Judges Opinions Public Notices, — June 30, 2020 8:57 — 0 Comments

Public Notices, June 10, 2020

Volume 57, No. 45

 

PUBLIC NOTICES

DECEDENTS’ ESTATES

CHANGE OF NAME

 

TABLE OF CONTENTS

Megan E. Pulaski v. Jeremy J. Pulaski

 

NOTICE IS HEREBY GIVEN that Letters Testamentary or of Administration have been granted in the following estates. All persons indebted to the said estate are required to make payment, and those having claims or demands to present the same without delay to the administrators or executors named.

 

FIRST PUBLICATION

 

ESTATE OF MARY ANN GOMEZ, late of Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor

 

James M. Fick, Executor

George E. Christianson

411 Chestnut Street

Lebanon, PA  17042

 

ESTATE OF GEORGE K. SHAAK, SR., late of the City of Lebanon, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Adam S. Auchey, Executor

228 Jacklyn Drive

Cranberry Township, PA 16066

 

ESTATE OF KENNETH D. THOMPSON, JR., late of Lebanon County, Pennsylvania, deceased. Letters of Administration have been granted to the undersigned Administrator.

 

Kyle K. Thompson, Administrator

Anthony J. Fitzgibbons, Esquire

279 N. Zinn’s Mill Road

Suite D

Lebanon, PA 17042

 

ESTATE OF EDWIN R. RODRIGUEZ, late of the City of Lebanon, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executrix.

 

Jeanette Torres, Executrix

Estate of Edwin R. Rodriguez

Reilly Wolfson Law Office

1601 Cornwall Road

Lebanon, PA 17042

 

ESTATE OF STEVEN J. MARTEL, late of Heidelberg Township, Lebanon County, Pennsylvania, deceased. Letters of Administration have been granted to the undersigned Administrator.

 

William F. Martel Jr., Administrator

Horace M. Ehrgood, Esquire

410 Chestnut Street

Lebanon, PA 17042

 

ESTATE OF WILLIAM M. GETTLE JR., late of North Lebanon Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executrix.

 

Ruth S. Gettle, Executrix

Horace M. Ehrgood, Esquire

410 Chestnut Street

Lebanon, PA 17042

 

ESTATE OF LYDIA S. SOLOMON, late of Heidelberg Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executrix.

 

  1. Jacqueline Miller, Executrix

Horace M. Ehrgood, Esquire

410 Chestnut Street

Lebanon, PA 17042

 

ESTATE OF THOMAS A. KRING, late of Heidelberg Township, Lebanon County, Pennsylvania, deceased. Letters of Administration have been granted to the undersigned Administratrix.

 

Rebecca E. McCafferty Administratrix

Horace M. Ehrgood, Esquire

410 Chestnut Street

Lebanon, PA 17042

 

ESTATE OF MARILYN L. HARTMAN, late of the City of Lebanon, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executors.

 

Jeffrey L. Hartman, Co-Executor

Larry B. Hartman, Co-Executor

1140 Wilson Ave

Chambersburg, PA 17201

ESTATE OF JAMES A. SANDERS, late of Cleona Borough, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Beau R. Sanders, Executor

Kevin M. Richards, Esquire

PO Box 1140

Lebanon, PA 17042-1140

 

ESTATE OF WILBUR M. SPANGLER, late of South Lebanon Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Frederick Spangler, Executor

83 Valley Road

PO Box 673

Mount Gretna, PA 17064

 

Edward J. Coyle, Esquire

Buzgon Davis Law Offices

PO Box 49

525 South Eighth Street

Lebanon, PA 17042

 

ESTATE OF GRACE V. SHUEY, late of Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executors.

 

Douglas B. Shuey, Co-Executor

Clayton H. Shuey, Jr., Co-Executor

George E. Christianson, Esquire

411 Chestnut Street

Lebanon, PA  17042

 

ESTATE OF CARL L. HOFFMAN, late of Jackson Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

David G. Schwalm, Executor

Stephen R. Gibble, Esquire

Gibble Law Offices, P.C.

126 E. Main Street,

Lititz, PA 17543

 

SECOND PUBLICATION

 

ESTATE OF VIRGINIA L. YINGST, late of the City of Lebanon, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executrix.

 

Joan Y. Breidenstine, Executrix

Estate of Virginia L. Yingst

Reilly Wolfson Law Offices

1601 Cornwall Road

Lebanon, PA 17042

 

ESTATE OF FREDERICK RUEBMAN, JR., late of South Londonderry Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executors.

 

James Ruebman, Co-Executor

Keith Mearig, Co-Executor

John R. Gibbel, Esquire

PO Box 5349

Lancaster, PA 17606

 

ESTATE OF PHYLLIS A. STONER, late of the Swatara Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Daniel Stoner, Sr., Executor

Jon F. Arnold, Esquire

410 Chestnut Street

Lebanon, PA 17042

 

ESTATE OF MERLIN C. CRAUN late of South Lebanon Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executrix.

 

Suzanne K. Rueppel, Executrix

George W. Porter, Esquire

909 E. Chocolate Avenue

Hershey, PA 17033

 

ESTATE OF ESTHER L. BUCK, late of North Londonderry Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executrices.

 

Carol A. Danz, Co-Executrix

Karen M. Meads, Co-Executrix

George W. Porter, Esquire

909 E. Chocolate Avenue

Hershey, PA 17033

 

ESTATE OF ROBERT P. FUNK, late of Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Ronald P. Funk, Executor

Anthony J. Fitzgibbons, Esquire

279 North Zinn’s Mill Road

Suite D

Lebanon, PA 17042

 

ESTATE OF HENRY M. BERGER, late of North Cornwall Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executors.

