Dotson v. Dotson

COURT OF APPEALS OF VIRGINIA

Present: Judges Benton, Elder and Annunziata

Argued at Salem, Virginia

EDITH P. LANE DOTSON

OPINION BY

v. Record No. 0405-95-3 JUDGE LARRY G. ELDER

JANUARY 21, 1997

JIMMY A. DOTSON

FROM THE CIRCUIT COURT OF BUCHANAN COUNTY

Nicholas E. Persin, Judge

Robert M. Galumbeck (Galumbeck, Simmons &

Reasor, on brief), for appellant.

No brief or argument for appellee.

By final decree entered February 2, 1995, Edith P. Lane

Dotson was awarded a divorce from her husband, Jimmy A. Dotson,

on the ground of adultery. The trial court awarded wife a lump

sum of $1.8 million, the parties' lake residence, various

personalty, and attorney's fees. The judge also ordered husband

either to provide health insurance for wife or to pay wife the

cost of her health insurance, in the amount of $425 per month.

Wife contends the trial court improperly consolidated

equitable distribution and spousal support considerations in

deciding to award her the $1.8 million lump sum. She argues the

trial court erred in failing to designate the lump sum award as

either spousal support or as a monetary award and argues that if

the award was intended as a monetary award, the support award was

insufficient. Alternatively, she argues that if the award was

intended as support, the monetary award was inequitable. Wife

also contends that in determining the award, the judge (1) failed

to consider all of the statutory factors; (2) failed to consider

the income husband's mining business would produce; and (3) erred

in assuming wife could support herself from the lump sum award.

For the following reasons, we reverse the lump sum award and

remand the case for further consideration.

I.

Husband and wife were married in 1961. Throughout the

marriage, husband was self-employed in the coal mining industry.

Wife was the homemaker and occasionally worked as a substitute

teacher when their children were minors. She also kept the books

for the parties' farm, helped with the bookkeeping for husband's

business, and frequently picked up parts for the business.

The evidence proved that the parties ceased having sexual

relations nineteen years ago after the wife had an operation.

The evidence also proved husband engaged in an adulterous

relationship for ten to fifteen years prior to 1992 when wife

filed for divorce. The trial court found that the husband's

conduct caused the marriage to end.

In conjunction with the equitable distribution hearing, the

parties stipulated that the value of their marital estate was

$5,312,150. The marital estate included the parties' farm,

valued between $210,000 and $240,000, the marital home, valued at

$55,000, the parties' lake house, valued at $38,000, and

certificates of deposit valued at $3,567,350. The marital estate

also included husband's coal company, the net asset value of

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which the parties stipulated was $689,267.

Evidence proved that the parties filed joint income tax

returns and reported income of $988,000 in 1987. Their income

declined to $428,000 in 1992. Wife submitted an expense sheet

reflecting monthly expenses of $4,218.35 after separation. She

also testified that health insurance would cost $425 per month.

The trial court granted wife a divorce from husband on the

ground of adultery. In consideration of "the factors . . . in

[Code] Sections 20-107.3 and 20-107," the trial court awarded

wife a "lump sum" of $1.8 million, the lake residence, and other

property. The trial court also ordered husband either to provide

wife health insurance or pay her $425 per month, the current cost

of her health insurance. The trial court also ordered the

parties to establish three large trust funds for their adult

children consistent with an agreement the parties made, and

granted other relief.

The trial court stated that in making the award he had

considered wife's health and the effect of husband's adultery on

wife, the lifestyle the parties maintained, the earnings the

parties received from husband's mining business, and the fact

that mining was an unpredictable industry and was not likely to

generate in the future the kind of income the parties had enjoyed

previously. In declining to grant wife's motion for

reconsideration and make an additional support award, the trial

court explained that the lump sum would allow wife both to save a

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substantial portion of the award and also to earn a return

through investment. The trial court stated that the lump sum

award was equitable "in construing the spousal support statute

and the equitable distribution statute" and further stated, "I

was considering . . . giving her less lump sum and [making] an

award of spousal support, but . . . I felt . . . it would be

better to give her a lump sum of money and let her cut the ties

with Mr. Dotson and not be worried about whether her spousal

support check is going to be coming in every month. But if I had

[made an award of spousal support], I would have lowered the lump

sum award." The trial judge also stated his understanding that

the court was not required to distinguish whether its lump sum

award was intended as support or as distribution.

II.

"A distinct difference . . . exists between a spousal

support award and a monetary award." Brown v. Brown, 5 Va. App.

238, 246, 361 S.E.2d 364, 368 (1987).

Spousal support involves a legal duty flowing

from one spouse to the other by virtue of the

marital relationship. By contrast, a

monetary award does not flow from any legal

duty, but involves an adjustment of the

equities, rights and interests of the parties

in marital property.

