Estate of Ronald J Sons v. Mary Beth Sons ( 2019 )

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
ESTATE OF RONALD J. SONS, by DAVID UNPUBLISHED
WILLIAM SONS, Personal Representative, November 14, 2019
Plaintiff-Appellant,
v No. 346979
Van Buren Circuit Court
MARY BETH SONS, LC No. 2017-067664-DO
Defendant-Appellee.
Before: MURRAY, C.J., and MARKEY and BECKERING, JJ.
PER CURIAM.
In this appeal from a judgment of divorce (JOD) that dissolved the marriage of Ronald J.
Sons and defendant, Mary Beth Sons, plaintiff, the Estate of Ronald J. Sons,1 challenges the trial
court’s division of marital property. Specifically, plaintiff argues that the trial court’s award to
defendant of homes in Michigan and Florida was inequitable. We affirm.
I. RELEVANT FACTS AND PROCEEDINGS
The couple married on June 22, 2012. At the time, both knew that Mr. Sons was
suffering from stage IV cancer. Defendant’s premarital assets from a prior divorce included a
Chevron Employee’s Savings and Investment plan valued at $650,000, a BP retirement
accumulation plan that paid $64 monthly, an insurance policy with a face value of $50,000, and
monthly maintenance payments of approximately $1,330 for three years. In addition, defendant
1
Less than a month after entry of the JOD, and shortly after filing his claim of appeal, plaintiff,
who had been suffering from stage IV cancer, died. Subsequently, this Court granted a motion to
substitute the Estate of Ronald J. Sons, by personal representative David William Sons, as
plaintiff-appellant. Ronald Sons v Mary Beth Sons, unpublished order of the Court of Appeals,
entered May 21, 2019 (Docket No. 346979). We use “Mr. Sons” to refer to the original plaintiff
in this case, and “plaintiff” to refer to the plaintiff-appellant estate.
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also had approximately $73,000 in the bank, an IRA of approximately $24,000, and $1,700 in
retirement income from the Catholic school where she had taught. Mr. Sons’s premarital assets
were $1,978 a month from social security, a monthly pension of $1,053.97 from the Chicago Tile
Institute, a monthly pension of $649 from the Bricklayers Union, $25,000 in a bank account, and
a fixer upper house on Water Street in Paw Paw, Michigan.
Mr. Sons filed a complaint for divorce on November 6, 2017. He testified at the
subsequent bench trial that he received income of $461,000 during the course of the marriage
and spent $397,000 on purely marital expenses.2 In support of this assertion, he offered into
evidence excel spreadsheets that he and his brother, David, created. Defendant’s attorney
objected to the admissibility of the spreadsheets on grounds that Mr. Sons had not disclosed all
of the spreadsheets during discovery, and had not provided the bank statements that were the
purported basis of the spreadsheets, instead disclosing only “screen shots” of partial
documentation covering only three years. The trial court ultimately ruled that the spreadsheets
were inadmissible, but said that it would rely on testimony based on the spreadsheets and on its
own notes.
Defendant admitted into evidence three years’ of bank statements from her real estate
business3 to show the amount of money transferred from her business into either Mr. Sons’s
personal account, from which defendant could not write checks, or into the couples’ joint
account. Defendant testified that the statements showed that from 2015 through 2017, she
transferred $34,750 into Mr. Sons’s personal account and a net of $215,990 into their joint
account. Defendant said that some of the transfers into Mr. Sons’s account were for things he
wanted to buy when he felt good, such as a boat, a dinghy, a jet ski, and a rowboat, all of which,
defendant learned through discovery, Mr. Sons had titled in his name alone. Defendant
explained that when they first married, “it was understood that what was his was his and what
was mine was mine.” However, as time went on, Mr. Sons increasingly devoted his income to
his medical treatment, while defendant took on more of the couples’ financial obligations, until,
by 2016, she was paying for everything except the car insurance and the boat insurance.
Defendant and Mr. Sons agreed that defendant withdrew $200,000 from her premarital
retirement account4 to purchase property from Mr. Sons’s nephew in 2012. The property
consisted of a small lakefront lot with a house and a lot across the street with a pole barn.
