Messmer v. Messmer , 2020 ND 62 ( 2020 )

Filed 03/19/20 by Clerk of Supreme Court
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2020 ND 62
Clare Messmer, Plaintiff and Appellee
v.
Robert Messmer, Defendant and Appellant
No. 20190243
Appeal from the District Court of Stark County, Southwest Judicial District,
the Honorable Rhonda R. Ehlis, Judge.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
Opinion of the Court by Jensen, Chief Justice, in which Justices VandeWalle,
Crothers, and Tufte joined. Justice McEvers filed an opinion concurring in
part and dissenting in part.
Thomas F. Murtha IV (argued) and Dennis W. Lindquist (appeared),
Dickinson, ND, for plaintiff and appellee.
Jennifer M. Gooss, Beulah, ND, for defendant and appellant.
Messmer v. Messmer
No. 20190243
Jensen, Chief Justice.
[¶1] Robert Messmer appeals from an amended divorce judgment and order
granting a new trial. He argues the district court erred in the inclusion of 320
acres of property in the marital estate, the valuation and distribution of the
parties’ property, the denial of an award of spousal support, and the denial of
an award of attorney fees. We affirm the district court’s inclusion of the 320
acres in the marital estate, reverse the district court’s valuation of the 320
acres, and remand the case for further proceedings consistent with this
opinion.
I
[¶2] Robert Messmer and Clare Messmer were married in 1984. During the
marriage, Robert Messmer actively engaged in farming and ranching. Clare
Messmer helped with the farming and ranching activities as well as working
outside the home.
[¶3] Clare Messmer initiated divorce proceedings on June 13, 2016. A trial
was held on May 7, 2018, with a judgment entered on August 22, 2018.
[¶4] On September 10, 2018, Robert Messmer filed a motion for a new trial
asserting an error had been made in the valuation of a wind turbine lease. On
October 5, 2018, Clare Messmer filed a motion to amend the judgment to
include 320 acres of land not included within the original property distribution.
On November 7, 2018, the district court granted both of the motions after
finding the parties had inadvertently failed to provide evidence of the value of
the wind turbine lease during the first trial, finding the 320 acres should be
included within the marital estate, and setting the valuation date for the 320
acres as the date of the subsequent second trial.
[¶5] On appeal, Robert Messmer raises several challenges to the district
court’s findings. He asserts the court erred in finding a gift of a remainder
interest in the 320 acres had been delivered to him and was includable in the
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marital estate, and the court erred in using the second trial date as the date
for valuing the 320 acres. He also challenges the court’s distribution of marital
property asserting the court failed to properly consider the conduct of the
parties during the marriage, erred in ordering him to make an equalization
payment to Clare Messmer, and erred in the valuation of mineral interests.
Additionally, he challenges the denial of his request for spousal support and
the denial of his request for attorney fees.
II
[¶6] Subsequent to the first trial, the parties discovered a remainder interest
in 320 acres had been gifted to Robert Messmer by his mother who had
retained a life estate in the property. Robert Messmer argues the district court
erred when it included the 320 acres in the marital estate. Robert Messmer
asserts that, at the time of the first trial, the conveyance from his mother was
not a completed gift because he did not have physical possession of the deed
and he was unaware of the transfer.
[¶7] After granting a divorce, the district court is required to value the
parties’ property and debts and “make an equitable distribution.” N.D.C.C. §
14-05-24(1). Our standard of review for distribution of marital property is well
established:
This Court reviews a district court’s distribution of marital
property as a finding of fact, and will not reverse unless
the findings are clearly erroneous. A finding of fact is clearly
erroneous if it is induced by an erroneous view of the law, if there
is no evidence to support it, or if, after reviewing all the evidence,
we are left with a definite and firm conviction a mistake has been
made. We view the evidence in the light most favorable to the
findings, and the district court’s factual findings are presumptively
correct.
Adams v. Adams, 2015 ND 112, ¶ 13, 863 N.W.2d 232 (internal citations and
quotations omitted); see also Holm v. Holm, 2017 ND 96, ¶ 4, 893 N.W.2d 492.
[¶8] In order for an asset to be included within the marital estate, one or both
of the parties must have a present property interest in the asset, rather than
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a mere expectancy. Paulson v. Paulson, 2010 ND 100, ¶ 19, 783 N.W.2d 262
(citing 27B C.J.S. Divorce § 852 (2009)). Gifts may be included within the
marital estate if the gift satisfies certain prerequisites:
A district court may consider property to be part of the marital
estate, if supported by evidence, even if a party claims it is owned
by a nonparty. Barth v. Barth, 1999 ND 91, ¶ 8, 593 N.W.2d 359.
