Fernando v. Fernando , 102 N.E.3d 657 ( 2017 )

[Cite as Fernando v. Fernando, 2017-Ohio-9323.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
Champa Fernando, :
Plaintiff-Appellee, :
No. 16AP-788
v. : (C.P.C. No. 15DR-450)
Shanaka J. Fernando, : (REGULAR CALENDAR)
Defendant-Appellant. :
D E C I S I O N
Rendered on December 29, 2017
On brief: Petroff Law Offices, LLC, Ronald R. Petroff, and
Michelle J. Askins, for appellee.
On brief: Atkins and Atkins Attorneys at Law, Jacqueline
Baumann, and Arianna Atkins, for appellant.
APPEAL from the Franklin County Court of Common Pleas,
Division of Domestic Relations
DORRIAN, J.
{¶ 1} Defendant-appellant, Shanaka J. Fernando, appeals the October 19, 2016
judgment entry and final decree of divorce entered by the Franklin County Court of
Common Pleas, Division of Domestic Relations. For the following reasons, we affirm in
part and reverse in part.
I. Facts and Procedural History
{¶ 2} Appellant and plaintiff-appellee, Champa Fernando, were married on
January 6, 1996, and three children were born as issue of the marriage. On February 10,
2015, appellee filed a complaint for divorce. On January 22, 2016, the parties submitted
an agreed entry settling their personal property issues. On March 4, 2016, the parties
submitted and the trial court accepted a document containing agreed joint stipulations
No. 16AP-788 2
and a divorce settlement memorandum. As relevant to the present appeal, the parties
stipulated that, in addition to the marital residence located in Dublin, Ohio, they were
joint owners of five properties located in Sri Lanka: one located in Seeduwa ("the Seeduwa
property"), three located in Bollatha ("the Bollatha properties"), and one located in
Colombo ("the Colombo property"). The parties stipulated appellee would retain the
marital residence and appellant would be entitled to a share of the equity of the marital
residence, as determined by the court. The parties also entered stipulations regarding
their automobiles, spousal support, life insurance, retirement accounts, financial
accounts, and custody of their children.
{¶ 3} A hearing was conducted in early March 2016, with the final day of the
hearing occurring on March 15, 2016. Following the hearing, on October 19, 2016, the
trial court entered a judgment granting a final decree of divorce. With respect to the Sri
Lankan properties, the divorce decree provided appellant would retain the Seeduwa
property and the Bollatha properties. The decree further provided that the land portion of
the Colombo property was appellee's separate property, and appellee would retain it. The
court held the building located on the Colombo property was marital property, and each
of the parties was entitled to one-half of the equity in that structure. The trial court also
held appellee was entitled to half of the profits from the sale of another Sri Lankan
property ("the Ja-Ela property") the parties previously owned, which appellant sold in
2013. The decree further provided for division of the parties' automobiles and other
assets and accounts, and for custody of the children.
II. Assignments of Error
{¶ 4} Appellant appeals and assigns the following six assignments of error for our
review:
[I.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion by determining the parties' de
facto termination of marriage date was after the date of the
final hearing.
[II.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion by failing to make an equitable
division of martial property when it excluded the value of the
cars in the property division.
No. 16AP-788 3
[III.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion by failing to make an equitable
division of martial property when the court chose an arbitrary
amount in determining the value of the Colombo property.
[IV.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion in determining the amount of
rental income received by Appellee for purposes of property
division.
[V.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion in including the proceeds of
the Ja-Ela property in the division of property which resulted
in an inequitable division of property.
[VI.] The lower court in its Judgment Entry Decree of Divorce
erred and abused its discretion in determining that the land
located on the Colombo property was Appellee's separate
property.
III. Discussion
A. Duration of the Marriage for Property Valuation
{¶ 5} In his first assignment of error, appellant asserts the trial court abused its
discretion by holding that the parties' marriage terminated as of the date of the final
judgment entry rather than the date of the final hearing. Appellant argues the trial court
effectively found a de facto termination date that was contrary to the statutory
presumption for when a marriage terminates for purposes of property valuation and the
facts in this case.
