In re the Marriage of Schmidt ( 2020 )

IN THE COURT OF APPEALS OF IOWA
No. 19-0495
Filed June 3, 2020
IN RE THE MARRIAGE OF JAMES C. SCHMIDT
AND BEVERLY J. SCHMIDT
Upon the Petition of
JAMES C. SCHMIDT,
Petitioner-Appellant,
And Concerning
BEVERLY J. SCHMIDT,
Respondent-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Palo Alto County, Nancy L.
Whittenburg, Judge.
James Schmidt appeals from the decree of separate maintenance entered
by the district court with regard to his marriage to Beverly Schmidt. AFFIRMED.
Willis J. Hamilton of Hamilton Law Firm, P.C., Storm Lake, for appellant.
Jennifer Bennett Finn of Pelzer Law Firm, LLC, Estherville, for appellee.
Considered by Vaitheswaran, P.J., and Doyle and May, JJ.
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VAITHESWARAN, Presiding Judge.
James and Beverly Schmidt married in 1953. Sixty-five years later, the
district court overruled James’ petition for dissolution of the marriage and granted
Beverly’s request for separate maintenance. After appointing James a guardian
ad litem based on his dementia and after considering the testimony of multiple
witnesses, the court equally divided a farm, giving each spouse a life estate in the
other’s interest, and ordered James to pay Beverly alimony of “$1000 per month
. . . until the death of either of them.” The court also ordered James to “make the
premium payment on the health insurance coverage for Beverly available through
[his] federal pension.”
On appeal, James contends the district court should have (1) dissolved the
marriage, (2) characterized certain “financial benefits . . . from his mother” as
separate inherited or gifted property; (3) awarded less alimony; and (4) not ordered
him to pay attorney and guardian ad litem fees.
I. Dissolution versus Separate Maintenance
A dissolution decree “may be entered when the court is satisfied from the
evidence presented that there has been a breakdown of the marriage relationship
to the extent that the legitimate objects of matrimony have been destroyed and
there remains no reasonable likelihood that the marriage can be preserved.” Iowa
Code § 598.17(1) (2016). In the alternative, a court may file a decree for separate
maintenance without dissolving the marriage. See id. §§ 598.21(1), 598.28; In re
Estate of Whalen, 827 N.W.2d 184, 185 n.1 (Iowa 2013) (citing 2 Marlin M. Volz,
Jr., Iowa Practice Series, Methods of Practice § 31:31, at 869 (2012)).
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James contends the court’s “financial rulings . . . would not have differed
from rulings made in a dissolution” and the court did not “explain” how a decree of
separate maintenance would place the parties in a better financial position in the
final years of their lives. To the contrary, the district court thoroughly explained the
benefits of a separate maintenance decree. The court found that Beverly had
“health insurance coverage through James’ pension and a dissolution of the
parties’ marriage would likely sever Beverly’s right to that coverage.” The court
also found that a separate maintenance decree would allow Beverly to receive
market-based income from the parties’ farm, which was cash-rented to family
members at discounted rates. The record fully supports the court’s findings.
We begin with James’ testimony. He agreed with his attorney that his
marriage relationship had broken down, but when asked whether he wanted to be
divorced, he responded, “Well, we’ve had some tough times in the past. So I don’t
know.” His equivocal testimony stood in marked contrast to the testimony of the
husband in In re Marriage of Morgan, 218 N.W.2d 552, 558 (Iowa 1974), cited by
James, who stated “he no longer loved his wife and did not want to be married to
her.”
We turn to the report of James’ guardian ad litem. She expressed “concern”
about his responses. She noted that he was “easily led into answers and positions
without truly understanding what [was] being asked.” She cited a pretrial interview
in which “he was adamant that Beverly had filed the divorce” action and “[h]e was
confused on the facts that led to the divorce, who his attorney was, and what his
assets were.” Nonetheless, he “repeated multiple times that even though he and
Beverly couldn’t live together anymore, he cared about her and wanted to make
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sure she was being taken care of.” Cf. id. (concluding the husband’s “conduct in
openly living with [a woman other than his wife] under the circumstances described
in this record, his complete disregard of his responsibility as a father and express
dissatisfaction with his marriage to petitioner and his decision that he no longer
wished to remain married to his wife and his desire to get away from her sense of
duty and responsibility” established “a breakdown of the marriage”). The guardian
ad litem stated James “had little to no input into the pretrial stipulation or trial
preparation” and the “financial information” was prepared and provided by his
relatives who stood to gain from a dissolution of the marriage. She characterized
the case as “as a probate contest under the cloak of a dissolution of marriage.”