Defendant paid $170,000 for the lakefront property and $30,000 for the lot and pole barn.
2
According to calculations done at trial, Mr. Sons earned approximately $360,696 during the 66-
month marriage. When defendant’s counsel pointed out the difference to him, Mr. Sons stated
that he also had some minor side jobs and over $10,000 in donations for cancer care. In the end,
Mr. Sons could not explain where the $461,000 figure came from and stated that the $100,000
discrepancy was “not much difference.”
3
Defendant obtained her real estate license in 2013 and subsequently ran a successful real estate
business.
4
Presumably, the reference is to the Chevron Employee’s Savings and Investment plan
defendant obtained in her prior divorce.
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Defendant explained that she was not a realtor at the time, did not know anything about buying
houses, did not work with a realtor to purchase the property, and did not have it appraised before
purchasing it. She said that Mr. Sons’s nephew told her someone had made a $170,000 offer on
it, and that Mr. Sons told her it was a good deal and purchasing it would help his family. She
said she had been naïve and indicated that she felt pressured to buy the property. In addition to
the property’s purchase price, defendant also paid $60,000 in taxes and early retirement-plan
withdrawal fees.
Defendant initially titled the Michigan property in her name and put it in her living trust.
In January 2014, however, she quitclaimed the property from herself as grantor to herself and
Mr. Sons as husband and wife with rights of survivorship. Mr. Sons testified that defendant took
this step in exchange for his agreement to help with the bills. However, defendant said she did it
because Mr. Sons “was becoming increasingly agitated,” often telling her that if she died in a car
accident, her family would kick him out of the house and he would have nowhere to live, and
saying that if she loved him, she would put him on the title.5
Mr. Sons and defendant testified to the amount of work they put into the Michigan house,
and defendant testified to the amount of work yet to be done. Mr. Sons said that he put on new
roofing, put in two closets, made a basement walkout with a patio, regraded the yard and re-
planted grass. He could not remember who paid for the materials and labor to make these
improvements. Defendant testified that, at the time of trial, the well needed replacing because it
was not deep enough, was too close to the house, and was discharging rust particles. The
electrical wiring needed to be re-done, the ceiling fan was about to fall off the dining room
ceiling, all of the windows leaked, the roof leaked when the wind was from a certain direction,
and the back porch was not “legal” because it was built without a permit. In addition, the pole
barn’s roof leaked and the overhead door did not work.
An April 2018 appraisal of the property came in at $135,000. Mr. Sons disputed this
value through his witness, Daniel Leonard, a state-certified appraiser and associate broker for a
real estate company. Leonard testified, based on his drive-by inspection of the property and his
review of aerial images, sales records, a 2015 appraisal, and the 2018 appraisal, that he saw no
reason why the property should decline in value from $170,000 to $135,000. Leonard opined
that some of the older, purportedly comparable properties used to arrive at a value for the subject
property were stale. He admitted, however, that he did not enter the home or the pole barn, did
not know the interior condition of either, and did not do an appraisal. Dan Northrup, the
appraiser responsible for the April 2018 appraisal, explained the reasoning behind his choice of
5
The record evidence suggests that Mr. Sons may have sought title on the real estate because
title determined ownership under the parties’ prenuptial agreement. Defendant’s testimony that
Mr. Sons titled all the vehicles and watercraft purchased in his name only was undisputed. In
addition, defendant admitted into evidence a text message Mr. Sons sent her shortly after he filed
for divorce. In the message, he apparently indicated that there were only three pieces of property
in joint ownership, that he would have to give defendant a “wad of cash,” and that he would have
divorced her as soon as she signed over the lake house to him.
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comparables and each adjustment he made to the comparables and stood by his appraisal of
$135,000. The court admitted Northrup’s appraisal report without objection; it was the only
appraisal submitted to the trial court.
