In Re the Marriage of Lynn Marie Larsen and Roger Wayne Larsen Upon the Petition of Lynn Marie Larsen, and Concerning Roger Wayne Larsen ( 2016 )

IN THE COURT OF APPEALS OF IOWA
No. 15-1527
Filed September 28, 2016
IN RE THE MARRIAGE OF LYNN MARIE LARSEN
AND ROGER WAYNE LARSEN
Upon the Petition of
LYNN MARIE LARSEN,
Petitioner-Appellee,
And Concerning
ROGER WAYNE LARSEN,
Respondent-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Story County, Timothy J. Finn,
Judge.
Roger Wayne Larsen appeals various economic provisions of the decree
dissolving his marriage to Lynn Marie Larsen. AFFIRMED.
Erin M. Carr of Carr & Wright, P.L.C., Des Moines, for appellant.
Nicole S. Facio of Newbrough Law Firm, L.L.P., Ames, for appellee.
Considered by Vaitheswaran, P.J., and Doyle and Mullins, JJ.
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MULLINS, Judge.
Roger Wayne Larsen appeals certain economic provisions of the decree
dissolving his marriage to Lynn Marie Larsen: (1) the allocation of the income tax
exemptions between the parties; (2) the $1136 equalization payment awarded to
Lynn; (3) the distribution of the marital property; and (4) the adoption of the
support provision from the partial stipulation for the decree. On our de novo
review, we affirm.
I. Background Facts and Proceedings
Lynn and Roger were married in November 1995. The parties have three
children. The petition for dissolution was filed in August 2014. In October 2014,
a temporary order concerning child support was entered. A two-day trial
commenced on April 29, 2015. By the end of the day on April 30, 2015, the
parties submitted a partial stipulation for the decree, which the court approved in
all respects. In the partial stipulation, which noted the parties were both
employed and self-supporting, the parties agreed to the following relevant
matters: (1) Lynn would have physical care of the minor children and Roger
would receive liberal visitation; (2) Roger would pay certain sums in child
support, and his separation from service in the military would not constitute
grounds for modification; and (3) Lynn would provide health insurance and dental
coverage for the children.
In the dissolution decree, the court also resolved certain disputed matters
between the parties, including the allocation of tax exemptions, the distribution of
the parties’ marital assets, and an equalization payment from Roger to Lynn for
money Lynn paid for the children’s dental expenses for which Roger received a
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reimbursement check from the parties’ dental insurance. Following entry of the
dissolution decree, Roger appealed.
II. Standard and Scope of Review
We review cases tried in equity, such as dissolution cases, de novo. Iowa
R. App. P. 6.907; In re Marriage of Gust, 858 N.W.2d 402, 406 (Iowa 2015). We
give weight to the factual findings of the district court, especially when
considering the credibility of witnesses, but we are not bound by them. Iowa R.
App. P. 6.904(3)(g). Prior cases, though helpful, have little precedential value
because we must base our decision primarily on the particular circumstances of
the parties presently before us. In re Marriage of Weidner, 338 N.W.2d 351, 356
(Iowa 1983). We accord the trial court considerable latitude in making factual
determinations and will disturb the ruling only when there has been a failure to do
equity. Gust, 858 N.W.2d at 406.
III. Analysis
Roger challenges four economic provisions of the dissolution decree. In
matters of property distribution, we are guided by Iowa Code section 598.21
(2013). The parties in a dissolution action “are entitled to a just and equitable
share of the property accumulated through their joint efforts.” In re Marriage of
O’Rourke, 547 N.W.2d 864, 865 (Iowa Ct. App. 1996). Iowa law does not require
an equal division, but rather, “what is fair and equitable in each circumstance.” In
re Marriage of Campbell, 623 N.W.2d 585, 586 (Iowa Ct. App. 2001). “Equitable
distributions require flexibility and concrete rules of distribution may frustrate the
court’s goal of obtaining equitable results.” In re Marriage of Driscoll, 563
N.W.2d 640, 642 (Iowa Ct. App. 1997). Thus, “it is inherent in the court’s
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equitable powers, to make appropriate adjustments, according to the unique
facts of each case.” Id.
