Court Opinion

ID: 4568634
Source: CourtListenerOpinion
Date Created: 2020-09-22 23:06:58.489527+00
Date Added: 2024-06-11T13:28:12.906983
License: Public Domain

RENDERED: AUGUST 21, 2020; 10:00 A.M.
                        NOT TO BE PUBLISHED

                 Commonwealth of Kentucky
                           Court of Appeals

                             NO. 2019-CA-000158-MR

DALE EUGENE MAYO                                                     APPELLANT

                 APPEAL FROM GREENUP CIRCUIT COURT
v.               HONORABLE JEFFREY L. PRESTON, JUDGE
                        ACTION NO. 18-CI-00367

ANNIE MAGLICYANG MAYO                                                  APPELLEE

                                    OPINION
                                   AFFIRMING

                                   ** ** ** ** **

BEFORE: CALDWELL, DIXON, AND L. THOMPSON, JUDGES.

DIXON, JUDGE: Dale Eugene Mayo appeals from the findings of fact,

conclusions of law, and decree of dissolution of marriage entered on December 19,

2018, and the order denying his motion for specific findings or, in the alternative,

motion to alter, amend, or vacate said order, entered on January 9, 2019, by the

Greenup Circuit Court. Following review of the record, briefs, and law, we affirm.
                FACTS AND PROCEDURAL BACKGROUND

             The parties were married in June 2009. At that time, Dale was

employed with the Veterans’ Administration (VA) Hospital in Huntington, West

Virginia, and Annie was a full-time college student who was also employed. Prior

to the parties’ marriage, Dale purchased a parcel of land upon which he built a

home. At the time of the parties’ marriage, the home mortgage was $76,305.

Thereafter, Dale refinanced the home and used the borrowed funds to pay over

$20,000 of Annie’s student debt. Annie’s name was also added to the home’s

deed. Over the course of the marriage, Dale became disabled and began receiving

disability benefits in 2014, while Annie obtained various professional degrees,

improving her employment status. The parties had a joint checking account in

which they deposited their paychecks, but Dale maintained control of the finances.

Annie fixed up the yard, leveling the ground and planting grass, and had a concrete

pad poured for an outdoor patio. In 2012, the home was valued at $135,000, and in

2018, the home was appraised at $154,000. At the time of separation, the house

was under a mortgage of approximately $80,000, the parties owned two vehicles

free of debt, and Annie had no outstanding student loan debt.

             Annie left the marital residence, taking no furniture or household

items. Because she did not have a separate checking account from which to pay

her bills, she withdrew $16,000 of the $17,000 in the parties’ joint account and

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used approximately $7,000 to furnish an apartment. Annie also sent $5,000 to her

family in the Philippines. In August 2018, a hearing on the use of those funds was

held, and the trial court, finding that Annie may be in need of money, did not

require her to return any of the funds taken from the joint account. Thereafter,

Annie loaned $1,500 each to two friends.

              After a final hearing in which both parties testified, the court entered

its findings of fact, conclusions of law, and decree of dissolution of the parties’

marriage. The court found: Annie did not dissipate marital funds; the amount of

equity Annie had in the marital residence was offset by the funds she withdrew

from their joint account; Dale’s payment of Annie’s student loans did not entitle

him to maintenance; and Dale was not otherwise entitled to maintenance. Dale

moved the trial court for specific findings or, in the alternative, to alter, amend, or

vacate its decree. The motion was denied, and this appeal followed.

                             STANDARD OF REVIEW

              The standard of an appellate court’s review of a trial court’s findings

of fact is well-settled.