According to defendant, Mr. Sons was the driving force behind obtaining the couple’s
Florida house, a foreclosure in Englewood located near Mr. Sons’s brother. Unable to obtain a
mortgage on his own because of a 2010 foreclosure and bankruptcy, Mr. Sons asked defendant to
help, and she did. In order to purchase and renovate the Florida home, defendant took out a
$107,000 mortgage on the Michigan house and a $31,000 home equity line of credit. Defendant
testified that she transferred $7,700 from her business account to the joint account to pay the
earnest money. In addition, because the mortgage had not come through by the time they had to
close on the Florida house, defendant withdrew the remaining balance due from her retirement
account. She used the mortgage money to replace the amount she had withdrawn from her
retirement account, thereby avoiding penalties, to pay off credit cards and the Jeep driven by Mr.
Sons so that her credit-to-debt ratio would be acceptable to the financial institution, and to help
with remodeling the Michigan and the Florida houses. Defendant testified to her belief that she
funded a greater share of the improvements to the Florida house, based on what she transferred
to the joint account and Mr. Sons’s charges on the credit cards, which she paid, but she said it
was work that needed to be done and she “just wanted to make him happy.” Both agreed that
defendant was solely liable for repaying the mortgage and home equity loan. Mr. Sons did not
remember the exact timing of events related to the purchase, did not remember anything about
defendant having to pay off credit cards, and insinuated that defendant somehow benefitted from
the money in excess of the house’s purchase price. He and defendant stipulated to $129,000 as
the value of the Florida house.
Mr. Sons accused defendant of having affairs with two men and asserted that her
infidelities were the reason he filed for divorce, but presented no evidence to substantiate his
accusations. Defendant called two witnesses who were present at an event where Mr. Sons
insisted that he saw defendant and a certain man “making out like the Russians were dropping
bombs on us[,]” and both testified that Mr. Sons’s allegations were completely unfounded. In
addition, defendant testified that after she received the divorce papers, she discovered that Mr.
Sons had installed a surveillance camera in her home that allowed him to see and hear everything
she was doing. 6
After hearing the proofs and considering written closing arguments, the trial court entered
a decision on October 25, 2018. After acknowledging the prenuptial agreement with attached
schedules of premarital assets, the trial court found that the marriage had lasted approximately
five years and five months, that defendant contributed 60% or more of the income for joint
expenses during the marriage, while Mr. Sons contributed 40% or less, and that the facts did not
support Mr. Sons’s allegations of infidelity. The court also found that Mr. Sons would need a
residence, transportation, and continuing medical treatment until his death, and lacked the ability
6
Police came out, removed the camera, and checked her home for other bugs; she declined to
press charges.
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to earn money beyond his pensions and social security, while defendant did not have any special
needs and could continue to build her real estate business. Finally, the court stated that it would
base its division of the assets on what assets the parties brought into the marriage, the income
they provided to the marriage, their relationship during the marriage, and their needs at the time
of the divorce.
Based on these findings, and relevant to the issue on appeal, the trial court awarded the
Michigan house and its debt to defendant. Recounting the testimony regarding purchase of the
Florida house, and noting the $129,000 stipulated value of the house, the court concluded that
there was no true equity in the Florida house, as the mortgage and home equity loan taken out on
the Michigan property to purchase the Florida house approximated the value of the Florida
house. In light of defendant’s liability on the mortgage and loan, the trial court awarded the
Florida house to defendant, subject to Mr. Sons’s life estate. The court entered a corresponding
JOD on December 21, 2018.
II. DISCUSSION
Plaintiff first contends that the trial court committed clear error by accepting $135,000 as
the appraisal value of the Michigan property, without considering the property’s $200,000
purchase price. We disagree.
When reviewing dispositional rulings, we first review the trial court’s findings of fact,
Sparks v Sparks, 440 Mich 141, 151; 485 NW2d 893 (1992), and will not reverse them unless
they are clearly erroneous, Hodge v Parks, 303 Mich App 552, 555; 844 NW2d 189 (2014).