 

Johan E. Berger, Co-Executor

Ross A. Berger, Co-Executor

Kevin M. Richards, Esquire

PO Box 1140

Lebanon, PA 17042

 

ESTATE OF FREDERICK RUEBMAN, JR., late of South Londonderry Township, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Co-Executors.

 

James Ruebman, Co-Executor

Keith Mearig, Co-Executor

John R. Gibbel, Esquire

PO Box 5349

Lancaster, PA 17606

 

THIRD PUBLICATION

 

ESTATE OF RIDA J. DEVITZ a/k/a RIDA JEANNETTE DEVITZ a/k/a JEANNETTE R. DEVITZ late of the City of Lebanon, Lebanon County, Pennsylvania, deceased. Letters Testamentary have been granted to the undersigned Executor.

 

Hayes A. Clark, IV, Executor

Patrick M. Reb, Esquire

547 S. 10th Street

Lebanon, PA 17042

 

ESTATE OF KATHLEEN ANN MULHERN, late of Jackson Township, Lebanon County, Pennsylvania, deceased. Letters of Administration have been granted to the undersigned Administrator.

 

Dominic J. Mulhern

PO Box 336

Richland, PA 17087

 

Kenneth C. Sandoe, Esquire

36 West Main Avenue

Myerstown, PA 17067

 

CHANGE OF NAME

 

NOTICE is hereby given that on May 28, 2020, a petition for change of name was filed in the Court of Common Pleas requesting a decree to change the name of AMARA CATHERINE UNDERWOOD to AMARA CATHERINE CRANE.

 

The Court has fixed the 29th day of June, 2020, at 2:00 o’clock P.M. at Lebanon County Court of Common Pleas, located at 400 South Eighth Street, Lebanon, Pennsylvania 17042, as the time and place for the hearing on said petition when and where all persons interested may appear and show cause, if any they have, why the prayer of the petitioner should not be granted.

 

JUDGES OPINION

 

Megan E. Pulaski v. Jeremy J. Pulaski

 

Civil Action-Family Law-Divorce-Equitable Distribution-Marital Assets-Gift from Parent-Loan from Parent-Marital Residence-Mortgage Credit-Fair Rental Value Credit-Allocation of Debt-Collateral Estoppel

 

The parties, who were married on September 25, 2004 and separated on May 10, 2014, received monies during the marriage from Defendant’s mother (“Mother”) that were used to acquire marital property, including the marital residence.  Plaintiff (“Wife”) filed a Complaint seeking Divorce and Equitable Distribution against Defendant (“Husband”), who asserted that monies received from Mother during the marriage were a loan, not a gift.  Following the adoption of the Report and Recommendation of the Special Master who awarded fifty-five percent (55%) of the marital estate to Husband and directed that Wife pay Mother $105,088.50 to account for monies loaned to the parties during the marriage, Wife filed Exceptions to the Report and Recommendation adopted by the Court.  Wife asserted that the Special Master erred and abused his discretion in his percentage distribution of the marital estate and by finding that monies given by Mother during the marriage were a loan and directing her to pay monies to Mother.

 

  1. In reviewing a Special Master’s report, the Court must give the fullest consideration to the credibility findings of the Special Master, who was present to observe the demeanor of the witnesses and hear their testimony.

 

  1. The Special Master’s report is only advisory, and the Court is not bound by its conclusions.

 

  1. The Court must consider all of the evidence de novo and must make an independent determination of the fairness of the Special Master’s distribution scheme.

 

  1. The Court’s role in equitable distribution is to effectuate economic justice between the parties.

 

  1. In distributing property, while the Court is required to consider all of the factors set forth in the Divorce Code at 23 Pa.C.S. § 3502, the Court is not compelled to consider each factor equally.

 

  1. The Divorce Code permits allocation of different percentages to different assets or classes of assets between parties.

 

  1. Where Mother contributed $200,000.00 toward the purchase of the marital residence that enabled the parties to purchase the $525,00 marital residence, economic justice warrants a finding that Husband was a greater contributor to the acquisition of that marital asset such that Husband should receive seventy-five percent (75%) and Wife should receive twenty-five percent (25%) of the proceeds of the marital residence.

 

  1. A spouse who has been excluded from the marital home is presumed responsible for the upkeep of his or her interest in the marital home.

 

  1. The Court in its discretion may award a credit to a spouse who maintains full financial responsibility of the marital home.

 

  1. The Court in its discretion may award credit to a spouse who has not resided in the home for the fair rental value of the marital home as compensation for use of the premises by the spouse in possession.

 

  1. Offsetting rental credits and mortgage credits is a methodology routinely employed by the courts to account for these credits.

 

  1. Since the Special Master erred by failing to award Wife rental value credit for twenty-four (24) months Husband resided in the marital home while Wife was contributing to mortgage payments upon the marital home, Husband will not be awarded credit for his sole payment of the mortgage on the martial residence for a period of time thereafter.

 

  1. Where the record establishes that Mother gave an identical gift of $200,000.00 to her other son, Husband initially testified that the $200,000.00 to he and Wife was consistent with that of an intervivos inheritance, the payments made by Husband to Mother after the parties’ separation quickly were funneled back to Husband by Mother to purchase and to renovate his residence without execution of any loan documentation and Husband and Mother displayed a lack of transparency regarding their financial interrelationship, Mother’s $200,000.00 contribution toward the marital residence was an intervivos inheritance to Husband for which Mother never expected repayment.