                     The trial court heard the evidence and saw the
              witnesses. It is in a better position than the appellate
              court to evaluate the situation. Gates v. Gates, [412
S.W.2d 223 (Ky. 1967)]; McCormick v. Lewis, [328
S.W.2d 415 (Ky. 1959)]. The court below made
              findings of fact which may be set aside only if clearly
              erroneous. Hall v. Hall, [386 S.W.2d 448 (Ky. 1964)];

                                          -3-
                CR[1] 52.01, 7 Kentucky Practice, Clay 103. We do not
                find that they are. They are not ‘manifestly against the
                weight of evidence.’ Ingram v. Ingram, [385 S.W.2d 69
                (Ky. 1964)]; Craddock v. Kaiser, [280 Ky. 577, 133
S.W.2d 916 (1939)]. A reversal may not be predicated
                on mere doubt as to the correctness of the decision.
                Buckner v. Buckner, [295 Ky. 410, 174 S.W.2d 695
                (1943)]. When the evidence is conflicting, as here, we
                cannot and will not substitute our decision for the
                judgment of the chancellor. Gates v. Gates, supra;
                Renfro v. Renfro, [291 S.W.2d 46 (Ky. 1956)].

Wells v. Wells, 412 S.W.2d 568, 571 (Ky. 1967) (emphases added). Accordingly,

the crux of this case is whether the trial court’s findings of fact are supported by

substantial evidence. After careful review, we hold that they are; therefore, we

must affirm.

                     DISSIPATION OF THE MARITAL ESTATE

                On appeal, Dale contends the trial court erred by finding that Annie

had not dissipated $8,000 in marital funds by sending $5,000 to her family and

loaning $3,000, collectively, to two friends. In support, Dale cites to Brosick v.

Brosick, 974 S.W.2d 498 (Ky. App. 1998). Therein, the Court held:

                The concept of dissipation requires that a party used
                marital assets for a non-marital purpose. The spouse
                alleging dissipation should be required to present
                evidence establishing that the dissipation occurred. Once
                the dissipation is shown, placing the burden of going
                forward with the evidence on the spouse charged with the
                dissipation is reasonable because that spouse is in a better
                position to account for these assets. This analysis

1
    Kentucky Rules of Civil Procedure.

                                            -4-
             pertaining to the shifting of the burden of going forward
             with the evidence, using the preponderance of the
             evidence standard, is in accord with the practice
             implicitly followed in Barriger v. Barriger, [514 S.W.2d
114 (Ky. 1974)].
Id. at 502. In Brosick, the husband spent and gave over $1,000,000 to his mistress

while he was still married. In Barriger, the husband converted approximately

$25,000 of the parties’ savings into cash and then dissipated it through “reckless

extravagance.” 514 S.W.2d at 114-15. The husband testified that he took a

Caribbean cruise, gambled in Las Vegas, and entertained a series of women.

             This case is certainly factually distinguishable from Brosick and

Barriger in that, here, Annie was able to account for the $8,000. Annie testified

that Dale had not let her spend money during their marriage or send money to her

family. She testified that she worked hard over the course of the marriage and

should be allowed to help her family. Another panel of our Court held:

             a party is free to dispose of his marital assets as he sees
             fit so long as such disposition is not fraudulent or
             intended to impair the other spouse’s interest such that it
             may properly be classified as a dissipation of the marital
             estate. See Brosick v. Brosick, 974 S.W.2d 498 (Ky.
             App. 1998) (finding of dissipation requires showing the
             money was expended for non-marital purpose, was done
             in anticipation of divorce, and was done to deprive other
             party of his or her interest).

                   While giving away valuable assets may almost
             assuredly cause marital strife—and for that reason alone
             is generally avoided by those who wish to remain happily

                                         -5-
                or peacefully married—we cannot conclude in this
                instance that the transfer was inappropriate . . . .

Ensor v. Ensor, 431 S.W.3d 462, 472-73 (Ky. App. 2013).

                Here, Dale offered no proof—let alone proof sufficient to meet his

burden by a preponderance of the evidence—that Annie defrauded him or acted

with intent to deprive him of his share of marital property. Substantial evidence

supported the court’s finding that Annie did not dissipate marital funds; thus, we

must affirm as to this issue.

                INCREASE IN VALUE OF MARITAL RESIDENCE

                Dale also argues that because no evidence was offered to explain the

increase in value of the marital residence, except for general economic conditions,

the increase in value is considered nonmarital property under KRS2 403.190(2)(e),

which provides “[t]he increase in value of property acquired before the marriage to

the extent that such increase did not result from the efforts of the parties during

marriage” is nonmarital property. However, in the case before us, this is not borne

out by the record. Annie testified that while no significant improvements were

made to the interior of the house, she made improvements to the yard and patio.

