Szokan v. Stevens

[Cite as Szokan v. Stevens, 2020-Ohio-7001.]
IN THE COURT OF APPEALS
ELEVENTH APPELLATE DISTRICT
LAKE COUNTY, OHIO
LINDA C. SZOKAN, EXECUTOR : OPINION
OF THE ESTATE OF DOLORES A.
STEVENS, :
CASE NO. 2020-L-020
Plaintiff-Appellee, :
- vs - :
LINDA C. SZOKAN, et al., :
Defendants :
DONALD H. STEVENS, :
Defendant-Appellant. :
Civil Appeal from the Lake County Court of Common Pleas, Case No. 2017 CV 01098.
Judgment: Affirmed.
Gary D. Zeid, Sternberg & Zeid Co., L.P.A., 7547 Mentor Avenue, Suite #301, Mentor,
Ohio, 44060-5466 (For Plaintiff-Appellee).
Timothy H. Snyder, 12373 Kinsman Road, Suite 105, P.O. Box 386, Burton, Ohio 44021
(For Defendant-Appellant).
THOMAS R. WRIGHT, J.
{¶1} Appellant, Donald H. Stevens, appeals the trial court’s declaratory judgment
regarding the ownership of certain U.S. Savings Bonds that were bought during his
marriage to the deceased, Delores A. Stevens. He contends the court misinterpreted
their separation agreement in concluding that the bonds should be distributed as part of
deceased’s estate. We affirm.
{¶2} Appellant and the deceased were married for approximately 27 years and
had no children. During a 16-year period beginning in 1986, the couple purchased
numerous U.S. Savings Bonds Series EE and I. Each bond expressly lists appellant and
the deceased as co-owners. As of the date of the Stevens’ dissolution in November 2002,
the bonds were valued at more than $60,000.
{¶3} Prior to terminating their marriage, appellant and the deceased negotiated
a separation agreement that was ultimately incorporated into the dissolution decree. In
its preamble, the agreement provides that it was their mutual desire to “completely settle
and determine” their respective rights “to any and all property, real and personal, each
may have by virtue of their marriage * * *.’ Article 7(D) of the agreement states that the
document “constitutes the entire understanding of the parties, and there are no
representations, warranties, covenants or undertakings other than those expressly set
forth herein * * *.” In addition, Article 8 states that to be effective a modification or waiver
of any agreement provision must be in writing and executed with the same formality as
the agreement itself.
{¶4} Article 3 of the separation agreement governs the distribution of the marital
property. Although section (E) of that provision is titled “RETIREMENT/PENSION, I.R.A.,
SHARES, STOCKS AND BONDS,” it makes no reference to their collection of U.S.
Savings Bonds. In fact, there is no reference to the bonds in Article 3 or throughout the
entire agreement.
{¶5} In regard to property not expressly listed in the agreement, section (H) of
Article 3 sets forth a catchall provision, which states: “The parties have effected, to their
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mutual satisfaction, a division of all property, real and personal, of whatever kind or
description, and wheresoever situation.”
{¶6} As to the implementation of the separation agreement, Article 12(A) states:
“Upon the signing of this Agreement, each party shall deliver to the other party, or permit
the other party to take possession of all items or property to which he or she is entitled
under the terms of this Agreement * * *.”
{¶7} From the issuance of the dissolution decree in November 2002 until her
death in May 2017, the deceased had exclusive possession of all bonds purchased during
the marriage. Although a federal statutory procedure exists for removing a person’s name
from a U.S. Savings Bond when his co-ownership has been terminated, the deceased did
not attempt to invoke the procedure. Moreover, she did not cash any of the bonds.
{¶8} Approximately one month before her death, the deceased executed a Last
Will and Testament, in which she bequeathed her entire estate to her sister, Linda C.
Szokan. In stating the bequest, the will does not cite or list any specific asset, but instead
only refers to the “estate.” As a result, there is no reference to the bonds in the will.