Id. "[T]he amount of support is based on current needs of the

spouse . . . and the ability of the other spouse . . . to pay

from current assets." Williams v. Williams, 4 Va. App. 19, 24,

354 S.E.2d 64, 66 (1987). "The income of the party who is

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required to pay, however such income is derived or derivable, is

the fund from which the allowance [for support] is made." Ray v.

Ray, 4 Va. App. 509, 513, 358 S.E.2d 754, 756 (1987). "The

`equitable distribution' statute, however, is intended to

recognize a marriage as a partnership and to provide a means to

equitably divide the wealth accumulated during and by that

partnership." Williams, 4 Va. App. at 24, 354 S.E.2d at 66.

Under the statutory scheme, the trial judge must consider

its equitable distribution award in fashioning a support award,

but consideration of spousal support is improper when making an

equitable distribution award. See Code § 20-107.3(F) (monetary

award must be determined without regard to support); Code

§ 20-107.1(8) (in determining amount of support award, court must

consider, inter alia, provisions made with regard to the

distribution of marital property); see also Kaufman v. Kaufman,

7 Va. App. 488, 493-94, 375 S.E.2d 374, 377 (1988) (court cannot

determine parties' relative needs and abilities until after it

determines the monetary award).

The trial judge's initial opinion letter and the final

decree state that the judge considered both the statutory factors

relating to the determination of a support award, Code

§ 20-107.1, and the factors relating to the determination of a

monetary award, Code § 20-107.3(E), in determining the amount of

the lump sum. The court further stated that he gave her a lump

sum so that she would "not be worried about whether her spousal

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support check is going to be coming in every month." It is

apparent that the trial judge either considered support as a

factor in determining the equitable distribution award or lumped

together the equitable distribution award and a lump sum spousal

support award, either of which was erroneous. Furthermore, in

denying wife's motion for reconsideration of periodic support,

the trial court stated that he considered awarding wife periodic

support and would have granted her a smaller lump sum if he had

made separate awards.

In failing to distinguish spousal support from property

distribution as required by the statutory framework, the trial

court committed reversible error. Treating the property

distribution award and spousal support award as one not only

reflects an erroneous application of the law but also precludes

principled review. Accordingly, the decision of the trial court

is reversed and the case is remanded for a redetermination of

both the equitable distribution award and the spousal support

award. 1

Reversed and remanded.

1

We do not find it necessary to address the other issues

raised because a redetermination of the equitable distribution

award will necessarily require the trial judge to reconsider

spousal support and the statutory factors relating thereto.

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Annunziata, J., concurring.

I concur in the opinion of the majority that the trial court

erred in awarding wife a "lump sum," representing both an

equitable distribution award and a spousal support award.

However, I agree with wife's contention that the court clearly

erred as well in its consideration of certain factors relating to

spousal support, whatever amount the court intended its support

award to be. These issues will be of import on remand because,

in my opinion, such error would require reversal irrespective of

the reversible error the majority addresses. See Keyser v.

Keyser, 7 Va. App. 405, 414-15, 374 S.E.2d 698, 703-04 (1988).

Accordingly, I write separately to address those issues.

In determining spousal support, the trial court must

consider all of the statutory factors set forth in Code

§ 20-107.1. Keyser, 7 Va. App. at 414-15, 374 S.E.2d at 703-04.

Failure to do so is reversible error. Bristow v. Bristow, 221

Va. 1, 3, 267 S.E.2d 89, 90 (1980). Among other things,

"the court must look to the financial needs

of the wife, her age, physical condition and

her ability to earn, and balance against

these circumstances the financial ability of

the husband to pay, considering his income

and ability to earn."

Via v. Via, 14 Va. App. 868, 870, 419 S.E.2d 431, 433 (1992)

(quoting Klotz v. Klotz, 203 Va. 677, 680, 127 S.E.2d 104, 106

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(1962)); see also Code § 20-107.1(1).

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A.

"Income producing property conveyed pursuant to Code

§ 20-107.3 would alter the needs of one party and the ability of

the other party to pay spousal support." Gamble v. Gamble, 14

Va. App. 558, 577, 421 S.E.2d 635, 646 (1992). Thus, the court

must consider income which may be produced by a monetary award in

determining spousal support. Kaufman v. Kaufman, 7 Va. App. 488,

493, 375 S.E.2d 374, 377 (1988). However, a court may not

consider the corpus of a monetary award as income to the

receiving spouse. Ray v. Ray, 4 Va. App. 509, 513, 358 S.E.2d

754, 756 (1987). The law does not require a spouse, who is

possessed of a sizeable estate in his or her own right, "`to

invade that estate to relieve the obligation of her former

[spouse] whose actions have brought an end to their marriage.'"

