Fogt v. Fogt , 2019 Ohio 1403 ( 2019 )

[Cite as Fogt v. Fogt, 2019-Ohio-1403.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
DEFIANCE COUNTY
SARA FOGT,
PLAINTIFF-APPELLANT, CASE NO. 4-18-10
v.
JEFFREY C. FOGT, OPINION
DEFENDANT-APPELLEE.
Appeal from Defiance County Common Pleas Court
Domestic Relations Division
Trial Court No. 13-DR-42551
Judgment Affirmed
Date of Decision: April 15, 2019
APPEARANCES:
Charles E. Bloom for Appellant
John S. Shaffer for Appellee
Case No. 4-18-10
PRESTON, J.
{¶1} Plaintiff-appellant, Sara Fogt (“Sara”), appeals the October 26, 2018
judgment of the Defiance County Court of Common Pleas, Domestic Relations
Division. For the reasons that follow, we affirm.
{¶2} Sara and defendant-appellee, Jeffrey Fogt (“Jeffrey”), were married on
October 31, 1998. (See Doc. Nos. 1, 32). Nearly 15 years later, on September 12,
2013, Sara filed a complaint in the trial court requesting a divorce from Jeffrey.
(Doc. No. 1). Jeffrey filed his answer to Sara’s complaint on January 29, 2016.
(Doc. No. 32).
{¶3} The final hearing in the matter commenced before the magistrate on
January 8, 2016. (See Doc. Nos. 43, 44). Additional hearings were conducted
before the magistrate on February 19, April 29, July 8, and September 23, 2016.
(See Doc. Nos. 43, 44). On November 23, 2016, Sara filed written closing
arguments. (Doc. No. 43). That same day, Jeffrey filed proposed findings of fact
and conclusions of law. (Doc. No. 44). On December 9, 2016, Sara filed her
response to Jeffrey’s proposed findings of fact and conclusions of law. (Doc. No.
45). That same day, Jeffrey filed his response to Sara’s written closing arguments.
(Doc. No. 46).
{¶4} On April 10, 2017, the magistrate issued his decision recommending
that a divorce be granted. (Doc. No. 54). Relevant to this appeal, the magistrate
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also recommended that the trial court make the following orders with respect to
contested assets and debts: that a bank account, First Federal #8283, valued at
$80,531 be divided equally between Sara and Jeffrey and that Jeffrey assume sole
responsibility for the payment of interest and principal on a $90,000 loan the parties
received from Jeffrey’s parents in July 2000. (Id.). In addition, the magistrate
recommended that the trial court order Jeffrey to pay Sara spousal support in the
sum of $4,400 per month for 66 months. (Id.).
{¶5} On April 24, 2017, Jeffrey filed objections to the magistrate’s decision.
(Doc. No. 55). First, Jeffrey objected to the magistrate’s recommended division of
First Federal #8283. (Id.). He argued that the value of First Federal #8283 should
be reduced by $16,249.73 prior to division to account for two payments he made
from the account in January 2016: $12,000 toward estimated 2015 federal income
tax liability and $4,249.73 toward real estate taxes for calendar year 2015 payable
in calendar year 2016. (Id.). In addition, Jeffrey argued that although the magistrate
found that the $90,000 loan was essentially a marital debt, the magistrate failed to
assign responsibility for the debt equally between himself and Sara. (Id.). Thus,
Jeffrey argued that he should receive credit against other marital assets for one-half
of the $90,000 obligation. (Id.). Finally, Jeffrey argued that both the amount of
spousal support owed per month to Sara and the length of the term of spousal
support should be reduced because the magistrate incorrectly determined the
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duration of the marriage and because the magistrate should have given him credit
for the three and a half years that he supported Sara from the date of the filing of
her complaint for divorce until the date of the magistrate’s decision. (Id.). On May
3, 2017, Sara filed her response to Jeffrey’s objections to the magistrate’s decision.
(Doc. No. 56).
{¶6} On May 22, 2017, Jeffrey requested that the trial court grant him an
additional 30 days to obtain and file copies of the transcripts of the hearings held
before the magistrate. (Doc. No. 58). On June 14, 2017, the trial court granted
Jeffrey’s motion and gave him until June 24, 2017 to file the transcripts. (Doc. No.
59). On June 22, 2017, Jeffrey requested that the trial court grant him an additional
extension of 30 days to file the transcripts. (Doc. No. 60). On June 26, 2017, the
trial court granted Jeffrey’s motion and gave him an additional 30 days until July
24, 2017 to file the transcripts. (Doc. No. 61). However, inexplicably, Jeffrey failed
to file any transcripts in the trial court.