“The principles applicable to inter vivos gifts in general apply as
well to purported gifts of certificates of deposit.” 38 Am.Jur.2d
Gifts § 67 (1999). A valid gift made during the donor’s lifetime
must satisfy certain requirements―donative intent, delivery,
actual or constructive, and acceptance by donee. Makedonsky v.
North Dakota Dep’t of Human Servs., 2008 ND 49, ¶ 11, 746
N.W.2d 185. (“A valid gift requires an intention by the donor to
then and there give the property to the donee, coupled with an
actual or constructive delivery of the property to the donee and
acceptance of the property by the donee.”) A donor’s intent is a
question of fact. Doeden v. Stubstad, 2008 ND 165, ¶ 12, 755
N.W.2d 859. The actual or constructive delivery must be “of a
nature sufficient to divest the owner of all dominion over
the property and to invest the donee therewith.” In re Kaspari’s
Estate, 71 N.W.2d 558, 567 (N.D. 1955).
Kovarik v. Kovarik, 2009 ND 82, ¶ 13, 765 N.W.2d 511.
[¶9] In support of her motion for a new trial, Clare Messmer cited Dinius v.
Dinius, for the proposition that there was constructive delivery of the
deed because Robert Messmer’s mother had recorded it. 448 N.W.2d 210 (N.D.
1989). In Dinius, we affirmed a finding that deeds were delivered when the
parties were in control of real property, the deeds were recorded, but the deeds
were not physically delivered. Id. at 215-17. Whether there was actual or
constructive delivery of a deed is a finding of fact. Id. at 216.
[¶10] The district court found, and Robert Messmer has not challenged, that
the deed was filed by Robert Messmer’s mother with the county recorder before
the parties’ separation. The court further found that neither party was aware
of the transfer until after the first trial. Finally, the court found Robert
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Messmer’s mother had passed away between the date of the first trial and the
date of the second trial.
[¶11] A conveyance by deed takes effect upon the delivery of the deed by the
grantor. CUNA Mortg. v. Aafedt, 459 N.W.2d 801, 803-04 (N.D. 1990) (citing
Frederick v. Frederick, 178 N.W.2d 834, 837 (N.D. 1970); N.D.C.C. § 47-09-06).
A presumption of constructive delivery arose when Robert Messmer’s mother
filed the deed with the county recorder divesting herself of the remainder
interest in the property. Dinius, 448 N.W.2d 210. “The recording of a deed may
create a rebuttable presumption of its delivery to, and its acceptance by, the
grantee.” CUNA Mortg., at 804. The presumption of acceptance following the
recording of a deed only arises when the deed is beneficial to the grantee. Id.
[¶12] Failure to renounce a deed after learning of its existence may be
sufficient to show a grantee accepted the deed. CUNA Mortg., 459 N.W.2d 801
at 804. To rebut a presumption of delivery arising from the recording of a deed,
the opposing party must provide clear and convincing evidence. Eide v. Tveter,
143 F. Supp. 665, 669 (D.N.D. 1956).
[¶13] The specific issue of whether the 320 acres should be included within the
marital estate was raised below and contested in the district court. Robert
Messmer has not challenged the court’s finding the deed had been filed prior
to the parties’ separation. The filing creates a presumption of both delivery and
acceptance occurring at the time the deed was filed. The presumption requires
clear and convincing evidence to rebut. Robert Messmer offered no evidence to
rebut the presumption of delivery and acceptance. Although the court found
that neither party knew about the deed prior to the entry of the first judgment,
Robert Messmer did not provide evidence, or even assert, he had renounced
the gift during the post-trial motion or the second trial. Robert Messmer’s only
argument in the court below, and on appeal, is that delivery did not occur
because he was not physically given the deed and he was unaware of the
transfer. Under these circumstances, after having determined the deed had
been recorded and in the absence of any evidence of renunciation, the court did
not err in including Robert Messmer’s remainder interest in the 320 acres in
the marital estate.