Id. at 514, 358 S.E.2d at 757 (quoting Klotz, 203 Va. at 680, 127

S.E.2d at 106); see also Zipf v. Zipf, 8 Va. App. 387, 398-99,

382 S.E.2d 263, 269-70 (1989) ("[A] decree which singles out

[Code § 20-107.1(8)] to the exclusion of others, and which

essentially treats the support-seeking spouse's marital assets as

income, cannot withstand scrutiny on appeal").

Here, while the court expected wife to reinvest part of the

lump sum and support herself with the proceeds, no evidence

showed, and the court made no finding with respect to, what

amount of income, if any, the funds were likely to produce.

Thus, it is impossible to determine the extent to which the trial

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court properly considered the income which the lump sum would

produce in the future and the extent to which the court

improperly assumed wife could invade her share of the marital

estate to support herself. 2 It is clear, however, that the court

could not properly have considered the parties' relative needs

and their relative abilities to meet those needs in the absence

of evidence which established the income the lump sum could

produce. The failure to properly consider these factors is

error. See Code § 20-107.1(1); Via, 14 Va. App. at 870, 419

S.E.2d at 433.

B.

Furthermore, a support award which allows one party to

approximate more closely the "station of life" enjoyed during the

marriage while necessarily and materially diminishing that of the

other party, is improper in the absence of evidence directing

such a result. See Code § 20-107.1(3); Via, 14 Va. App. at 870,

419 S.E.2d at 433 (a support award should, within the limits of

the payor spouse's ability to pay, maintain the payee spouse

"according to the station of life to which she [or he] was

accustomed during the marriage").

While a party's comparative financial

condition before marriage and after divorce

may demonstrate one's ability to support

oneself, the court must consider the needs of

each spouse in relation to each party's

ability to provide for those needs and the

2

This impossibility is compounded, of course, by the fact

that we are unable to determine what amount of the lump sum, if

any, represents support and what amount represents a money award.

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other spouse's ability or resources to

provide for those needs. The station to

which a party may have grown accustomed

during marriage is to be considered in

determining support.

Keyser, 7 Va. App. at 413-14, 374 S.E.2d at 703-04 (citation

omitted); Homer H. Clark Jr., The Law of Domestic Relations in

the United States 427 (2d. ed. 1987) (A spouse is not limited to

receiving support which covers only the necessities of food,

clothing, and shelter. To the extent the payor spouse is able to

supply them, the recipient is entitled to have the comforts and

even the luxuries of life).

The evidence in this case fails to support the conclusion

that the trial court properly considered the parties' stations in

life in light of their relative abilities to meet their support

obligations. The court assumed wife's support needs would be

fully met from the income or corpus of the lump sum. In so

doing, the court failed to consider husband's income producing

property and his ability to earn income from his mining

operations as sources of support for wife. While the court's

lump sum award left each party approximately $1.8 million in

certificates of deposit, the court assumed wife's share would

earn income but disregarded the potential income husband's share

could produce. The court's distribution also left husband the

income his mining operations would earn, which the record shows

was between $1 million and $256,000 per year from 1989 to 1992.

Thus, the income producing value of husband's post-divorce estate

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would remain intact and his business income unburdened, while

wife's estate would effectively erode.

While a post-divorce reduction in each party's station in

life may be expected under the facts of this case, the court's

disparate treatment of the parties' estates and incomes in

determining spousal support makes manifest the likelihood of a

disproportionate change in wife's post-divorce station of life.

Such disparate treatment is not supported by the evidence or the

court's findings and is, therefore, erroneous. See, e.g.,

Keyser, 7 Va. App. at 414-15, 374 S.E.2d at 703-04.

C.

Finally, the trial court excluded husband's business income

from its determination of the lump sum award because it found

that mining in that part of the state is unpredictable and

unlikely to yield similarly high returns in the future. However,

"in setting support awards, [the court] must look to current

circumstances and what the circumstances will be `within the

immediate or reasonably foreseeable future,' not what may happen

in the future." Srinivasan v. Srinivasan, 10 Va. App. 728, 735,

396 S.E.2d 675, 679 (1990). An award "`premised upon the

occurrence of an uncertain future circumstance . . . ignores the

design and defeats the purpose of the statutory scheme.'" Payne

v. Payne, 5 Va. App. 359, 363, 363 S.E.2d 428, 430 (1987)

(quoting Jacobs v. Jacobs, 219 Va. 993, 995-96, 254 S.E.2d 56, 58

(1979)). Thus, the court improperly speculated as to the demise

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of husband's mining operations.

I would direct the court to consider these factors on

remand.

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