{¶7} On July 25, 2017, Sara filed a motion to dismiss Jeffrey’s objections
based on Jeffrey’s failure to support his objections with transcripts of the hearings
conducted before the magistrate. (Doc. No. 62). On August 9, 2017, the trial court
denied Sara’s motion to dismiss. (Doc. No. 63).
{¶8} On May 9, 2018, the trial court sustained Jeffrey’s objections to the
magistrate’s decision. (Doc. No. 65). First, the trial court ordered that the balance
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of First Federal #8283, “$80,531.00[,] should be reduced by the sum of $16,249.73
prior to division” between Sara and Jeffrey. (Id.). In addition, with respect to the
$90,000 loan, the trial court concluded that Jeffrey “must be credited with one-half
of the amount of the mar[ital] debt in the overall asset division.” (Id.). Finally,
although the trial court did not alter the amount of spousal support owed per month
by Jeffrey to Sara, it reduced the term of spousal support from 66 months to 54
months. (Id.).
{¶9} On October 26, 2018, the trial court filed its final judgment entry of
divorce, which, among other things, granted Sara and Jeffrey a divorce from each
other and incorporated the modifications the trial court made to the magistrate’s
decision in the trial court’s May 9, 2018 judgment. (Doc. No. 67).
{¶10} On November 19, 2018, Sara filed a notice of appeal. (Doc. No. 68).
She raises four assignments of error for our review. We will begin by addressing
Sara’s first assignment of error, followed by Sara’s second, third, and fourth
assignments of error, which we will address together.
Assignment of Error No. I
The trial court erred in failing to dismiss Appellee’s objections
when the appellee failed to file a transcript of the proceedings to
support his objections.
{¶11} In her first assignment of error, Sara argues that the trial court erred
by denying her motion to dismiss Jeffrey’s objections to the magistrate’s decision.
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Specifically, Sara argues that the trial court could not have considered Jeffrey’s
objections without transcripts of the hearings conducted before the magistrate.
(Appellant’s Brief at 11-12). Therefore, Sara argues, the trial court should have
dismissed Jeffrey’s objections without further consideration.
{¶12} “Civ.R. 53(D) governs proceedings in matters referred to magistrates.”
Williams v. Ormsby, 9th Dist. Medina No. 09CA0080-M, 2010-Ohio-3666, ¶ 9.
Civ.R. 53(D) provides in relevant part:
An objection to a factual finding, whether or not specifically
designated as a finding of fact under Civ.R. 53(D)(3)(a)(ii), shall be
supported by a transcript of all the evidence submitted to the
magistrate relevant to that finding or an affidavit of that evidence if a
transcript is not available. * * * The objecting party shall file the
transcript or affidavit with the court within thirty days after filing
objections unless the court extends the time in writing for preparation
of the transcript or other good cause. If a party files timely objections
prior to the date on which a transcript is prepared, the party may seek
leave of court to supplement the objections.
Civ.R. 53(D)(3)(b)(iii). “The duty to provide a transcript to the trial court rests with
the person objecting to the magistrate’s decision.” Slepsky v. Slepsky, 11th Dist.
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Lake No. 2016-L-032, 2016-Ohio-8429, ¶ 20, citing In re O’Neal, 11th Dist.
Ashtabula No. 99-A-0022, 2000 WL 1738366, *7 (Nov. 24, 2000).
{¶13} “Where a party fails * * * to file a transcript of the evidence presented
at the magistrate’s hearing, the trial court, when ruling on the objections, is required
to accept the magistrate’s findings of fact and to review the magistrate’s conclusions
of law based on the factual findings.” Nieto v. Marcellino, 11th Dist. Geauga No.
2017-G-0146, 2018-Ohio-4952, ¶ 15, citing Slepsky at ¶ 20, citing State ex rel.
Duncan v. Chippewa Twp. Trustees, 73 Ohio St. 3d 728, 730 (1995) and Saipin v.
Coy, 9th Dist. Summit No. 21800, 2004-Ohio-2670, ¶ 9; Long v. Long, 3d Dist.
Defiance No. 4-02-22, 2003-Ohio-854, ¶ 10 (“[A]bsent a transcript or appropriate
affidavit as provided in the rule, a trial court is limited to an examination of the
magistrate’s conclusions of law and recommendations only in light of the
accompanying findings of fact, unless the trial court elects to hold further
hearings.”), citing Wade v. Wade, 113 Ohio App. 3d 414, 418 (11th Dist.1996).