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III
[¶14] Robert Messmer also challenged the district court’s valuation of the 320
acres at the time of the second trial, arguing the property should have been
valued as a remainder interest on May 18, 2018, the date of the parties’ first
trial. The court, in its order granting the motion to reopen the case subsequent
to the first judgment, found the appropriate valuation date to be the date of
the second trial. The court declined “to value the land as a remainder interest
as the current value should be the value of the property with Robert being the
owner of the land in its entirety.” In finding the appropriate valuation date to
be the date of the second trial, the court relied on its finding “Robert is the
owner of this property, with no further restrictions . . . [b]oth parties have an
interest in this Court properly dividing all assets of the marriage, and
distributing those assets in an equitable manner.” The court thereafter valued
the 320 acres as of the date of the second trial.
[¶15] Valuation of the marital estate is governed by N.D.C.C. § 14-05-24(1)
which reads as follows:
When a divorce is granted, the court shall make an equitable
distribution of the property and debts of the parties. Except as
may be required by federal law for specific property, and subject to
the power of the court to determine a date that is just and
equitable, the valuation date for marital property is the date
mutually agreed upon between the parties. If the parties do not
mutually agree upon a valuation date, the valuation date for
marital property is the date of service of a summons in an action
for divorce or separation or the date on which the parties last
separated, whichever occurs first.
The statute is unambiguous. It does not provide the district court with
discretion when the parties do not agree upon a valuation date. In the absence
of an agreement, the statute requires valuation of the marital estate as of the
date of service of a summons or the date on which the parties last separated,
whichever occurs first.
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[¶16] The second sentence of N.D.C.C. § 14-05-24(1) reads: “[e]xcept as may be
required by federal law for specific property, and subject to the power of the
court to determine a date that is just and equitable, the valuation date for
marital property is the date mutually agreed upon between the parties.” That
sentence requires the district court to use the valuation date agreed upon by
the parties unless the court determines the agreement would not be just and
equitable.
[¶17] The third sentence of N.D.C.C. § 14-05-24(1) reads: “[i]f the parties do
not mutually agree upon a valuation date, the valuation date for marital
property is the date of service of a summons in an action for divorce or
separation or the date on which the parties last separated, whichever occurs
first.” That sentence does not include any directive to the district court to
exercise its discretion, but instructs the court, in the absence of an agreement
between the parties, to value the marital property on the date of service of a
summons or the date the parties last separated, whichever occurs first.
[¶18] Reading district court discretion into the third sentence and allowing the
court to exercise its discretion in the absence of an agreement would render
the legislature’s directives meaningless. There would be no circumstances
under which the court would not have discretion. Regardless of this Court’s
preference regarding district court discretion in selecting an equitable date for
valuing a marital estate, “the letter of it [the law] is not to be disregarded under
the pretext of pursuing its spirit.” N.D.C.C. § 1-02-05.
[¶19] Through the enactment of N.D.C.C. § 14-05-24(1), the legislature has
provided a definitive process for determining the date to value the marital
estate that limits the district court’s discretion to accepting or rejecting an
agreed upon valuation date. The statute does not provide the court with
discretion to select its own valuation date and the court misapplied the law by
valuing the 320 acres at the date of the second trial.
[¶20] We have recently considered the district court’s authority to revalue
assets of a marital estate subsequent to trial in extraordinary circumstances.
Innis-Smith v. Smith, 2018 ND 34, 905 N.W.2d 914. In Innis-Smith, this Court
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reversed a district court’s decision not to allow a case to be reopened because
of a change in the value of an asset two years subsequent to trial. Id. at ¶ 19.
We held reconsideration of a property division may be appropriate in an
extraordinary case “when a substantial, unanticipated change in valuation of
an asset occurs after trial but before distribution.” Id. (quoting Grinaker v.
Grinaker, 553 N.W.2d 204, 209 (N.D. 1996)). That decision seems inapposite
to a strict application of N.D.C.C. § 14-05-24(1) which became effective August
1, 2017. However, we were not asked to consider the application of N.D.C.C. §
14-05-24(1) in Innis-Smith, all of the relevant events except the issuance of our
opinion in Innis-Smith occurred prior to the effective date of the statute, and
we have not been requested by either party to reconcile that case with
the present case. Consideration of whether our decision in Innis-Smith can, or
needs to be, reconciled with N.D.C.C. § 14-05-24(1) is unnecessary in this case.
