Andera Zora v. Dhafir Jarbo ( 2024 )

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
ANDERA ZORA, UNPUBLISHED
July 2, 2024
Plaintiff-Appellee,
v No. 364533
Genesee Circuit Court
DHAFIR JARBO, LC No. 2019-328957-DM
Defendant-Appellant.
Before: GADOLA, C.J., and BORRELLO and PATEL, JJ.
PER CURIAM.
Defendant appeals as of right the trial court’s judgment of divorce that divided the parties’
marital property and awarded the parties joint legal custody of their minor child, but awarded sole
physical custody of the child to plaintiff. The court also ordered defendant to pay plaintiff spousal
support for two years, to pay child support of $846 a month, and to pay an unspecified amount of
plaintiff’s attorney fees. We affirm in part, vacate in part, and remand for further proceedings.
I. FACTUAL AND PROCEDURAL HISTORY
The parties were married in December 2014 and have one child, who was born in 2017.
Plaintiff filed this action for divorce in July 2019. The proceedings became contentious, resulting
in many disputes and motions, and culminating in a 10-day trial that ended in January 2022.
The parties initially lived in an apartment after they were married. Plaintiff paid the rent
because defendant did not qualify to be on the lease, which was solely in plaintiff’s name. In 2017,
defendant bought a home on Misty Morning Drive in Flushing, where the family lived together
until the breakdown of the marriage. In March 2019, defendant signed a quitclaim deed conveying
the Misty Morning property to himself and his brother Nawar, as tenants in common. Defendant
claimed that Nawar contributed toward the mortgage payments.
Throughout the marriage, defendant’s family figured prominently in the couple’s lives. A
focal point of the proceedings was plaintiff’s resistance to the amount of time that defendant and
the child spent with defendant’s close-knit family. The family often gathered at defendant’s
brothers’ home on Redding Street in Troy (the “Redding home”), which was formerly the
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residence of defendant’s parents. Many of defendant’s family members gathered at the Redding
home on Sundays for meals, to watch football, and to spend time together. After the couple
separated, defendant and the child would spend about two nights a week at the Redding home
during defendant’s parenting time.
Defendant was involved in businesses with his brothers. Defendant had a 25% interest in
a liquor store, Marvin’s Liquor, that was jointly owned with his brother Steven who owned 75%.
Defendant also owned the building, called the “Chamberlain building,” that housed the liquor
store. In March 2019, defendant established Landon J. Properties, LLC, and transferred ownership
of the Chamberlain building to that company. Defendant then allegedly transferred 90%
ownership in Landon J. Properties to another brother, Mouaid, and kept 10% for himself. Although
the Chamberlain building has four business units, Marvin’s Liquor was the only tenant actively
paying rent at the time of trial. Marvin’s Liquor previously paid defendant $2,500 a month in rent,
but defendant later reduced the amount to $1,500 a month.
Throughout the marriage, plaintiff was the sole owner of the Penthouse Club in Detroit,
which was owned and managed without any input or financial backing from defendant. However,
the business closed in September 2019.
The trial was conducted in two phases. The first phase, held in September and October
2020, focused on custody and parenting time. The second phase, held over eight days in January
2022, focused on the division of property, child support, and spousal support. The trial court
addressed all issues in a written opinion issued in November 2022, and entered its judgment of
divorce in December 2022.
The trial court awarded the parties joint legal custody of their child, but awarded sole
physical custody to plaintiff. The court awarded defendant parenting time on alternating weekends
from 10:00 a.m. on Saturday until 7:00 p.m. on Sunday, and one evening a week from after school
until 7:00 p.m. The court prohibited defendant from exercising any overnight parenting time at
the Redding home, which the court stated “more closely approximates a family rooming house
than a suitable residence for a young child.” The trial court ordered defendant to pay $846 a month
in child support. Additionally, the court ordered defendant to pay plaintiff spousal support of
$1,500 a month for 12 months, and then $1,200 a month for an additional 12 months.
Furthermore, the trial court found that a condominium that plaintiff purchased after the
parties separated qualified as marital property, but awarded it to plaintiff. The trial court found
that the Penthouse Club was plaintiff’s separate property and that defendant should not share in
any of its income or its indebtedness. The trial court determined that Marvin’s Liquor and Landon
J. Properties had a combined value of $809,500 and it awarded plaintiff 48% of that value for her
share of the businesses. The trial court also ordered that plaintiff could elect to force a sale of the
businesses, in which event she would be entitled to the first $388,560 of any sale proceeds. Finally,
the trial court held that defendant was required to pay “some or all” of plaintiff’s reasonable
attorney fees, in an amount to be determined at a later date.
Defendant appeals the judgment of divorce. Defendant asserts the trial court erred in
failing to consider the child’s established custodial environment before making its custody
determination. Further, defendant contends the trial court’s findings as to defendant’s income
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were against the great weight of the evidence, and thus abused its discretion in awarding child
support and spousal support. Lastly, defendant argues the trial court’s division of property and
award of attorney fees were abuses of discretion.
II. ESTABLISHED CUSTODIAL ENVIRONMENT
Defendant first argues that the trial court erred by deciding the issue of custody without
first determining the child’s established custodial environment. We agree.
This Court employs three different standards of review when analyzing child-custody
cases. Foskett v Foskett, 247 Mich App 1, 4; 634 NW2d 363 (2001). This Court reviews a trial
court’s choice, interpretation, and application of the existing law for clear legal error. Id. at 4-5.