“‘Where the failure to provide the relevant portions of the transcript or suitable
alternative is clear on the face of the submissions, the trial court cannot then address
the merits of that factual objection because the objecting party, whether through
inadvertence or bad faith, has not provided all of the materials needed for the review
of that objection.’” (Emphasis sic.) Nieto at ¶ 15, quoting Wade at 418.
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{¶14} Here, it is undisputed that Jeffrey failed to provide the trial court with
transcripts of the hearings conducted before the magistrate. As a result, the trial
court was bound to accept the magistrate’s findings of fact. Nieto at ¶ 15; Long at
¶ 10. However, while the trial court was required to accept the magistrate’s findings
of fact, it was nevertheless permitted to consider Jeffrey’s objections to the extent
that Jeffrey argued that the magistrate erred in his interpretation of the law or in the
application of the law to the facts as found. Indeed, the trial court had an obligation
to determine whether the magistrate correctly interpreted and applied the law prior
to adopting the magistrate’s decision and that obligation would have been the same
irrespective of whether Jeffrey filed objections to the magistrate’s decision. See
Civ.R. 53(D)(4)(c) (“If no timely objections are filed, the court may adopt a
magistrate’s decision, unless it determines that there is an error of law * * * evident
on the face of the magistrate’s decision.”); Civ.R. 53(D)(4)(d) (“In ruling on
objections, the court shall undertake an independent review as to the objected
matters to ascertain that the magistrate has * * * appropriately applied the law.”).
Therefore, because Jeffrey’s objections related to the application of the law to the
magistrate’s findings of fact and because the trial court had an independent
responsibility to review the magistrate’s application of the law, the trial court did
not err by denying Sara’s motion to dismiss Jeffrey’s objections.
{¶15} Sara’s first assignment of error is overruled.
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Assignment of Error No. II
The trial court’s decision is in error and is not supported by the
manifest weight of the evidence as found in the complete record
when contrary to the magistrate’s findings of fact the trial court
ruled that the value of the Federal bank account #8283 should be
reduced by the sum of $16,249.73 to account for payments for the
estimated income and real estate taxes from this account.
Assignment of Error No. III
The trial court’s decision is in error and is not supported by the
manifest weight of the evidence as found in the complete record
when contrary to the magistrate’s findings of fact the trial court
ruled that the $90,000 debt is a marital obligation.
Assignment of Error No. IV
The trial court’s decision is in error and is not supported by the
manifest weight of the evidence as found in the complete record
when contrary to the magistrate’s findings of fact it ruled that the
appellant’s term of spousal support should be reduced from 66
months to a period of 54 months.
{¶16} Each of Sara’s remaining assignments of error take issue with the trial
court’s modification of certain aspects of the magistrate’s decision. In her second
assignment of error, Sara argues that by reducing the balance of First Federal #8283
by $16,249.73 prior to division, the trial court “abused its discretion by ignoring the
factual findings of the Magistrate, assuming facts not in evidence, utilizing a
different valuation date for the division of this account, making its own factual
finding, and rejecting the Magistrate’s Conclusion of Law.” (Appellant’s Brief at
14). In her third assignment of error, Sara argues that the trial court’s decision to
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assess half of the $90,000 loan against her share of the marital property was an abuse
of discretion because the trial court reached this conclusion by rendering a factual
finding not made by the magistrate—that the loan is a legitimate marital debt. (Id.
at 16-21). Finally, in her fourth assignment of error, Sara argues that the trial court
abused its discretion by reducing the term of spousal support from 66 months to 54
months because, in doing so, the trial court “reject[ed] [the magistrate’s] factual
findings, and * * * ma[de] other specific findings when the evidence and testimony
presented to the Magistrate upon which it was based was never provided.” (Id. at
22); (Id. at 21-25).
{¶17} Generally, “[a]n appellate court reviews the trial court’s decision to
adopt, reject or modify the Magistrate’s decision under an abuse of discretion
standard.” Tewalt v. Peacock, 3d Dist. Shelby No. 17-10-18, 2011-Ohio-1726, ¶
31, citing Figel v. Figel, 3d Dist. Mercer No. 10-08-14, 2009-Ohio-1659, ¶ 9,
citing Marchel v. Marchel, 160 Ohio App. 3d 240, 2005-Ohio-1499, ¶ 7 (8th Dist.).
However, “‘[o]n appeal of a judgment rendered without the benefit of a transcript
or affidavit, an appellate court only considers whether the trial court correctly
applied the law to the facts as set forth in the magistrate’s decision.’” In re Estate
of Stanford, 2d Dist. Montgomery No. 23249, 2010-Ohio-569, ¶ 22, quoting In re
Estate of Lucas, 2d Dist. Montgomery No. 23088, 2009-Ohio-6392, ¶
32, citing Ross v. Cockburn, 10th Dist. Franklin No. 07AP-967, 2008-Ohio-3522, ¶
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5-6. Thus, we consider only whether the trial court abused its discretion by
modifying the magistrate’s conclusions of law in light of the magistrate’s findings
of fact. An abuse of discretion suggests the trial court’s decision is unreasonable,
arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St. 3d 217, 219
(1983).