 

  1. The doctrine of collateral estoppel requires that when an issue of ultimate fact has been determined by a valid and final judgment, that issue cannot be litigated between the same parties in any future lawsuit.

 

  1. While the Court decreed in a previous lawsuit filed by Mother against Husband and Wife that the proceeds for the purchase of the marital residence was marital debt owed by Husband and Wife to Mother and directed that allocation of that debt be determined an equitable distribution, an Order that the Court collaterally is estopped from altering, the Court will allocate that debt exclusively to Husband in order to effectuate economic justice between the parties.

 

L.C.C.C.P. No. 2014-20610, Opinion by Bradford H. Charles, Judge, August 13, 2019.

 

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY

PENNSYLVANIA

 

 

CIVIL ACTION – FAMILY DIVISION

 

MEGAN E. PULASKI                       :  NO. 2014-20610

                             Plaintiff                :       

                                                          :                                                                            v.                                                :       

                                                          :       

JEREMY J. PULASKI,                     :

                             Defendant           :

 

O R D E R

 

 

 

AND NOW, this 13th day of August, 2019, in accordance with the attached Opinion and after consideration of the arguments submitted by the parties and the complete record of the case, the Exceptions filed by WIFE to the Report and Recommendations of the Special Master are granted in part and denied in part. Accordingly, the Recommendation of the Special Master is affirmed in part and denied in part. The Order of this Court is as follows:

  1. Plaintiff Megan E. Pulaski (hereafter “WIFE”) and Defendant Jeremy J. Pulaski (hereafter “HUSBAND”) are hereby divorced from the bonds of matrimony pursuant to Section 3301(d) of the Pennsylvania Divorce Code.
  2. The Court determines that the value of all marital assets totals $316,019.56, which represents the following:

 

 

(a) Net proceeds from the sale of the marital home $76,148.76

 

(b) Bank accounts                                                        $40,590.00

 

(c) Proceeds from the sale of 2010 GMC Acadia      $13,500.00

 

(d) 2009 Flagstaff Camper                                           $13,500.00

 

(e) Marital portion of WIFE’s Cornwall Manor

retirement                                                                     $750.00

 

(f) Marital portion of Wife’s 401(k)                           $118,153.80

 

(g) Marital portion of Husband’s

Edward Jones/Hartford account                             $53,377.00

 

  1. The value of all marital assets excluding the proceeds of the marital residence totals $239,870.80.
  2. Husband shall be entitled to 75% of the proceeds from the sale of the marital residence, which is $57,111.57.
  3. Husband shall be entitled to 55% of the remainder of the marital assets, which is $131,928.94.
  4. HUSBAND shall not be entitled to any post-separation mortgage credit.
  5. HUSBAND is therefore entitled to $189,040.51 of the total marital estate.
  6. HUSBAND currently has in his possession assets of the marital estate totaling $125,246.38, including one-half of the proceeds from the sale of the marital residence, one-half of the bank accounts, the 2009 Flagstaff Camper and the marital portion of his Edward Jones/Hartford account.
  7. WIFE is entitled to 25% of the proceeds from the sale of the marital residence, which is $19,037.19.
  8. WIFE is entitled to 45% of the remainder of the marital assets, which is $107,941.86.
  9. WIFE shall not be entitled to post-separation rental credit.
  10. WIFE is therefore entitled to $126,979.05 of the total marital estate.
  11. WIFE currently has in her possession assets of the marital estate totaling $190,773.18, consisting of one-half of the net proceeds from the marital home, one-half of the bank accounts, the proceeds from the GMC Acadia, and the marital portions of both her Cornwall Manor retirement and her 401(k) accounts.
  12. WIFE shall pay HUSBAND the sum of $63,794.13, which will properly distribute the marital assets according to the distribution scheme set forth above. ($190,773.18 – $126,979.05 = $63,794.13 / $63,794.13 + $125,246.38 = $189,040.51)
  13. WIFE shall make this payment via transfer from her 401(k) plan to a qualified plan of HUSBAND within sixty (60) days of the final decree.
  14. The transfer shall be considered a tax-free event to both HUSBAND and WIFE.
  15. The $210,177.00 debt claimed by Jean Pulaski (hereafter “PULASKI”) is marital debt by virtue of an Order of Judgment dated September 5, 2017 at Lebanon County Action Number CP-52-CV-01588-2016.
  16. The marital debt owed to PULASKI is allocated exclusively to HUSBAND.
  17. WIFE’s share of the debt associated with the Judgment entered at CP-52-CV-01588-2016 is ZERO. WIFE shall have no obligation to pay anything to either HUSBAND or PULASKI regarding the $210,177 debt claimed by PULASKI.
  18. The joint vacation club shall be sold and the net proceeds of that sale shall be divided equally.
  19. HUSBAND’s request for alimony is denied.
  20. The cost of preparation of a QDRO and any administrative fees charged by WIFE’s 401(k) Plan shall be divided equally between the parties.
  21. The parties shall execute all documents necessary to effectuate the above order and shall cooperate with one another in all necessary respects to effectuate the terms of this Order.
  22. The parties shall be equally responsible for the fees of the Special Master.

 

 

 

 

 

THE  COURT:

 

 

______________________,J.

BRADFORD H. CHARLES

 

 

BHC/kgw

 

cc:     Colleen Gallo, Esq.

Max Smith, Esq.