{¶ 6} "Because the value of an asset may change over time, the court must select a
date as of which to value marital assets." Rossi v. Rossi, 8th Dist. No. 100133, 2014-Ohio-
1832, ¶ 29. See also Heyman v. Heyman, 10th Dist. No. 05AP-475, 2006-Ohio-1345, ¶ 31
("The first step in making an equitable distribution of marital property is to determine the
duration of the marriage."). R.C. 3105.171(A)(2)(a) creates a presumption that the term of
a marriage for purposes of property valuation is the time from the date of the marriage
through the date of the final hearing in an action for divorce. Meeks v. Meeks, 10th Dist.
No. 05AP-315, 2006-Ohio-642, ¶ 50. If the court determines use of that date would be
inequitable, however, it may select a termination date that it considers equitable. R.C.
3105.171(A)(2)(b). "[A] trial court may use a de facto termination of marriage date when
No. 16AP-788 4
the evidence clearly and bilaterally shows that it is appropriate based upon the totality of
the circumstances." Meeks at ¶ 50. The court has discretion whether to use the final
hearing date or a de facto termination date and this decision is subject to review for abuse
of discretion. Id.
{¶ 7} An abuse of discretion occurs when a trial court's decision is "unreasonable,
arbitrary, or unconscionable." Blakemore v. Blakemore, 5 Ohio St. 3d 217, 219 (1983). "A
decision is unreasonable if there is no sound reasoning process that would support the
decision." AAAA Ents., Inc. v. River Place Community Urban Redevelopment Corp., 50
Ohio St. 3d 157, 161 (1990). An arbitrary decision is one that lacks adequate determining
principle and is not governed by any fixed rules or standard. Porter, Wright, Morris &
Arthur, LLP v. Frutta Del Mondo, Ltd., 10th Dist. No. 08AP-69, 2008-Ohio-3567, ¶ 11.
An unconscionable decision may be defined as one that affronts the sense of justice,
decency, or reasonableness. Id.
{¶ 8} The final hearing in this case occurred on March 15, 2016. The trial court
entered its final judgment granting the divorce on October 19, 2016. In the divorce
decree, the court found the duration of the marriage was from January 6, 1996 until the
date of filing of the divorce decree—i.e., October 19, 2016. The trial court did not declare
any alternative termination date or duration of the marriage for purposes of property
valuation. Thus, in effect, the court held that the duration of the marriage for purposes of
property valuation and distribution was from January 6, 1996 until October 19, 2016. See
Pierron v. Pierron, 4th Dist. No. 07CA3153, 2008-Ohio-1286, ¶ 1 ("Where a decree is
silent about the date of distribution, the date the marriage terminates controls that
issue.").
{¶ 9} The majority of the property valuation and distribution issues presented in
this case were not impacted by the trial court's determination of the marriage termination
date. As discussed below, the trial court made its valuation and division of real property
based on appraisals and evidence presented at trial. The parties stipulated to the values of
their automobiles and the court found the parties had no joint financial accounts. The
divorce decree provided each party would retain his or her respective life insurance policy,
thus there was no need to determine a date for dividing the value of those policies.
Similarly, the court found neither party owned any stocks, bonds, or mutual funds, so
No. 16AP-788 5
there was no need to determine an appropriate valuation date for distribution of those
assets. However, the court found the parties' retirement accounts were marital property
and ordered them to be equally divided. The trial court did not provide a specific date for
valuation of those retirement accounts; therefore, the order effectively provided that they
were to be divided equally based on the value as of the date of the final judgment entry.
See Pierron at ¶ 1. Accordingly, we must consider whether the trial court abused its
discretion by effectively holding that the termination date of the marriage for purposes of
property valuation was the date of the final judgment entry, rather than the date of the
final hearing.
