In Re: The Marriage of Terri L. Potter and Brent D. Potter: Terri L. Potter v. Brent D. Potter ( 2014 )

Pursuant to Ind.Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before
any court except for the purpose of
establishing the defense of res judicata, Jan 27 2014, 9:41 am
collateral estoppel, or the law of the case.
ATTORNEY FOR APPELLANT: ATTORNEY FOR APPELLEE:
ANDREW MICHAEL WILKERSON CAITLIN M. MILLER
Rowdy G. Williams Law Firm, P.C. Hunt, Hassler, Lorenz & Kondras, LLP
Terre Haute, Indiana Terre Haute, Indiana
IN THE
COURT OF APPEALS OF INDIANA
IN RE: THE MARRIAGE OF TERRI L. POTTER )
AND BRENT D. POTTER: TERRI L. POTTER, )
)
Appellant-Petitioner, )
)
vs. ) No. 11A01-1304-DR-229
)
BRENT D. POTTER, )
)
Appellee-Respondent. )
APPEAL FROM THE CLAY SUPERIOR COURT
The Honorable Michael R. Rader, Special Judge
Cause No. 11D01-1102-DR-66
January 27, 2014
MEMORANDUM DECISION - NOT FOR PUBLICATION
BAILEY, Judge
Case Summary
T.P. (“Mother”) appeals the denial of her motion to correct error, which challenged
the property division and child support order entered in the dissolution of her marriage to
D.B.P. (“Father”). We affirm.
Issues
Mother presents the following consolidated and restated issues:
I. Whether the dissolution court abused its discretion in the determination
of assets and liabilities comprising the marital pot;1
II. Whether the dissolution court abused its discretion in its determination
of Father’s income available for child support; and
III. Whether the dissolution court abused its discretion in denying Mother’s
claim for reimbursement of extraordinary expenses.
Facts and Procedural History
The parties were married on April 13, 1990. They had two children, B.P. (born in
1991), and L.P. (born in 1995). On February 7, 2011, Mother filed a petition to dissolve the
marriage. B.P. lived independent of his parents and L.P. remained with Mother in the former
marital residence. Father moved to a second property owned by the parties.
The first of three evidentiary hearings took place on March 9, 2012. At that time, the
parties stipulated that their personal property had been divided. Attorneys for the respective
parties advised the dissolution court that the parties were in possession of two residences, one
1
Mother articulates an additional issue as follows: “Whether the Trial Court abused its discretion when it
found that a presumptive equal property division was warranted.” Appellant’s Brief at 1. However, she does
not develop this issue, and we observe that she requested an equal division of the marital assets. Mother may
not complain of alleged error she has invited. See Balicki v. Balicki, 837 N.E.2d 532, 541 (Ind. Ct. App.
2005), trans. denied. It appears that her actual complaint is that the dissolution court abused its discretion in
deciding what assets and liabilities were includable in the marital pot for division.
2
over-financed and the other having approximately $20,000 in equity; a joint bankruptcy
petition had been filed one day earlier – with the primary objective of discharging debt for
numerous consumer charge card accounts; and the principal asset of the parties was
retirement funds. These retirement accounts consisted of husband’s account worth $5,892
and Wife’s deferred compensation account worth $42,952, her annuity worth $23,387 and
her pension having a present net value of $39,117. At that time, Father was unemployed and
Mother was employed as a teacher in Clay County Schools. It was stipulated that Father had
paid child support to Mother through May 20, 2011. The parties had alternated paying health
insurance premiums for L.P.
After hearing evidence, the court took the matter of property division under
advisement pending the anticipated discharge in bankruptcy. The court declined to enter a
specific child support order against Father at that time, stating that credible evidence had
been presented that Father had suffered depression so extreme that he was unable to work.
On May 25, 2012, a second hearing was conducted, at which the parties’ bankruptcy
attorney testified. He testified that Mother was residing in the property with negative equity
and he had advised her not to re-affirm the property in bankruptcy proceedings. Rather, it
was Mother’s apparent intention to continue making payments and residing at the property
without a legal obligation to do so. Father was remaining at the second property, which had
been re-affirmed in the bankruptcy proceedings. Father testified that he had recently
obtained unemployment compensation benefits of $390 per week. He proposed that his child
support be calculated with that amount as his gross income while Mother proposed that
3
Father’s gross income available for child support purposes should be equal to his salary when
last employed.
On August 23, 2012, the final hearing was held. The bankruptcy discharge had been
entered and the controversies between the parties distilled to what, if any, income should be
imputed to Father for child support purposes, what amount he might pay for L.P.’s expenses
listed by Mother on an evidentiary exhibit, whether a horse in Father’s possession should be
surrendered to L.P., and whether the parties should share: the teacher’s retirement account, a
claimed debt to Mother’s parents, bank account funds originating from Father’s father (then
deceased), and the mortgage of the property surrendered in bankruptcy but informally
retained by Mother.