Court Administration (Order only)

 

 

TABLE OF CONTENTS

 

  1. FACTUAL BACKGROUND 2
  2. INTRODUCTION 2
  3. FACTS 3
  4. HEARING ON DECEMBER 14, 2017 4
  5. HEARING ON MAY 3, 2018               12
  6. HEARING ON AUGUST 1, 2018               13
  7. REPORT OF THE SPECIAL MASTER               14
  8. WIFE’s EXCEPTIONS TO THE REPORT OF

                       THE SPECIAL MASTER AND SUBSEQUENT

                       PROCEEDINGS RELATED TO THOSE

                       EXCEPTIONS                                                                 17

 

  1. SCOPE OF REVIEW 20

III. DISCUSSION                                                                                    21           

  1. THE MASTER’S 55/45 DISTRIBUTION SCHEME IN

     FAVOR OF HUSBAND                                                           21

 

  1. CREDITS        24
  2. THE MASTER’S DETERMINATION THAT THE

               PULASKI GIFT IS MARITAL DEBT                                      27

 

  1. CONCLUSION 32

 

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY

PENNSYLVANIA

 

CIVIL ACTION – FAMILY DIVISION

 

 

MEGAN E. PULASKI                                :  NO. 2014-20610

                             Plaintiff                         :       

                                                                   :                                                                            v.                                             :       

                                                                   :       

JEREMY J. PULASKI,                              :

                             Defendant                     :

 

 

 

APPEARANCES:

 

Colleen Gallo, Esquire                                  FOR Plaintiff       

 

Max Smith, Esquire                                        FOR Defendant

 

 

OPINION BY CHARLES, J., August 13, 2019

 

Before us is the question of how a marital home and its encumbering debt should be divided.  Both parties have proffered dramatically different arguments.  Before tackling those arguments, we wish to emphasize two realities of this case that cannot be ignored in a search for economic justice:

  • The parties’ marital home could not have been procured without the financial largesse of Jeremy Pulaski’s mother, PULASKI. No fair division of the marital home could or would be possible without giving due weight to the manner in which the residence was procured.
  • Regardless of how the finances were funneled from mother to son, there was never any intent that son should repay mother. It would therefore be grossly unfair to expect WIFE to exclusively bear any repayment burden.

We will, of necessity, address some of the esoteric legal arguments proffered by the parties.  As we do so, we will always remember the factual realities outlined above, and our decision will respect the importance of those realities.

 

  1. FACTUAL BACKGROUND

 

  1. INTRODUCTION

The factual and procedural background underlying our ultimate decision is a prolonged and fractured one. That background has evolved, piecemeal, over four fact-finding hearings—three in front of the Special Master and one in front of this Court. This tortured process is, in part, the result of acrimony between the parties, which we have come to expect in such proceedings, but even more it is the result of evasiveness, if not outright dishonesty, regarding financial information and transactions central to a just equitable distribution scheme.  The testimony and submitted documentation regarding those financial relationships and transactions have evidenced, in the most generous light, “creative accounting.” There has been contradictory evidence offered by the same party, sometimes at different proceedings and sometimes at the same proceeding.  Lawyer and client have contradicted each other in the same submission to the Court. Third parties have inserted themselves into the proceedings, both through collateral litigation and an attempt to offer evidence after the record was closed by the Special Master. A specific and very direct Order of this Court requiring information from a party was largely ignored.

It is this frustrating landscape that forms the backdrop for our decision today. So that our reasoning is understood by the parties, interested third parties, and any appellate court that will ultimately review our decision, we will set forth the factual and procedural background of the case in detail so that there is a complete context for the decision rendered today. With that explanation for the lengthy synopsis that follows, we turn to the facts.

 

  1. FACTS

WIFE and HUSBAND were married on September 25, 2004 and separated on May 10, 2014. On August 19, 2014, WIFE filed a Complaint in Divorce, raising claims for divorce and equitable distribution. On July 21, 2017, HUSBAND filed an Answer and Counterclaim to the Complaint, seeking alimony, alimony pendente lite, and attorney’s fees, costs and expenses. On September 20, 2017, this Court appointed Keith L. Kilgore, Esq., as Special Master.        The Special Master eventually conducted three hearings in the matter.

 

 

  1. Hearing on December 14, 2017

At the first hearing on December 14, 2017, the Special Master heard testimony from both HUSBAND and WIFE. This testimony established the following:

The parties married on September 24, 2004. (N.T. December 14, 2017 at 8) Three children were eventually born into the marriage: Liam, born January 29, 2006; Ethan, born November 13, 2007; and Breelyn, born July 1, 2010. (N.T. December 14, 2017 at 9) Since separation, the parties have shared legal and physical custody of their minor children. (N.T. December 14, 2017 at 19; Exhibit 8) WIFE pays HUSBAND $572.79 in monthly child support. (N.T. December 14, 2017 at 20)

WIFE was born on June 30, 1979, and thus was 38 at the time of the hearing. (N.T. December 14, 2017 at 7) She earned an Associate’s Degree in Nursing from HACC in 2004 and has been employed since September of 2004 as an RN. (N.T. December 14, 2017 at 10) For the last 11 years, WIFE has been employed at various nursing homes operated by the United Church of Christ. Currently she serves as the Assistant Director of Nursing at Ephrata Manor, where she earns approximately $93,000.00 a year. (N.T. December 14, 2017 at 11, 12, 53; Exhibit 1) WIFE typically receives a 2% cost of living raise each year. (N.T. December 14, 2017 at 51) She is eligible for health, vision and dental insurance, accidental death benefits, retirement and life insurance benefits. (N.T. December 14, 2017 at 12-14) She provides health insurance coverage for the family with a payroll deduction of $70.26 biweekly. (N.T. December 14, 2017 at 16-16; Exhibits 2-3)