Beverly articulately corroborated many of the guardian ad litem’s
observations. She testified James suddenly moved out of the family home—a
decision instigated by their son after she applied to become James’ conservator.1
Her intent in filing the conservatorship action, she said, was not to have James
placed in a nursing home, as their son told James, but to address James’ inability
to handle their “money situations,” including receipt of cash rent from their farm.
She explained James also worked as “a mail carrier for 28 years” and had “a very
good retirement,” and it “didn’t make sense to” her that they “didn’t have enough
money all the time.”
Beverly attributed James’ flagging financial competence to his progressive
Alzheimer’s disease and dementia, for which “there was very little that could be
done.” She testified to certain family members’ efforts to usurp control over their
1 The action was subsequently dismissed.
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assets and James’ failure to respond to those efforts. She described her dire
financial situation in the wake of these developments and her need for medical
insurance through James’ policy. With respect to the pending dissolution petition,
Beverly stated she “stopped to see [James] one time, and he thought” she was the
one who filed for divorce. She told him, “No. It was you.”
Beverly unequivocally stated she did “not want a divorce.” She explained
she had “been married to him for 63 years. And it’s unimaginable that anybody
would want a divorce after that time—amount of time.” See, e.g., id. at 560 (“It is
obvious that in making this determination [of a breakdown of the marriage] the
court must depend to a considerable extent upon the subjective state of mind of
the parties.”). The district court weighed her testimony against James’ brief and
controlled responses and credited Beverly’s version. This was the court’s
prerogative. See In re Marriage of Roberts, 545 N.W.2d 340, 343 (Iowa Ct. App.
1996). On our de novo review, we conclude the district court acted equitably in
declining to dissolve the marriage and in determining “both parties will be in a better
financial position to provide for their needs in the final years of their lives under
separate maintenance.”
II. Inheritance
Decades ago, James purchased a farm from his mother using funds she
lent him. James did not repay those funds, and, when she died, they were offset
against his inheritance. As noted, the district court equally divided the farm
between James and Beverly. See Iowa Code § 598.21(1) (“Upon every judgment
of annulment, dissolution, or separate maintenance, the court shall divide the
property of the parties and transfer the title of the property accordingly . . . .”).
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James argues the farm should have been treated as separate inherited
property. He acknowledges “the farm was not inherited from [his] mother,” but
contends “his ability to finance the purchase of the farm was enhanced by inherited
funds.” He further concedes “the appreciation in value of the farmland from its
acquisition in 1988 until the present day is a marital asset,” but claims “[a]n
equitable division of the farm” should be less than a 50/50 split.
The district court found the farm was not inherited property. The court
pointed to a stipulation denominating 100% of the farmland as “marital property.”
The court also noted that James’ mother transferred the farm to him by warranty
deed “nine years before her death” and the farm “was not probated in [her] estate
because she had no ownership interest in the farm at the time of her death.” The
court stated:
[James] has not provided any authority for his assertion that use of
his inheritance proceeds for repayment to decedent’s estate of the
debt he owed decedent resulting from decedent’s loan of money to
[him] to buy property during decedent’s lifetime, causes the property
purchased with the loan to be classified as inherited property and the
court has found no authority to support this argument.
....
. . . . [A]ccordingly, James does not hold title to any portion of
the farm by inheritance and the repayment to his mother’s estate of
debts he owed to her is just that, repayment of debts. His use of
funds he would have received as a distributee of his mother’s estate
to repay debts incurred for renting a farm or purchasing a farm during
his mother’s lifetime, do not operate to convert an inter vivos transfer
to an inheritance. The farm is solely a marital asset subject to
equitable division in a dissolution of marriage or order for separate
maintenance.
On our de novo review, we discern support for the district court’s findings and we
agree with the court’s analysis. Cf. In re Marriage of McDermott, 827 N.W.2d 671,
680 (Iowa 2013) (rejecting the argument that certain property transfers “were an
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advancement of [the husband’s] inheritance”). We conclude the farm was subject
to division. We also conclude the court acted equitably in equally dividing the
property based at the very least on the length of the marriage. See Iowa Code
§ 598.21(5).
III. Alimony
James concedes “[i]t is appropriate that there be an award of alimony,” but
contends “the amount [ordered by the court] is excessive.” He asks us to reduce
the sum to $500 per month.
“The question of whether to award alimony is a matter of discretion and not
a matter of right.” In re Marriage of Mann, ___ N.W.2d ___, ___, 2020 WL
2090114, at *4 (Iowa 2020). A court is to consider the factors set forth in Iowa
Code section 598.21A(1). Id.
