IN RE THE MARRIAGE OF BURRACK, 02-0500 (Iowa App. 5-14-2003)

No. 3-043 / 02-0500Court of Appeals of Iowa.
Filed May 14, 2003

Appeal from the Iowa District Court for Black Hawk County, Stephen C. Clarke, Judge.

Patti Burrack appeals various economic provisions of the parties’ dissolution decree. AFFIRMED AS MODIFIED.

Judith O’Donohoe of Elwood, O’Donohoe, Stoechl, Braun Churbuck, Charles City, for appellant.

Thomas Langlas of Gallagher, Langlas Gallagher, Waterloo, for appellee.

Heard by Huitink, P.J., Hecht, J., and Habhab, S.J.[*]

HABHAB, S.J.

Patti Burrack appeals various economic provisions of the parties’ dissolution decree. She contends the district court erred when it: (1) labeled as alimony the $1500 she receives per month in order to equalize the property division; (2) calculated Tim’s child support obligation; (3) concluded she should be responsible for twenty-five percent of the children’s unreimbursed medical expenses; (4) failed to require Tim to obtain a release of the mortgage on the parties’ marital home and (5) refused to award her more than $10,000 in trial attorney fees. Patti also requests a true award of alimony and appellate attorney fees. We affirm as modified.

Background Facts and Proceedings. Patti and Tim were married in 1980 and have two children: Bree, born July 19, 1981,[1] and Jordan, born March 3, 1986. At the time of trial, Patti was fifty-two years old, and Tim was fifty years old.

Tim obtained a Bachelor of Science degree in farming from Iowa State University in 1973. Upon graduation, Tim returned home to Arlington, Iowa, to work in the family farming corporation, Burrack Farms, Inc. Currently, Tim is also renting land that he farms. Patti graduated from high school and worked various jobs until she married Tim. For most of their marriage, Patti stayed at home to raise the children and at times she even provided home schooling for the children. She also minimally assisted Tim in the farm work. In 1992 Patti moved to Waterloo because she was unhappy with her place in Burrack Farms, Inc. and she wanted her children to attend Walnut Ridge Academy. In order to purchase a home in Waterloo for Patti and the children, Tim borrowed $130,000 from Burrack Farms, Inc. Tim has been paying Burrack Farms, Inc. back at a rate of $10,000 per year, and at the time of trial he owed $50,000.

Patti filed a petition for dissolution in April 1999. The major asset of the parties at the time of dissolution was their shares of Burrack Farms, Inc. Prior to their marriage, Tim was gifted 210 shares of stock in Burrack Farms, Inc. In 1984 Tim transferred 105 of his 210 shares to Patti.[2] At hearing, the district court had the difficult task of valuing the parties’ shares of stock in Burrack Farms, Inc. and both parties’ gross income. Both parties presented expert testimony. The district court found Tim’s expert, Brad Moorman, to be more credible and concluded the value of the 210 shares of stock was $441,000 and Tim’s gross income was approximately $49,000. The court concluded Patti had the ability to earn $12,000 per year. Although Patti maintains she is unable to work due to a variety of medical problems, the court determined she presented no credible medical evidence to support this assertion.

Following the hearing, the court entered a dissolution decree on January 29, 2002. Patti and Tim were awarded joint legal custody of the parties’ minor child with primary care granted to Patti. Tim was ordered to pay $500 per month in child support for Jordan and for him to attend Walnut Grove Academy. He was also ordered to carry both Bree and Jordan on his medical insurance for as long as he pays support for Jordan and one-third of Bree’s post-secondary education expenses. Patti was awarded the homestead in Waterloo, and Tim was ordered to pay the remaining debt on the home to Burrack Farms, Inc. Tim also received the 210 shares of stock in the farm corporation. In lieu of any additional property settlement from Tim to Patti, the court ordered Tim to pay Patti $1500 per month in alimony for a period of thirteen years.[3] Patti appeals.

Standard of Review. Dissolution of marriage decrees are reviewed in equity. In re Marriage of Knickerbocker, 601 N.W.2d 48, 50 (Iowa 1999). Our standard of review is therefore de novo. Iowa R.App.P. 6.4. In such cases, we examine the entire record and adjudicate anew rights on the issues properly presented. In re Marriage of Beecher, 582 N.W.2d 510, 512-13 (Iowa 1998). In doing so, we give weight to the fact-findings of the district court, especially when considering the credibility of witnesses, but are not bound by them. Iowa R.App.P. 6.14(6)(g).