The dissolution court determined that the marital pot should include the real property
formally re-affirmed in bankruptcy, all pension funds, and the bank account in Father’s
control. The real property surrendered in bankruptcy and the familial debt listed and
discharged in bankruptcy were not included in the marital pot. As for the horse, the
dissolution court considered it to be personal property subject to the parties’ stipulation that
they had divided such property. The court determined that an equal division of the marital
pot was just and equitable; Mother was given credit for significant payments made on charge
accounts after separation of the parties but prior to the bankruptcy discharge. The dissolution
court anticipated that Father would receive a share of the teacher’s pension funds as “an
alternate payee.” (App. 37.)
4
The parties filed respective motions to correct error. At the February 22, 2013 hearing
on the motion to correct error, the dissolution court acknowledged that Father could not be
treated as an alternate payee of the teacher’s retirement funds. On March 26, 2013, the court
entered an Amended Final Decree of Dissolution. Ultimately, Mother was to pay Father
$26,563.00 as an equalization payment and Father was to pay Mother $3,920 as child support
arrearage. He was ordered to pay $79 weekly as child support. The calculation was based
upon imputed income of $10 per hour. However, the arrearage award did not include an
assessment for six months when Father was undergoing treatment for depression.2 Also,
Father was not ordered to contribute to L.P.’s expenses claimed by Mother as extraordinary
expenses beyond basic child support.
Mother now appeals.
Discussion and Decision
Property Division
The division of marital property involves a two-step process. Thompson v.
Thompson, 811 N.E.2d 888, 912 (Ind. Ct. App. 2004), trans. denied. First, the trial court
must determine what property is to be included in the marital estate, or marital pot. Id.Second, the trial court must divide the marital property under the presumption that an equal
split is just and reasonable. Id. (citing Ind. Code § 31-15-7-5).
The division of marital assets lies within the sound discretion of the trial court, and we
reverse only for an abuse of discretion. Hartley v. Hartley, 862 N.E.2d 274, 284 (Ind. Ct.
2
During this time, Father paid L.P.’s health insurance premiums of $24.16 per week.
5
App. 2007). A party who challenges the trial court’s division of marital property must
overcome a strong presumption that the court considered and complied with the applicable
statute, and that presumption is one of the strongest presumptions applicable to our
considerations on appeal. Id. We do not reweigh the evidence or assess the credibility of the
witnesses, but consider only the evidence most favorable to the trial court’s disposition of the
marital property. Id. Finally, we do not substitute our judgment for that of the dissolution
court even where the facts might allow for a different conclusion. Id.All marital property goes into the marital pot for division, whether it was owned by
either spouse before the marriage, acquired by either spouse after the marriage and before
final separation of the parties, or acquired by their joint efforts. I.C. § 31-15-7-4(a); Hill v.
Hill, 863 N.E.2d 456, 460 (Ind. Ct. App. 2007). Property acquired by a spouse after the final
separation date is excluded from the marital estate. Thompson, 811 N.E.2d at 912. The trial
court is also required to divide the marital debt. See Moore v. Moore, 695 N.E.2d 1004,
1010 (Ind. Ct. App. 1998). Mother contends that the court erred in determining the makeup
of the marital pot in several respects.
Pension Inclusion.
“Property” for purposes of dividing the marital pot includes:
(1) a present right to withdraw pension or retirement benefits;
(2) the right to receive pension or retirement benefits that are not forfeited
upon termination of employment or that are vested (as defined in Section
411 of the Internal Revenue Code) but that are payable after the dissolution
of marriage[.].
6
I.C. § 31-9-2-98(b). Whether a right to a present or future benefit constitutes an asset that
should be included in the marital pot depends mainly upon whether it has vested by the time
of dissolution. Bingley v. Bingley, 935 N.E.2d 152 (Ind. Ct. App. 2010). In order for a
future pension benefit to be considered marital property in Indiana, the right to the pension
must not be contingent upon future employment. Hann v. Hann, 655 N.E.2d 566 (Ind. Ct.
App. 1995), trans. denied. However, vested retirement pensions which are not forfeited upon
employment termination and are contingent upon the retiree’s survival are considered part of
the marital pot. Schueneman v. Schueneman, 591 N.E.2d 603, 608 (Ind. Ct. App. 1992).
Here, the parties stipulated that Mother’s pension was vested. She testified that she
would receive a monthly payment at age sixty-five, if retired, regardless of whether she
continued employment with the Clay County Schools. Counsel for both parties advised the
dissolution court that they had been in contact with the plan administrator, who placed a
present net value of the account that was to provide a future income stream at $39,117. No
evidence of a different value was presented.
