Court Opinion

ID: 4173081
Source: CourtListenerOpinion
Date Created: 2017-05-31 16:41:20.862967+00
Date Added: 2024-06-11T09:36:38.383641
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before any                                 FILED
court except for the purpose of establishing                         May 31 2017, 10:45 am

the defense of res judicata, collateral                                   CLERK
                                                                      Indiana Supreme Court
estoppel, or the law of the case.                                        Court of Appeals
                                                                           and Tax Court

ATTORNEY FOR APPELLANT                                  ATTORNEY FOR APPELLEE
Chad D. Wuertz                                          Stacy L. Kelley
Wuertz Law Office, LLC                                  Glaser & Ebbs
Indianapolis, Indiana                                   Indianapolis, Indiana

                                          IN THE
    COURT OF APPEALS OF INDIANA

Anthony J. Rhea,                                        May 31, 2017
Appellant-Petitioner,                                   Court of Appeals Case No.
                                                        49A02-1611-DR-2572
        v.                                              Appeal from the Marion Superior
                                                        Court
Marjorie Rhea,                                          The Honorable James A. Joven
Appellee-Respondent.                                    Trial Court Cause No.
                                                        49D13-1503-DR-8513

Bailey, Judge.

Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017           Page 1 of 11
                                          Case Summary
[1]   Anthony Rhea (“Husband”) appeals the property division in the dissolution of

      his marriage to Marjorie Rhea (“Wife”). We affirm.

                                                   Issues
[2]   Husband presents two issues for review:

              I.      Whether the trial court abused its discretion by precluding
                      Husband’s realtor from testifying as an expert on the value
                      of real properties owned by the parties; and

              II.     Whether the trial court abused its discretion by deviating
                      from a presumptive 50/50 split of the marital pot.

                            Facts and Procedural History
[3]   The parties were married on May 19, 1995. On March 16, 2015, Husband filed

      a petition for dissolution of the marriage.

[4]   At that time, Husband and Wife owned three real properties in Marion County,

      Indiana. The property located on Priscilla Avenue had been purchased and

      occupied by Wife prior to the marriage. It was the initial marital home, but was

      later converted to exclusive use as a day care center. The property located on

      East 23rd Street had been purchased and renovated for re-sale. The property on

      Bluestem had been the second marital home. It had been occupied by Husband

      post-separation and was in foreclosure at the time of the final hearing. A

      Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 2 of 11
      private sale was pending, but for a purchase price of less than the two

      mortgages and expenses of sale.

[5]   Provisional hearings were conducted in July, August, and September of 2015.

      A final hearing was conducted on October 17 and 18, 2016. The marriage was

      dissolved pursuant to a decree entered on November 3, 2016. Wife received

      58% of the marital assets and Husband received 42%. This appeal ensued.

                                Discussion and Decision
                                    Exclusion of Testimony
[6]   Husband argues that his realtor should have been allowed to testify as an expert

      on the value of real properties owned by the parties. The competency of a

      witness to testify as an expert is a matter for the trial court to determine and is

      subject to its discretion. Hegerfeld v. Hegerfeld, 555 N.E.2d 853, 855 (Ind. Ct.

      App. 1990). An abuse of discretion occurs if the trial court’s decision is clearly

      against the logic and effect of the facts and circumstances before the court, or

      the reasonable, probable, and actual deductions to be drawn therefrom. Dillard

      v. Dillard, 889 N.E.2d 28, 32 (Ind. Ct. App. 2008). An abuse of discretion also

      occurs when the trial court has misinterpreted the law. Id.

[7]   Wife requested that she be awarded the properties on Priscilla Avenue and East

      23rd Street. She obtained written appraisals for the properties, with assigned

      values of $67,000.00 and $203,500.00, respectively. The appraisals were

      admitted into evidence at the final hearing. Husband disagreed with those

      Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 3 of 11
      values but did not submit into evidence an alternate appraisal. Rather, he

      called as a witness Merrill Moores (“Moores”), the attorney and real estate

      agent who was handling the short sale of the Bluestem property, 1 to “rebut” the

      appraisals. (Tr. Vol. I at 158).

[8]   At the commencement of his testimony, Moores stated that he was a licensed

      real estate agent and a practicing attorney who did not have a real estate

      appraiser’s license. He testified that he did appraisals “for divorces” and for

      “his own purposes seeking listings.” (Tr. Vol. I at 152.) Husband’s counsel

      asked Moores if he had “looked at” the Priscilla Avenue property and Wife

      objected that Husband was eliciting speculative testimony unsupported by

      documentation. (Tr. Vol. I at 155.) Wife asked a “preliminary question” of

      Moores, and Moores confirmed that he had not compiled a written appraisal.