{¶ 10} As explained above, there is a statutory presumption that, for the purposes
of property valuation, a marriage terminates as of the date of the final hearing, but a trial
court may find a de facto termination date if using the date of the final hearing would be
inequitable. Generally, a trial court may find a de facto termination date of a marriage at
some point prior to the final hearing on the divorce petition, based on the facts and
circumstances in the case. See Meeks at ¶ 50 ("Although there may be a de facto
termination of the marriage prior to the date of the final divorce hearing, such
termination must be clear and bilateral, not unilateral. Generally, trial courts use a de
facto termination of marriage date when the parties separate, make no attempt at
reconciliation, and continually maintain separate residences, separate business activities,
and separate bank accounts."); Mantle v. Sterry, 10th Dist. No. 02AP-286, 2003-Ohio-
6058, ¶ 13 ("The applicable case law [regarding determination of a de facto termination
date] simply requires the trial court to consider all facts relevant to the issue of whether
the parties' marriage was irretrievably broken at some point in time prior to the final
hearing date."). Factors to be considered in determining whether to declare a de facto
termination date include "whether the parties made a clear and bilateral decision to
separate, whether the marriage was irretrievably broken at the time of separation,
whether the separation was friendly, whether the parties engaged in sexual relations after
the date of separation, whether either party had begun to cohabitate with another
following separation, and whether the parties maintained separate financial
arrangements." Heyman at ¶ 33. The parties' agreed joint stipulations provided, in
relevant part, that they were incompatible and had lived separate and apart for over one
No. 16AP-788 6
year without interruption and without cohabitation as of that date. These stipulations
suggest the parties had made a clear and bilateral decision to separate and that the
marriage was irretrievably broken at the time of the hearing in March 2016, if not earlier.
The trial court's decision did not contain any discussion or analysis of the de facto
termination date factors.
{¶ 11} Additionally, as appellant notes on appeal, use of the date of the judgment
entry as the marriage termination date for property valuation may create problems in
equitably dividing marital property because the evidence presented at a hearing relates to
the value of the property as of that time, not as of the eventual date of a final judgment
entry. See Rossi at ¶ 30 (holding trial court did not abuse its discretion by failing to apply
the date of final judgment entry as the termination date of the marriage and stating that
"use of the date of final judgment as the marriage termination date in valuing and
distributing marital property would be virtually unworkable").
{¶ 12} The trial court failed to specify a marriage termination date for purposes of
property valuation, thereby effectively holding that the marriage terminated for purposes
of property valuation as of the date of the final judgment entry. The trial court did not
address the statutory presumption contained in R.C. 3105.171(A)(2)(a) or any equitable
factors that might make an alternative date appropriate. Thus, the decision failed to set
forth any reasoning process or determining principle to support the court's rejection of
the statutory presumption and effective use of an alternate marriage termination date for
purposes of property valuation.
{¶ 13} Accordingly, we sustain appellant's first assignment of error.
B. Issues Related to the Colombo Property
{¶ 14} Next, we turn to appellant's third, fourth, and sixth assignments of error,
which relate to the Colombo property.
{¶ 15} In his sixth assignment of error, appellant argues the trial court erred by
concluding that the land portion of the Colombo property was appellee's separate
property.
{¶ 16} The Colombo property consisted of a plot of land, given by appellee's father
in 2001 ("the Colombo land") and a multi-story, multi-unit building that was completed
in 2010 ("the Colombo building"). Both appellant and appellee testified the Colombo
No. 16AP-788 7
building was constructed using marital funds. The trial court concluded the Colombo
building was marital property, and neither party disputes that finding on appeal. The trial
court further concluded the Colombo land was appellee's separate property. Appellant
argues the trial court erred in reaching this conclusion.