Mother now claims that her pension funds are subject to forfeiture and that Father will
receive a windfall if she dies before reaching full retirement age, in that he is currently
entitled to the equalization payment regardless of her survival. She did not present evidence
of divestiture or forfeiture at the hearings. Instead, Mother’s theory was that Father should
not share in the disputed pension funds because she had maintained stable employment while
Father allegedly displayed less frugality and economic foresight. Her new argument that the
asset is speculative and non-divisible because she may die before age sixty-five is neither
7
supported by the evidence of record or the applicable law. The dissolution court did not
abuse its discretion by including the pension in the marital pot.
Exclusion of Debt to Mother’s Parents and Liability for Former Marital Residence.
Mother asserts that Father should have been held liable for one-half of loan
indebtedness due to her parents. Mother’s mother testified that, in 1984, she and her husband
had loaned the couple $6,000 for a down-payment on real estate and later had loaned $15,000
for the purchase of the marital residence and $3,000 for the purchase of a vehicle. She
testified that she had received some payments but decided to allow payback upon sale of the
real estate. She claimed entitlement to $25,000 to $30,000, including interest. There were no
documents evidencing the loan.
In the bankruptcy proceedings, a debt to Mother’s parents was listed as an unsecured
debt, with a notation that Father disputed the validity of the debt. Father was discharged as to
any liability for this debt. Mother elected, during the bankruptcy proceedings and after the
filing of the petition for marital dissolution, to re-affirm the debt individually. Accordingly,
to the extent that a collectible debt exists, it is a post-petition debt of Mother, a liability not
properly included in the marital pot. See Fuehrer v. Fuehrer, 651 N.E.2d 1171, 1774 (Ind. Ct.
App. 1995) (recognizing that debts incurred by one party after the marital estate closes –
generally on the date of filing – are not to be included in that estate), trans. denied.
As for the alleged liability for a mortgage on the former marital residence, there is
uncontroverted evidence that neither party reaffirmed the mortgage and the debt was
discharged in bankruptcy proceedings. Mother testified that she was not legally obligated to
8
pay for the house. Rather, she hoped to be allowed to remain in the residence if she made
regular payments because the house was over-financed and a poor subject for foreclosure and
resale by the mortgagor. Because Mother did not show the existence of a legal obligation of
the parties, the dissolution court was not obliged to include the claimed debt in the marital
pot.
Exclusion of Horse.
Mother maintains that Father was erroneously permitted to keep a horse valued at
$6,000 without accounting for its value. At the initial hearing, counsel for both parties
advised the court that the personal property had been divided. Mother continued to refer to a
horse as L.P.’s horse and the dissolution court sought clarification:
Court: All the personal property, you’ve already taken care of it. Is that true?
Mother’s Counsel: Yes Your Honor. …
Court: Okay and that includes the horses.
Father’s Counsel: Yes.
Mother’s Counsel: Well he indicated that the horses weren’t in anybody’s
name so I guess their [sic] not. He stated they are not marital assets.
Court: Well I guess the question is though were they taken into consideration
when you divided personal property?
Mother’s Counsel: Yes.
Father’s Counsel: Yes.
Mother’s Counsel: We did talk about the horses in dividing personal property.
(Tr. 161.)
9
On appeal, a party is precluded from taking advantage of invited error, or error in
which she acquiesced. See Balicki, 837 N.E.2d at 541 (observing that the doctrine of invited
error is grounded in estoppel and prevents a party from taking advantage of error he or she
commits, invites or is the natural consequence of his or her own negligence or misconduct).
We need not entertain Mother’s allegation that the dissolution court failed to include an item
of personal property within the marital pot, in light of counsel’s representation that personal
property had been considered and divided.
Moreover, the record supports the dissolution court’s conclusion that L.P. made no
claim to the horse. L.P. did not testify or assert her ownership of the animal. Father testified
that, although the horse was not registered to L.P., it had originally been purchased as her
eleventh birthday present, but she had shown no interest in the horse in several years. It had
been maintained by Father and pastured with horses that were left in his care when his father
died and his mother was placed in a nursing home. According to Father, he left almost all
household furnishings and items to Mother with the understanding that the gift horse was to
remain with him. We find no error in the court’s decision not to include the value of the
horse on the balance sheet of assets and liabilities to be divided.
Child Support
Mother also contends that the dissolution court awarded an insufficient amount of
current child support and child support arrearage. The dissolution court found that Father
was unable to work for the period of May 20, 2011 through November 1, 2011, and was not
liable for child support during that period beyond the insurance premiums paid for L.P. As to
10
the remaining time, the court imputed income to Father of $10 per hour (roughly equivalent
to the amount of his unemployment benefits) although Mother had requested that the
dissolution court impute income equivalent to Father’s last salary of $634 weekly.