WIFE has been unable to voluntarily contribute to her retirement account since separation, but her employer continues to contribute 14% annually to her retirement plan. (N.T. December 14, 2017 at 13-14, 36-37)

The balance of WIFE’s UCC retirement fund at the time of separation in May of 2014 was $82,994.48. (N.T. December 14, 2017 at 36, Exhibit 14) As of September 30, 2017, WIFE’s UCC retirement account appreciated to $132,844.96. (N.T. December 14, 2017 at 37; Exhibit 15)

WIFE also has a retirement plan derived from previous employment with Cornwall Manor. (N.T. December 14, 2017 at 37) WIFE began working at Cornwall Manor seven years prior to her marriage to HUSBAND and continued working there until March of 2007. (N.T. December 14, 2017 at 37-38) The retirement account was opened with a balance of $2,270.57 on March 27, 2007, when WIFE concluded her employment at Cornwall Manor. The balance of the account as of December 30, 2016 was $2,293.87. (N.T. December 14, 2017 at 38)

Since the date of separation, WIFE has incurred substantial credit card debt in order to pay monthly expenses, and she has not been able to save any money. (N.T. December 14, 2017 at 21, 22, 24, 57) As of December 14, 2017, WIFE estimated her credit card debt to be $12,000. (N.T. December 14, 2017 at 22) She presently rents a home in Annville from her parents at a rate of $800.00 a month, excluding all utilities. (N.T. December 14, 2017 at 7, 18, 19, 52-53; Exhibit 7)

HUSBAND was born on August 3, 1977 and was thus 40 at the time of the hearing. (Exhibit 36) HUSBAND earned a Bachelor’s Degree in Electrical Occupations from Penn State School of Technology in 1999. (N.T. December 14, 2017 at 73-74) HUSBAND is employed as an electrician and has worked for Rudicks, formerly Altmare, for the past nine (9) years.  (N.T. December 14, 2017 at 74)           HUSBAND earns $26.00 an hour or approximately $55,000.00 a year. (N.T. December 14, 2017 at 77; Exhibit 24) He is eligible for health insurance benefits as well as paid time off, but does not receive any retirement benefits paid by his employer. (N.T. December 14, 2017 at 77) In addition to his full-time employment with Rudicks, HUSBAND occasionally performs side jobs under the table. (N.T. December 14, 2017 at 66-75) HUSBAND’s earnings from Rudicks totaled $58,781.00 in 2015, $56,493.00 in 2016, and $58,126.00 in 2017. (N.T. December 14, 2017 at 76-79; Exhibits 25-26, 48-52)

At the time of separation, HUSBAND had two (2) retirement accounts, a Hartford account and an Edward Jones account. (N.T. December 14, 2017 at 84-86) HUSBAND opened his Hartford retirement account during the marriage in 2011. The account balance on December 31, 2011 was $16,273.63. (N.T. December 14, 2017 at 84; Exhibit 27) As of December 31, 2014, several months after separation, the value of the account was $16,455.88. (N.T. December 14, 2017 at 85; Exhibit 28) As of June 30, 2017, the account’s value had appreciated to $17,184.79. (Exhibit 29)

HUSBAND’s Edward Jones account had a value of $20,178.39 as of the date of his marriage to WIFE. (N.T. December 14, 2017 at 86; Exhibit 30) At the time of separation, the account balance had increased to $36,808.26. (N.T. December 14, 2017 at 87; Exhibit 31) As of June 30, 2017, the account had appreciated to $52,023.50. (N.T. December 14, 2017 at 88; Exhibit 32) Since separation, HUSBAND has not made any contributions to or withdrawals from either of his retirement accounts. In August of 2017, HUSBAND consolidated his retirement plans into one account with Edward Jones. (N.T. December 14, 2017 at 85)

HUSBAND remained in the marital home following separation in May of 2014 until the home was sold in May of 2016. (N.T. December 14, 2017 at 25) Thereafter, in August of 2016, HUSBAND purchased a home at 4080 Shanamantown Road in Annville for a sum of $205,000.00. (N.T. December 14, 2017 at 72-73, 95, 107; Exhibit 35) The purchase included a $63,000.00 down payment made by HUSBAND, who indicated the source of the down payment money was his mother, PULASKI. (N.T. December 14, 2017 at 109; Exhibit 36)[1] HUSBAND also received an additional $22,260.00 for renovations for his new home from his mother, with whom he lived for one year while those renovations were taking place. (N.T. December 14, 2017 at 98) HUSBAND indicated the $22,260.00 was a loan from his mother, and he was obligated to pay on the loan when possible. (N.T. December 14, 2017 at 96, 98-99; Exhibit 34) As of the date of the hearing, HUSBAND indicated he had made some payments on the outstanding loan but didn’t know the exact amount of those payments. (N.T. December 14, 2017 at 96, 98-99)

HUSBAND testified that he was also able to purchase, with $15,000.00 cash, a two-acre plot of land for camping on August 29, 2017. (N.T. December 14, 2017 at 109-110; Exhibit 37) The cash for the camping lot purchase had come from his house, where he “generally always had cash laying around.” (N.T. December 14, 2017 at 110-111) HUSBAND indicated the funds may have come from gambling, as part of his “poker gambling fund.” (N.T. December 14, 2017 at 110-111) HUSBAND has not incurred any credit card debt and has been able to accumulate savings since separation. (N.T. December 14, 2017 at 111-112)