Although she testified that she had no idea how much these improvements

increased the value of the home, in the absence of proof from Dale to the contrary,

2
    Kentucky Revised Statutes.

                                            -6-
the court was not only permitted to infer that the improvements increased the value

but required to do so.

             As another panel of our Court observed:

                    The burden of proof is on the party claiming that
             the increase in value is to be considered nonmarital, and
             he must satisfy that burden by “clear and convincing”
             evidence. Brosick v. Brosick, 974 S.W.2d 498 (Ky. App.
             1998). “KRS 403.190(3) . . . creates a presumption that
             any such increase in value is marital property, and
             therefore, a party asserting that he or she should receive
             appreciation upon a nonmarital contribution as his or her
             nonmarital property carries the burden of proving the
             portion of the increase in value attributable to the
             nonmarital contribution. By virtue of the KRS
             403.190(3) presumption, the failure to do so will result in
             the increase being characterized as martial [sic]
             property.” Travis v. Travis, 59 S.W.3d 904, 910-11 (Ky.
             2001).

                    KRS 403.190(2)(e) carves out an exception to
             what is considered “marital property” for “[a]n increase
             in value of property acquired before the marriage to the
             extent that such increase did not result from the efforts of
             the parties during marriage.” (Emphasis added).
             Therefore, conversely an increase in value of property
             that did result from the efforts of the parties during
             marriage should be considered marital property. In
             Goderwis v. Goderwis, 780 S.W.2d 39 (Ky. 1989), the
             Kentucky Supreme Court held that if nonmarital property
             increases in value during the marriage, the trial court
             must determine the reason for the increase. If the
             increase is attributable to general economic conditions, it
             is considered nonmarital. However, “[a]n increase in
             value of nonmarital property during marriage which is
             the result of a joint effort of the parties establishes the
             increase in value of the nonmarital property as marital
             property.” Id. at 40.

                                         -7-
Croft v. Croft, 240 S.W.3d 651, 653-54 (Ky. App. 2007).

             The improvements to the home described and performed by Annie

cannot be discredited as reasons for the increase in value. “The Court requires

only a showing that the increase in value of the property was not solely attributable

to general economic conditions, but was a result of the joint efforts of the parties in

order to qualify property as marital property.” Id. at 654. Thus, in the case herein,

the court did not err in determining the increase in value of the parties’ marital

home was marital property.

             Moreover, although the mortgage was higher at the end of the parties’

marriage due to refinancing than at the beginning of the marriage, it is undisputed

that marital funds were used to pay the mortgage. This further supports the trial

court’s finding that at least some of the increased value of the residence was

marital property. See id. at 654-55.

                                 MAINTENANCE

             Dale further argues the trial court erred in finding that his payment of

over $20,000 of Annie’s student loans was a gift and refusing to compensate him

for this contribution to the acquisition of her professional degree in the form of

maintenance. At the final hearing, Dale admitted he voluntarily paid these loans

out of good will for his wife. Annie also testified these payments were gifts.

                                          -8-
             An award of maintenance comes within the sound discretion of the

trial court; however, a reviewing court will not uphold the award if it finds that the

trial court abused its discretion or based its decision upon findings of fact that are

clearly erroneous. Perrine v. Christine, 833 S.W.2d 825, 826 (Ky. 1992).

Additionally, an award of maintenance must satisfy the statutory provisions of

KRS 403.200, which provides:

             (1) In a proceeding for dissolution of marriage or legal
             separation, or a proceeding for maintenance following
             dissolution of a marriage by a court which lacked
             personal jurisdiction over the absent spouse, the court
             may grant a maintenance order for either spouse only if it
             finds that the spouse seeking maintenance:

                (a) Lacks sufficient property, including marital
                    property apportioned to him, to provide for
                    his reasonable needs; and

                (b) Is unable to support himself through
                    appropriate employment or is the custodian
                    of a child whose condition or circumstances
                    make it appropriate that the custodian not be
                    required to seek employment outside the
                    home.