{¶9} The will also names Szokan as executor of the estate. Within three weeks
of her sister’s death, Szokan submitted the will to probate. One month later, Szokan filed
a separate action on behalf of the estate seeking a declaratory judgment regarding the
status of the bonds. Her complaint alleges that appellant claims ownership of the bonds
because he is the surviving co-owner. Challenging his claim, the complaint alleges that
the bonds should be declared estate assets because they were distributed to the
deceased under the terms of the separation agreement.
{¶10} After Szokan amended her complaint by attaching copies of the separation
3
agreement, dissolution decree, will, and an inventory of the bonds, appellant moved for
summary judgment on the declaratory judgment claim. In an affidavit accompanying the
motion, appellant avers that at the time they negotiated the separation agreement in 2002,
he and the deceased also reached an understanding that the bonds would remain titled
in both of their names until one of them died, and that the survivor would become sole
owner. He further states that the deceased retained possession of the bonds during her
lifetime only as a matter of convenience and that she intended to send the bonds to him
prior to her death. In addition, appellant argues that even though the separation
agreement does not reference the bonds, its terms are consistent with their oral
agreement that the survivor would become sole owner.
{¶11} Szokan filed a competing motion for summary judgment. As to appellant’s
averment of a separate understanding concerning the disposition of the bonds, Szokan
asserts that the averment could not be considered because the terms of the separation
agreement were plain and unambiguous. She further asserts that since the agreement
had no specific reference to the bonds, Article 3(H) of the agreement, governing
unenumerated property, controls. Construing that term, Szokan argues that the
deceased’s sole possession of the bonds after the dissolution was sufficient to establish
her entitlement to sole ownership.
{¶12} In ruling in favor of Szokan, appellee, on both summary judgment motions,
the trial court first held that under federal law ownership of the bonds can be modified
through a property agreement that is incorporated into a divorce/dissolution decree. Next,
the court concluded that the terms of the subject separation agreement were sufficient to
establish that appellant and the deceased intended for her to receive the bonds as part
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of the property distribution. Relying primarily upon Articles 3(H) and 12(A), the court held
that the couple not only intended to divide all of their marital property, but also intended
for the distribution to occur immediately; thus, the deceased’s continuous possession of
the bonds since the dissolution demonstrates that she became sole owner. Thus, the
court found that the bonds were probate assets that would be distributed in accordance
with the deceased’s will.
{¶13} In challenging this decision, appellant asserts two assignments:
{¶14} “[1.] Reviewing both parties’ motions for summary judgment de novo, the
record is clear and convincing that the trial court erred to the prejudice of the appellant by
granting the appellee-plaintiff’s motion for summary judgment and denying the appellant-
defendant’s motion for summary judgment in favor of the appellee.
{¶15} “[2.] The trial court erred to the prejudice of the appellant by granting the
appellee-plaintiff’s motion for summary judgment as it lacked jurisdiction over the subject
matter or otherwise and by failing to even rule thereupon.”
{¶16} Since our ruling on appellant’s jurisdictional argument could render his first
assignment moot, we address his second assignment first. In arguing that the trial court
did not have subject matter jurisdiction over the bond issue, he notes that in order to
determine whether the deceased was the sole owner of the bonds prior to her death, it
was necessary for the trial court to interpret the couple’s 2002 separation agreement. He
contends that as a probate court, the trial court lacked the authority to do so because
once the agreement was incorporated into the dissolution decree, exclusive jurisdiction
to construe and apply the agreement lies with the domestic relations court. We disagree.
{¶17} R.C. 2101.24(A)(1) sets forth an extensive list of judicial acts that a probate
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court has exclusive jurisdiction to perform, including:
{¶18} “(a) To take proof of wills and to admit to record authenticated copies of wills
executed, proved, and allowed in the courts of any other state, territory, or country * * *.
{¶19} “* * *
{¶20} “(c) To direct and control the conduct and settle the accounts of executors
and administrators and order the distribution of estates;
{¶21} “* * *
{¶22} “(k) To construe wills;
{¶23} “(l) To render declaratory judgments * * *.”
{¶24} Furthermore, a probate court “has plenary power at law or in equity to
dispose fully of any matter that is properly before the court, unless the power is expressly
otherwise limited or denied by a section of the Revised Code.” R.C. 2101.24(C).