At the time of separation, the parties’ marital residence was located at 617 Horseshoe Trail Drive, Lebanon, Lebanon County. (N.T. December 14, 2017 at 24.) The residence was initially owned by PULASKI, who purchased the property and built the home for HUSBAND and WIFE to use and enjoy. (N.T. December 14, 2017 at 44) For a period of time after the home was built, the parties rented the residence from PULASKI for the sum of $1,300.00 a month, until PULASKI lost her job and needed to sell the property. (N.T. December 14, 2017 at 45) In the fall of 2008, the parties purchased the property from PULASKI, financing the $525,000.00 purchase price with a $325,000.00 bank mortgage and a $200,000.00 conditional gift from PULASKI. (Exhibit 22; N.T. December 14, 2017 at 46) According to the written terms of a September 2, 2008 Conditional Gift Agreement and a corresponding Note, PULASKI was entitled to repayment of the conditional gift of $200,000.00 upon the resale of the property or the bankruptcy of the parties. (N.T. December 14, 2017 at 46; Exhibit 22) PULASKI made a similar conditional gift to her other son, Jason Pulaski, in the same amount.[2]  (N.T. December 14, 2017 at 112) At the December 14, 2017 hearing, HUSBAND gave the following description of the “conditional gift”:

She had given me and Megan and along with my brother and his wife, instead of dying and willing us money, she preferred basically to give us the money and watch us enjoy it like our house or our house. So that’s just who she is and that’s who she is still. So when we separated and the new house came along, she’s still going to do the same thing which she did. She’s now at like I have to restart everything so now she helped me again with what she could.

 

(N.T. December 14, 2017 at 114)

 

After separation, and in anticipation of divorce, the parties placed the 617 Horseshoe Trail property up for sale. Although only HUSBAND continued to reside in the home, the parties split the mortgage payments of $2,600.00 a month. WIFE paid $1,300.00 a month from May of 2014 until October of 2015, using $20,295.00 in funds from bank accounts the couple had split upon separation. (N.T. December 14, 2017 at 25-26, 35) After October of 2015, WIFE’s bank account proceeds were completely depleted, and WIFE was unable to pay both the $1300.00 mortgage payment on the 617 Horseshoe Trail property and the $800.00 a month rent for her current residence. It was at that point that she ceased contributing to the mortgage payments owed on the Horseshoe Trail property. (N.T. December 14, 2017 at 25-26)

After a year and a half on the market, the Horseshoe Trail property finally sold in May of 2016 for $395,000.00, leaving the parties with  proceeds of $76,148.76 from the sale. (N.T. December 14, 2017 at 26) The parties split the proceeds, with each receiving $38,124.38 on May 27, 2016. (N.T. December 14, 2017 at 27; Exhibit 11)           HUSBAND endorsed his settlement check for $38,124.38 to PULASKI on June 9, 2016. (N.T. December 14, 2017 at 89-90; Exhibit 33) Six days later, on June 15, 2016, HUSBAND made a $30,000.00 cash payment to PULASKI. (N.T. December 14, 2017 at 90; Exhibit 33) HUSBAND testified that the $30,000.00 came from the division of the joint bank accounts with WIFE and other monies he had earned and saved. (N.T. December 14, 2017 at 90) HUSBAND testified that both these “payments” related to the parties’ obligations to PULASKI under the Conditional Gift Agreement. (N.T. December 14, 2017 at 88-90; Exhibit 33)

HUSBAND eventually made three additional payments of $1,500.00 to PULASKI in January, April and August of 2017, such that his total payments to her—at the time of the first hearing before the Master on December 14, 2017– amounted to $72,500.00. (N.T. December 14, 2017 at 62, 90-91; Exhibit 33) WIFE did not directly make any payments to PULASKI upon the sale of the residence or at any time thereafter. (N.T. December 14, 2017 at 46, 67-68)

On September 5, 2017, in collateral litigation related to the Conditional Gift Agreement, the Honorable Samuel Kline of the Lebanon County Court of Common Pleas entered Judgment against both HUSBAND and WIFE in the amount of $137,677.00. The Judgment total reflected a gross debt of $210,177.00, minus $72,500.00 paid by HUSBAND. (N.T. December 14, 2017 at 47; Exhibit 23)[3] Judge Kline’s Order described the $137,677.00 still owing as “marital debt” and directed that that debt be allocated by the Special Master. (Exhibit 23)

At the conclusion of the hearing on December 14, 2017, the Master held open the Record in order that the parties might submit specific documentation regarding year-end wage and investment statements, tax returns, and vehicle values. HUSBAND was also directed to provide an accounting of how he had amassed $30,000.00 in order to make a June 15, 2016 cash payment to PULASKI.

 

 

 

  1. Hearing on May 3, 2018

On May 3, 2018, the Master held a second hearing to take additional testimony based upon the supplemental documentation submitted by the parties. At that hearing, the Master heard testimony from both PULASKI and HUSBAND, who provided further details regarding the financial transactions between them.

With regard to HUSBAND’s first conditional gift “payment” of $38,124.38 on June 9, 2016, PULASKI testified that, on that same date, she secured a one-month Certificate of Deposit in the amount of $38,000.00 with those monies. (N.T. May 3, 2018 at 5-6; Exhibit 50) On June 15, 2016, HUSBAND made another payment to Pulaski, this time in the amount of $30,000.00.  (N.T. May 3, 2018 at 5-6; Exhibit 51)   On that same date, PULASKI purchased another one-month CD, this time for $30,000.00, the exact amount of HUSBAND’s payment to her. (N.T. May 3, 2018 at 5-6; Exhibit 50)

HUSBAND admitted that, on July 11, 2016, immediately after his mother’s June 9, 2016 $38,000.00 CD matured, HUSBAND’s Northwest Checking Account received a deposit of $38,001.67. (N.T. May 3, 2018 at 14-16; Exhibit 52) Likewise, he allowed that, on July 15, 2016, immediately after his mother’s June 15, 2016 $30,000.00 CD matured, HUSBAND’s Northwest Checking Account received a deposit of $30,001.23. (N.T. May 3, 2018 at 14-16; Exhibit 52)

At the May 3, 2018 hearing, HUSBAND also presented documentation related to his claim that at least some of the $15,000.00 cash he paid for camping land in August of 2017 came from gambling winnings at Hollywood Casino. (N.T. May 3, 2018 at 18-19) HUSBAND presented vouchers totaling $14,500.00 for gambling winnings in late 2014.  (N.T. May 3, 2018 at 19).