{¶ 17} In divorce proceedings, the court is required to determine what constitutes
marital property and what constitutes separate property. R.C. 3105.171(B). Marital
property does not include separate property. R.C. 3105.171(A)(3)(b). Separate property is
defined by statute, in relevant part, as "[a]ny gift of any real or personal property or of an
interest in real or personal property that is made after the date of the marriage and that is
proven by clear and convincing evidence to have been given to only one spouse." R.C.
3105.171(A)(6)(a)(vii). The statute further provides that the commingling of separate
property with any other type of property does not destroy its identity, unless the separate
property is not traceable. R.C. 3105.171(A)(6)(b). When the parties contest whether an
asset is marital or separate property, it is presumed to be marital property unless proven
otherwise. Wolf-Sabatino v. Sabatino, 10th Dist. No. 10AP-1161, 2011-Ohio-6819, ¶ 11.
The party requesting that an asset be classified as separate property bears the burden of
tracing it to his or her separate property. Id. We review a trial court's determination of
property as marital or separate under a manifest weight standard, and will affirm a trial
court's determination if it is supported by some competent, credible evidence. Roush v.
Roush, 10th Dist. No. 15AP-1071, 2017-Ohio-840, ¶ 18, citing Banchefsky v. Banchefsky,
10th Dist. No. 09AP-1011, 2010-Ohio-4267, ¶ 36.
{¶ 18} Appellant testified at trial that he initially did not have a good relationship
with appellee's parents, but by the time of the marriage and thereafter he was on good
terms with them. He stated the Colombo land was given as a gift by appellee's father to
benefit the family—i.e., appellee, appellant, and their children. Appellant testified it was
his intention the couple would occupy part of the Colombo building after retiring. On
appeal, appellant claims the Colombo land was intended to be a wedding gift to the
couple, but that delivery of the gift was delayed until five years after the marriage because
there were squatters living on the land.
{¶ 19} Appellee testified the Colombo land was a gift from her father, received in
December 2001, given solely to her. She stated that her father subdivided a plot of land
No. 16AP-788 8
and gave a portion to each of his daughters. Appellee testified that, although she and
appellant had been married five years and had their first child at the time of the gift, it was
intended solely to benefit her. Appellee stated she did not intend to reside on the
Colombo land in retirement, and that the Colombo building was constructed to be leased
to others for profit. Appellee testified the Colombo land was titled in her name alone.
Appellee introduced a copy of the deed of gift from her father naming her as the recipient
of the gift and an affidavit from her father, made in 2011, attesting the Colombo land was
a gift to appellee and not to appellant. On cross-examination, appellee admitted the
affidavit from her father was prepared around the time of a prior divorce filing, which she
subsequently withdrew.
{¶ 20} Appellant argues the trial court erred by concluding the Colombo land was
appellee's separate property. Appellant claims the use of marital funds to maintain the
property, build the Colombo building, and pay property taxes on the Colombo land
demonstrate the Colombo land was marital property. Appellant claims the fact that the
Colombo land is titled in appellee's name alone is not conclusive as to whether it is marital
or separate property. Appellant argues the affidavit from appellee's father should be given
little weight because it was prepared in anticipation of a divorce proceeding. Appellant
further argues appellee was not a credible witness because she failed to provide certain
information on her financial disclosures and tax returns.
{¶ 21} Appellant also cites the decision of the Eleventh District Court of Appeals in
Stacy v. Stacy, 11th Dist. No. 2004-A-0076, 2005-Ohio-5289, in support of his claim that
the Colombo land was marital property. In Stacy, Ronald Stacy claimed the trial court
erred by concluding that a vacant parcel of land given by his mother was marital property.
Id. at ¶ 14. The lot was transferred by a quitclaim deed from Ronald's mother to Ronald
and his then-wife Sherri. Ronald testified it was his idea to put his wife's name on the
deed. Following the transfer, the property taxes on the lot were paid from marital funds.