This Court reviews a trial court’s findings of fact under the great weight of the evidence standard,
where a trial court’s factual findings will be upheld unless “the evidence clearly preponderates in
the opposite direction.” Id. (citation omitted). Discretionary rulings, including the trial court’s
ultimate determination of custody, are reviewed for an abuse of discretion. Id.. Whether an
established custodial environment exists is a question of fact. Mogel v Scriver, 241 Mich App 192,
197; 614 NW2d 696 (2000). Thus, a trial court’s findings regarding the existence of an established
custodial environment must be affirmed unless the evidence clearly preponderates in the opposite
direction. Phillips v Jordan, 241 Mich App 17, 20; 614 NW2d 183 (2000).
“[A] trial court is required to determine whether there is an established custodial
environment with one or both parents before making any custody determination. Kessler v
Kessler, 295 Mich App 54, 61; 811 NW2d 39 (2011) (emphasis in original). The determination
of an established custodial environment is crucial because it determines the applicable burden of
proof. Id. at 61. MCL 722.27(1)(c) provides, in pertinent part:
. . . The court shall not modify or amend its previous judgments or orders
or issue a new order so as to change the established custodial environment of a child
unless there is presented clear and convincing evidence that it is in the best interest
of the child. The custodial environment of a child is established if over an
appreciable time the child naturally looks to the custodian in that environment for
guidance, discipline, the necessities of life, and parental comfort. The age of the
child, the physical environment, and the inclination of the custodian and the child
as to permanency of the relationship shall also be considered.
Because the trial court’s award of custody in this case was a new order and not a
modification or amendment of a prior order, it was only subject to the limitation in MCL
722.27(1)(c) that the court “shall not . . .issue a new order so as to change the established custodial
environment of a child unless there is presented clear and convincing evidence that it is in the best
interest of the child.” A trial court’s failure to determine “whether there was an established
custodial environment is clear legal error,” and this error “is not harmless because the trial court’s
determination regarding whether an established custodial environment exists determines the
proper burden of proof in regard to the best interests of the children.” Kessler, 295 Mich App at
62.
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Although the trial court acknowledged in its opinion that it “must determine whether the
child has an established custodial environment with either or both parents as this determination
charts the burden of proof for the party seeking the change,” it neglected to specifically decide
whether an established custodial environment existed with either or both parents. Rather, the trial
court determined that it was unnecessary to make a determination regarding an established
custodial environment because “under either metric of evidentiary proof (clearly convincing or the
preponderance of evidence), Defendant’s request for split custody falls short.”
The flaw in the trial court’s analysis is that it did not view the custody dispute as one
involving an original custody determination. Both parties had requested physical custody of the
child and the trial court had not made a prior custody determination, yet the court analyzed the
custody dispute solely from the perspective of placing a burden of proof on defendant to show that
a “change” of custody was appropriate, without first determining whether the child had an
established custodial environment that would be subject to change. The court concluded that
“[s]uch a change is simply not warranted.”
The trial court needed first to determine if the child had an established custodial
environment with one or both parents in order to determine whether an award of joint physical
custody to defendant would alter the child’s established custodial environment. The trial court’s
framework may have been appropriate if the court had first determined that an established custodial
environment existed solely with plaintiff, in which case the court could not alter that established
custodial environment unless clear and convincing evidence showed that such a change was in the
child’s best interests. Conversely, if an established custodial environment existed with both
parties, then the court would have been required to maintain that established custodial environment
unless clear and convincing evidence demonstrated a change was in the child’s best interests. In
either case, it was necessary first to determine whether the child had an established custodial
environment with one or both parties.
Furthermore, as discussed later, the trial court also failed to make any findings regarding
the statutory best-interest factors in MCL 722.23. Because the trial court’s failure to expressly
decide whether an established custodial environment existed with one or both parents affects the
framework for properly resolving this custody dispute, the error was not harmless. Indeed, plaintiff
concedes that the trial court erred by failing to determine whether an established custodial
environment existed with one or both parties and that remand for such a determination is necessary.
Accordingly, we vacate the trial court’s custody decision and remand for a determination whether
an established custodial environment exists with one or both parents, and further proceedings
consistent with that determination.
III. BEST INTEREST OF THE CHILD AND PARENTING TIME FACTORS
Defendant also argues that the trial court erred by failing to make necessary findings
regarding the statutory best-interest factors in MCL 722.23 and the parenting-time factors in MCL
722.27a. We agree.
In child-custody disputes, the best interests of the child control. MCL 722.25(1). To
determine the best interests of the child, the trial court must consider all the factors provided in
MCL 722.23. Foskett, 247 Mich App at 9. The factors are:
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(a) The love, affection, and other emotional ties existing between the parties
involved and the child.
(b) The capacity and disposition of the parties involved to give the child
love, affection, and guidance and to continue the education and raising of the child
in his or her religion or creed, if any.
(c) The capacity and disposition of the parties involved to provide the child
with food, clothing, medical care or other remedial care recognized and permitted
under the laws of this state in place of medical care, and other material needs.
(d) The length of time the child has lived in a stable, satisfactory
environment, and the desirability of maintaining continuity.
(e) The permanence, as a family unit, of the existing or proposed custodial
home or homes.
(f) The moral fitness of the parties involved.
(g) The mental and physical health of the parties involved.
(h) The home, school, and community record of the child.
(i) The reasonable preference of the child, if the court considers the child to
be of sufficient age to express a preference.
(j) The willingness and ability of each of the parties to facilitate and
encourage a close and continuing parent-child relationship between the child and
the other parent or the child and the parents. A court may not consider negatively
for the purposes of this factor any reasonable action taken by a parent to protect a
child or that parent from sexual assault or domestic violence by the child's other
parent.
(k) Domestic violence, regardless of whether the violence was directed
against or witnessed by the child.