On June 20, 2018, both parties submitted Post-Hearing Briefs to the Master in anticipation of the Report and Recommendations of the Special Master.

 

  1. Hearing on August 1, 2018

On July 16, 2018, HUSBAND’s counsel submitted additional documentation to the Master. The additional documentation consisted of two emails from PULASKI, who suggested that WIFE had an equity interest in real estate that WIFE had not previously disclosed. Specifically, PULASKI claimed that WIFE actually owned the Annville Maple Street property in which she was residing, as opposed to renting it from her parents, a fact that contradicted WIFE’s December 14, 2017 testimony to the Master.

Upon objection from WIFE that the Special Master should not consider the documentation provided by PULASKI, the Master conducted a third hearing on August 1, 2018, in order to take testimony based on the July 16, 2018 documentation. After hearing testimony and reviewing documentation provided by PULASKI and WIFE, the Special Master ultimately concluded that WIFE did not possess an ownership interest in the Maple Street property.

 

  1. Report of the Special Master

On October 22, 2018, the Special Master issued a Report and accompanying Recommendations.  The Special Master’s findings and recommendations with respect to property distribution included the following:

 

(1) Of the eleven (11) factors set forth by 23 Pa.C.S.A. §3502(a) of the     Divorce Code, three weighed in favor of unequal distribution of the marital assets to HUSBAND:

  • 23 Pa.C.S.A. §3502(a)(3) – The age, health, station, amount and sources of income, vocational skills, employability, estate, liabilities      and needs of each of the parties.

 

  • 23 Pa.C.S.A. §3502(a)(5) – The opportunity of each party for future acquisitions of capital assets and income.

 

  • 23 Pa.C.S.A. §3502(a)(6) – The sources of income of both parties, including, but not limited to, medical, retirement, insurance or other benefits.

 

The Master determined that the remaining factors were neutral, including 23 Pa.C.S.A. §3502(a)(7), the contribution of each party to the acquisition of the marital assets.

(2) The marital assets of the parties totaled $316,019.56[4] and consisted of        the following:

  1. Net proceeds from the sale of the marital home $76,148.76
  2. Bank accounts $40,590.00
  3. Proceeds from the sale of 2010 GMC Acadia $13,500.00
  4. 2009 Flagstaff Camper $13,500.00
  5. Wife’s marital portion of Cornwall Manor

retirement                                                                      $750.00

  1. Marital portion of Wife’s 401(k)                            $118,153.80
  2. Marital portion of Husband’s

Edward Jones/Hartford account                             $53,377.00

 

(3)   WIFE had marital assets in her possession valued at $190,773.18, consisting of one-half of the net proceeds from the marital home, one-half of the bank accounts, the proceeds from the GMC Acadia, and the marital portions of both her Cornwall Manor retirement and her 401(k) accounts.

(4) HUSBAND had marital assets in his possession valued at $125,246.38, including one-half of the proceeds from the sale of the marital residence, one-half of the bank accounts, the 2009 Flagstaff Camper and the marital portion of his Edward Jones/Hartford account.

(5) Based upon his analysis of the factors set forth by §3502(a) which weighed in favor of unequal distribution to HUSBAND, the Master recommended that the marital assets of $316,019.56 be divided fifty-five percent (55%) to HUSBAND ($173,810.76) and forty-five percent (45%) to WIFE ($142,208.81). Using that distribution scheme, the Master determined that WIFE had $48,564.37 ($190,773.18 – $142,208.81) more in assets in her possession than she was entitled to and she was obligated to pay that amount, with an adjustment for credits, to HUSBAND.

(6)   HUSBAND was entitled to an additional credit of $10,400.00, one-half of the mortgage payments made by him on the marital home from November, 2015 through May, 2016.

(7)   WIFE was therefore required to pay husband a total of $57,614.38[5] ($47,214.383 + $10,400) via a transfer from her 401(k) to a qualified account of HUSBAND within 60 days of the Final Decree, with the parties sharing any costs associated with the preparation and distribution of the transfer.

(8)   The sum of $210,177.00 claimed by PULASKI by virtue of a conditional gift to the parties in 2008 was determined to be marital debt, with each party responsible for one half, or $105,088.50, of the total debt.

(9) Determining that HUSBAND had already paid PULASKI $72,500.00, the Special Master ordered HUSBAND to pay PULASKI $32,500.00 within one year of the Final Decree.

(10) WIFE’s half of the PULASKI debt–$105,088.50—was to be paid by WIFE to PULASKI in monthly payments of $875.00 until fully paid, with payments commencing 60 days after the Final Decree.

(11) HUSBAND’s request for alimony was denied.

(12) The parties were to share equally any and all costs associated with the proceedings.