{¶25} Given these statutory provisions, a declaratory judgment proceeding can be
maintained in a probate court for the purpose of determining title to alleged estate assets.
Wosniak v. Wosniak, 90 Ohio App. 3d 400, 408, 629 N.E.2d 500 (9th Dist.1993). Such a
proceeding is permissible so long as the disputed assets are related to the administration
of the estate. Id.
{¶26} Furthermore, emphasizing the probate court’s “plenary power” under R.C.
2101.24(C), Ohio appellate courts have concluded that such a court has the authority to
interpret a separation agreement when such a declaration is necessary to determine the
extent and ultimate distribution of estate assets. Estate of LaMar v. LaMar, 9th Dist.
Medina No. 2070-M, 1992 WL 150277, *2 (June 24, 1992); Johnson v. Wheeler, 10th
Dist. Franklin No. 95APF07-839, 1996 WL 112641, *4-5 (Mar. 14, 1996).
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{¶27} Here, it is undisputed that the deceased had sole possession of the bonds
during the 15-year period prior to her death. Given these circumstances, a legitimate
issue existed as to whether the bonds are estate assets. As a result, the determination
of ownership of the bonds fell within the trial court’s subject-matter jurisdiction as a
probate court. Moreover, in making that determination, the trial court had the authority to
construe and apply the terms of the 2002 separation agreement.
{¶28} As a separate argument under his second assignment, appellant contends
that even if the trial court acted within the scope of its power in construing the separation
agreement, it still should have deferred the issue to the domestic relations court under
the jurisdictional-priority rule. That rule provides that when the same issue has been
properly raised in two state courts of concurrent jurisdiction, the court that had its
jurisdiction invoked first acquires exclusive authority to adjudicate the issue. State ex rel.
Consortium for Economic and Community Dev. for Hough Ward 7 v. Russo, 151 Ohio
St.3d 129, 2017-Ohio-8133, 86 N.E.3d 327, ¶ 8. However, the rule only applies when the
two actions are pending at the same time. Id. at ¶ 11. Here, not only did the jurisdiction
of the domestic relations court end in November 2002 with the issuance of the dissolution
decree, but also there is nothing establishing that its jurisdiction was re-invoked via a
motion regarding the ownership of the bonds. Thus, since the bond issue was only
pending before the trial court, the jurisdictional-priority rule does not apply, and the trial
court had the authority to resolve the parties’ dispute regarding the interpretation of the
separation agreement.
{¶29} Because the trial court did not exceed the scope of its jurisdiction by
addressing the declaratory judgment claim, appellant’s second assignment lacks merit.
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Thus, we address appellant’s challenge to the trial court’s interpretation of the 2002
separation agreement set forth in his first assigned error.
{¶30} He asserts that since the separation agreement had no specific provision
concerning the distribution of the bonds, it is evident that he and the deceased intended
to continue their co-ownership notwithstanding the dissolution of their marriage.
Appellant further asserts that since their co-ownership had not been altered, he became
the sole owner of each bond immediately upon her death.
{¶31} In support, appellant emphasizes that pursuant to Title 31, Sections 353.50
and 360.50 of the Code of Federal Regulations (C.F.R.),1 the manner in which a savings
bond is registered is conclusive proof of its ownership. Thus, since all of the bonds bought
during appellant’s marriage were registered to him “or” the deceased, they were legally
co-owners under the foregoing provisions. Nevertheless, appellant also acknowledges
that federal law allows for modification of ownership rights through the terms of a
settlement agreement. Title 31, Sections 353.22(a) and 360.22(a) both provide: “The
Department of the Treasury will recognize a divorce decree that ratifies or confirms a
property settlement agreement disposing of bonds or that otherwise settles the interests
of the parties in a bond.”
{¶32} Although Title 31, Sections 353.2 and 360.2 set forth definitions of various
terms used in the two sets of regulations, a definition for the term “divorce” is not provided.
However, under Ohio law, a “decree of dissolution of marriage has the same effect upon
the property rights of the parties, including rights of dower and inheritance, as a decree
1.