{¶18} Sara’s second and third assignments of error concern the trial court’s
modification of the portions of the magistrate’s decision regarding the division of
First Federal #8283 and allocation of responsibility for payment of the $90,000 loan.
Thus, Sara’s second and third assignments of error relate to the division of marital
assets and liabilities. “In awarding property to the parties to a divorce proceeding,
the trial court must first determine whether property is marital or separate.” Siferd
v. Siferd, 3d Dist. Hancock No. 5-17-04, 2017-Ohio-8624, ¶ 25, citing R.C.
3105.171(B). Marital property includes all real and personal property that is owned
by either or both of the spouses and all interest that either or both of the spouses has
in any real or personal property, and “that was acquired by either or both of the
spouses during the marriage.” R.C. 3105.171(A)(3)(a)(i)-(ii). “Property acquired
during a marriage is presumed to be marital property unless it can be shown to be
separate.” Schwarck v. Schwarck, 3d Dist. Auglaize No. 2-11-24, 2012-Ohio-3902,
¶ 19, citing Huelskamp v. Huelskamp, 185 Ohio App. 3d 611, 2009-Ohio-6864, ¶ 13
(3d Dist.).
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{¶19} “‘Although Ohio’s divorce statutes do not specifically articulate debt
as an element of marital and separate property, the rules concerning marital assets
are usually applied to marital and separate debt as well.’” Siferd at ¶ 26, quoting
Schwarck at ¶ 20, citing Vonderhaar-Ketron v. Ketron, 5th Dist. Fairfield No. 10
CA 22, 2010-Ohio-6593, ¶ 34. “‘The property to be divided in a divorce proceeding
includes not only the assets owned by the parties but also any debts incurred by the
parties.’” Id., quoting Forman v. Forman, 3d Dist. Marion No. 9-13-67, 2014-Ohio-
3545, ¶ 31, citing Marrero v. Marrero, 9th Dist. Lorain No. 02CA008057, 2002-
Ohio-4862, ¶ 43. Like property acquired during a marriage, debts incurred during
a marriage are presumptively marital debts unless it can be proved that they are not.
Schwarck at ¶ 21, citing Vergitz v. Vergitz, 7th Dist. Jefferson No. 05JE52, 2007-
Ohio-1395, ¶ 12, citing Knox v. Knox, 7th Dist. Jefferson No. 04JE24, 2006-Ohio-
1154, ¶ 25-26.
{¶20} Generally, trial courts should divide marital assets and debts equally
between the spouses. R.C. 3105.171(C)(1). However, where equal division of the
marital assets and debts would be inequitable, “the trial court must ‘divide the
marital * * * property equitably between the spouses * * *.’” Siferd at ¶ 25, quoting
R.C. 3105.171(B). “‘Trial courts have “broad discretion to determine what property
division is equitable in a divorce proceeding.”’” Id. at ¶ 27, quoting Collins v.
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Collins, 3d Dist. Marion No. 9-10-53, 2011-Ohio-2339, ¶ 28, quoting Cherry v.
Cherry, 66 Ohio St. 2d 348 (1981), paragraph two of the syllabus.
{¶21} We turn first to the trial court’s modification of the magistrate’s
decision as to the division of First Federal #8283. In his decision, the magistrate
made the following observations and findings relevant to the valuation and division
of First Federal #8283:
The Court notes that the parties previously agreed to divide up the
uncontested financial accounts as of January 10, 2016. The balance
[of First Federal #8283] on that date was about $80,531. * * * [Sara]
* * * objected to large payments [Jeffrey] made in January 2016 from
the account for estimated taxes ($12,000) and real estate taxes
($4,247.76). [Sara] stated that these payments up until then had been
made out of the company account of Professional Vision Services,
LLC which by agreement was awarded to [Jeffrey] and that the sole
purpose of paying them now out of the personal account was to reduce
the amount of her share.
The court finds that [First Federal #8283] should be valued as of
January 10, 2016 at $80,531 and split equaly * * *. The payments
[Jeffrey] made from [First Federal #8283] in January [2016] were
atypical and the only reason they were made from [First Federal
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#8283] instead of the historical account was to reduce the amount of
funds paid to [Sara].