      (Tr. Vol. I at 156.) Wife moved to exclude Moores’ testimony as irrelevant.

[9]   In the ensuing bench conference, the trial court characterized Wife’s objection

      as an objection to Moores’ qualifications as an expert, and stated that a lay

      witness is not permitted to give opinion testimony. The trial court inquired

      whether Husband’s counsel had authority for the proposition that someone

      other than a licensed appraiser could testify concerning real estate value;

      counsel responded that he did not currently possess such authority; and the trial

      court ruled that Moores could not give opinions regarding properties other than

      1
       Moores testified without objection regarding the progress of the Bluestem property sale and the anticipated
      proceeds.

      Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017              Page 4 of 11
       the Bluestem property. Husband was afforded the opportunity to make an offer

       of proof. Counsel summarized:

               If allowed to testify, this witness would testify that the valuation
               of Priscilla property – or the property at Priscilla would be in a
               market analysis that he performed looking at comparable
               properties, at or above $80,000, I think $82 to $85, additionally
               that the property that would be the 23rd Street address, in the
               neighborhood it is with the transition of the market that’s there,
               the actual evaluation of it would be $270 – or $265,000 to
               $275,000 in a normal market condition; substantially higher than
               what the – the appraisal has been offered and opposing party’s
               documents.

       (Tr. Vol. I. at 165.)

[10]   On appeal, Husband directs our attention to Indiana Code Section 25-34.1-3-8.

       This statute permits a person licensed as a real estate broker to appraise real

       estate in Indiana for compensation, although he or she is not licensed or

       certified as a real estate appraiser. Husband then argues that the trial court

       made a mistake of law in concluding that Moores was unqualified to render an

       opinion as to real estate values.

[11]   Pursuant to Indiana Code Section 25-34.1-3-8, a real estate broker may accept

       compensation for performing a real estate appraisal even if the broker does not

       have an appraiser’s license. However, this statute does not directly concern the

       qualifications of an expert witness to offer evidence. Indiana Rule of Evidence

       702(a) addresses testimony by expert witnesses, providing:

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 5 of 11
                A witness who is qualified as an expert by knowledge, skill,
                experience, training, or education may testify in the form of an
                opinion or otherwise if the expert’s scientific, technical, or other
                specialized knowledge will help the trier of fact to understand the
                evidence or to determine a fact in issue.

[12]   Nevertheless, whether a real estate broker may offer valuation testimony in

       some circumstances2 is beside the point in this case. Even assuming Moores is

       qualified and competent to conduct a property-specific appraisal, he did not

       perform that function here. As indicated in the offer of proof, his anticipated

       testimony was based upon an undocumented market analysis. The offer of

       proof did not explain the methodology for or scope of a market analysis, and

       Husband made no claim that Moores had examined the subject properties

       beyond looking inside. In these circumstances, the trial court was within its

       discretion to conclude that Moores’ valuation testimony would not assist in the

       determination of a fact in issue.

                              Deviation from Presumptive Split
[13]   Pursuant to Indiana Code Section 31-15-7-5, the trial court shall presume that

       an equal division of the marital property between the parties is just and

       reasonable. The presumption may be rebutted by relevant evidence, including

       evidence concerning the following factors:

       2
         See e.g., Hudson v. McClaskey, 641 N.E.2d 36, 41 (Ind. Ct. App. 1994) (the trial court did not abuse its
       discretion in permitting expert testimony of land value by an auctioneer/broker/appraiser who allegedly
       lacked formal appraisal training but had taken several appraisal courses).

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017               Page 6 of 11
               (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 of 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.

               (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.

[14]   Wife was awarded 58% of the marital estate and Husband was awarded 42%.

       Husband argues that the deviation amounted to clear error because (1) Wife’s

       counsel, in the written proposed order, improperly expanded upon the oral

       direction of the trial court; (2) Wife’s testimony as to her day care earnings is

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 7 of 11
       contradicted by evidence of her cash flow; and (3) Husband was hindered in the

       presentation of evidence relative to his retirement plans.

[15]   On October 25, 2016, the trial court detailed an administrative event in the

       Chronological Case Summary:

               Comes now the court and directs counsel for [Wife] to submit a
               Decree that adopts the stipulations of the parties and divides the
               marital estate in accordance with Exhibit Q from trial. Husband
               shall pay $10,000 of Wife’s attorney fees due to disparities in
               income and discovery issues. Court finds that a deviation of the
               50/50 presumption is appropriate given the property Wife
               brought into the marriage, the disparity in incomes and economic
               circumstances as they leave the marriage. Husband owes Wife
               $1,500 for maintenance for Sept-Nov.