The bonds purchased by appellant and the deceased included Series EE U.S. Savings
Bonds and Series I U.S. Savings Bonds. Title 31, Section 353.01 et seq. govern the
Series EE bonds, while Section 360.01 et seq. govern the Series I bonds.
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of divorce.” R.C. 3105.65(B). More generally, it has been noted that “[a]lthough some
states attach different legal requirements to the termination of a marriage by divorce and
dissolution * * *, the plain meaning of the word ‘divorce’ includes both procedures. See
e.g., 27A C.J.S. Divorce [Section] 2 (‘When used without qualification, the term “divorce”
imports a dissolution of the marriage relation between a husband and a wife, that is, a
complete severance of the tie by which the parties are united.’) * * *.” Hall v. France,
S.D.Ohio No. 2-12-CV-726, 2013 WL 1703358, *3 (April 18, 2013).
{¶33} Given the absence of any regulatory definition limiting the scope of the term
divorce in Title 31, Sections 353.22(a) and 360.22(a), and given that the incorporation of
a separation agreement into a dissolution decree has the same effect on the distribution
of marital property as the incorporation of a settlement agreement into a divorce decree,
the two sections likewise apply to a dissolution decree. Hence, if the terms of a separation
agreement, as incorporated into a dissolution decree, alter the ownership of a bond as
between the two original co-owners, the modification will be enforceable in seeking
payment on the bond from the Department of the Treasury.
{¶34} In his brief, appellant does not contest the applicability of Sections 353.22(a)
and 360.22(a) to the 2002 separation agreement he executed with the deceased. Rather,
he asserts the trial court erred in holding that the agreement altered their relationship as
co-owners. Thus, the dispositive issue is the proper interpretation of that agreement.
{¶35} “A separation agreement is a contract and its interpretation is a matter of
law. Forstner v. Forstner, 68 Ohio App. 3d 367, 372, 588 N.E.2d 285 (11th Dist.1990).
Review of a matter of law is de novo. Arnott v. Arnott, 132 Ohio St. 3d 401, 2012-Ohio-
3208, 972 N.E.2d 596, ¶ 14.
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{¶36} “The cardinal principle in contract interpretation is to give effect to the intent
of the parties. Skivolocki v. E. Ohio Gas Co., 38 Ohio St. 2d 244, 313 N.E.2d 374 (1974),
paragraph one of the syllabus. Such intent is presumed to reside in the language the
parties chose to employ in the agreement. Kelly v. Med. Life Ins. Co., 31 Ohio St. 3d 130,
509 N.E.2d 411 (1987), paragraph one of the syllabus. If the language of the contract is
clear and unambiguous, the contract must be enforced as written. Corl v. Thomas & King,
10th Dist. No. 05AP-1128, 2006-Ohio-2956, ¶ 26. Ambiguity exists only when the terms
of an agreement cannot be determined within the four corners of the contract or where
the language of the agreement is susceptible to two or more reasonable interpretations.
United States Fid. & Guar. Co. v, St. Elizabeth Med. Ctr., 129 Ohio App. 3d 45, 55, 716
N.E.2d 1201 (2d Dist.1998).” Yodzis v. Savercool, 6th Dist. Lucas No. L-12-1159, 2012-
Ohio-5558, ¶ 9-10.
{¶37} “‘[A] writing * * * will be read as a whole, and the intent of each part will be
gathered from a consideration of the whole.’ Foster Wheeler Enviresponse, Inc. v.
Franklin Cty. Convention Facilities Auth., 78 Ohio St. 3d 353, 361, 678 N.E.2d 519 (1997).
‘Courts should attempt to harmonize provisions and words so that every word is given
effect.’ Christe v. GMS Mgt. Co., 124 Ohio App. 3d 84, 88, 705 N.E.2d 691 (9th
Dist.1997).” Kent State Univ. v. Bradley Univ., 2019-Ohio-2088, 136 N.E.3d 774, ¶ 39
(11th Dist.).