The district court found:
This is a marriage of exceptionally long duration. Beverly is existing
on subsistence income. She receives highly discounted or
subsidized rent from her daughter and son-in-law. It is not known
whether James’ federal pension benefits are received under the
Federal Employees Retirement System (FERS), the Civil Service
Retirement System (CSRS) or a Thrift Savings Plan (TSP) and
subject to equitable division herein; however, although the Pretrial
Stipulation Form was silent as to the disposition of this asset, as was
the evidence at trial, James is receiving the full benefit of his pension
income. His income, as a result of this, is substantial[ly] higher than
Beverly’s income. Without an alimony provision, Beverly’s sole
source of income is her monthly social security in the amount of
$527.00.
The court determined “the length of the marriage and disparity in incomes”
supported an award of “traditional or permanent monthly alimony in the amount of
$1000, payable until her death or the death of James, whichever first occurs.” We
discern no abuse of discretion the court’s ruling.
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IV. Fees
The district court ordered James to pay $2000 of Beverly’s trial attorney
fees and taxed him with $4420 for the guardian ad litem. James challenges the
awards.
In granting attorney fees, the district court stated:
Beverly has not had control of the parties’ marital assets or access
to them during these proceedings. Instead, either James or his
Attorney-in-Fact under a Power of Attorney has controlled the
parties’ marital assets and often to the advantage of other family
members and not the parties to this dissolution. Because Beverly
does not and has not had access to marital funds for payment of her
fees, she is awarded $2000 in attorney fees payable by James.
We discern no abuse of discretion in the court’s ruling. See In re Marriage of
Maher, 596 N.W.2d 561, 568 (Iowa 1999).
We turn to the guardian ad litem fees. Although the court divided court costs
equally, the court taxed the guardian ad litem fees “as court costs . . . solely against
. . . James.” James appears to challenge the assessment.
“The general rule is that the court costs are only taxable to the extent
provided by statute.” City of Des Moines v. State ex rel. Clerk of Court, 449 N.W.2d
363, 364 (Iowa 1989). James sought appointment of the guardian ad litem under
the authority of Iowa Court Rule 1.211. Cf. Iowa Code § 598.12(1) (authorizing
appointment of a guardian ad litem for a minor child); In re Marriage of Loftin, No.
11-0508, 2011 WL 5394445, at *5 (Iowa Ct. App. Nov. 9, 2011) (requiring
apportionment of minor guardian ad litem fees “in the same manner as other
costs”). That rule prohibits a judgment against a person “whose physician certifies
to the court that the party appears to be mentally incapable of conducting a
defense.” See In re Estate of Leonard, ex rel Palmer v. Swift, 656 N.W.2d 132,
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139 (Iowa 2003). The rule says nothing about who should pay the guardian ad
litem fees. But Iowa Code section 625.14 authorizes the clerk to “tax in favor of
the party recovering costs” certain specified items and “any further sum for any
other matter which the court may have awarded as costs in the progress of the
action, or may allow.” The supreme court has construed the provision to permit
the taxation of guardian ad litem fees as court costs. See Grant v. Laurie, 533
N.W.2d 563, 564 (Iowa 1995) (referencing section 624.14 and stating, “When, as
is usual in Iowa, a guardian ad litem is an attorney, and necessary services include
those as an attorney, the fees to be allowed should include those for professional
legal services”); Lalla v. Gilroy, 369 N.W.2d 431, 434 n.3 (Iowa 1985) (citing
section 625.14 and stating, “This court has in the past approved taxation of [a
guardian ad litem] fee [in private civil litigation] as court costs”); cf. State Pub. Def.
v. Iowa Dist. Ct., 644 N.W.2d 354, 357 (Iowa 2002) (allowing payment of guardian
ad litem fees under section 815.10(1), which authorizes payment of fees for an
indigent person in criminal and juvenile proceedings); Garcia v. Wibholm, 461
N.W.2d 166, 170 (Iowa 1990) (disallowing payment of guardian ad litem fees from
public funds). Based on this authority, we conclude the district court appropriately
taxed the guardian ad litem fees to James as court costs.
V. Appellate Attorney Fees
Beverly asks “James to contribute to her [appellate] attorney fees.” She did
not file an attorney fee affidavit. Accordingly, we decline her request. See In re
Marriage of Berning, 745 N.W.2d 90, 94 (Iowa Ct. App. 2007).
AFFIRMED.