Ronald's mother testified it was her intention that the gift was solely for Ronald and that
the lot was to be returned to her if the couple wanted to sell it. Id. at ¶ 17. The trial court
concluded the lot was marital property, noting that the deed was prepared by legal
counsel and that if Ronald's mother had intended it to be a gift solely to him, that could
have been reflected by making the deed to Ronald alone. The court also noted the alleged
No. 16AP-788 9
restriction on sale of the property could have been included in the deed, but was not. The
trial court concluded that testimony from Ronald and his mother was a self-serving
attempt to retain a valuable asset. Id. at ¶ 19. Noting there was conflicting testimony
regarding whether the gift was intended for Ronald or for the couple, the court of appeals
affirmed the trial court's ruling, finding that Ronald failed to establish by clear and
convincing evidence the gift was intended solely for him. Id. at ¶ 20. Appellant argues the
present case is analogous to Stacy because the property taxes on the Colombo property
were paid with marital funds. Despite this similarity, there is a substantial difference in
the present case, in that the deed of gift conveying the Colombo land was made solely to
appellee. Thus, we are not persuaded the reasoning of the Stacy decision applies in the
present case.
{¶ 22} The fact that appellee holds title to the Colombo land is not conclusive as to
its identity as marital or separate property. R.C. 3105.171(H). See also Wolf-Sabatino at
¶ 66. Although the trial court referred to that fact as strengthening appellee's claim of
separate property, it did not rely solely on appellee's individual ownership of the property
in reaching its conclusion. The court also found the deed, the trial testimony, and the
affidavit from appellee's father clearly established his intent to give the Colombo land
solely to appellee. To the extent appellant challenges the credibility of appellee's
testimony or the affidavit from appellee's father, those issues were raised at trial and the
court was able to consider them in evaluating and weighing the evidence. "It is the place
of the trial court, not the reviewing court, to assess the credibility of the witnesses."
Heyman at ¶ 18. Under the circumstances in this case, we conclude there was competent,
credible evidence to support the trial court's conclusion and, therefore, the finding that
the Colombo land was appellee's separate property was not against the manifest weight of
the evidence. Compare Crowder v. Crowder, 10th Dist. No. 98AP-1124 (Aug. 5, 1999)
(holding that even if lump sum mortgage payment and monthly mortgage payments on
the marital residence made by appellant's father were considered gifts, there was no
evidence they were given only to the appellant); Pettry v. Pettry, 81 Ohio App. 3d 30, 34-
35 (10th Dist.1991) (holding that despite appellant's testimony that a down payment on
the marital home was advanced by her parents, she failed to demonstrate the down
payment was intended to be a separate gift to her, rather than a gift to the couple).
No. 16AP-788 10
{¶ 23} Accordingly, we overrule appellant's sixth assignment of error.
{¶ 24} In his third assignment of error, appellant argues the trial court abused its
discretion in determining the value of the Colombo property. As explained above, we
conclude the trial court's determination that the Colombo land was appellee's separate
property was not against the manifest weight of the evidence. Therefore, in considering
appellant's third assignment of error, we will evaluate whether the trial court abused its
discretion in determining the value of the Colombo building, which it found to be marital
property.
{¶ 25} After determining what constitutes marital property and what constitutes
separate property, the court is required to divide the marital and separate property
equitably. R.C. 3105.171(B). With respect to marital property, R.C. 3105.171(C)(1)
provides that marital property shall be divided equally, unless an equal division would be
inequitable, in which case the property shall be divided in the manner the court
determines equitable. The trial court must value the marital property to determine an
appropriate division. See Raymond v. Raymond, 10th Dist. No. 11AP-363, 2011-Ohio-
6173, ¶ 22 ("To comply with its duty [under R.C. 3105.171(C)(1)], the trial court must value
and divide all marital property in a divorce, and in most cases, the failure to do so
amounts to an abuse of discretion. Although a trial court possesses broad discretion to
determine the value of marital property, it may not omit valuation altogether.") (Citations
omitted.). We review a trial court's determination of the value of marital property for
abuse of discretion. Beagle v. Beagle, 10th Dist. No. 09AP-353, 2009-Ohio-6570, ¶ 11 ("A
trial court has broad discretion to determine the value of marital property, and its
determination will not be disturbed on appeal absent an abuse of that discretion."); Grody
v. Grody, 10th Dist. No. 07AP-690, 2008-Ohio-4682, ¶ 20 ("A trial court has broad
discretion in developing a measure of value for property in a divorce case.").
