In Re the Marriage of David Meyers and Anna Meyers Upon the Petition of David Meyers, and Concerning Anna Meyers ( 2015 )

IN THE COURT OF APPEALS OF IOWA
No. 14-0897
Filed April 22, 2015
IN RE THE MARRIAGE OF DAVID MEYERS
AND ANNA MEYERS
Upon the Petition of
DAVID MEYERS,
Petitioner-Appellee,
And Concerning
ANNA MEYERS,
Respondent-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Pottawattamie County, Kathleen
Kilnoski, Judge.
Anna Meyers appeals the district court’s decree of dissolution and denial
of her motion for new trial. AFFIRMED AS MODIFIED AND REMANDED
Suellen Overton of Overton Law Office, Council Bluffs, for appellant.
Stephen C. Ebke of Ebke Law Office, Council Bluffs, for appellee.
Considered by Mullins, P.J., and Bower and McDonald, JJ.
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BOWER, J.
Anna Meyers appeals the property division, child support, and tax
exemption provisions of the decree dissolving her marriage to David Meyers.
Anna also asks for appellate attorney fees. We affirm as modified and remand
for calculation of the child support obligation.
I. BACKGROUND FACTS AND PROCEEDINGS
Anna and David were married in 1996. They have four children, three of
whom are minors and currently residing with the parties; their placement is not at
issue. In the year before their marriage, the couple lived together in a home
owned by Anna located in Council Bluffs (Bel-Air Drive home). Shortly after their
marriage the couple purchased another Council Bluffs home, which served as
their marital residence until their separation in 2013.
At the time of trial, David was fifty-one years old and in relatively good
health. David has an associate’s degree, and for the past fourteen years David
has worked as a support technician in the Children’s Hospital’s cardiac
catheterization lab. David’s 2013 W-2 shows an income of $70,297.79.
Anna is forty-seven years old and has suffered seizures, migraines, and
has high cholesterol. Anna has a doctorate in nursing practice, which she
received in 2010. She works as a professor of nursing practice for three online
colleges. She estimates her annual income to be approximately $24,000. Prior
to becoming a professor, she worked as a nurse practitioner in a clinical setting.
For 2012, she had an income of $67,270, and earned a like amount since 2009.
Anna testified she was terminated from her employment because she suffered a
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seizure at work. She hired an attorney and was offered her job back on a
probationary basis, but declined electing to move to Carson, Iowa, to care for her
father who suffers from Alzheimer’s.
David filed the petition for dissolution in June 2013, and trial was held in
January 2014. Prior to trial, the couple reached an agreement concerning their
children. However, they could not agree on issues concerning their respective
incomes and the distribution of property. Based on David’s W-2, the court found
his annual income to be $70,297.79. The court found “Anna’s voluntary change
in careers ha[d] resulted in a significant decline in her income. Her testimony
revealed that her health was not the reason for her decision to reduce her
income.” For the purposes of child support (based on her income from past
years), the court set Anna’s income at $67,270. The court set child support and
divided the other property, with each party receiving $78,981 in net assets. The
court declined Anna’s request for a setoff for premarital funds used in the marital
home (proceeds of the sale of the Bel-Air home and a personal injury
settlement).
In March 2014, Anna filed a motion for new trial. She claimed the property
settlement in the decree was not fair and reasonable, the child support provisions
were contrary to the law and the evidence submitted, and the court’s failure to
award her attorney fees was contrary to the evidence. After a hearing the court
denied Anna’s motion. Anna now appeals from the dissolution decree and the
denial of her motion for new trial.
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II. STANDARD OF REVIEW
In this equity action involving the dissolution of a marriage, we engage in
de novo review. In re Marriage of McDermott, 827 N.W.2d 671, 676 (Iowa 2013).
Our review involves examining the entire record and adjudicating anew the
issues presented. Id. We give weight to the district court’s factual findings,
though they are not binding on us. Id. We defer to the district court’s opinion
regarding the believability of the parties because of the trial judge’s superior
ability to gauge their demeanor. In re Marriage of Pundt, 547 N.W.2d 243, 245
(Iowa Ct. App. 1996).