A. Income Tax
In the dissolution decree, the district court determined Lynn was entitled to
claim a filing status as the head of household as well as claim the income tax
exemption for one of the parties’ children while Roger was entitled to claim the
income tax exemption for the parties’ other two children. On appeal, Roger
contends this arrangement inequitably shifts the tax burden to him. He requests
that he be allowed to claim all three children because Lynn receives a larger tax
exemption by claiming the head of household filing status.
Iowa rules provide the “[h]ead of household filing status shall be assigned
if a parent is the custodial parent of one or more of the mutual children of the
parents.” Iowa Ct. R. 9.6(1). Lynn was therefore entitled the head of household
filing status. The rules further provide the general rule that “[t]he custodial parent
shall be assigned one additional dependent exemption for each mutual child of
the parents.” Iowa Ct. R. 9.6(5). The district court may award the tax exemption
to a noncustodial parent, however, “to achieve an equitable resolution of the
economic issues presented.” In re Marriage of Okland, 699 N.W.2d 260, 269
(Iowa 2005) (citation omitted). Such an award “may be appropriate when it
would ‘free up more money for the dependent’s care.’” Id. (citation omitted).
Roger contends being allowed to claim all three children would reduce his
taxable income by approximately $12,000, while Lynn already receives a credit
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as head of the household in excess of that amount.1 Roger concludes being
awarded the tax credits would free up more of his income for the children; but the
same remains true for Lynn. On our de novo review, we find no inequity in the
court’s division of the income tax exemptions between the parties.
B. Equalization Payment
In the dissolution decree, the district court ordered Roger to pay Lynn
$1136 “for equalization of money she paid for the children’s dental expenses for
which Roger received a check from the parties’ dental insurance.” Roger does
not deny he received this check and kept the proceeds. Instead, he claims he
was entitled to keep this money as an offset for $1884 he paid to the children’s
college savings accounts during the pendency of this case.
However, the parties’ payment of medical expenses was governed by the
temporary support order entered in October 2014. This order required Lynn and
Roger to “split any uncovered medical expenses equally on the children.” It is
undisputed that Lynn covered this expense in its entirety, Roger made no
contribution toward this expense, and Roger retained the reimbursement check
from the insurance company. We find the district court’s order complied with the
temporary support order in place and find no reason to depart from the holding of
the district court.
1
Lynn notes a $12,000 reduction would actually raise Roger’s child support obligation
for the three children; thus, without a corresponding increase in child support, the
adjustment proposed by Roger would only result in Lynn incurring a greater tax burden,
leaving less money to be used for the care of the children.
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C. Property Distribution
The district court made the following distribution of the parties’ real estate:
(1) Roger was awarded the home he resided in—valued by the court at $75,305
in net value—with $40,000 deemed to be set off to Roger as his “inherited”
property and the remaining $35,305 as joint marital property; (2) the second
home was to be sold, with the first $35,5052 to be paid to Lynn to offset the
property Roger retained, the next $10,000 to be paid to Lynn to offset money she
had paid on the home, and the rest to be divided evenly.
Roger challenges this distribution, arguing his inheritance was actually
$56,775. In the calculations Lynn provided to the court, she valued the gifts and
inheritances received by Roger at $40,061.97. At trial, Roger explained the
discrepancy in Lynn’s valuation by indicating she did not see $16,000 in deposits.
Lynn notes the district court also characterized Roger’s $20,000 coin collection
as purchased with inherited property, which raises the amount the court
attributed as inherited property to a total of $60,000. This was despite Roger’s
testimony at trial that the coins were purchased with marital funds.
In response, Roger notes Lynn withdrew $20,000 from the marital account
post-separation to offset Roger’s possession of the coin collection, but the district
court failed to consider this sum. Lynn counters she withdrew the sum and spent
it on the children, the house, utilities, clothing, food, medical expenses, and car
repairs during the course of this litigation. Lynn provided an accounting for these
expenditures to the district court. Lynn further notes she paid $15,500 in
2
We note what appears to be a typographical error resulting in a discrepancy between
the finding of $35,305 in marital property and the award of $35,505. Neither party
appealed or requested correction of those numbers, and we decline to do so sua sponte.
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mortgage payments and taxes on the second home, for which the district court
credited her only $10,000. Finally, Lynn notes the $20,000 withdrawal occurred
in May 2014, and the parties continued to jointly deplete the money remaining in
the account, using said sums toward household expenses.