(Doc. No. 54). Later in his decision, the magistrate noted that the tax payments
made from First Federal #8283 “were otherwise proper being toward legitimate
marital debt.” (Id.).
{¶22} In its judgment sustaining Jeffrey’s objections and modifying the
magistrate’s decision, the trial court concluded as follows:
The first issue raised by [Jeffrey’s] objection relates to the division of
[First Federal #8283]. The Magistrate determined the value of this
marital asset to be $80,531. [Jeffrey] contends that the value of this
marital balance ought to have been reduced [because of]: 1) [a]
$12,000 estimated tax payment to the Internal Revenue Service made
January 13, 2016 (last quarter estimate for calendar year 2015); [and]
2) $4,249.73 being a payment for Real Estate taxes for calendar year
2015, payable in 2016 and made January 13, 2016 * * *.
[K]nowing that the Court is bound by [the] factual determinations
made by the Magistrate, the Court must determine whether the facts
stated by the Magistrate warrant the conclusions reached. It appears
* * * that, notwithstanding the prior practice of the parties, the
payments for both estimated income tax and real estate taxes should
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properly be subtracted from the balance of [First Federal #8283] prior
to division. As noted by the Magistrate, these are obviously specific
marital expenses and the fact that, in earlier years, a different source
of funding for these payments [was used] does not change their
character. * * *
Regarding [First Federal #8283] * * *, based upon the foregoing, the
value of the account[,] $80,531.00[,] should be reduced by the sum of
$16,249.73 prior to division.
(Doc. No. 65).
{¶23} We conclude that the trial court did not abuse its discretion by
modifying the magistrate’s decision with respect to the balance of First Federal
#8283. Contrary to Sara’s assertion, in ordering that the balance of First Federal
#8283 be reduced prior to division, the trial court did not change any of the
magistrate’s findings of fact or make any additional findings of fact. The magistrate
found that First Federal #8283 had a balance of $80,531 in January 2016, and it is
undisputed that First Federal #8283 is a marital asset. Furthermore, the magistrate
found that two payments totaling $16,247.76 were made from First Federal #8283
in January 2016, and the magistrate found that these payments were made in order
to discharge legitimate marital debts. Except as discussed in the next paragraph,
these findings remained intact in the trial court’s modification of the magistrate’s
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decision. However, unlike the magistrate, the trial court ensured that the property
division conformed to the general legal rule that marital assets and debts are to be
divided equally between the spouses. That is, the trial court allocated responsibility
for the payment of legitimate marital debts equally between Sara and Jeffrey as it is
generally required to do. The trial court’s modifications were not unreasonable,
arbitrary, or unconscionable. Thus, the trial court did not abuse its discretion.
{¶24} However, we do note a discrepancy between the amount found by the
magistrate to have been paid from First Federal #8283 in January 2016 and the
amount that the trial court ultimately deducted from the balance of First Federal
#8283. The magistrate found that two payments were made in January 2016—one
for $12,000 and one for $4,247.76—totaling $16,247.76. (Doc. No. 54). Yet, the
trial court ordered that the balance of First Federal #8283 be reduced by $16,249.73
prior to division. (Doc. No. 65). While the magistrate’s findings support reducing
the balance of First Federal #8283 by $16,247.76, the magistrate’s decision does not
support reducing the balance of First Federal #8283 by the amount ordered by the
trial court. However, to remand for $1.97 is neither judicially economic nor
financially advantageous to the parties and accordingly, it will be considered
harmless error.
{¶25} Next, we consider whether the trial court abused its discretion by
modifying the magistrate’s decision so that half of the $90,000 loan would be
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assessed against Sara’s share of the total marital property. With respect to the
$90,000 loan, the magistrate made the following findings and conclusions:
[T]he parties on July 20, 2000 borrowed $90,000 from [Jeffrey’s]
parents and signed a note for that amount. No periodic principle [sic]
payments were required except a balloon payment on July 20, 2010.
However, monthly interest payments were required at 8%. [Jeffrey]
signed his name “dba Professional Vision services.” The purpose of
the loan was not clearly stated but appeared to be business related. No
documents were provided showing the receipt of and deposit of the
money and [Sara] could not recall ever seeing the check or any funds
deposited in the company account. * * * On July 20, 2010, a new note
was signed continuing the debt for another ten years. This time the
interest rate was reduced to 4%.