III. ANALYSIS
A. Property Division
Anna claims the district court’s distribution of property was not equitable
as the court ignored her pre-marital personal injury assets, the court allocated to
her $47,321 of her liquidated retirement account and did not allocate similar
funds as a result of David’s withdrawal from his retirement account, and the court
awarded $2500 in frozen food to her.
Iowa courts strive to divide marital property equitably between divorcing
spouses based on the factors set out in Iowa Code section 598.21(5) (2013). But
an equitable division is not necessarily an equal division. In re Marriage of
Hansen, 733 N.W.2d 683, 702 (Iowa 2007). The factors relevant to this case
include the length of the marriage; the property brought into the marriage; the
contribution of each party to the marriage, giving appropriate economic value to
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each party’s contribution and homemaking; the earning capacity of each party;
and other economic circumstances of each party. See Iowa Code § 598.21(5).
1. Pre-Marital Personal Injury Proceeds
The property a party brings into the marriage is a factor to consider in
making an equitable division. Iowa Code § 598.21(5)(b). In some instances, this
factor may justify a full credit, but it is not required. In re Marriage of Miller, 552
N.W.2d 460, 465 (Iowa Ct. App. 1996). A premarital asset is not otherwise set
aside like gifted or inherited property. Id. Additionally, in considering
accumulations to premarital assets, we do not limit our focus to the parties’ direct
contributions to the increase. Id. Rather, we broadly consider the contributions
of each party to the overall marriage, as well as all other factors. Iowa Code
§ 598.21(5). Financial matters make up only a portion of a marriage, and must
not be emphasized over other contributions in determining an equitable
contribution. Miller, 552 N.W.2d at 465.
Prior to the marriage Anna was involved in a car accident and suffered
injuries. She sued the driver and received a $53,750 settlement. Anna used
these funds to purchase the Bel-Air Drive home. Anna testified the funds from
the sale of this house were used in the purchase of the marital home. Anna
claims the district court’s ruling fails to give her credit for these funds. The court
noted in the decree:
Anna claims she should have a portion of the current marital
home that was purchased in 1996 awarded to her as a premarital
asset. She produced no documentation to show the amounts, if
any, that were actually utilized for the purchase of the marital home
from the proceeds of the home she owned before they got married.
She did produce a 1099 form from that sale in David’s name and
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Social Security number. The marital home was placed in joint
tenancy in both David and Anna’s names when it was purchased.
....
Anna’s claim for a setoff for premarital investments in the
marital home is hereby denied. Specific reasons for said denial are
the lack of any credible information as to the amounts which might
be involved, if any, the significant passage of time, and the placing
of the marital home in joint tenancy when it was purchased.
In the court’s denial of Anna’s motion for new trial, it clarified:
The court FINDS that Anna sold her premarital home a few
months after the parties married in 1995. David had lived with her
in the premarital home for about a year before the marriage, and he
contributed toward the household expenses while living with Anna.
Anna testified that she was not sure how the proceeds from the
sale of that home were distributed, but that she “assumed” that
most of those proceeds were used to set up the parties’ marital
home. She could not recall the amount of the down payment on
the marital home, and she had no other evidence about the
purchase of the marital home. The 1099 form from the sale of the
premarital home showed that the home was in David’s name. The
marital home was owned jointly by the parties for nearly seventeen
years. Given the length of the parties’ marriage and the parties’
commingling of premarital assets into furnishing and purchasing the
marital home, the court finds that no inequity has been done to
Anna by failing to set aside any of the premarital assets in her
previous home.
Based on our de novo review of the record, we agree with the district
court’s ruling.
2. Retirement Accounts
Anna claims the court’s allocation of the proceeds from the parties’ various
retirement accounts was inequitable. Prior to the parties’ separation, Anna
withdrew a total of $47,321 from her accounts. Anna testified the funds were
used to repay loans from her father and family expenditures. Also prior to their
separation, the parties’ entered into a written agreement concerning the
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distribution of $30,000 in David’s retirement policy. The assets were used to pay
marital debts listed in the written agreement.