“Findings of fact are clearly erroneous when this Court is left with the definite and firm
conviction that a mistake has been made.” Id. (quotation marks and citation omitted). We afford
special deference “to a trial court’s factual findings that are based on witness credibility.” Id.Contrary to plaintiff’s representations, the record shows that the trial court did consider
the purchase price of the property and concluded that Northrup’s April 2018 appraisal was a fair
one “as there are many problems with the home according to the testimony.” In addition,
defendant’s undisputed trial testimony was that Northrup’s valuation was consistent with the
2015 appraisal of the property completed for purposes of obtaining a mortgage to pay for the
Florida house. Defendant testified that the initial 2015 appraisal was in the low 120s, and that
“[t]hat amount went by five times until we got the amount Ron [Mr. Sons] wanted.” This
statement certainly implies that Mr. Sons was well aware of the value of the property. Defendant
further testified that after she and Mr. Sons made some improvements, the appraisal still rose to
only $135,000 or $139,000.
Plaintiff implies that the trial court should have used $200,000 as the fair market value of
the property because that is what defendant paid for it. Fair market value is “ ‘[t]he price that a
seller is willing to accept and a buyer is willing to pay on the open market and in an arm’s-
length transaction; the point at which supply and demand intersect.’ ” Mackey v Dep’t of
Human Servs, 289 Mich App 688, 699; 808 NW2d 484 (2010), quoting Black’s Law Dictionary
(7th ed), p 1549 (emphasis added in Mackey). “An ‘arm’s-length’ transaction, in turn, is defined
as ‘relating to dealings between two parties who are not related . . . and who are presumed to
have roughly equal bargaining power; not involving a confidential relationship[.]’ ” Id., quoting
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Black’s Law Dictionary (7th ed), p 103. The hallmarks of an arm’s-length transaction are that “it
is voluntary, i.e., without compulsion or duress; it generally takes place in an open market; and
the parties act in their own self-interest.” See Mackey 289 Mich App at 699 (quotation marks
and citations omitted). In addition, this Court has “recognized that family members deal with
each other in financial matters differently than they do with strangers in arm’s-length
transactions.” Id. at 700 (quotation marks, ellipsis, brackets, and citation omitted).
Here, defendant testified that she felt pressured by Mr. Sons to purchase the house from
his nephew and that she did not work with a realtor or have the property appraised prior to
purchasing it. Further, the sale appears to have been a private affair, not something that occurred
on the open market. Thus, the circumstances surrounding defendant’s purchase of the property
do not support the assumption that the purchase price of $200,000 was the property’s fair market
value.
In sum, Northrup’s was the only appraisal submitted to the trial court and it was in line
with the property’s 2015 appraisal. Although Leonard questioned the appraisal, he did not
inspect the interior of the house or the pole barn, and appeared to assume, incorrectly, that
$170,000 was the fair market value of the house. In light of these facts, the trial court’s
acceptance of $135,000 as the value of the Michigan property does not leave us with “the
definite and firm conviction that a mistake has been made.” Hodge, 303 Mich App at 555.
Accordingly, the trial court’s finding of fact that the value of the Michigan property is $135,000
is not clearly erroneous.
Plaintiff also argues that the trial court’s distribution of assets was inequitable, and that,
at the very least, the trial court should have awarded him $98,500 as his share of the equity in the
two houses.7 Plaintiff contends that awarding him half the equity in the two properties would
represent a congruent division of the property, especially since the court did not award plaintiff
spousal support or attorney fees and awarded only a “nominal sum” for plaintiff’s contribution to
defendant’s business. In addition, plaintiff reiterates that Mr. Sons earned $461,000 during the
marriage, almost all of which he spent on marital expenses, and that the division of property left
him “with virtually nothing.” Plaintiff’s arguments are without merit. We “review[] whether a
trial court’s dispositional rulings are fair and equitable in light of the trial court’s findings of
fact,” and will reverse “only if definitely and firmly convinced that the disposition is
inequitable.” Hodge, 303 Mich App at 555.
The circumstances surrounding acquisition of the Michigan property and the Florida
property support a conclusion that the trial court’s award of both properties to defendant was
equitable under the circumstances. Not only did defendant overpay for the Michigan property to
begin with, but she also had to pay another $60,000 for taxes and early withdrawal fees when
obtaining the money for the purchase price from her retirement account. It is undisputed that
plaintiff did not contribute toward this liability. Defendant also took out a mortgage and home
equity line of credit on the Michigan property to use to purchase the Florida house. Defendant is
7
Plaintiff bases its calculation of equity on the $200,000 value for the Michigan property that the
trial court properly rejected.