Alimony. In lieu of Patti receiving a more substantial property settlement, Tim was ordered to pay $1500 per month in alimony for a period of thirteen years. The district court reasoned if it were to award a substantial property settlement together with awards of attorney fees and alimony Tim would be unable to continue his operation of Burrack Farms, Inc. and pay the debt he has incurred. Therefore, the court determined an award of alimony would be appropriate because Tim would receive the tax benefit of deducting the amount paid in alimony from his gross income. Patti contends this court should remove the alimony label from the $1500 Tim is paying her each month since this essentially is a cash settlement to equalize the property division. She claims it is inequitable for Tim to receive tax benefits while she has to include this amount in her gross income each year. She further argues Tim is in a better position financially than her as a result of the property division due to the fact the district court did not appropriately value Tim’s income and Burrack Farms, Inc. In addition to the $1500 she receives per month, Patti asks this court grant her a true award of alimony in the amount of $750 per month for the period in which support is payable to Jordan and then the amount should be raised to $1250 per month until her death or remarriage.

Alimony is not an absolute right; an award depends upon the circumstances of each particular case. In re Marriage of Eastman, 538 N.W.2d 874, 876 (Iowa Ct.App. 1995). The discretionary award of alimony is made after considering those factors listed in Iowa Code section 598.21(3) (1999). We consider property division and alimony together in evaluating their individual sufficiency. In re Marriage of O’Rourke, 547 N.W.2d 864, 866 (Iowa Ct.App. 1996). After a careful review of the record, we believe the district court placed too much weight on the testimony presented by Tim’s expert. We find several problems with the valuation of Burrack Farms, Inc. and Tim’s income due to the discrepancies between Tim’s personal and corporate tax returns and his financial statements. Accordingly, we find the alimony award made by the district court should be modified to the sum of $2000 per month. All of the other terms and conditions of the alimony award shall remain as set out in the decree.

Child Support. Tim was ordered to pay $500 per month in child support. Patti argues this award should be increased to $800 per month because Tim’s net monthly income is understated and her net monthly income is overstated. We have reviewed the child support award in light of the other financial aspects in this case and conclude the district court properly set Tim’s child support obligation.

Uncovered Medical Expenses. The district court required Tim to pay seventy-five percent of any unreimbursed medical expenses incurred by the parties’ children. Patti objects and asks that Tim pay for eighty-four percent of the children’s unreimbursed medical expenses. We find the district court’s arrangement equitable in view of the disparities in income between the parties.

Mortgage. The partners in a marriage are entitled to a just and equitable share of the property accumulated through their joint efforts In re Marriage of Bonnette, 584 N.W.2d 713, 714 (Iowa Ct.App. 1998). Equitable distribution does not necessarily mean an equal division of property, nor does it mean a percentage division of the property. Id. In making this assessment, we consider the factors set forth in Iowa Code section 598.21 (1999). We also consider property division and alimony together in evaluating their individual sufficiency. In re Marriage of Hardy, 539 N.W.2d 729, 732 (Iowa Ct.App. 1995).

Patti argues the mortgage on the marital home held by Burrack Farms, Inc. should be released so she can refinance or sell the home. Although we agree Patti should have the ability to refinance or sell the home, we cannot require Burrack Farms, Inc. to sign a personal promissory note to have the balance of the mortgage released. Therefore, we order Tim to pay the balance of the mortgage to Burrack Farms, Inc. within one year from the date of the filing of this opinion.

Trial Attorney Fees. The district court ordered Tim to pay $10,000 toward Patti’s attorney fees. Patti requests Tim pay an additional $10,000 toward her attorney fees for a total of $20,000. A party does not have a right to an award of attorney fees; rather the district court uses its discretion to determine whether an award is appropriate. In re Marriage of Dieger, 584 N.W.2d 567, 570 (Iowa Ct.App. 1998). “Whether attorney fees should be awarded depends on the respective abilities of the parties to pay the fees and the fees must be fair and reasonable.” In re Marriage of Applegate, 567 N.W.2d 671, 675 (Iowa Ct.App. 1997). After carefully reviewing the record, we find it was within the sound discretion of the district court to award Patti $10,000 in attorney fees. Therefore, we deny Patti’s request for additional attorney fees.

Appellate Attorney Fees. Patti also seeks attorney fees at the appellate level. An award of attorney fees is not a matter of right, but rests within the discretion of the court. In re Marriage of Ales, 592 N.W.2d 698, 704 (Iowa Ct.App. 1999). “We are to 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 district court’s decision on appeal.” In re Marriage of Courtade, 560 N.W.2d 36, 38 (Iowa Ct.App. 1996). We grant Patti $2500 in appellate attorney fees.

AFFIRMED AS MODIFIED.