{¶38} In holding that the terms of the 2002 separation agreement are sufficiently
clear to establish that the deceased became the sole owner of the bonds, the trial court
relied on three terms. First, the court cites Article 7(D), which provides that the signed
agreement sets forth “the entire understanding of the parties,” and there were no separate
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covenants or undertakings between them. Second, the trial court notes that under Article
12(A), appellant and the deceased promised to deliver or allow each other to immediately
take possession of all property distributed to each under the agreement. The third term
cited by the trial court is Article 3(H) captioned “Property Not Specifically Enumerated.”
{¶39} The September 2002 separation agreement states in pertinent part:
{¶40} “WHEREAS, said husband and wife desire to settle their differences and
property rights arising out of their marital relationship, and by these presents do, forever
and completely settle and determine, the following, but not limited to:
{¶41} “(1) the past, present and future care, maintenance and support of each
other;
{¶42} “(2) the right to any and all property, real and personal, each may have by
virtue of their marriage;
{¶43} “(3) dower, curtesy, and all rights of descent and distribution;
{¶44} “(4) payment of debts and taxes; and
{¶45} “(5) all other benefits and privileges conferred and all obligations imposed
on each by virtue of their marriage relationship or otherwise.
{¶46} “NOW THEREFORE, * * * said husband and wife agree that:
{¶47} “* * *
{¶48} “ARTICLE 3: DIVISION OF PROPERTY
{¶49} “* * *
{¶50} “(E) RETIREMENT/PENSION, I.R.A., SHARES, STOCKS AND BONDS
{¶51} “[This section does not reference any bonds and does not reference the
bonds currently in issue.]
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{¶52} “* * *
{¶53} “(H) PROPERTY NOT SPECIFICALLY ENUMERATED
{¶54} “The parties have effected, to their mutual satisfaction, a division of all
property, real and personal, of whatever kind or description, and wheresoever situat[ed].
{¶55} “* * *
{¶56} “ARTICLE 7: FULL DISCLOSURE, COMPLETE AGREEMENT, &
BINDING EFFECT
{¶57} “The parties each respectively acknowledge that:
{¶58} “* * *
{¶59} “(C) the provisions herein, including the provisions regarding the support
and division of property are fair, just, and reasonable under all circumstances;
{¶60} “(D) this Agreement constitutes the entire understanding of the parties, and
there are no representations, warranties, covenants or undertakings other than those
expressly set forth herein;
{¶61} “* * *
{¶62} “ARTICLE 8: MODIFICATION AND WAIVER
{¶63} “A modification or waiver of any of the provisions of this Agreement shall be
effective only if made in writing and executed with the same formality as this Agreement.
* **
{¶64} “ARTICLE 9: MUTUAL RELEASES
{¶65} “Each party releases and discharges the other from all causes of action,
claims, demands, or rights, which either of the parties had or now has against the other
arising or growing out of the marital relationship, except any cause of action for divorce
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or dissolution of marriage or as provided within this Agreement. The parties mutually
agree that each may freely sell or otherwise dispose of his or her property in any manner
including by gift, deed or Last Will and Testament. Each party does hereby release and
relinquish to the other and is by those presents barred from any and all rights or claims
by way of dower, curtesy, or any probate rights caused by the death of a spouse, and will
be treated as if having predeceased and not been married to the other spouse.
{¶66} “* * *
{¶67} “ARTICLE 12: IMPLEMENTATION OF AGREEMENT
{¶68} “(A) Upon the signing of this Agreement, each party shall deliver to the other
party, or permit the other party to take possession of all items of property to which he or
she is entitled under the terms of the Agreement * * *.” (Emphasis added.)
{¶69} First, to the extent that Article 7(D) states that the separation agreement is
meant to delineate all promises and understandings between appellant and the deceased
in regard to the termination of their marriage, it does not permit an oral agreement to the
contrary. Therefore, even if, as appellant asserts, he and the deceased orally agreed to
maintain co-ownership of the bonds until either of them died, such a covenant directly
conflicts with Article 7(D) and is unenforceable. If the couple wanted to continue as co-
owners notwithstanding the dissolution, such an agreement had to be included in their
written agreement.
{¶70} Second, given its caption and concise language, Article 3(H) was patently
intended to be a catchall provision applicable to all marital assets not delineated in the
separation agreement. Since the bonds are not mentioned, the catchall provision applies.