***
The evidence indicates that the interest payments required for the debt
were paid through the books and accounts of Professional Vision
Services, LLC of which [Jeffrey] was the sole member. The account
was treated apparently as a payable by the LLC to [Jeffrey]. All
interest payments required by the notes have been paid by the
company. * * * [Jeffrey] was able to produce a document * * * which
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he states shows a $60,000 payment to State Bank on a loan he took
out to purchase the practice of Dr. Brunotte. [Jeffrey] indicated that
the source of the $60,000 payment was the loan from his parents. * *
* [T]he evidence suggests logically that the money did come from his
parents and was used for business purposes. Exhibit 7, shows a
purchase agreement between Dr. Brunotte and [Jeffrey] for the sale of
Brunotte’s practice in which [Jeffrey] agreed to pay him $160,000 at
the closing which was scheduled for May 10, 2000. Exhibit U shows
that [Jeffrey] secured a loan from the State Bank and Trust Co. on
May 9, 2000 in the amount of $160,000 one day before the closing.
The payment of $60,000 shown on Exhibit U, was received on July
26, 2000, six days after the signing of the note and likely receipt of
the $90,000. Thus, $60,000 of the funds are accounted for and
business related but not the remaining $30,000.
[Jeffrey] essentially failed to show where the remaining thirty
thousand dollars is being held or, if it no longer exists, when and for
what use was the money put. * * * [I]t is reasonable to find that
[Jeffrey] and his business are responsible for [the other $30,000] and
charged with knowledge of [its] existence. * * *
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Under the circumstances, the Court finds that the debt despite being
somewhat impractical is legitimate. [Jeffrey] is to be solely
responsible for the payment of interest and principle [sic] on the debt
and hold [Sara] harmless.
(Doc. No. 54).
{¶26} In modifying the magistrate’s decision as to the allocation of
responsibility for the $90,000 loan, the trial court concluded:
In the Magistrate’s Decision, the Magistrate effectively describes [the
$90,000 loan] as a legitimate marital debt. The Magistrate makes
payment of that debt and interest the responsibility of [Jeffrey].
Notwithstanding this determination that the $90,000 debt is in fact a
marital obligation, the Magistrate failed to credit [Jeffrey] for
payment of one-half of this marital debt against other marital assets.
Again, being bound by the factual determination of the Magistrate, the
Court determines from the Magistrate’s expression of facts that this
$90,000 debt is, in fact, properly considered a marital debt. In
assigning responsibility for payment of this marital debt to [Jeffrey],
[Jeffrey] must be credited with one-half of the amount of the marital
debt in the overall asset division.
(Doc. No. 65).
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{¶27} We conclude that the trial court did not abuse its discretion by
modifying the magistrate’s decision in order to hold Sara responsible for half of the
$90,000 loan. In order to hold Sara responsible for half of the $90,000 loan, the
$90,000 loan must be a marital debt. Sara asserts that the magistrate classified the
$90,000 loan as a “business debt” of Jeffrey’s business rather than as a marital debt
and thus appropriately concluded that Jeffrey’s business and Jeffrey himself should
be responsible for the whole loan. (Appellant’s Brief at 19). Sara further contends
that the trial court altered the magistrate’s findings—that is, the trial court concluded
that the $90,000 loan is a marital debt instead of preserving the magistrate’s
conclusion that the loan is a business debt. (See id.). Thus, Sara argues, the trial
court abused its discretion by “reclassifying” the $90,000 loan as a marital debt in
order to hold her responsible for half of the obligation without the benefit of the
transcripts of the hearings.
{¶28} Sara’s argument is without merit. Contrary to Sara’s argument, in
concluding that the $90,000 loan is a marital obligation and assigning to Sara and
Jeffrey equal responsibility for its payment, the trial court did not disturb the
magistrate’s findings of fact. Instead, to the extent that the magistrate concluded
that the $90,000 loan is solely a debt of Jeffrey’s business, the trial court determined
that the magistrate’s findings of fact did not support that conclusion. Thus, the trial
court merely reached a different legal conclusion based on the facts as found by the
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magistrate and that conclusion is supported by the magistrate’s findings of fact.
First, the note evidencing the $90,000 loan was signed on July 20, 2000, which was
during the course of the parties’ marriage. (Doc. No. 54). Although Jeffrey signed
the note “dba Professional Vision Services,” Jeffrey was not the only signatory on
the note; Sara also signed the note. (See id.). Moreover, the magistrate found that
$60,000 of the $90,000 loan was spent in connection with the acquisition of another
doctor’s practice. (Id.). As at least two-thirds of the proceeds of the loan were used
to expand Jeffrey’s business, which was the principal source of income during the
marriage, Sara and Jeffrey derived joint personal benefits from the proceeds of the
loan. Furthermore, the fact that the interest payments for the loan were paid through
Professional Vision Services’s accounts does not demand a conclusion that the debt
is strictly an obligation of Jeffrey’s business. In relation to the division of First
Federal #8283, the magistrate noted that the parties had an established practice of
paying personal income and real estate taxes out of the business’s accounts. (See
id.). Thus, because Sara and Jeffrey had a practice of paying marital expenses out
of business accounts, the payment of interest payments from business accounts is
not determinative of whether the loan is solely a business obligation.