(l) Any other factor considered by the court to be relevant to a particular
child custody dispute. [MCL 722.23].
In actions tried without a jury, a trial court is required to make findings of fact and
separately state its conclusions of law. MCR 2.517(A)(1). “Brief, definite, and pertinent findings
and conclusions on the contested matters are sufficient, without over elaboration of detail or
particularization of facts.” MCR 2.517(A)(2); Foskett, 247 Mich App at 12-13. In child custody
disputes, a trial court must consider and explicitly state its findings of fact and conclusions
regarding each best-interest factor. Rittershaus v Rittershaus, 273 Mich App 462, 475; 730 NW2d
262 (2007). The court is not required to comment on every matter in evidence or declare
acceptance or rejection of every proposition argued, but the record must be sufficient for this Court
to determine whether the evidence clearly preponderates against the trial court’s findings. Id.-5-
In this case, after noting that the parties’ submitted proposed findings of fact and
conclusions of law on all trial issues, the trial court analyzed the best-interest factors as follows:
A comparison of the proposed findings of fact and conclusions of law
submitted by the parties reveals Defendant’s position is woefully unpersuasive.
After days and days of trial, Plaintiff submitted detailed factor by factor analysis
under each of the best interest factors, MCL 722.23(a)-(l). Defendant submitted
generalized statements about Plaintiff viewing dad as a loving, supportive husband
and father. This custody battle was no contest and Defendant’s position is marked
by a paucity of real support. The Court has reviewed the detailed articulation of
the evidence in support of Plaintiff’s claim that [the child’s] best interest would be
served by remaining with her under her custody. She is awarded physical custody
and the child’s residence is established as her home.
Thus, the trial court commented on the adequacy of the parties’ proposed findings of fact, but it
did not explicitly state its own findings of fact or conclusions of law regarding any of the best-
interest factors. Indeed, the court did not indicate which factors it believed favored each party,
neither party, or were irrelevant. Without knowing how the trial court considered and resolved
each best-interest factor, there is no record for this Court to determine whether the evidence clearly
preponderates against the trial court’s findings. See Ritterhaus, 273 Mich App at 475. Therefore,
we remand for explicit findings of fact and conclusions of law regarding each best-interest factor
and for the court to reconsider its custody decision in light of its findings.
Defendant also argues that the trial court failed to make appropriate findings in support of
its decision regarding parenting time. “The child’s best interests govern a court’s decision
regarding parenting time.” Shade v Wright, 291 Mich App 17, 31; 805 NW2d 1 (2010), citing
MCL 722.27a(1). “Both the statutory best interest factors in the Child Custody Act, MCL 722.23,
and the factors listed in the parenting time statute, MCL 722.27a(6),[1] are relevant to parenting
1
The parenting-time factors are now set forth in MCL 722.27a(7), which provides that a court may
consider the following factors when determining the frequency, duration, and type of parenting
time to be granted:
(a) The existence of any special circumstances or needs of the child.
(b) Whether the child is a nursing child less than 6 months of age, or less
than 1 year of age if the child receives substantial nutrition through nursing.
(c) The reasonable likelihood of abuse or neglect of the child during
parenting time.
(d) The reasonable likelihood of abuse of a parent resulting from the
exercise of parenting time.
(e) The inconvenience to, and burdensome impact or effect on, the child of
traveling for purposes of parenting time.
(f) Whether a parent can reasonably be expected to exercise parenting time
in accordance with the court order.
(g) Whether a parent has frequently failed to exercise reasonable parenting
time.
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time decisions.” Id. Although “[c]ustody decisions require findings under all of the best interest
factors, . . . parenting time decisions may be made with findings on only the contested issues.” Id.
at 31-32 (citation omitted).
In this case, the trial court correctly stated that the frequency, duration, and type of
parenting time was within the court’s discretion, but it did not recite or analyze any of the
parenting-time factors listed in MCL 722.27a(7). Moreover, as already noted, the court did not
make any findings regarding the best-interest factors in MCL 722.23, which may also be relevant
to parenting time decisions. Shade, 291 Mich App at 31. Therefore, remand is also necessary for
the trial court to reconsider the issue of parenting time and to make appropriate findings of fact on
contested issues consistent with the child’s best interests and MCL 722.27a.
IV. CHILD SUPPORT
Defendant argues that the trial court erred by failing to make factual findings regarding its
determination of defendant’s income for purposes of calculating child support. We agree.
In Borowsky v Borowsky, 273 Mich App 666, 672; 733 NW2d 71 (2007), this Court
explained:
Whether the trial court properly applied the Michigan Child Support
Formula (MCSF) to the facts of the case is a question of law that this Court reviews
de novo. Burba v Burba (After Remand), 461 Mich 637, 647; 610 NW2d 873(2000). This Court also reviews de novo the proper interpretation of the MCSF and
the applicable statutes. Atchison v Atchison, 256 Mich App 531, 534-535; 664
NW2d 249 (2003). This issue also involves review of matters committed by the
MCSF to the discretion of the trial court. Where the MCSF commits a matter to
the discretion of the trial court, this Court will review the trial court’s exercise of
discretion for abuse. Burba, supra at 649 (holding that the trial court abused its
discretion by deviating from the formula for a legally improper reason). An abuse
of discretion occurs when a court selects an outcome that is not within the range of
reasonable and principled outcomes. Maldonado v Ford Motor Co, 476 Mich 372,
388; 719 NW2d 809 (2006). Finally, to the extent that the trial court made factual
findings in determining the amount of support under the child support formula,
those findings are reviewed for clear error. Beason v Beason, 435 Mich 791, 805;
460 NW2d 207 (1990).
Throughout the trial, the parties disputed defendant’s income from Marvin’s Liquor and
Landon J. Properties. Defendant presented evidence of his tax returns, including his W-2 wages.