             (2) The maintenance order shall be in such amounts and
             for such periods of time as the court deems just, and after
             considering all relevant factors including:

                    (a) The financial resources of the party
                        seeking maintenance, including marital
                        property apportioned to him, and his
                        ability to meet his needs independently,
                        including the extent to which a provision
                        for support of a child living with the

                                          -9-
                           party includes a sum for that party as
                           custodian;

                       (b) The time necessary to acquire sufficient
                           education or training to enable the party
                           seeking maintenance to find appropriate
                           employment;

                       (c) The standard of living established during
                           the marriage;

                       (d) The duration of the marriage;

                       (e) The age, and the physical and emotional
                           condition of the spouse seeking
                           maintenance; and

                       (f) The ability of the spouse from whom
                           maintenance is sought to meet his needs
                           while meeting those of the spouse
                           seeking maintenance.

                Dale cites to KRS 403.190(1)(d)3 to support his contention that the

court is permitted to consider the economic circumstances of the parties in dividing

3
    KRS 403.190(1) provides:

                (1) In a proceeding for dissolution of the marriage or for legal
                separation, or in a proceeding for disposition of property following
                dissolution of the marriage by a court which lacked personal
                jurisdiction over the absent spouse or lacked jurisdiction to dispose
                of the property, the court shall assign each spouse’s property to
                him. It also shall divide the marital property without regard to
                marital misconduct in just proportions considering all relevant
                factors including:

                       (a) Contribution of each spouse to acquisition of the
                       marital property, including contribution of a spouse
                       as homemaker;

                                                -10-
marital property. According to Annie’s tax return for 2017, she earned $78,183.

By contrast, for the same year, Dale received $20,712 from Social Security and

$4,493 in VA benefits. However, Dale was awarded the marital residence, its

furnishings, and at least one vehicle, while Annie was awarded the $16,000 she

previously withdrew from the parties’ joint account, as well as a few limited items.

Hardly a windfall. Nevertheless, Dale further contends that KRS 403.200

authorizes the court to consider the economic circumstances of the parties in

determining maintenance, including the fact that one spouse acquired a

professional degree with the help of the other.

             As noted, to properly award maintenance under KRS 403.200, a court

must find the spouse seeking maintenance (1) lacks sufficient property, including

the marital property apportioned to him or her, to provide for his or her reasonable

needs, and (2) is unable to support himself or herself through appropriate

employment. Herein, the court considered the bills presented by Dale, which

                   (b) Value of the property set apart to each spouse;

                   (c) Duration of the marriage; and

                   (d) Economic circumstances of each spouse when
                   the division of property is to become effective,
                   including the desirability of awarding the family
                   home or the right to live therein for reasonable
                   periods to the spouse having custody of any
                   children.

                                           -11-
included amounts for services he had performed in the past—with no apparent

difficulty according to Annie—such as mowing, power-washing the home, and

washing/waxing the vehicles. Dale’s projected monthly expenses were calculated

based on mowing weekly, power-washing the house monthly, and washing and

waxing two vehicles monthly. Per those estimated expenditures, Dale claimed a

deficit of $25 per month in paying his bills. The trial court found Dale’s income

sufficient to pay his monthly expenses and properly take care of himself.

Similarly, Dale was awarded sufficient property to provide for his reasonable

needs.

             Kentucky does not have a set formula for “reimbursement alimony.”

Schmitz v. Schmitz, 801 S.W.2d 333, 336 (Ky. App. 1990). The solution depends

upon the facts of the case. Id. Here, the trial court specifically stated it “carefully

considered the expenses of both parties, the income of both parties and the lifestyle

in which they were accustomed in arriving at this decision on the issue of

maintenance.” This determination was supported by the record, well within the

discretion of the trial court, and will not be easily set aside. Therefore, we hold

that the court did not abuse its discretion in denying maintenance.

                                   CONCLUSION

             Therefore, and for the foregoing reasons, the orders entered by the

Greenup Circuit Court are AFFIRMED.

                                          -12-
          ALL CONCUR.

BRIEF FOR APPELLANT:      BRIEF FOR APPELLEE:

James W. Lyon, Jr.        R. Stephen McGinnis
Greenup, Kentucky         Erin N. Hall
                          Greenup, Kentucky

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