IV
[¶21] On appeal, Robert Messmer raises several other issues related to the
district court’s allocation of the marital estate including the following:
asserting the factual findings regarding the conduct of the parties during the
marriage were clearly erroneous or incomplete, challenging the award of an
equalization payment from Robert Messmer to Clare Messmer, challenging the
manner in which certain parcels of real property were allocated, and
challenging the manner in which mineral interests were allocated. He also
argues the court erred by denying his request for spousal support and attorney
fees. Property division and spousal support issues are interrelated and
intertwined, often must be considered together, and the court is not prevented
from reconsideration and reallocation of both issues on remand. Mertz v.
Mertz, 2015 ND 13, ¶ 27, 858 N.W.2d 292. Because the remaining issues are
interrelated and intertwined with the valuation of the 320 acres, it is
unnecessary to address those issues on this appeal.
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V
[¶22] We affirm the district court’s inclusion of the 320 acres in the marital
estate. We reverse the district court’s use of the second trial date as the
valuation date for the 320 acres and remand for use of a valuation date
consistent with N.D.C.C. § 14-05-24(1). Resolution of the remaining issues
raised by Robert Messmer on appeal are unnecessary in light of the remand to
the district court.
[¶23] Jon J. Jensen, C.J.
Jerod E. Tufte
Daniel J. Crothers
Gerald W. VandeWalle
McEvers, Justice, concurring in part and dissenting in part.
[¶24] I concur with the majority in sections I, II, and IV, and respectfully
dissent with the majority that N.D.C.C. § 14-05-24(1) is unambiguous.
[¶25] “On numerous occasions this Court has stated that statutes must be
construed as a whole to determine the intent of the legislature and that the
intent must be derived from the whole statute by taking and comparing every
part thereof together.” State v. Mees, 272 N.W.2d 61, 64 (N.D. 1978). A statute
is ambiguous if it can produce more than one meaning and absurd results. Id.
Under N.D.C.C. § 1-02-39:
If a statute is ambiguous, the court, in determining the
intention of the legislation, may consider among other matters:
1. The object sought to be attained.
2. The circumstances under which the statute was enacted.
3. The legislative history.
4. The common law or former statutory provisions, including
laws upon the same or similar subjects.
5. The consequences of a particular construction.
6. The administrative construction of the statute.
7. The preamble.
[¶26] Section 14-05-24(1), N.D.C.C., reads as follows:
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When a divorce is granted, the court shall make an equitable
distribution of the property and debts of the parties. Except as
may be required by federal law for specific property, and subject to
the power of the court to determine a date that is just and
equitable, the valuation date for marital property is the date
mutually agreed upon between the parties. If the parties do not
mutually agree upon a valuation date, the valuation date for
marital property is the date of service of a summons in an action
for divorce or separation or the date on which the parties last
separated, whichever occurs first.
[¶27] In breaking down N.D.C.C. § 14-05-24(1), it would be absurd to say
courts will only have to follow the provision “[e]xcept as may be required by
federal law” in the second sentence only if parties agree. If something is
required by federal law, the parties will have to follow it whether they agree to
a valuation date or not. It also seems absurd to me that the legislature
intended to give the district court the power to do what is just and equitable
only when the parties agree. I would suggest that the best time to give court
discretion is when parties do not agree, and I think that is what the legislature
intended.
[¶28] Based on the legislative history, it is clear that the intent was generally
to move the valuation date earlier. See Hearing on H.B. 1325 Before the House
Judiciary Comm., 65th N.D. Legis. Sess. (Jan. 25, 2017) (testimony of Connie
Triplett stating, “[t]he point of the bill is to move the valuation date up to three
to six months after a divorce starts”). It also appears that the legislature was
made aware that the courts would have to deal with property values decreasing
over time through no fault of either party and it was argued the court should
have discretion to deal with those situations and also to consider an exception
for federal pension issues. Id. The House Standing Committee Minutes of the
Judiciary Committee reflect the reasons for the proposed amendments to the
bill:
Chairman K. Koppelman: Property might be inflated or decreased
in value because of the time lapsing. It is fairest to value it at the
earliest date possible. Do you think your language deals with this?
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Representative Klemin: This clarifies the default date. If the
parties agree on a date, why should anyone else decide differently.
It is also subject to federal law relating to pensions that overrides
everything. It is always up to the court.
[¶29] The dates in the statute were intended to be a default, but always leaving
it up to the court. I invite the legislature to reconsider the need of courts to
have the discretion necessary to make an equitable division of property based
on the realities of the case before the court.
[¶30] Lisa Fair McEvers
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