(h) The threatened or actual detention of the child with the intent to retain
or conceal the child from the other parent or from a third person who has legal
custody. A custodial parent's temporary residence with the child in a domestic
violence shelter shall not be construed as evidence of the custodial parent's intent
to retain or conceal the child from the other parent.
(i) Any other relevant factors.
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Plaintiff introduced evidence of large cash deposits that defendant made to his bank account and
large payments made on his mortgage. There was also evidence that defendant transferred 90%
of his ownership in Landon J. Properties to his brother, reduced the rent that Marvin’s Liquor paid
to Landon J. Properties, and reduced his salary from Marvin’s Liquor. In its opinion, the trial court
addressed defendant’s income for purposes of calculating child support as follows:
Testimony and exhibits reveal that Defendant’s stated income levels are marked by
incredulity, shenanigans, subterfuge, and a clear effort to manipulate for divorce
purposes. (Defendant apparently likes to give away assets for nothing in return.)
He spends more than he reportedly makes. She makes nothing even though she
could. Child support will be calculated on his income of $6,500 per month and hers
at $3,500 per month, effective the entry date of this order.
“The Michigan Legislature has required that when a court orders child support as part of a
divorce judgment ‘the court shall order child support in an amount determined by application of
the child support formula developed by the state friend of the court bureau’ unless to do so would
be ‘unjust or inappropriate’ and the trial court makes certain specified findings ‘in writing or on
the record . . . .’ ” Stallworth v Stallworth, 275 Mich App 282, 283-284; 738 NW2d 264 (2007),
quoting MCL 552.605(2); Peterson v Peterson, 272 Mich App 511, 516-517; 727 NW2d 393(2006). Pursuant to the 2021 MCSF Manual, “courts must order child support in the amount
determined by applying this formula.” 2021 MCSF 1.10(B). If the trial court deviates from the
formula, it must make a record regarding the statutory criteria for doing so. Stallworth, 275 Mich
App at 284 (citation omitted).
“The first step in figuring each parent’s support obligation is to determine both parents’
individual incomes.” 2021 MCSF 2. This is generally determined by ascertaining “the actual
resources of each parent.” MCL 552.519(3)(a)(vi). The MCSF provides guidance for determining
income for self-employed individuals and small business owners. 21 MCSF 2.01(E). In addition,
trial courts are allowed to impute income to a parent on the basis of the parent’s unexercised ability
to pay when the parent has an actual ability and likelihood of earning the imputed income.
Stallworth, 275 Mich App at 284 (citation omitted).
Defendant complains that the trial court clearly erred by finding that he had a yearly income
of $78,000 for purposes of determining child support without making appropriate findings of fact
to explain how it arrived at this figure. Although defendant relies only on his W-2 wages for the
last five years to support his argument that the trial court erred by finding that he had an annual
income of $78,000, the MCSF does not restrict income to wages, but also includes earnings from
other sources. 2021 MCSF 2.01(C). There was evidence that defendant’s highest W-2 wage level
from the previous five years was $32,000 in 2018. But defendant also received rental income
ranging from $24,000 in 2016 to $43,8000 in 2018. And defendant received a K-1 distribution of
$17,076 from Jarbo Brothers in 2020 and a K-1 distribution of $1,324 from Landon J. Properties
in 2019.
Defendant’s adjusted gross income on his tax returns was $52,280 in 2016, $49,453 in
2017, $59,027 in 2018, 43,443 in 2019, and $39,159 in 2020. As plaintiff points out, however,
there was also evidence of large cash deposits to defendant’s bank accounts, which defendant
failed to explain fully. Additionally, there was evidence that between April 2018 and March 2019,
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approximately $51,000 in mortgage payments were made against the mortgage on defendant’s
Misty Morning property, although defendant claimed that his brother Nawar also contributed
toward those payments. Defendant also testified that in March 2019, he reduced his work hours,
ostensibly to spend more time with the child, which the trial court could have found supported a
decision to impute additional income to defendant.
The trial court erred in failing to explain how it arrived at a monthly income of $6,500 for
defendant. Although there was evidence from which the trial court could have found that
defendant’s actual monthly income was greater than what he reported, or that additional income
could be imputed to defendant because of an unexercised ability to earn a greater income, the trial
court failed to specify how it resolved the disputed issues related to defendant’s income. We are
also unable to discern from the trial court’s statements that defendant’s “stated income levels are
marked by incredulity, shenanigans, subterfuge, and a clear effort to manipulate” whether the court
followed the guidance in the MCSF for determining defendant’s actual income, or whether the
court imputed additional income to defendant because it found that he voluntarily reduced or
eliminated his income. The trial court failed to make any factual findings on the disputed issue
whether defendant voluntarily reduced his income. Stallworth, 275 Mich App at 287. If the court
imputed income to defendant, it was required to analyze the factors in 2021 MCSF 2.01(G).
Therefore, it is also necessary to vacate the trial court’s award of child support and remand for
reconsideration of the issue of child support consistent with the MCSF and for specific factual
findings regarding defendant’s actual income or any decision to impute income to defendant.
V. SPOUSAL SUPPORT
Defendant also argues that several of the trial court’s factual findings supporting its award
of spousal support are clearly erroneous, and therefore, the court erred by awarding plaintiff
spousal support of $1,500 a month for one year and $1,200 a month for a second year. We agree
that some of the trial court’s findings are clearly erroneous.
This Court reviews a trial court’s award of spousal support for an abuse of discretion.