{¶29} In sum, the magistrate found that Sara co-signed a loan during the
course of her marriage to Jeffrey and that the bulk of the proceeds of the loan were
put toward the expansion and development of Jeffrey’s business—the principal
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source of income during the couple’s marriage. “Marital debt has been defined as
any debt incurred during the marriage for the joint benefit of the parties or for a
valid marital purpose.” Schwarck, 2012-Ohio-3902, at ¶ 21, citing Ketchum v.
Ketchum, 7th Dist. Columbiana No. 2001 CO 60, 2003-Ohio-2559, ¶ 47, citing
Turner, Equitable Division of Property, Section 6.29, at 455 (2d Ed. Rev. 2002).
Because the $90,000 loan was incurred during the marriage for the joint benefit of
the parties, the trial court properly considered the $90,000 obligation a marital debt.
As discussed above, marital debts should generally be divided equally between the
spouses. Thus, the trial court’s decision to modify the magistrate’s recommendation
in order to effect an equal division of responsibility for the $90,000 loan was in
accordance with the law and not unreasonable, arbitrary, or unconscionable.
Accordingly, the trial court did not abuse its discretion.
{¶30} Finally, in her fourth assignment of error, Sara argues that the trial
court erred by deciding to reduce the length of the term of spousal support owed by
Jeffrey from 66 months to 54 months. “‘Pursuant to R.C. 3105.18, a reasonable
amount of spousal support should be awarded when appropriate.’” Siferd, 2017-
Ohio-8624, at ¶ 39, quoting Jordan v. Jordan, 3d Dist. Hancock No. 5-03-07, 2003-
Ohio-7116, ¶ 14. “R.C. 3105.18 ‘directs a trial court to use the factors to determine
whether spousal support is “appropriate and reasonable,” not whether it is
“necessary.”’” Id., quoting Muckensturm v. Muckensturm, 3d Dist. Hancock No. 5-
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11-38, 2012-Ohio-3062, ¶ 20, citing Chaudhry v. Chaudhry, 9th Dist. Summit No.
15252, 1992 WL 74204, *3 (Apr. 8, 1992). The fourteen factors under R.C.
3105.18(C) include:
(a) The income of the parties, from all sources, including, but not
limited to, income derived from property divided, disbursed, or
distributed under section 3105.171 of the Revised Code;
(b) The relative earning abilities of the parties;
(c) The ages and the physical, mental, and emotional conditions of
the parties;
(d) The retirement benefits of the parties;
(e) The duration of the marriage;
(f) The extent to which it would be inappropriate for a party,
because that party will be custodian of a minor child of the marriage,
to seek employment outside the home;
(g) The standard of living of the parties established during the
marriage;
(h) The relative extent of education of the parties;
(i) The relative assets and liabilities of the parties, including but not
limited to any court-ordered payments by the parties;
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(j) The contribution of each party to the education, training, or
earning ability of the other party, including, but not limited to, any
party’s contribution to the acquisition of a professional degree of the
other party;
(k) The time and expense necessary for the spouse who is seeking
spousal support to acquire education, training, or job experience so
that the spouse will be qualified to obtain appropriate employment,
provided the education, training, or job experience, and employment
is, in fact, sought;
(l) The tax consequences, for each party, of an award of spousal
support;
(m) The lost income production capacity of either party that resulted
from that party’s marital responsibilities;
(n) Any other factor that the court expressly finds to be relevant and
equitable.
R.C. 3105.18(C)(1)(a)-(n). “‘[O]nce the factors of R.C. 3105.18 have been
considered, the amount of spousal support is within the sound discretion of the trial
court.’” Siferd at ¶ 39, quoting Jordan at ¶ 14, citing Young v. Young, 9th Dist.
Lorain No. 93CA005554, 1993 WL 548765 (Dec. 29, 1993).
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{¶31} In the portion of his decision dealing with spousal support, the
magistrate conducted an exhaustive analysis of the relevant R.C. 3105.18(C)(1)
factors. (See Doc. No. 54). Neither Sara nor Jeffrey took issue with the majority of
the magistrate’s R.C. 3105.18(C)(1) findings. Instead, Jeffrey’s objections focused
only on the magistrate’s findings concerning the duration of the parties’ marriage
and the effect that an informal support arrangement entered into between Sara and
Jeffrey during the pendency of their divorce should have on the length of the term
of spousal support. The magistrate found, in relevant part, as follows:
The Court may issue a spousal support order if it is appropriate and
reasonable. In determining whether to do so, the court considers all
relevant factors including those listed in 3105.18 of the Ohio Revised
Code. The Court notes first that the parties were married on
10/30/1998, and the marriage lasted nearly 15 years up to the date of
the complaint and 17 years to the start of the final hearing. * * * The
court also notes that during the proceedings the parties entered into an
informal support agreement which will be taken into consideration for
spousal support.