Addressing the retirement funds and the loan, the court reasoned:
Anna claims there were significant loans totaling $46,600.00
from her father to the parties over the course of their marriage.
David disputed her claims that her father loaned the parties
significant sums. Anna produced a document which she said was
signed by herself and her father dated June 1, 2013. However, the
Court also reviewed Exhibit 21, which provides a medical diagnosis
about two weeks prior to that date which would significantly
undermine the ability of Anna’s father to understand this
documentation. In addition, this was supposedly signed just three
days after Anna and David had entered into the agreement with
regard to his 403(b) account and where no mention was made of
any of these amounts. Anna admitted in testimony there were no
loan documents ever prepared for any of these amounts. The
weight of the credible evidence did not support Anna’s claims that
her father made loans to the parties during the marriage.
Shortly before and shortly after the separation of the parties,
Anna cashed in her retirement accounts which totaled $47,321.65
in payments to her. Of these amounts, she admits $28,000.00 was
paid to her father as “repayment” for the loans she claims, and an
additional $14,269.00 was utilized to make repairs to the new home
her father purchased in Carson, Iowa. There is no evidence these
expenses were for marital debts and both amounts should be
included in Anna’s net asset listing.
We defer to the district court’s credibility findings and affirm the district court’s
distribution of these funds.
3. $10,000 Loan on David’s Life Insurance Policy
Anna claims the $10,269.05 loan David borrowed from his life insurance
policy should have been included as his asset. We agree. At trial, David testified
he took out a $10,000 loan against his Prudential life insurance policy, and he
used those funds for living expenses and to repay his parents for a loan for his
attorney fees. This occurred before Anna moved out of the marital home. David
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was unsure whether he told Anna he took out the loan. When asked to elaborate
on what bills he used the loan for, David noted “[l]iving expenses. We were
accustomed to her bringing home money, and so we still had food and whatnot to
pay, gasoline; all those things.”
Upon our de novo review of the record we find the $10,269.05 loan should
have been added to David’s assets. David’s loan suffers from the same lack of
support as Anna’s withdrawal from her retirement funds, and it would be
inequitable to exclude the loan from David’s assets. See Iowa Code § 598.21(5);
Hansen, 733 N.W.2d at 702. We modify the district court’s property distribution
to include the $10,269.05 loan as David’s asset. As a result, David shall make
an equalization payment of $5135 to Anna within sixty days.
4. Food Expenses
Anna claims the inclusion of $2500 in “frozen food” as an asset to her was
inequitable. The food expenses were the result of a recent bill to a food coop
paid from a jointly held account. Since Anna received physical care of two of the
children she received two-thirds of the food, and David received the other one-
third of the food. We find the district court’s allocation of the “food” was
equitable. See Iowa Code § 598.21(5); Hansen, 733 N.W.2d at 702.
B. Child Support
Anna claims the district court incorrectly calculated child support by
imputing income to her, and by using David’s W-2 to calculate his income rather
than his year-end pay stub, showing a higher income. Anna contends the court
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should not have imputed income because she was fired from her prior employer
and is employed in a position which produces substantially less income.
1. Earning Capacity
In determining if it is appropriate to use a parent’s earning capacity rather
than a parent’s actual earnings to meet the child’s needs or do justice between
the parties, courts will consider whether the parent’s inability to earn a greater
income is self-inflicted or voluntary. In re Marriage of McKenzie, 709 N.W.2d
528, 533 (Iowa 2006). This “self-infliction rule” applies equitable principles to the
determination of child support to prevent parents from gaining an advantage by
reducing their earning capacity and ability to pay support through improper intent
or reckless conduct. In re Marriage of Foley, 501 N.W.2d 497, 500 (Iowa 1993).
In the decree, the district court reasoned:
Anna completed her doctorate in nursing practice in 2010.