       (App. at 13.) In the Decree of Dissolution, the reasons for deviation have been

       expanded to include “the actions of the parties during the pendency of this

       matter.” (Appealed Order at 3.) It appears that counsel followed the trial

       court’s directive but then took some liberty in drafting.3 However, the trial

       court adopted the additional grounds in counsel’s submission. Ultimately, even

       if a trial court has adopted verbatim a party’s proposed findings and

       conclusions, causing a lower level of confidence that findings reflect the

       independent judgment of the trial court, the task of this Court is to review for

       3
        Husband makes a cursory allegation that the Decree also improperly referenced a stipulation, when the
       parties had none. As Husband points out, the final hearing began with the parties denying that they had
       made any stipulation. However, during a break in the final hearing, the parties reached an agreement as to
       personal property and advised the trial court accordingly. This stipulation was properly included in the
       Decree.

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017             Page 8 of 11
       clear error the findings as adopted. Kitchell v. Franklin, 26 N.E.3d 1050, 1058

       (Ind. Ct. App. 2015).

[16]   When reviewing a property division, we begin with a strong presumption that

       the trial court considered and complied with the applicable law governing

       property division. Perkins v. Harding, 836 N.E.2d 295, 299 (Ind. Ct. App. 2005).

       We cannot substitute our judgment for the trial court’s, even if the evidence

       could have supported a different property distribution. Augspurger v. Hudson,

       802 N.E.2d 503, 512 (Ind. Ct. App. 2004). We decide whether the decision

       distributing property constitutes an abuse of discretion, considering only the

       evidence most favorable to the court’s disposition of the property. Estudillo v.

       Estudillo, 956 N.E.2d 1084, 1092 (Ind. Ct. App. 2011).

[17]   At the time of the final hearing, Wife was receiving Social Security payments of

       $947.00 per month. Her 2015 tax return indicates that her net annual income

       from the operation of a day care center was $421.00 per year. She testified that

       she was in 2016 earning $87.00 per week in net income. Husband’s income for

       the prior year consisted of wages of $126,530.00. He had earned $63,090.79 for

       January through May of 2016. As such, there was evidence to support the

       finding of disparate economic circumstances. Wife testified that she had owned

       the Priscilla Avenue property when the parties got married. This supports the

       finding that Wife brought property into the marriage. As for the conduct during

       the proceedings – the basis for the finding that Wife’s counsel added and the

       trial court adopted – there was testimony that Husband was ordered to pay the

       mortgage on the Bluestem property during his tenancy there, but did not do so

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 9 of 11
       despite regular income. Ultimately, the Bluestem property was sold in a short

       sale after foreclosure proceedings were commenced. This evidence supports the

       determination that Husband’s conduct negatively impacted the net marital

       estate available for division. In sum, the deviation is amply supported by the

       evidence.

[18]   Husband argues, however, that certain evidence should be disregarded. That is,

       he focuses upon the testimony that Wife nets $87.00 weekly from the day care

       center together with the testimony that the Priscilla Avenue property was

       owned free of any mortgage. Ignoring Schedule C of the 2015 tax return

       indicating that Wife took in gross proceeds of $60,648.00, Husband insists that

       it is a “financial impossibility” for Wife to have maintained the “cash flow” for

       a mortgage payoff if she earns only $87.00 per week. (Appellant’s Brief at 15.)

       His argument represents a stark request to reweigh evidence. We decline the

       invitation. See Estudillo, 956 N.E.2d at 1092 (recognizing that we do not

       reweigh the evidence nor assess witness credibility when reviewing a property

       distribution decision).

[19]   Finally, Husband asserts that the finding of disparate incomes rests upon an

       assumption that he will continue working, yet he was not offered a meaningful

       opportunity to introduce evidence of his need to retire. Husband directs our

       attention to a colloquy between Husband’s counsel and the trial court, during

       which counsel suggested that sixty-two “is retirement, Judge.” (Tr. Vol. II at

       pg. 189.) The trial court disagreed and expressed the view that, in the absence

       of medical necessity, a claim of plans for early retirement would likely not be

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 10 of 11
       accorded much evidentiary weight. Thereafter, Husband testified that he is a

       diabetic. He did not, however, claim that his retirement was imminent or that

       his early retirement would be medically necessary. Husband’s cursory

       argument in this regard is, at bottom, an additional request to reweigh the

       evidence. Husband has not demonstrated that the trial court abused its

       discretion by deviating from the presumptive 50/50 split.

                                              Conclusion
[20]   The trial court did not abuse its discretion by precluding valuation testimony

       concerning two of the marital real properties. The trial court’s order of property

       division is supported by the evidence and does not constitute an abuse of

       discretion.

[21]   Affirmed.

       Vaidik, C.J., and Robb, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 49A02-1611-DR-2572 | May 31, 2017   Page 11 of 11