Loutts v Loutts, 298 Mich App 21, 25; 826 NW2d 152 (2012). This Court also reviews a trial
court’s decision whether to impute income to a party for an abuse of discretion. Id. at 25-26. “An
abuse of discretion occurs when the trial court’s decision falls outside the range of reasonable and
principled outcomes.” Id. at 26 (citation omitted). Any factual findings by the trial court are
reviewed for clear error. Id. A finding is clearly erroneous if, after reviewing the entire record,
this Court is left with the definite and firm conviction that a mistake was made. Id. “If the trial
court’s findings are not clearly erroneous, we must determine whether the dispositional ruling was
fair and equitable under the circumstances of the case.” Id. (citation omitted).
In awarding spousal support, the goal is to balance the incomes and needs of the parties so
that neither will be impoverished. Berger v Berger, 277 Mich App 700, 726; 747 NW2d 336(2008). The amount of spousal support is to be based on what is just and reasonable under the
circumstances of the case. Id. When considering whether to award spousal support, the trial court
should consider the following factors:
(1) the past relations and conduct of the parties, (2) the length of the marriage, (3)
the abilities of the parties to work, (4) the source and amount of property awarded
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to the parties, (5) the parties' ages, (6) the abilities of the parties to pay alimony, (7)
the present situation of the parties, (8) the needs of the parties, (9) the parties' health,
(10) the prior standard of living of the parties and whether either is responsible for
the support of others, (11) contributions of the parties to the joint estate, (12) a
party's fault in causing the divorce, (13) the effect of cohabitation on a party's
financial status, and (14) general principles of equity. [Loutts, 298 Mich App at 31(quotation marks and citations omitted.]
“The trial court should make specific factual findings regarding the factors that are relevant to the
particular case.” Loutts, 298 Mich App at 32 (citation omitted).
The trial court made brief but specific findings for each spousal support factor. Defendant
challenges the trial court’s findings regarding several of the factors, which we address below.
A. LENGTH OF THE MARRIAGE
The trial court found that the parties had been marred for seven years, which it considered
to be neither a short-term nor a long-term marriage. Defendant contends this was an error because
at the time plaintiff filed her complaint for divorce in 2019, the parties had been married for less
than five years. However, defendant submitted proposed findings of fact and conclusions of law
to the trial court in which he asserted that the marriage was seven years, two months and 18 days.
The trial court’s finding is consistent with defendant’s own proposed findings of fact. “A party
cannot request a certain action of the trial court and then argue on appeal that the action was error.”
People v Perkins, 314 Mich App 140, 158; 885 NW2d 900 (2016); see also Loutts, 298 Mich App
at 36. In any event, the parties were married in December 2014, and had been married for slightly
more than seven years when the trial concluded in January 2022, and had not yet been married for
eight years when the trial court issued its opinion in December 2022. Thus the trial court’s finding
concerning the length of the marriage and that it was neither short term nor long term is not clearly
erroneous.
B. ABILITY TO WORK
Defendant argues that the trial court erred by determining that plaintiff had a limited ability
to work. Defendant asserts that plaintiff had an extensive work history and earned significantly
more than he during the marriage. Plaintiff argues that the evidence supports the trial court’s
finding and points out that she had not earned an income of more than $65,000 since 2017, five
years before entry of the judgment. Since then, she had been a stay-at-home mother. The trial
court found that defendant had “the greater ability to work as he is employed by a family business,
is a salaried not hourly employee, and can basically make his own hours.” Conversely, the court
found that plaintiff had been out of the work force and has greater childcare responsibilities.
We agree that the trial court erred by finding that this factor favored an award of spousal
support for plaintiff. Both parties had an equal ability to work. Plaintiff was not working at the
time of trial, but she had an established work history and she admitted that she was capable of
working a full-time job. Plaintiff did not present any evidence that she was unable to work.
Accordingly, the trial court erred by determining that defendant had the greater ability to work.
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C. THE SOURCE AND AMOUNT OF PROPERTY AWARDED TO THE PARTIES
The trial court held that this factor had minimal weight because, while defendant’s store
and property were successful, “they do not seem to be vastly productive outside of producing
income to Defendant and his family.” However, the trial court found that this factor “slightly
favors an award to Plaintiff, [because] even though she might have some assets, she certainly
cannot live off them..” Defendant argues that the trial court erred by failing to consider that
plaintiff was awarded 100% of the interest in her business, received equity from the marital home,
took her condo free and clear of any interest of defendant, and was awarded an additional $388,560
in property settlement incident to defendant’s business interests.
“[S]pousal support is intended to balance the incomes and needs of the parties so that
neither party will be impoverished as a result of the divorce.” Gates v Gates, 256 Mich App 420,
436; 664 NW2d 231 (2003) (quotation marks and citation omitted). “[W]here both parties are
awarded substantial assets, the court in evaluating a claim for spousal support, should focus on the
income-earning potential of the assets and should not evaluate a party’s ability to provide self-
support by including in the amount available for support the value of the assets themselves.” Id.(citation omitted).
Considering this guidance, the trial court’s findings regarding this factor are not clearly
erroneous. Defendant still owned two businesses that had earning potential and plaintiff’s business
no longer had any earning potential. Moreover, plaintiff had considerable debt and should not
have to support herself on the assets she received in the divorce apart from their income-earning
potential. The trial court did not abuse its discretion by assigning this factor only minimal weight
and finding it slightly favored plaintiff.