{¶ 26} "Although a trial court enjoys broad discretion in determining the value of a
marital asset, such discretion is not without limit. An appellate court's duty is not to
require the adoption of any particular method of valuation, but to determine whether,
based upon all the relevant facts and circumstances, the court abused its discretion in
arriving at a value." Apps v. Apps, 10th Dist. No. 02AP-1072, 2003-Ohio-7154, ¶ 38. "A
trial court must have a rational evidentiary basis for assigning value to marital property."
No. 16AP-788 11
Id. See also Dach v. Homewood, 10th Dist. No. 14AP-502, 2015-Ohio-4191, ¶ 36 ("[A]
domestic court has broad discretion to make divisions of property and if there is some
competent, credible evidence to support the trial court's decision, there is no abuse of
discretion.").
{¶ 27} At trial, three sets of appraisals of the Sri Lankan properties, including the
Colombo property, were admitted as evidence. Appellant submitted appraisals conducted
in 2011 and a second set of appraisals conducted in 2015. Appellee submitted appraisals
conducted on March 10, 2016. Although the parties had stipulated to the admission of
appraisal reports on the Sri Lankan properties, appellant objected to appellee's March 10,
2016 appraisals because they were conducted after the stipulations had been entered. The
trial court overruled appellant's objection, but noted it would give the 2016 appraisals
appropriate weight because the appraiser who prepared the reports was unable to testify
in the proceedings.
{¶ 28} In the divorce decree, the trial court generally found "the appraisal done
and introduced by Defendant to be the most accurate appraisals." (Jgmt. Entry at 5.) All
the appraisals of the Sri Lankan properties stated property values in Sri Lankan rupees.
The parties stipulated to a conversion rate of 134.44 Sri Lankan rupees to one United
States dollar. Based on that conversion rate, the trial court's determination of the values
of the four Sri Lankan properties awarded to appellant under the property settlement
matched the values contained in the 2015 appraisals submitted by appellant, rounded to
the closest whole dollar. With respect to the Colombo building, however, the trial court's
determination of value matched the value contained in the 2011 appraisal of the Colombo
property submitted by appellant. The 2011 appraisal stated the Colombo building was
worth 19,687,000 rupees, which would be $146,437.07 at the stipulated conversion rate.
The 2015 appraisal stated the Colombo building was worth 21,000,000 rupees, which
would be $156,203.51 at the stipulated conversion rate. In the divorce decree, the trial
court concluded the Colombo building was worth $146,437.07, and that appellant was
entitled to one-half of that value. The trial court also appears to have relied on the 2011
appraisal in determining the value of the Colombo land and the total value of the Colombo
property.
No. 16AP-788 12
{¶ 29} As noted above, a trial court must have a rational evidentiary basis for
assigning value to marital property. Apps at ¶ 38. The trial court's discussion of the
Colombo property does not contain any indication why the court found the 2011 appraisal
of that property more persuasive than the 2015 appraisal, despite relying on the 2015
appraisals in determining the value of all the other Sri Lankan properties. The trial court
relied on the 2011 appraisal without explanation or justification to set the value of the
Colombo building for purposes of division of the marital property. On remand, the trial
court may provide a rational evidentiary basis for relying on the 2011 appraisal or
consider the 2015 appraisal if it determines the same to be a rational evidentiary basis for
the value of the Colombo property.