Furthermore, under that provision, appellant and the deceased determined how they were
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going to divide the unenumerated assets. Again, given the use of the word “divide” in
Article 3(H), continuing co-ownership of an asset is not permissible. Hence, the bonds,
like all other marital assets, were subject to distribution between them.
{¶71} Third, pursuant to both Article 3(H) and Article 12(A), this distribution was
to occur immediately upon the execution of the separation agreement. Appellant agreed
to either deliver to, or allow the deceased to keep possession of, all assets which were
distributed to her under the agreement. As a result, the intended distribution of an
unenumerated asset under Article 3(H) was established through a party’s continued
possession of the asset after the dissolution of the marriage.
{¶72} In relation to the bonds, there is no dispute that the deceased maintained
sole possession during the 15-year period between the dissolution and her death.
Appellant did not present any evidence showing he ever contested her possession of the
bonds. Accordingly, under the unambiguous catchall provision in Article 3(H), the bonds
were distributed to the deceased in 2002, and she was their sole owner when she died in
2017.
{¶73} In challenging the trial court’s interpretation of Article 3(H), appellant argues
that the language of the catchall provision is too general and broad to deprive him of his
ownership rights in the bonds. Citing Klan v. Klan, 8th Dist. Cuyahoga No. 86897, 2006-
Ohio-1738, he contends that the separation agreement had to have express language in
regard to the bonds before his ownership rights could be extinguished.
{¶74} Klan is distinguishable on the grounds that it involved the termination of a
beneficiary’s rights to the proceeds of a life insurance policy. Notwithstanding the manner
in which appellant’s name was printed on each bond as a co-owner, his legal interest in
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the bonds was no different than his interest in any other marital asset that he purchased
with the deceased during their marriage. Since appellant has not shown that the catchall
provision in Article 3(H) is generally unenforceable, the bonds were properly distributed
to the deceased in accordance with the provision.
{¶75} Upon reading the parties’ separation agreement as a whole, Article 3(H),
the language in the preamble, and Article 12(A), regarding possession of the property,
dictate that the bonds in the decedent’s continued possession 15 years after the
agreement belonged to her, and according to Article 7(D) and Article 8, any alleged oral
agreement to the contrary is unenforceable.
{¶76} Accordingly, appellee was entitled to summary judgment on her declaratory
judgment claim because: (1) there is no genuine issue as to any material facts; (2) she
is entitled to prevail as a matter of law; and (3) even when the evidence is construed in a
manner most favorable to appellant, a reasonable person can only reach a conclusion
adverse to him. Civ.R. 56(C); Klan, 206-Ohio-1738, at ¶ 9
{¶77} Therefore, appellant’s first assignment lacks merit, and the judgment of the
Lake County Court of Common Pleas, Probate Division, is affirmed.
CYNTHIA WESTCOTT RICE, J., concurs,
MATT LYNCH, J., dissents with a Dissenting Opinion.
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_____________________________
MATT LYNCH, J., dissents with a Dissenting Opinion.
{¶78} I respectfully dissent and would reverse the decision of the probate court
declaring the savings bonds to the assets of the decedent’s estate. These bonds were
registered in Stevens’ name and the decedent’s name and, under federal law, became
Stevens’ property upon the decedent’s death unless disposed of otherwise by the
Separation Agreement. The probate court frankly acknowledged that “[t]he Separation
Agreement did not * * * list or mention for division the U.S. Savings Bonds co-owned by
the couple” (sic). Despite the absence of anything in the Agreement identifying the bonds
or providing for their division, the majority affirms “that the terms of the 2002 separation
agreement are sufficiently clear to establish that the deceased became the sole owner of
the bonds.” Supra at ¶ 38. They do no such thing. Rather, the conclusion that the
Agreement gave the bonds to the decedent rests on nothing more than the lower court’s
invention of provisions in the Agreement to effect what it presumes the parties must have
intended. This exercise in the creation of terms for the purpose of giving ownership of
the bonds to the decedent is contrary to both federal and Ohio law. Accordingly, I dissent.