Child support calculations are made using the income shares model set forth in the
Indiana Child Support Guidelines (“Guidelines”). Sandlin v. Sandlin, 972 N.E.2d 371, 374
(Ind. Ct. App. 2012). The Guidelines apportion the cost of supporting children between the
parents in accordance with their means, based upon the premise that children should receive
the same portion of parental income after a dissolution that they would have received if the
family had remained intact. Id. A trial court’s calculation of child support under the
Guidelines is presumptively valid and we will reverse a decision in child support matters only
if it is an abuse of discretion, that is, when the trial court misinterprets the law or the decision
is clearly against the logic and effect of the facts and circumstances that were before the
court. Id.A trial court may impute income to a parent for purposes of calculating child support
upon determining that he or she is voluntarily unemployed or underemployed. Id. at 375
(citing Matter of Paternity of Buehler, 576 N.E.2d 1354, 1355-56 (Ind. Ct. App. 1991)). The
Guidelines permit imputation to discourage parents from avoiding significant child support
obligations by becoming unemployed or taking a lower paying job; however, the Guidelines
do not require that parents work to their full economic potential. Id.Here, there was testimony from both parents regarding the significant events that led
to Father’s loss of employment. In a short span of time before Mother petitioned to dissolve
11
the marriage, Father suffered the loss of his father to aggressive pancreatic cancer, and had to
admit his mother and grandparents to nursing care facilities. Father’s mother accused Father
of hastening his father’s death by providing substandard care and Father reportedly had found
this accusation devastating. Father also suffered the loss of a close friend and had
experienced strained relationships with his children. At some point, he stopped going to
work and was fired. Father sought treatment through Vista Care hospice services, the
Hamilton Center, and one Dr. French. He was diagnosed with a major depressive disorder
and was prescribed several medications. Father continued to receive counseling services,
including grief therapy, for several months.
Mother directs our attention to testimony that Father had answered an interrogatory
indicating that his mental health was “fine,” he had been able to perform farm work for a
friend, and he had made limited efforts to obtain new employment during a several-month
period. Appellant’s Brief at 10. In essence, Mother requests that we reweigh the evidence to
find that Father was never debilitated by depression such that he could not maintain
employment at his previous level. The record reveals a sufficient basis for the limited
imputation of income to Father, and we decline the invitation to reweigh the evidence.
Denial of Contribution to Extraordinary Expenses
Mother submitted an exhibit detailing “Expenses for [L.P.]” for which she sought
contribution from Father. (App. 85.) The listed expenses were as follows:
Optometrist $ 565
Orthodontist 530
Phone 610.69
Volleyball Camp 435
12
Volleyball Equipment 81
Sports Uniforms 179.79
Sports Physical 236.25
Sports letter jacket 236.68
Book rental fees 188.57
School photography 41
School clothes 1,696.02
Health Insurance 3,383.97
Personal Grooming 663
Formal Dance Dress 864.96
School Lunches 870
Auto Insurance 330
Life Insurance 213.85
Auto/Fuel Cost 416.36
$11,542.14
During testimony, Mother admitted that some of the expenses were taken into account
by the Guidelines computation of child support; for example, each parent was credited with
health insurance premiums on the child support worksheet and each was ordered to pay a
proportional share of uninsured medical expenses. Additionally, Mother admitted that
certain of the expenses were duplicative of those for which child support was awarded, for
example, school book fees, clothing, school lunches, and grooming. There were extra-
ordinary expenses for sports; however, the evidence established that Mother and Father had
not agreed to these.
The Guidelines indicate that, where parents agree to their child’s participation in
optional activities, the parents should pay a pro rata share and, in the absence of such an
agreement, the court should take into account factors such as each parent’s ability to pay,
which parent encourages the activity, historical participation, and the reasons for
encouragement or opposition. Ind. Child Support Guideline 8.
13
Here, the dissolution court commented upon Father’s limited resources and declined
to order his contribution to the claimed extra-ordinary expenses. We observe that several of
the claimed expenses, such as for food, clothing, grooming, and school books, are not extra-
ordinary. It is also clear from the evidence presented that Father could not afford a separate
vehicle for his child. The vehicle and cell phone are typical expenses a family of limited
means might expect their teenager to forego or afford by obtaining after-school employment.
The expenses for the optional activity of volleyball are in excess of $1,000 and are the type of
educational extra-curricular expense that parents might well agree to cover, proportional to
their incomes. Here, however, there was no such agreement. We do not find, given Mother’s
superior income, her encouragement that L.P. participate in a sport, and the lack of
consultation with Father (who has limited resources) that the dissolution court abused its
discretion.
Conclusion
Mother has not established that the dissolution court abused its discretion in the
division of marital assets or the award of child support.
Affirmed.
FRIEDLANDER, J., and KIRSCH, J., concur.
14