Opinion
Case No. 2D19-441
02-26-2020
Robert D. NATHEY, Appellant, v. Rhonda NATHEY, Appellee.
Brandon J. Rafool and Patrick W. Maloney of Brandon J. Rafool, L.L.C., Winter Haven, for Appellant. Michael M. Brownlee of The Brownlee Law Firm, P.A., Orlando, for Appellee.
Brandon J. Rafool and Patrick W. Maloney of Brandon J. Rafool, L.L.C., Winter Haven, for Appellant.
Michael M. Brownlee of The Brownlee Law Firm, P.A., Orlando, for Appellee.
PER CURIAM.
Robert D. Nathey appeals a final judgment of dissolution of marriage. He raises three issues on appeal. There being merit in one of them, we reverse and remand this case in part for further proceedings. We affirm the final dissolution of marriage in all other respects.
When the Natheys married in December 2001, Mr. Nathey already owned a home that he had built. The loan used to finance the construction of the home was in Mr. Nathey's name only and the property remained titled in his name alone throughout the parties' marriage. During the marriage, the Natheys lived in the home and made mortgage payments with marital funds. The Natheys satisfied the mortgage in 2006 and subsequently obtained a home equity line of credit in 2008. The parties made payments on the home equity line of credit with marital funds, but there was still a balance on that loan at the time of the dissolution of marriage.
In the final judgment of dissolution of marriage, the circuit court characterized the home as a marital asset with equity of $253,522. The court then awarded Mrs. Nathey $100,000 as her marital equity in the home. That property, however, was not a marital asset. Because Mr. Nathey constructed the home before the marriage and kept title in his name, it should have been characterized as his nonmarital property. See § 61.075(6)(b)(1), Florida Statutes (2018) (" ‘Nonmarital assets and liabilities’ include: Assets acquired ... by either party prior to the marriage ...."); Belmont v. Belmont, 761 So. 2d 406, 408 (Fla. 2d DCA 2000) ("Nonmarital assets may not be conveyed, absent agreement, to the non-owning spouse in equitable distribution."); Cornette v. Cornette, 704 So. 2d 667, 668 (Fla. 2d DCA 1997) ("The trial court erred by classifying the ... property as a marital asset and awarding it to the wife. The husband purchased the property before the marriage, and it was titled in his name alone."). Thus, we are compelled to reverse the circuit court's judgment to the extent it classified Mr. Nathey's home as marital property. On remand, the circuit court must treat the property as a nonmarital asset.
That, however, is not the end of the matter. Section 61.075(6)(a)(1)(b) defines "marital assets" to include "[t]he enhancement in value and appreciation of nonmarital assets resulting either from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets." Thus, "an increase in equity due to the use of marital funds to pay down a mortgage balance is a marital asset subject to equitable distribution." Mitchell v. Mitchell, 841 So. 2d 564, 567 (Fla. 2d DCA 2003) ; Cornette, 704 So. 2d at 668 ("The marital funds used to pay down the mortgage on the property, however, enhanced the value of the nonmarital asset; thus, the resulting equity in the property is a marital asset subject to equitable distribution."). Here, the mortgage on the home and home equity line of credit were both paid down by marital funds. Accordingly, any increase in the property's equity due to these payments is a marital asset subject to equitable distribution. Therefore, on remand, the circuit court shall calculate the amount by which marital funds reduced the indebtedness on the home and equitably distribute to Mrs. Nathey her share of that amount. See Mitchell, 841 So. 2d at 571.
In her pleadings, Mrs. Nathey waived any claim to appreciation of nonmarital property. Cf. Kaaa v. Kaaa, 58 So. 3d 867, 872-73 (Fla. 2010) ("In sum, when a marital home constitutes nonmarital real property, but is encumbered by a mortgage that marital funds service, the value of the passive, market-driven appreciation of the property that accrues during the course of the marriage is a marital asset subject to equitable distribution under section 61.075(5)(a)(2), Florida Statutes (2007).").
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Affirmed in part; reversed in part; remanded with instructions.
KHOUZAM, C.J., and MORRIS and LUCAS, JJ., Concur.