***
[Jeffrey] testified that the credit card listed at $6,000 per month * * *
which he included in his budget in Exhibit 92 was used for
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miscellaneous expenses and to provide temporary spousal support to
[Sara] without a formal Court order per the parties[’] agreement. In
Exhibit R [Jeffrey] lists the monthly support payments he has made to
[Sara] per the informal agreement to provide her with temporary
support in lieu of an actual * * * spousal support order. * * * This
arrangement went on while [Sara] lived in the marital home and after
she moved out. * * * Thus, it appears that the $6,000 per month credit
card payment listed on [Jeffrey’s] budget is representative of this
informal agreement and not a regular family expense.
***
[T]he court has taken into consideration all of the statutory factors,
testimony, comments in the briefs, fact statements in this decision, the
need for and ability to pay support, the likely child support amount,
and all other relevant factors. Upon due consideration, the Court finds
that a reasonable and appropriate order of spousal support should be
$4,400 per month modifiable for a period of sixty six months * * *.
(Doc. No. 54).
{¶32} With respect to the length of the parties’ marriage and the term of
spousal support, the trial court concluded as follows:
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[Jeffrey’s] final objections relate to determination of [his] income for
purposes of child and spousal support, and the duration of spousal
support to be paid.
Relating to the Magistrate’s determination of income, again, absent a
transcript and being required to rely on the Magistrate’s factual
determinations, the Court finds that the Magistrate’s determination of
income is appropriate. While * * * from evidence referred to by the
Magistrate, it would have been possible to draw up different factual
conclusions, the Court under the circumstances is satisfied that[,]
based on the facts determined by the Magistrate, the determination of
[Jeffrey’s] income is proper.
Addressing the duration of spousal support, the Court determines that,
in the absence of a transcript, the Magistrate’s finding related to
duration of the marriage will not be disturbed. The principle
legitimate issue raised by [Jeffrey’s] objection is the period of time, if
any, during the pendency of the divorce for which [Jeffrey] should be
credited against the spousal support term. It is clear, and
acknowledged by the Magistrate, that an effectively informal spousal
support arrangement existed throughout the pendency of the divorce.
* * * [I]t appears to the Court that the amount of spousal support, and
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the provisions relating to modification of the spousal support upon
majority of a child are proper and will not be disturbed. Nevertheless,
the sixty-six (66) month term for payment established by the
Magistrate is not appropriate. Spousal support has effectively been
paid during the pendency. The Court’s determination, therefore,
based upon the facts found by the Magistrate, is that the appropriate
term of spousal support in the amount found by the Magistrate is fifty-
four (54) months rather than sixty-six (66) * * *.
(Doc. No. 65).
{¶33} We conclude that the trial court did not abuse its discretion by
modifying the magistrate’s decision in order to reduce the length of the term of
spousal support from 66 months to 54 months. From the magistrate’s decision and
the trial court’s discussion of that decision, it is clear that the magistrate and the trial
court thoroughly considered the R.C. 3105.18(C)(1) factors. Thus, the length of the
term of spousal support owed to Sara was within the trial court’s sound discretion.
{¶34} In its decision modifying the magistrate’s spousal support
recommendation, it is clear that the trial court did not change any of the magistrate’s
findings of fact or make additional findings of fact. Instead, the trial court used the
magistrate’s findings of fact without any modifications and simply reached a
different conclusion about the appropriate length of spousal support from those
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findings. Specifically, the trial court acknowledged the magistrate’s findings as to
the informal spousal support arrangement entered into by Sara and Jeffrey but, in
settling on the appropriate length of the term of spousal support, it gave greater
weight to this informal arrangement than the magistrate did. We cannot say that the
trial court modified the magistrate’s decision in an arbitrary, unreasonable, or
unconscionable manner. Thus, the trial court did not abuse its discretion.
{¶35} Therefore, Sara’s second, third, and fourth assignments of error are
overruled.
{¶36} Having found no error prejudicial to the appellant herein in the
particulars assigned and argued, we affirm the judgment of the trial court.
Judgment Affirmed
ZIMMERMAN, P.J. and SHAW, J., concur.
/jlr
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