Summary
affirming reduced award of $1250 monthly for 120 months after twenty-five-year marriage because the wife had the potential to earn more money and had an inheritance she could use to reduce some of her expenses
Summary of this case from In re Marriage of KohorstOpinion
No. 2-868 / 02-0286
Filed January 29, 2003
Appeal from the Iowa District Court for Lee (North) County, R. David Fahey, Jr., Judge.
Charles Holliday appeals from several provisions of a decree dissolving his marriage with Renee Holliday. AFFIRMED AS MODIFIED.
J. Bryan Schulte of Schulte, Hahn Swanson, Burlington, for appellant.
Douglas Napier of Napier, Wolf Napier, Fort Madison, for appellee.
Considered by Vogel, P.J., and Zimmer and Hecht, JJ.
Charles Holliday appeals from the decree dissolving his marriage with Renee Holliday. He has two complaints about the division of marital assets and three complaints about the district court's alimony award. He also contends the court erred in awarding his former spouse trial attorney fees. We affirm as modified.
I. Background Facts and Proceedings.
Renee and Charles were married in 1976. They were both forty-eight years of age at the time of trial. The parties were separated from 1988 until 1992. They separated for the final time in January of 2001. The couple has one adult son, Chase, who is currently enrolled in college.
The parties met at Louisiana State University where Charles earned his bachelor's degree in education. Charles has been employed with Climax Corporation for the past twenty-two years as a human resources manager.
Renee attended Louisiana State but dropped out after three semesters. She worked full-time during most of the marriage. In 1995, she finished her college coursework and graduated with a degree in education. She currently earns approximately $17,500 per year as a high school teacher at a parochial school. She receives no benefits.
The parties accumulated substantial assets during their marriage. Charles acquired a 401(k) retirement plan valued at $277,363. He also has a pension. Charles inherited $27,000 from his mother in 2000. Renee inherited $39,000 from her father in 2001. The parties' marital home is valued at $85,000 and encumbered by a mortgage of $65,104. The parties have some additional assets which need not be detailed here.
Prior to trial, the parties reached a partial property settlement which resolved most of the issues relating to division of their assets and liabilities. The court dissolved the parties' marriage by decree entered January 25, 2002. Each party was awarded their respective inherited funds. Renee received the home, the emergency fund, one-half of Charles's pension, one-half of Charles's 401(k), a $5250 certificate of deposit or its cash equivalent, and the 1997 Ford Explorer. The court assigned Renee the mortgage, the loan on the Ford Explorer, and her student loans. Charles received the balance of the marital property. Each party received their respective checking and saving accounts as well. The court also ordered Charles to pay alimony. The decree provided for mandatory wage withholding to satisfy the alimony obligation. Finally, the court ordered Charles to pay $1500 of Renee's attorney fees. Charles appeals.
II. Scope of Review.
Our review of dissolution decrees is de novo. Iowa R.App.P. 6.4. We give weight to the district court's factual findings, particularly as to witness credibility, but are not bound by them. Iowa R.App.P. 6.14(6)( g); In re Marriage of Knickerbocker, 601 N.W.2d 48, 51 (Iowa 1999).
III. Discussion. A. Property Issues.
Charles first contends the trial court improperly included a life insurance annuity and a mutual fund in the marital estate. We find no merit in this argument. Charles testified these assets were purchased with funds from an inheritance. Renee did not challenge this testimony and the trial court found these assets were "substantially derived from inherited funds." Although the trial court specifically awarded this property to Charles, other language in the decree makes clear that the court was merely identifying these assets as inherited property belonging to Charles, without including the assets in the marital estate.
Charles next argues a certificate of deposit should not have been included in the division of property because it did not exist at the time of trial. We disagree. Charles stipulated to the certificate's existence at the onset of trial when the parties dictated a stipulation into the record. During trial, he testified he did not have the certificate, but later requested that he be awarded the asset he now claims does not exit. The court's conclusion that the certificate existed but was not in the possession of Charles is reasonable and consistent with the evidence. We find no inequity in this portion of the decree.
B. Alimony.
The trial court awarded Renee alimony of$2300 per month for the first thirty-two months following the decree and then $1750 per month until Renee reaches the age of sixty-five, remarries, or dies. Charles contends the trial court's alimony award should be eliminated or reduced.
Alimony is an allowance to the former spouse in lieu of a legal obligation to support that person. See In re Marriage of Gonzalez, 561 N.W.2d 94, 99 (Iowa Ct.App. 1997). Alimony is not an absolute right; an award depends upon the circumstances of each particular case. In re Marriage of Kurtt, 561 N.W.2d 385, 387 (Iowa Ct.App. 1997). We consider the length of the marriage, age, health, earning capacities, levels of education, and the likelihood the party seeking alimony will be self-supporting at a standard of living comparable to the one enjoyed during the marriage. In re Marriage of Clinton, 579 N.W.2d 835, 839 (Iowa Ct.App. 1998). In marriages of long duration where the earning disparity between the parties is great, both spousal support and nearly equal property division may be appropriate. In re Marriage of Weinberger, 507 N.W.2d 733, 735 (Iowa Ct.App. 1993).
We have previously summarized various categories of alimony and the purposes they serve.