{¶ 30} Accordingly, we sustain appellant's third assignment of error.1
{¶ 31} In his fourth assignment of error, appellant asserts the trial court abused its
discretion in determining the rental income appellee received from the Colombo building
and in distributing that income between the parties. We review a trial court's division of
property for abuse of discretion. Roush at ¶ 18.
{¶ 32} Both appellant and appellee testified at trial that the Colombo building was
completed in 2010. Appellee testified the Colombo building had been consistently rented
to a single family since 2010, and that she received approximately $10,000 per year in
rental income from the Colombo building. Appellant testified he had not received any of
the rental income from the Colombo building and he was seeking half of the
approximately $60,000 appellee had received in rental income from the Colombo
building during 2010 through 2016. Further, in an affidavit filed in opposition to
appellant's request for attorney fees related to discovery, appellee attested she received
$10,500 in rental income from the Colombo building in 2015.
{¶ 33} In the divorce decree, the trial court found appellee had received
$28,333.33 in rental income from the Colombo building from August 2010 through
1 In her brief on appeal, appellee requests the court sustain the third assignment of error. She appears to
argue the trial court should have relied on the 2015 appraisal in determining the value of the Colombo land,
but further argues the Colombo building was only worth 14,000,000 rupees, or $104,135.67 at the stipulated
conversion rate. It is unclear where appellee derived this proposed value, because it does not appear to be
contained in any of the three appraisals of the Colombo property submitted to the trial court. Regardless, to
the extent appellee seeks to challenge the trial court's determination of the value of the Colombo property,
she did not file a notice of appeal from the judgment and any such challenge is not properly before this
court.
No. 16AP-788 13
March 2016. The court further found no evidence had been given as to improvements or
receipts for expenses. The court concluded appellant was entitled to one-half of the rental
proceeds, or $14,166.67. The decision does not set forth the basis for the trial court's
finding that appellee received rental income from the Colombo building that was less than
half of the amount she testified to at trial. There does not appear to be any competent,
credible evidence in the record to support the trial court's determination of appellee's
rental income from the Colombo building.
{¶ 34} Accordingly, we sustain appellant's fourth assignment of error
C. Exclusion of Value of Automobiles from Property Division
{¶ 35} In his second assignment of error, appellant asserts the trial court abused its
discretion by failing to include the value of two of the parties' automobiles in the property
settlement. R.C. 3105.171(C)(1) provides that marital property shall be divided equally,
unless an equal division would be inequitable, in which case the property shall be divided
in the manner the court determines equitable. We review a trial court's division of marital
property for abuse of discretion. Lorey v. Lorey, 10th Dist. No. 16AP-14, 2016-Ohio-
5949, ¶ 14.
{¶ 36} In the divorce decree, the trial court held that appellee would retain, free
and clear from any claim of appellant, a 2012 Honda Odyssey that was titled jointly in the
parties' names. The trial court also held that appellant would retain, free and clear from
any claim of appellee, a 2011 Honda Civic and a 2012 Honda Civic, one of which was titled
jointly in the parties' names and one of which was titled in appellant's name. The trial
court further expressly held that appellant would not be entitled to any equity in the 2012
Honda Odyssey. Although the trial court did not expressly hold that appellee was not
entitled to any equity in the two vehicles retained by appellant, it effectively reached this
result by not providing for any transfer or offset of equity in the vehicles in the property
settlement portion of the divorce decree.
{¶ 37} Appellant argues the trial court abused its discretion because its decision
was inconsistent with the parties' agreed joint stipulations and settlement memorandum.
Under the joint stipulations, the parties agreed appellant would be entitled to retain all
equity in the 2012 Honda Civic. The joint stipulations did not include any express
provisions with respect to any equity in the 2012 Honda Odyssey or the 2011 Honda Civic,
No. 16AP-788 14
although it contained stipulations regarding the value of those vehicles. Appellant argues
on appeal that "[t]he intent of the parties seems clear that by mentioning the values of the
other two vehicles in the Settlement Memorandum but not the 2012 Honda Civic the
parties intended for the lower court to distribute their values in the division of property."