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solely liable for this debt. Thus, in large part due to Mr. Sons’s persistence, defendant may end
up paying in excess of $400,000 ($200,000 purchase price, plus $60,000 for taxes and early
withdrawal fees from her retirement account, plus $138,000 for the mortgage and home equity
loan) on a property fairly valued at only $135,000 and still in need of considerable repair. In
addition, the trial court did not split the value of the vehicles and watercraft awarded to each
party, because it reasoned that Mr. Sons did not have the money to pay defendant her share, and
because defendant wanted Mr. Sons to live out his days as happily as he could.
In dividing property, the court may also consider factors such as the contributions of the
parties to the marital estate and the fault or past misconduct of the parties. See Sparks, 440 Mich
at 159-160. Here, the trial court found that defendant contributed 60% or more to the joint
account, while Mr. Sons contributed 40% or less, and implied that defendant also made
substantial emotional contributions to the marriage enterprise. Regarding the latter, the trial
court observed that Mr. Sons’s stated reason for filing for divorce, defendant’s alleged
infidelities, was not supported by fact, and that defendant would strongly consider reconciling
with Mr. Sons and living as husband and wife, while Mr. Sons showed no such interest. In
addition, the record shows that Mr. Sons blindsided defendant by filing a complaint for divorce8
and installed a camera to spy on her, and strongly suggests that he was exploiting defendant’s
love for him for his own financial gain.
Plaintiff contends that without an award of equity, the JOD leaves plaintiff with “virtually
nothing” because a life estate in the Florida property was “essentially meaningless,” given that
Mr. Sons was on his deathbed and died shortly after entry of the JOD. Certainly, it was obvious
during the trial that Mr. Sons was ill. However, the trial court found that, although Mr. Sons
appeared telephonically for the last day of trial because his treating physician advised him not to
travel from Florida to Michigan, there was no prognosis on record as to life expectancy. The
record shows that plaintiff had survived at least five years with stage IV cancer and pursued an
aggressive approach to treatment. Thus, at the time of the award of his life estate, the trial court
had no idea how long Mr. Sons would be able to enjoy it. Based on what the trial court knew, it
was possible that Mr. Sons could have survived for some years more, residing rent-free in the
Florida home for as long as he lived. That he did not long survive entry of the JOD does not
render his life estate “essentially meaningless” at the time of its award.
Plaintiff also contends that an award of equity is proper because the trial court did not
award him spousal support or attorney fees, and only a “nominal amount” for his contributions to
defendant’s business. However, Mr. Sons did not seek spousal support, the record shows that the
parties agreed to pay their own attorney fees, and Mr. Sons did not provide any evidence of the
8
Defendant testified that, immediately prior to being served with the complaint and summons for
divorce, she and Mr. Sons were on the phone, planning her trip to Florida and their Thanksgiving
together. After exchanging I love yous, defendant told Mr. Sons that there was someone in the
driveway. He indicated that she had better “go get it[,]” and they hung up. The person coming
up the driveway was the process server.
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contributions he made to defendant obtaining her real estate license and building a successful
career that would call into question the insufficiency of the trial court’s $15,000 award.
Finally, plaintiff argues that he is entitled to an award of equity because of his financial
contributions to the marital estate. However, Mr. Sons did not support with admissible evidence
his assertions about his earnings and financial contributions to the marriage, and to the extent
that the trial court based its assessment of Mr. Sons’s financial contributions to the marriage on
Mr. Sons’s credibility, this Court gives deference to such findings. Hodge, 303 Mich App at
555.
In sum, the circumstances surrounding the purchase of the Michigan and Florida houses,
the relative contributions of the parties to the marriage enterprise, Mr. Sons’s own false
allegations, and his arguably manipulative conduct support the trial court’s award of the real
estate to defendant.
Affirmed.
/s/ Christopher M. Murray
/s/ Jane E. Markey
/s/ Jane M. Beckering
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