Until 2012, she had worked as a nurse practitioner in clinical
settings. She recently began a new career teaching online nursing
courses for three on-line schools. In 2012, she had an income from
her previous employer of $67,270.00. In a little over two months of
2013, she had earned $14,982.00 from that same employer. In her
testimony, Anna indicates she was terminated from that
employment after having a seizure while at work. She hired an
attorney and was offered a job back with the company on a
probationary basis. She declined that position. She testified that
her seizure problem has been resolved by medication. However,
she believed that she had an obligation to move in with her father in
Carson, Iowa, to help care for him rather than have him reside in an
assisted living facility. This move puts her further away from the
Council Bluffs/Omaha metro area and the employment
opportunities there. Anna testified that she choose to take a
significant cut in pay in order to be home with her father and
school-age children.
Anna’s voluntary change in careers has resulted in a
significant decline in her income. Her testimony revealed that her
health was not the reason for her decision to reduce her income.
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We find the district court properly imputed income to Anna. The record
shows Anna was offered an opportunity to return to her position on a
probationary basis, but declined. Instead, Anna took a lower paying position with
more flexibility to allow her time to care for her father and children. Anna’s
change in employment was voluntary, and therefore imputing income to her was
proper. See In re Marriage of Nelson, 570 N.W.2d 103, 106 (Iowa 1997) (“When
a parent voluntarily reduces his or her income or decides not to work, it may be
appropriate for the court to consider earning capacity rather than actual earnings
when applying the child support guidelines.”).
2. David’s 2013 Income
Concerning the discrepancy in David’s paystub versus his W-2, the court
found:
David produced his W-2 for the year 2013 which shows a gross
salary of $70,297.79. Included on that W-2 is a notation as to an
additional amount of $12,119.90. In reviewing David’s last pay stub
for the year 2013, this is the amount of health insurance paid by his
company on his behalf. Anna wanted the Court to use the income
for David shown on his last pay stub, but it likely includes most, if
not all, of this amount paid by the company for insurance and is not
actual income to David.
Pursuant to the factors listed in section 598.21(5), we find the district
court’s calculation of David’s income based on his W-2 was equitable.
3. Future Child Support Issues
Anna claims the court failed to provide a step-down in the child support
obligation when only one child remains in her home. We agree and remand to
the district court for a determination of children support when only one child is
eligible for support.
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4. Tax Exemption
Anna claims the court failed to address the child tax deduction when only
one child remains eligible for the exemption. “The ‘general rule’ is that the parent
given primary physical care of the child is entitled to claim the child as a tax
exemption.” In re Marriage of Kerber, 433 N.W.2d 53, 54 (Iowa Ct. App. 1988)
(citation omitted)); see also Iowa Ct. R. 9.6(5) (“The custodial parent shall be
assigned one additional dependent exemption for each mutual child of the
parents, unless a parent provides information that the noncustodial parent has
been allocated the dependent exemption for such child.”). We find based upon
the existing law and the facts of this case, Anna shall be awarded the tax
exemption.
C. Appellate Attorney Fees
Finally, Anna requests appellate attorney fees. An award of attorney fees
is not a matter of right and rests within our discretion. In re Marriage of Okland,
699 N.W.2d 260, 270 (Iowa 2005). We determine whether an award is
appropriate considering the needs of the party seeking the award, the other
party’s ability to pay, and whether the appeal required a party to defend the
district court’s decision. In re Marriage of Berning, 745 N.W.2d 90, 94 (Iowa Ct.
App. 2007). With these considerations in mind, we award Anna appellate
attorney fees in the amount of $1000.
IV. CONCLUSION
To summarize, we affirm all aspects of the district court’s decree of
dissolution except David’s $10,269.05 loan must be listed as his asset with an
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equalization payment made to Anna, the child support obligation for when one
child remains in the home must be calculated, and Anna should be granted the
tax exemption when only the youngest child may be claimed. We grant Anna’s
request for appellate attorney fees in the amount of $1000 and assess the costs
equally to the parties.
AFFIRMED AS MODIFIED AND REMANDED.