(Appellant's Brief at 22-23.) However, if this was the intent of the parties, they could have
made it clear by stating in the settlement memorandum that each party would receive
one-half the equity in those two vehicles. Under these circumstances, where the parties
did not expressly provide in the agreed joint stipulations whether the equity in the 2012
Honda Odyssey and 2011 Honda Civic was to be divided among the parties, we cannot
conclude the trial court abused its discretion by effectively permitting each party to retain
the equity in the vehicles they were awarded under the divorce decree.
{¶ 38} Accordingly, we overrule appellant's second assignment of error.
D. Proceeds of Sale of Ja-Ela Property
{¶ 39} In his fifth assignment of error, appellant claims the trial court abused its
discretion by holding appellee was entitled to one-half of the proceeds of the Ja-Ela
property sale. Appellant argues the trial court failed to consider the totality of the
circumstances surrounding the proceeds of this sale and each party's use of marital funds
to start individual businesses around the time of the sale.
{¶ 40} The trial court concluded appellant sold the Ja-Ela property in 2013 for a
profit of $34,960, and that appellee never received her half of the profits. The trial court
included a payment of $17,480 to appellee in the property settlement to account for one-
half of the profits from the Ja-Ela property sale.
{¶ 41} Appellant asserts he used the profits from the Ja-Ela property sale to start a
chicken farming business, which ultimately failed, resulting in a financial loss. Appellant
claims that around the same time, appellee used marital funds to start a business, which
also ultimately resulted in a loss of funds. Appellant argues the trial court's award was
inequitable because it failed to consider appellee's loss of marital funds through her
business venture, which effectively offset appellant's use of the Ja-Ela profits for his
business.
{¶ 42} Appellee testified at trial that the Ja-Ela property had been purchased in
2003, using funds from a home equity line on the marital residence. Appellee stated
No. 16AP-788 15
appellant sold the Ja-Ela property in 2013 and informed her he was using the money to
start a business in Sri Lanka. Appellee testified that none of the proceeds were used to
pay marital expenses. She requested the court award her one-half of the proceeds from
the Ja-Ela sale. On cross-examination, appellee admitted she opened a business around
the same time, using funds from her paychecks. Appellant testified that he used the
proceeds from the sale of the Ja-Ela property to start a chicken farming business. He
claimed appellee was generally aware he was starting a business, although she was not
aware of specific details. Appellant stated the business failed due to a flood, resulting in a
financial loss. Appellant argued appellee was not entitled to any of the proceeds from the
Ja-Ela sale, which he used to fund his individual business, because appellee had incurred
similar losses from her business venture using marital funds.
{¶ 43} It is undisputed that the Ja-Ela property was marital property and that
appellant unilaterally sold the property and used the proceeds to fund a business venture.
While the divorce decree did not expressly address appellant's claim that appellee was not
entitled to one-half the proceeds from the sale due to her use of marital funds for other
business ventures, the transcript demonstrates the trial court was aware of this argument
and could consider it in determining an equitable property settlement. Under these
circumstances, we conclude appellant has failed to demonstrate the trial court acted
arbitrarily, unreasonably, or unconscionably in awarding appellee one-half of the
proceeds of the Ja-Ela property sale. Thus, the trial court did not abuse its discretion in
making this award.
{¶ 44} Accordingly, we overrule appellant's fifth assignment of error.
IV. Conclusion
{¶ 45} For the foregoing reasons, we sustain appellant's first, third, and fourth
assignments of error, and overrule appellant's second, fifth, and sixth assignments of
error. We affirm in part and reverse in part the judgment of the Franklin County Court of
Common Pleas, Division of Domestic Relations, and remand the matter to that court for
further proceedings consistent with law and this decision.
Judgment affirmed in part and reversed in part; cause remanded.
BRUNNER and HORTON, JJ., concur.