D. THE PARTIES’ ABILITY TO PAY SUPPORT
The trial court found that this factor slightly favored an award of spousal support. The
court stated that defendant had the superior ability to pay support because plaintiff was “not as
enmeshed in the work force,” but regarded this situation as only temporary because plaintiff “is a
capable person with some prior work experience.” The court found that it was unclear what
defendant is capable of doing outside of working at his family business, but remarked that
defendant’s apparent belief that he could give away assets to his brother slightly favored an award
of spousal support. We find no clear error in the trial court’s findings regarding this factor.
E. THE PRESENT SITUATION OF THE PARTIES
The trial court found that this factor favored an award because defendant “is living as he
always has, likely spending beyond his means and now flip-flopping between residences” and
plaintiff “is trying to start a new life for her and her son.” Defendant argues that he was living in
an apartment paying $900 in rent, whereas plaintiff owned a condominium and was awarded any
income from her business free and clear of any claim from defendant. We hold that the trial court
erred in its consideration of this factor because it failed to consider that plaintiff had not worked
since she filed for divorce in 2019, despite her admission that she was capable of working a full-
time job. The child was born in 2017 and approaching school age at the time of trial, which
allowed plaintiff greater flexibility in obtaining a full-time job. Moreover, the trial court did not
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cite any factual support for its belief that defendant was living beyond his means. Thus, the trial
court erred by finding that this factor favored an award of spousal support.
F. THE PARTIES’ NEEDS
The trial court simply stated that plaintiff “has greater need, but notes this need should be
temporary and more transitional.” Accordingly, it found that this factor “[f]avors a limited award.”
Defendant argues that the trial court failed to make any findings of fact to support its conclusion
that this factor favored an award of spousal support. Although the court had already found that
plaintiff had a greater need due to her unemployment, it failed to consider plaintiff’s continued
unemployment throughout the duration of the case, despite her past work history and admission
that she was capable of working full time. The court did not explain why plaintiff needed two
more years to find employment. The trial court’s lack of findings as to this factor was clear error.
G. THE PARTIES’ PRIOR STANDARD OF LIVING AND OTHER SUPPORT
OBLIGATIONS
The trial court found that both parties’ prior standard of living was “marked by excess” and
the court stated that it would “not try to emulate it through an award of spousal support.” The
court also noted that neither party was legally obligated to provide for any other relative. However,
the court found that this factor slightly favored an award of spousal support because defendant’s
“standard of living will not be significantly affected if Defendant pays a modest amount and
Plaintiff will struggle without some assistance[.]” Defendant argues that the trial court failed to
consider that his income had been reduced and that he was ordered to pay $836 a month in child
support. We agree that the trial court erred when it stated that neither party was legally obligated
to provide for any other relative, given that the court had ordered defendant to pay child support.
Further, the trial court again failed to consider plaintiff’s continued unemployment in light of her
admission that she could work a full-time job.
H. GENERAL PRINCIPLES OF EQUITY
The trial court found that this factor favored an award of spousal support because
“[p]ayment of a moderate amount of spousal support for a short period of time is much more
equitable in these circumstances than no award.” Accordingly, the court awarded plaintiff $1,500
a month for the first 12 months after entry of the judgment and $1,200 a month for a second year.
Defendant argues that consideration of the relevant spousal support factors do not favor the award
and he will be impoverished by the amount awarded. Plaintiff argues that the trial court’s award
was proper, particularly considering that she was held responsible for considerable debt, had not
worked while this case was pending, and had not earned more than $65,000 since 2017.
The evidence does not support defendant’s assertion that he would be impoverished by
paying plaintiff $1,500 a month for one year and $1,200 a month for another year. Defendant
claimed that he willingly gave 90% of his interest in Landon J. Properties to his brother. Defendant
received $43,800 in rent in 2018, but after his alleged gift to his brother, his portion of that rent
would have been $4,380. Defendant also allowed Marvin’s Liquor to reduce its monthly rent
payment to Landon J. Properties from $2,500 to $1,500. Considering this evidence, defendant has
failed to establish that $1,500 a month of spousal support would impoverish him.
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However, because we have concluded that the trial court erred in its consideration of some
of the spousal support factors, and because remand is necessary for reconsideration of other issues
that may affect a proper determination of spousal support, remand for reconsideration of the trial
court’s spousal support award is also warranted.
VI. DIVISION OF PROPERTY
Defendant raises three challenges to the trial court’s property division. Defendant argues
that the trial court erred by (1) failing to treat Landon J. Properties as his separate property, (2)
awarding plaintiff a percentage of the value of Marvin’s Liquor that was owned by his brother,
and (3) awarding plaintiff the entirety of her condominium.
“The goal in distributing marital assets in a divorce proceeding is to reach an equitable
distribution of property in light of all the circumstances.” Gates, 256 Mich App at 423 (citation
omitted). The trial court must first determine what property is considered marital property and
what is considered separate property. Cunningham v Cunningham, 289 Mich App 195, 200-201;
795 NW2d 826 (2010). “[M]arital property is that which is acquired or earned during the marriage,
whereas separate property is that which is obtained or earned before the marriage.” Id. at 201
citing MCL 552.19. Only when the trial court determines what constitutes marital property, thus
the marital estate, can it divide the marital estate between the parties in an equitable manner in
light of all the circumstances. Id. Generally, “each party takes away from the marriage that party’s
own separate estate with no invasion by the other party.” Id. (citation omitted). However, separate
assets may transform into marital property “if they are commingled with marital assets and ‘treated
by the parties as marital property.’ ” Id. (citation omitted).