{¶79} The essential facts and applicable law in this case are as follows: The bonds
in question were purchased during the course of the marriage and registered in the names
of “Delores A Stevens or Donald H Stevens.” The ownership of bonds is governed by
federal regulations. Under those regulations, “[r]egistration is conclusive of ownership.”
31 C.F.R. 353.5(a). Registration of a bond in the form “A or B” is indicative of co-
ownership. 31 C.F.R. 353.7(a)(2). “If one of the coowners named on a bond has died,
the surviving coowner will be recognized as the sole and absolute owner * * *.” 31 C.F.R.
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353.70(b)(1). “The Department of the Treasury will recognize a divorce decree that
ratifies or confirms a property settlement agreement disposing of bonds or that otherwise
settles the interests of the parties in a bond.” 31 C.F.R. 353.22(a). Inasmuch as the
parties’ Separation Agreement does not “list or mention” the division of the bonds and co-
owner Delores has died, co-owner Stevens remains the “sole and absolute” owner. Thus,
the declaration that the bonds are the property of the decedent’s estate is contrary to
federal law.
{¶80} The failure of the Separation Agreement to provide for the disposition of the
bonds violated Revised Code 3105.63(A)(1) which provides: “The separation agreement
shall provide for a division of all property * * *.” Lanzara v. Lanzara, 8th Dist. Cuyahoga
No. 75751, 2000 WL 336540, *3 (“[p]ursuant to R.C. 3105.63(A)(1), a separation
agreement must contain a division of all property, not just property jointly owned by
husband and wife”). “When a separation agreement omits assets that are both
substantial in relative amount and material to an informed and deliberate agreement
about an equitable division of the property, such omissions render the dissolution decree
voidable, and the decree can be vacated by motion for relief filed under Civ.R. 60(B)(5).”
In re Murphy, 10 Ohio App. 3d 134, 461 N.E.2d 910 (1st Dist.1983), paragraph two of the
syllabus; Salundari v. Permadi, 9th Dist. Medina No. 15CA0040-M, 2016-Ohio-7818, ¶ 7-
8 (cases cited).
{¶81} In the present case, neither party sought to vacate the Separation
Agreement to provide for a division of the bonds (such relief, in any event, is beyond the
scope of the probate court’s jurisdiction). Instead, the probate court determined that the
Agreement “adequately disposed of the bonds” not because there is any provision in the
17
Agreement that did so but because “[s]ixty thousand dollars in savings bonds is a
substantial amount, which would not have been overlooked by the parties.” The parties
may have declared that they “effected, to their mutual satisfaction, a division of all
property,” and they may (or may not) have intended to do so, but their Agreement does
not substantiate their claim.
{¶82} The Separation Agreement provides in relevant part:
[3.](E) RETIREMENT/PENSION, I.R.A., SHARES, STOCKS
AND BONDS
Husband has a retirement account with the Ohio Police
and Fire Pension Fund. Wife is currently on Social Security
Disability that will become a private pension at the age of fifty-
five (55). As Wife and Husband each have their own
retirement accounts, they agree that each shall retain their
respective accounts free and clear of all claims of the other
and shall execute any documents necessary to enforce this
agreed disposition.
***
[3.](H) PROPERTY NOT SPECIFICALLY ENUMERATED
The parties have effected, to their mutual satisfaction,
a division of all property, real and personal, of whatever kind
of disposition, and wheresoever situated.
***
[7.](D) This Agreement constitutes the entire understanding of
the parties, and there are no representations, warranties,
covenants or undertakings other than those expressly set
forth herein * * *.
{¶83} It should be clear from the foregoing that the Agreement does not directly
or indirectly mention the bonds or provide for their division. It follows that the bonds were
not divided, that Stevens and the decedent remained co-owners, and that, upon the
decedent’s death, Stevens became sole owner.
{¶84} The majority affirms the probate court’s award of the bonds to the decedent
18
based on the provision concerning unenumerated assets. The majority writes: “[U]nder
that provision, appellant and the deceased had already determined how they were going
to divide the unenumerated assets. Again, given the use of the word ‘divide’ in Article
3(H), continuing co-ownership of an asset is not permissible. Hence, the bonds, like all
other marital assets, were subject to distribution between them.” Supra at ¶ 70.