Alimony is awarded to accomplish one or more of three general purposes. Rehabilitative alimony serves to support an economically dependent spouse through a limited period of education and retraining. Its objective is self-sufficiency. An award of reimbursement alimony is predicated upon economic sacrifices made by one spouse during the marriage that directly enhance the future earning capacity of the other. Traditional alimony is payable for life or for so long as a dependent spouse is incapable of self-support. The amount of alimony awarded and its duration will differ according to the purpose it is designed to serve.In re Marriage of O'Rourke, 547 N.W.2d 864, 866-67 (Iowa Ct.App. 1996) (citations omitted).
The trial court awarded Renee traditional alimony. Traditional alimony may be awarded in long-term marriages where life patterns have largely been set and the earning potential of both spouses can be predicted with some reliability. Kurtt, 561 N.W.2d at 388. Renee and Charles are both forty-eight and were married twenty-five years. The parties have lived a comfortable, not lavish, lifestyle. They have disparate income levels; Renee earns $17,500 annually while Charles earns approximately $73,165. Both parties have college educations. We conclude an alimony award was appropriate under these circumstances.
The district court further found that a claim for rehabilitative alimony could have been made under the facts of this case.
We now turn to Charles's claim that the amount of alimony awarded by the trial court is excessive. The court found Charles earns a net income of roughly $4500 per month, including his automobile reimbursement, while Renee earns a monthly net income of $1200.
When we look to the amount of permanent alimony a payee spouse should receive, if any, we must consider not simply present income, but his or her earning capacity as directed by Iowa Code section 598.21(3) (2001). See In re Marriage of Wahlert, 400 N.W.2d 557, 560-61 (Iowa 1987). Consequently, if both parties are in reasonable health, they need to earn up to their capacities in order to pay their own present bills and not lean unduly on the other party for permanent support. In re Marriage of Wegner, 434 N.W.2d 397, 399 (Iowa 1988).
The court ordered that Charles pay Renee alimony until she remarries, dies, or reaches age sixty-five. If Charles pays Rene alimony for the maximum period allowable under the decree, his obligation will equal nearly $375,000. Upon review of the record, we conclude the alimony award is excessive in amount and duration. Renee has chosen to work in the parochial school system. As a result, she earns significantly less than she would earn if employed in the public school system. She also receives no benefits from her current employer. The record reveals Renee has the education, experience, and ability necessary to substantially increase her level of income. In addition, she could significantly reduce her monthly expenses by applying her inheritance to her student loan, the mortgage on her house, or both. After carefully reviewing the record, we believe an alimony award of $1250 per month for 120 months is appropriate.
C. Wage Withholding.
Charles contends that the decree should not have included a provision for mandatory wage withholding to satisfy the alimony obligation. Our courts have consistently held that, absent an accompanying child support order, alimony is not subject to wage withholding. See In re Marriage of Eklofe, 549 N.W.2d 523, 525 (Iowa 1996) (alimony payments not subject to withholding because there was no valid accompanying order of child support); In re Cernetisch, 376 N.W.2d 598, 600 (Iowa 1985) (definition of support in Chapter 252D did not include alimony if not accompanied by child support order); In re Metcalf, 414 N.W.2d 850, 851-52 (Iowa Ct.App. 1987) (income withholding appropriate to satisfy alimony provision of decree containing child support order).
Prior to 1997, Iowa Code section 252D.1(1) defined support as "any amount which the court may require a person to pay for the benefit of a child under a . . . decree, and may include . . . if contained in a child support order, spousal support." The 1997 amendment removed the phrase "if contained in a child support order" which modifies the term spousal support. We conclude current section 252D.16(3) has the same effect as former section 252D.1 in regards to the immediate withholding of income to satisfy an alimony obligation.
Iowa Code section 252D.8(1) provides for the immediate withholding of income to satisfy a support order issued after January 1, 1994. The definition of support in chapter 252D has been amended since the promulgation of the aforementioned cases and now states that "any amount which the court . . . may require a person to pay for the benefit of a child under a . . . decree entered under chapter . . . 598 . . ., and may include . . . spousal support." Iowa Code § 252D.16(3) (emphasis added). Because the alimony award was not for the benefit of the adult child, Chase, we conclude it is not subject to mandatory wage withholding.
D. Termination of Alimony.
Charles argues the support award should additionally terminate upon his death. Section 598.21(3) is broad enough to warrant alimony payments after the payor's death. See In re Marriage of Debler, 459 N.W.2d 267, 270 (Iowa 1990). The assets Charles receives in the decree's property division are largely retirement assets. Under the circumstances of this case, we do not think continuing alimony beyond Charles's death is appropriate.
E. Attorney Fees.
Renee was awarded $1500 in attorney fees. Charles asserts this award is inequitable. Iowa trial courts have considerable discretion in awarding attorney fees. Gonzalez, 561 N.W.2d at 99. To overturn an award, the complaining party must show the trial court abused its discretion. Id. We find no abuse of discretion in the trial court's decision and accordingly, affirm.
Renee seeks an award of appellate attorney fees. An award of appellate attorney fees is not a matter of right but rests within our discretion. Kurtt, 561 N.W.2d at 389. We consider the needs of the party making the request, the ability of the other party to pay, and whether the party making the request was obligated to defend the trial court's decision on appeal. Id. We decline to grant Renee any appellate attorney fees.
IV. Conclusion.
We conclude an award of alimony was proper. We modify the alimony award by reducing it to $1250 per month for 120 months. The award shall terminate upon Renee remarrying, or the death of either party. The alimony award shall not be withheld from Charles's wages. We affirm the trial court's property distribution and the trial court's decision to award Renee trial attorney fees. We award no appellate attorney fees.