Defendant argued below that the Chamberlain building, which he later transferred to
Landon J. Properties, was purchased before the parties’ marriage, and therefore he should have
been awarded this asset as his separate property. Defendant testified that he purchased the
Chamberlain building in 2012 for $150,000 with most of the funds from his savings, but also
received gifts from friends and family to help with the purchase. Plaintiff agreed that she did not
know defendant when he purchased the Chamberlain building, but that while they were married,
defendant asked her for money to repay his cousin who had lent him money to buy the Chamberlain
building. Plaintiff claimed that she gave defendant $70,000 to repay his cousin. Plaintiff also
asserts that defendant made $50,000 worth of improvements to the building using her credit card,
which defendant ultimately paid off.
Despite the trial court acknowledging that defendant bought the Chamberlain building
before the marriage, it never made any specific finding whether Landon J. Properties was
defendant’s separate property or marital property. Although there was evidence from which the
trial court arguably could have found that the Chamberlain building was transformed into marital
property, there was conflicting evidence on that issue and the trial court never made any findings
to support its conclusion that it properly could be treated as a marital asset. Further, the trial court
awarded plaintiff 48% of the value of Landon J. Properties without addressing the fact that
defendant only owned a 10% interest in Landon J. Properties. Accordingly, we vacate the trial
court’s award of 48% of the value of Landon J. Properties to plaintiff and remand for further
consideration and appropriate findings of fact regarding whether Landon J. Properties is
defendant’s separate property or converted marital property, and if the latter, to then address
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defendant’s contention that he only possessed a 10% interest in that asset that may be subject to
distribution as part of the marital estate.
Defendant also argues that the trial court erred by awarding plaintiff 48% of the value of
Marvin’s Liquor when defendant only owned a 25% interest. The trial court determined that
Marvin’s Liquor had an appraised value of $438,500 as of December 31, 2020. Defendant
contends this was error because the expert witness evaluated defendant’s share in Marvin’s Liquor
to be worth $79,000. The court awarded all rights to Marvin’s Liquor to defendant, but awarded
plaintiff 48% of the appraised value of that asset. Also, there was never any testimony or other
evidence that defendant owned 100% of Marvin’s Liquor. The evidence indicated that defendant’s
brother Steven bought Marvin’s Liquor in 2013 and later transferred 25% ownership to defendant.
Steven testified that after defendant had worked at the store for three or four years, Steven thought
defendant was doing a good job so he offered defendant 25% of the business. Steven retained a
75% interest. The trial court erred by failing to address that defendant was only a 25% owner of
Marvin’s Liquor and then awarding plaintiff 48% of the total value of the business, rather than a
percentage of defendant’s interest.
Furthermore, “[t]his Court has long recognized that the jurisdiction of a divorce court is
strictly statutory and limited to determining the rights and obligations between the husband and
wife, to the exclusion of third parties.” Estes v Titus, 481 Mich 573, 582-583; 751 NW2d 493(2008) (quotation marks and citation omitted). The trial court awarded plaintiff 48% of the
appraised value of Marvin’s Liquor rather than an actual interest in the business itself.
Alternatively, the trial court held that plaintiff could “elect to . . . force a sale of the entirety” of
Marvin’s Liquor and Landon J. Properties, despite evidence that defendant’s brothers also owned
portions of these assets. The trial court had no authority to allow plaintiff to force a sale of any
property interests of defendant’s brothers. Accordingly, we also vacate the trial court’s award of
48% of the value of Marvin’s Liquor to plaintiff and remand for appropriate findings of fact
regarding the extent of defendant’s interest in Marvin’s Liquor and a distribution of a percentage
value of that interest as is equitable under the circumstances.
Defendant also argues that the trial court erred by awarding plaintiff the entirety of her
condominium, which the court found was a marital asset. Defendant argues that the trial court
erred by awarding plaintiff the entirety of this asset without considering the factors set forth in
Sparks v Sparks, 440 Mich 141; 485 NW2d 893 (1992). We disagree.
In Sparks, the Supreme Court stated that the division of property in a divorce is not
governed by any set rules, but that a court should consider “all the equitable factors involved”
including (1) duration of the marriage, (2) contributions of the parties to the marital estate, (3) age
of the parties, (4) health of the parties, (5) life status of the parties, (6) necessities and
circumstances of the parties, (7) earning abilities of the parties, (8) past relations and conduct of
the parties, and (9) general principles of equity. Id. at 159-160 (citation omitted).
The trial court found that plaintiff’s condominium was a marital asset because of the timing
of the purchase, but found that plaintiff bought the condominium with her own funds, and that it
had “little or no equity that can be considered marital.” The court further ruled that defendant was
not responsible for any indebtedness on the property. The trial court expressly noted that it had
considered the Sparks factors in deciding that plaintiff should be awarded the condominium in its
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entirety. Under the circumstances, the trial court’s decision to award this asset to plaintiff while
also holding plaintiff fully responsible for any indebtedness on the property, was not inequitable.
VII. ATTORNEY FEES
Defendant argues that the trial court erred by ordering him to pay plaintiff’s reasonable
attorney fees. We agree that remand for reconsideration of this issue is necessary.
A trial court’s decision to award attorney fees is reviewed for an abuse of discretion. Gates,
256 Mich App at 437-438. An abuse of discretion occurs when a trial court’s decision is outside
the range of reasonable and principled outcomes. Stallworth, 275 Mich App at 284. Findings of
fact on which the trial court bases an award of attorney fees are reviewed for clear error. Reed v
Reed, 265 Mich App 131, 164; 693 NW2d 825 (2005). “A finding is clearly erroneous when,
although there is evidence to support it, the reviewing court on the entire record is left with a
definite and firm conviction that a mistake was made.” Solution Source, Inc v LPR Assoc Ltd
Partnership, 252 Mich App 368, 381-382; 652 NW2d 474 (2002).