Finally, Roger requests $5500 “to make up for the difference in the
disparate values of the personal property of Roger and Lynn.” Lynn counters she
is responsible for $7000 in credit card debt that was not credited by the court.
Ultimately, when accounting for the $56,775 Roger identified as inherited
property (for which the court credited $60,000 as inherited property between the
home and the coins), the $20,000 Lynn withdrew, the approximate $15,500 Lynn
spent on mortgage payments and property tax payments (for which the court
credited $10,000), the $5500 Roger contends Lynn received more in personal
property, and the $7000 Lynn claims she accumulated in credit card debt, the
monetary difference in the award between the parties is approximately $10,000.
Lynn accounted for this amount as money spent on the children and other
necessities.3 Upon our de novo review, we conclude the district court equitably4
distributed the parties’ property and affirm.
D. Child Support
In the partial stipulation, the parties agreed:
[Roger] shall pay to [Lynn] the sum of $1400.00 per month for the
support of the [three] minor children. Support shall be reduced to
$1150.00 per months for two children. Support shall be reduced to
$800.00 per month for one child. This support level is based upon
3
Roger also testified he spent approximately $15,000 of the parties’ marital funds on
furniture for his home. Lynn also noted Roger claimed all three children in his 2014
taxes, receiving $6700 in refunds.
4
An equitable award need not be equal. See Campbell, 623 N.W.2d at 586.
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[Roger’s] combined income from the [Iowa Department of
Transportation] and the [Iowa Air Force National Guard]. [Roger’s]
separation of service from the military shall not be grounds for a
modification.
Roger claims the district court should not have adopted this provision, as it
“illegally binds the amount of child support at its current amount.” Roger
contends he is entitled to seek modification of the child support in the event there
is a material change in circumstances and a departure from the military could
constitute such a basis.
Lynn counters the provision was included because, at the time the parties
entered into the partial stipulation, Roger had expressed his intention to leave the
military that same year. She argues the provision was included to expressly
provide that his purported imminent departure from the military had been
contemplated by the parties and thus could not constitute a change in
circumstances.
As an initial matter,5 we note Roger did not object to the inclusion of this
term at trial or following trial. See Iowa R. Civ. P. 1.904(2). Thus, there is no
record for this court to review regarding the meaning of this clause or the
purpose of its inclusion. We further note Roger has, in fact, not left his
employment with the military, and thus his objection is premised upon a future,
hypothetical development in circumstances.
A stipulation in a dissolution proceeding “is enforceable like any other
contract . . . prior to entry of judgment by the court.” In re Marriage of Jones, 653
N.W.2d 589, 593 (Iowa 2002). “Nonetheless, the parties’ stipulation is not
5
In her brief, Lynn argues this claim was not preserved for appeal.
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binding on the court, as the court has the responsibility to determine ‘whether the
provisions upon which the parties have agreed constitute an appropriate and
legally approved method of disposing of the contested issues.’” Id. (citation
omitted). Here, the district court considered and approved the partial stipulation
in its decree, and it is the decree that determines the rights of the parties. See id.
at 594. We agree with Lynn that the provision does not preclude Roger from
seeking a modification of his child support obligation in the event of a material
change in circumstances. Instead, the partial stipulation—as adopted by the
court—acknowledges the child support award contemplated Roger’s likely
departure from the military at the time child support was set. We find the
stipulation, as agreed to by the parties and adopted by the court, does not
adversely affect the best interests of the children, see id. (“Moreover, a
stipulation will not be incorporated in the decree unless the court ‘determines the
settlement will not adversely affect the best interests of the parties’ children.’”
(citation omitted)), and we affirm.
E. Attorney Fees
Lynn requests $3500 in appellate attorney fees. Appellate attorney fees
are not a matter of right, but rather rest in this court’s sole discretion.” Okland,
699 N.W.2d at 270. In determining whether to award attorney fees, we consider
“the needs of the party seeking the award, the ability of the other party to pay,
and the relative merits of the appeal.” Id. Having considered these factors, we
determine Roger shall pay $1500 of Lynn’s appellate attorney fees. Costs shall
be assessed to Roger.
AFFIRMED.