{¶85} Contrary to the majority’s reading, Article 3(H) does not explain “how they
were going to divide the unenumerated assets.” The declaration in the Agreement that
“[t]he parties have effected * * * a division of all property” simply does not explain or
elucidate “how they were going to divide the unenumerated assets.” Rather, it is a
declaration that they had effected such a division to their mutual satisfaction. In light of
the fact that the Agreement is silent with respect to the bonds’ existence and that, after
separating, the bonds continued to be registered in the names of both parties, this
declaration is either false or, as Stevens maintains, the parties intended to continue joint-
ownership of the bonds. Either way, the parties, contrary to R.C. 3105.63(A)(1), did not
dispose of all their property in the Agreement. This failure, however, does not authorize
the probate court or this court to effect what the parties themselves failed to do. As
explained above, the proper remedy would have been a motion for relief from judgment.
In the absence of such relief, the Agreement must be applied as written, not as it ought
to have been written. As written, the bonds were not divided or otherwise disposed of.
Ownership of the bonds remained as it had during the course of the marriage.
{¶86} The majority then asserts that the use of the word “divide” or “division”
(which merely tracks the language of the statute) precludes the possibility of continuing
co-ownership. No authority is cited for this proposition which would significantly restrict
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the freedom of parties to a dissolution from disposing of their property in a manner they
deem equitable or appropriate. At least one court has expressly rejected such an
interpretation.
The purpose * * * of R.C. 3105.63’s mandate is not to literally
divide all property owned by the parties but rather to ensure
that the separation agreement has accounted for all of the
parties’ assets. Clearly, in electing joint ownership of this
particular piece of realty, the appellant and appellee
considered and dealt with the property. The separation
agreement, therefore, satisfies the mandate of R.C. 3105.63.
Daidone v. Daidone, 9th Dist. Lorain No. 3980, 1986 WL 9346, *1.
{¶87} Such an interpretation is also contrary to actual practice in domestic
relations law where, for various reasons, parties to a dissolution intentionally retain joint-
ownership of property. See, e.g., Stone v. Stone, 3d Dist. Hardin No. 6-04-12, 2006-
Ohio-1996, ¶ 2 (“[a]s part of the dissolution agreement and division of property, the parties
agreed to continue jointly owning a two-unit duplex”); Wymer v. Wymer, 11th Dist. Portage
No. 1354, 1984 WL 7298, *1 (“[i]n the decree of dissolution which ended their marriage,
the parties agreed the residence should remain the joint property of the parties until sold
by mutual agreement”). Again, this writer is aware of no authority that would render such
agreements invalid or impermissible under R.C. 3105.63.
{¶88} Assuming, arguendo, that the parties’ declaration that they had divided all
property to their satisfaction may be construed to mean that they intended to divide the
bonds as well, there is no legitimate basis for simply awarding the decedent full
ownership. The majority affirms this “distribution” based on a provision in the Agreement
that “each party shall * * * permit the other party to take possession of all items of property
to which he or she is entitled under the terms of this Agreement” and the decedent’s
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physical possession of the bonds after dissolution. The argument seems to be that, since
she retained possession of the bonds after separation, she must have been entitled to
them under the Agreement. The logic, however, is circular inasmuch as the Agreement
does not actually entitle her to possession of the bonds. Regardless, federal law is clear
that “[r]egistration is conclusive of ownership.” The fact that the decedent retained
possession of the bonds for fifteen years after dissolution and never attempted to alter
their registration inspires no confidence in the conclusion that the bonds were distributed
to the decedent in 2002 and that she was their sole owner at the time of her death in
2017.
{¶89} In sum, the following points should be considered: The Separation
Agreement makes no reference to the existence of the bonds. The Agreement makes no
provision for the division of unenumerated property. The Agreement does not state that
the parties are entitled to keep whatever property remains in their possession. Under
federal law, registration, not possession, is determinative of ownership. Despite this, the
majority maintains that the Agreement “dictate[s] that the bonds in the decedent’s
continued possession 15 years after the agreement belonged to her.” Supra at ¶ 75. I
must respectfully dissent.
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