Attorney fees are not recoverable as of right in divorce actions, but they are authorized by
both statute, MCL 552.13, and court rule, MCR 3.206(D). Reed, 265 Mich App at 164. MCL
552.13(1) provides that a trial court may require either party “to pay any sums necessary to enable
the adverse party to carry on or defend the action, during its pendency.” MCR 3.206(D) provides:
(1) A party may, at any time, request that the court order the other party to
pay all or part of the attorney fees and expenses related to the action or a specific
proceeding, including a post-judgment proceeding.
(2) A party who requests attorney fees and expenses must allege facts
sufficient to show that:
(a) the party is unable to bear the expense of the action, including the
expense of engaging in discovery appropriate for the matter, and that the other party
is able to pay, or
(b) the attorney fees and expenses were incurred because the other party
refused to comply with a previous court order, despite having the ability to comply,
or engaged in discovery practices in violation of these rules.
Attorney fees may also be awarded under a “common-law exception to the American rule ‘that an
award of legal fees is authorized where the party requesting payment of the fees has been forced
to incur them as a result of the other party’s unreasonable conduct in the course of the litigation.’ ”
Reed, 265 Mich App at 164-165 (citation omitted).
In this case, the trial court appears to have relied on both the statute and the court rule,
although the basis for the court’s award of attorney fees is not entirely clear. In its opinion, the
trial court explained its decision to award plaintiff attorney fees as follows:
As all understand, the Court may order one party to contribute to the other
party’s attorney fees in whole or in part. Two reasons exist for doing so by court
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rule and statute. This award may also include attorney fees when there is a
significant disparity in the parties’ incomes as well if there is one party’s dilatory
behaviors. Moreover, by statute, MCL 552.13(1), an award may be made so that
the other party need not use assets needed to live on to pay fees and costs.
By all metrics, Defendant is ordered to pay toward Plaintiff’s attorney fees
and costs. He has superior income, has been dilatory with groundless motions, has
raised and argued nearly ridiculous positions regarding custody and claims
involving Penthouse, and Plaintiff has been awarded little, if any, assets usable to
pay fees. The Court finds that the record calls for Defendant to pay some or all of
Plaintiff’s attorney fees.
The judgment of divorce contained a similar provision:
The Court finds that Defendant shall pay some or all of Plaintiff’s attorney
fees, which shall be reasonable, determined by a combination of the hours expended
and the hourly rate. Plaintiff’s counsel may file a motion for a hearing date
regarding attorney fees pursuant to the Court’s written Opinion, finding Defendant
(1) has superior income, (2) has been dilatory with groundless motions, (3) has
raised and argued nearly ridiculous positions regarding custody and claims
involving Penthouse, and (4) Plaintiff has been awarded little, if any, assets usable
to pay attorney fees.
The trial court’s attorney-fee award is problematic in several respects. Although the trial
court identified different reasons for why attorney fees may be awarded in a divorce action, it did
not clearly indicate the legal basis for its decision to award attorney fees in this case. The court
stated that defendant had been “dilatory with groundless motions….” This suggests that the trial
court may have been relying on either MCR 3.206(D)(2)(b) or the common-law exception that
allows attorney fees to be awarded when the requesting party has been forced to incur them as a
result of the other party’s unreasonable conduct in the course of litigation. However, the trial court
did not identify any previous court order that defendant failed to comply with or any discovery
violation by defendant to support an award under MCR 3.206(D)(2)(b). Further, to justify an
award of attorney fees under the common-law exception, “the attorney fees awarded must have
been incurred because of misconduct,” and the focus is on whether a party’s wrongful conduct
caused the other party to incur fees. Reed, 265 Mich App at 165. The trial court accused defendant
of filing “groundless motions,” and raising ridiculous positions regarding custody, but it did not
identify any motion that it believed was improperly filed or identify what position regarding
custody it believed was “ridiculous.” The court also accused defendant of raising ridiculous
positions regarding plaintiff’s ownership of the Penthouse Club, but again, it did not identify how
defendant’s positions in relation to this asset qualifies as misconduct.2 Additionally, plaintiff never
established what attorney fees were incurred as a result of any alleged misconduct by defendant.
2
Indeed our resolution of this appeal belies the assertion that defendant raised “ridiculous
positions” in the course of this litigation.
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The trial court also stated that attorney fees may be awarded when there is a significant
disparity in the parties’ incomes or so a party need not use assets needed to live on to pay fees and
costs. This suggests that the trial court may have found that attorney fees were justified under
MCL 552.13(1) or MCR 3.206(D)(2)(a). However, attorney fees under either the statute or the
court rule “may be awarded only when a party needs financial assistance to prosecute or defend
the suit.” Reed, 265 Mich App at 164. The trial court did not find that an award of attorney fees
was necessary to enable plaintiff to prosecute this action; the court only mentioned that defendant
had superior income. Further, an award of attorney fees under MCR 3.206(D)(2)(a) requires a
finding not only that one party is unable to bear the expense of the action, but also that the other
party is able to pay the requesting party’s fees. Merely stating that defendant has a superior income
does not satisfy the requirements of the court rule.
The trial court did not make appropriate findings to enable this Court to determine the
factual bases for the court’s award of attorney fees, thereby preventing this Court from determining
whether the trial court correctly applied the law or abused its discretion when awarding attorney
fees. Accordingly, we vacate the trial court’s award of attorney fees and remand for
reconsideration of this issue. On remand, the trial court must identify the specific legal authority
for any award of attorney fees and make appropriate findings of fact as necessary to support any
fee award.
Affirmed in part, vacated in part, and remanded for further proceedings consistent with this
opinion. We do not retain jurisdiction.
/s/ Michael F. Gadola
/s/ Stephen L. Borrello
/s/ Sima G. Patel
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