court though, fashioned a remedy by relying on Section 401(c) of the Act which provides:
(c) In all matrimonial causes, the court shall have full equity power and jurisdiction and may issue injunctions or other orders which are necessary to protect the interests of the parties or to effectuate the purposes of this act, and may grant such other relief or remedy as equity and justice require against either party or against any third person over whom the court has jurisdiction and who is involved in or concerned with the disposition of the cause.
Appellant contends that the court erred in relying on Section 401(c) since, appellant argues, that section was intended to provide only pendente lite remedies. We do not agree.
While Section 401(c) clearly does provide in part for protection during the pendency of an action, we find no indication that it is limited solely to such a purpose. In*566stead, the Section provides in pertinent part that “the court shall have full equity power and jurisdiction and may issue injunctions or other orders which are necessary to ... effectuate the purposes of this act____” Among the stated purposes of the Act is to “effectuate economic justice between the parties who are divorced or separated----” 20 P.S. § 102(a)(6). Moreover, the statute expressly states that the objectives of which the above is one shall be considered in construing its provisions. 23 P.S. § 102(b).
See also Rounick, Pennsylvania Matrimonial Practice, § 18:6 in which the authors note; “Section 401(c) is, perhaps, the most far-reaching power heretofore given to a court in a matrimonial cause in order to protect the interests of the parties and to effectuate the purposes of the New Divorce Code. This provision should be applied liberally.”
Section 401(c) is the same as § 601(2) of the Code proposed by the Joint State Government Commission and the comment to that section states in part that it is “... intended to give emphasis to the equity power and jurisdiction of the court and to make sure that it has effective power to deal with any problem which arises during the course of litigation:... ”
Keeping in mind the purpose of the Act we construe § 401(c) as granting the full equity powers for which it provides and therefore affirm the trial court’s use of such power because we agree that the facts of this case compel such an exercise of equitable power.
The parties had not accumulated marital property at the time of separation and Mrs. Lehmicke could not therefore be reimbursed for her contributions to her husband’s education through a distribution of property. In another case the distribution of property might provide a full remedy. See 23 P.S. § 401(d)(4).
Similarly alimony was denied here. While the propriety of the denial is not before us as an issue we note that the lower court could properly have concluded that an equitable *567remedy was necessary in this case because of the unavailability of alimony to Mrs. Lehmicke. This is so because unlike the alimony provisions of some of the states whose cases were cited earlier in this opinion, our statute provides only for “rehabilitative alimony”.5 An award of alimony in a case like the present one would be in the nature of “reimbursement” rather than “rehabilitation” and would therefore be inappropriate under the terms of the statute.
The trial court could not fashion an equitable distribution or an alimony award and yet the facts before it compelled some recompense for Mrs. Lehmicke who sacrificed for several years so that her husband could obtain his medical degree. Shortly after the degree was received the marriage failed and Mrs. Lehmicke was unable to see any benefit for her sacrifice. Dr. Lehmicke, on the other hand, was able to pursue a career as a physician.
While we therefore agree with the trial court’s exercise of its equitable power we do believe that a different measure of the amount of the award should have been used. The trial court awarded Mrs. Lehmicke a one-sixth share of the estimated value of her husband’s degree which in turn was valued based on his estimated earning capacity. We find no explanation of the decision to award that amount and believe that instead of awarding a percentage of the estimated value of the degree, that Mrs. Lehmicke should be compensated for the financial support she gave Dr. Lehmicke while he was a student; although, as we have said, the award is not an alimony award.
We will remand this case with instructions that the lower court consider Mrs. Lehmicke’s contribution to her husband’s attainment of his degree.
We recognize that Mrs. Lehmicke may not have actually paid much, if any, actual tuition, but it cannot be doubted *568that her financial support of her former husband and their child enabled him to pursue his education.
The award to her is in the nature of recompense for her contribution and ought to be related to it. In this respect we agree with the approach taken by the New Jersey Supreme Court in Mahoney v. Mahoney, supra in which the court awarded what it termed “reimbursement alimony.” While the lower court’s award in this case is not in the form of alimony, it is based on the same equitable principles on which the Mahoney court relied. The Mahoney court rejected a measure of damages based solely on the cost of educational assets, but instead said that the supporting spouse should be compensated for all financial contributions towards her former spouse’s education including household expenses, educational costs, school travel expenses and other contributions used by the supported spouse in obtaining his or her degree or license. We would add that in this case in which the couple had a child while Dr. Lehmicke pursued his education, the trial court should also consider the parties’ relative contributions to the support of that child.
We favor an award based on Mrs. Lehmicke’s contributions, rather than the estimated value of the degree because we believe that such an award more fairly compensates the spouse for her contributions. It is her contributions that are being reimbursed, not a piece of property that is being awarded.
We believe that such an award also avoids the speculation and uncertainty involved when an award is based on estimated value of a degree. For a similar approach to valuation see DeLarosa v. DeLarosa, supra; Zohler v. Zohler, supra; Inman v. Inman, supra.
Order affirmed in part and reversed in part and case remanded for further proceedings consistent with this opinion. Jurisdiction is not retained.
McEWEN, J., concurs in the result.
WIEAND, J., files a concurring and dissenting opinion.

. 23 P.S. §§ 101 et seq.

. The Pennsylvania Divorce Code similarly defines "marital property” as property acquired during the marriage. See 23 P.S. § 401(e).

. But see In re Marriage of Horstmann, Iowa, 263 N.W.2d 885 (1978); (increased earning capacity is a distributable asset); Inman v. Inman, Ky.App., 578 S.W.2d 266 (1979) (there are certain instances in which treating a professional license as marital property is the only way in which a court can achieve an equitable result). The Inman holding, however, is apparently limited. See Leveck v. Leveck, Ky.App., 614 S.W.2d 710 (1981) (where there was some marital property there is no need to treat a medical degree as a marital asset).

. See also 23 P.S. § 401(d)(4) which provides that one of the factors to be considered in distributing marital property is "the contribution by one party to the education, training, or increased earning power of the other part/'. Unfortunately in neither the Hodge case nor in the present appeal did the parties acquire any significant amount of marital property.

. The New Jersey alimony statute for example, provides that the court can order alimony or maintenance as the circumstances of the parties and nature of the case shall render fit, reasonable and just. See N.J.S.A. 2A:34-23.