 

  1. WIFE’s Exceptions to the Report of the Special Master and             subsequent proceedings related to those Exceptions

 

WIFE filed timely Exceptions, challenging both the overall 55/45 distribution scheme favoring HUSBAND and the specific directive that she pay PULASKI $105,008.50, WIFE’s share of the “marital debt” stemming from the collateral conditional gift Judgment at CP-52-CV-01588-2016.  The Court listed the matter for the February term of Argument Court, and both parties submitted timely briefs. Following Oral Argument on February 15, 2019, this Court entered an Order directing the parties to file supplemental briefs on the narrow issue of marital debt owed to PULASKI.[6] Further, as a result of arguments raised by WIFE at Argument, the Court also directed HUSBAND to file, within 30 days, an accounting of all monies he had received from his mother and all payments he had made to his mother from September 2, 2008 until the present.

On March 15, 2019, HUSBAND submitted a cover letter authored by HUSBAND’s counsel with attached documentation prepared at least in part by PULASKI.[7]  Unfortunately, the correspondence submitted on behalf of HUSBAND was neither complete nor responsive[8] to the specific directive of our February 15, 2019 Order.  With regard to the July 11, 2016 deposit of $38,001.67 into HUSBAND’s Northwest account, HUSBAND’s March 15, 2019 submission to the Court acknowledged a ”loan”[9] of $38,000.00 from Pulaski to HUSBAND for use as down payment money for the August, 2016 purchase of his Shanamantown Road home. However, the March 15, 2019 submission was silent as to the July 15, 2016 deposit of $30,001.23 into HUSBAND’s Northwest Account–money that HUSBAND had previously acknowledged also went towards his $63,000.00 total down payment.   Likewise, HUSBAND’s March 15, 2019 submission to this Court completely omitted any reference to a “loan” for $22,260.50 Pulaski had received from his mother for renovations to his Shanamantown Road property, despite the fact that the loan had initially been acknowledged by HUSBAND on the Expense and Obligation Statement admitted at the December 14, 2017 Hearing. (N.T. December 14, 2017 at 98; Exhibit 34) Concluding that HUSBAND had not complied with our Order of February 15, 2019, we entered an Order on April 17, 2019 scheduling a supplemental hearing for May 16, 2019 in order to receive testimony and evidence regarding the financial relationship between HUSBAND and PULASKI.

At that May 16, 2019 hearing, PULASKI testified that both of the July 2016 deposits into HUSBAND’s Northwest account, which totaled $68,000.00, came from the proceeds of the 30-day CD’s she had purchased with the  “payments” made by HUSBAND the month before. (N.T. May 16, 2019 at 26; Exhibit 61.) She indicated that the deposits represented a “short-term loan” to HUSBAND to enable him to have a down payment for his purchase of the Shanamantown Road property.  (N.T. May 16, 2019 at 4, 22, 24) Upon further questioning, PULASKI admitted that HUSBAND has not repaid any of the $68,000.00 in deposits “loaned” to him for his purchase of the Shanamantown Road residence, and there exists no documentation identifying the $68,000.00 as either a loan or a conditional gift. (N.T. May 16, 2019 at 24) With regard to the $22,260.50 she provided to HUSBAND for renovations to his Shanamantown Road home, PULASKI testified that the money was a loan being paid back through “in kind” services rendered to her by HUSBAND on her own renovation project.  (N.T. May 16, 2019 at 6-8)

HUSBAND testified at the May 16, 2019 hearing that the $22,260.50 loan he received from his mother for renovations was to be paid back through services. (N.T. May 16, 2019 at 32) When confronted with this contradiction to his December 14, 2017 testimony that he had already made cash payments on the renovation loan and his own handwritten notations regarding payments on the Income and Expense Statement admitted into evidence at that hearing—specifically the written notation indicating “pay as much when possible”––HUSBAND stated: “I’m an electrician. I’m not a lawyer.” (N.T. May 16, 2019 at 31)

With this factual record in mind, we turn to the resolution of WIFE’s Exceptions.

 

  1. SCOPE OF REVIEW

In reviewing a Special Master’s Report, we must give “fullest consideration” to the credibility findings of the Special Master, who was present to observe the demeanor of witnesses and hear their testimony.  Schuback v. Schuback, 603 A.2d 194, 196 (Pa. Super. 1992) (citing Dukmen v. Dukmen, 420 A.2d 667, 670 (Pa. Super. 1980)). A Special Master’s Report should not be lightly disregarded. Pasternak v. Pasternak, 204 A.2d 290, 291 (Pa. Super.1964). However, the Special Master’s Report is only advisory, and we are not bound by its conclusions. Id. at 291. We must consider all of the evidence de novo and make an independent determination of the fairness of the Special Master’s marital property distribution scheme. Id. See also Drake v. Drake, 725 A.2d 717, 727 (Pa. 1999).         That de novo review is further informed by the testimony and evidence we heard first-hand from both HUSBAND and PULASKI at a hearing before us on May 16, 2019, when we were able to make our own real-time determinations of credibility.

 

 

 

 

III.     DISCUSSION

The Court’s role in an equitable distribution dispute is to effectuate economic justice between the parties. See, e.g., Mercatell v. Mercatell, 854 A.2d 609, 612 (Pa. Super. 2004) It is through this lens that we have examined the complete factual record of the instant case and the Master’s Report and Recommendations based upon that record. While we have considered the record and the Report and Recommendations of the Special Master as a whole, our decision today is largely focused on a singular marital asset: the marital residence at 617 Horseshoe Trail Drive. Our decision today will adopt much of the Master’s Report and Recommendations. However, with respect to the Master’s treatment of the marital residence and the obligations flowing from that residence, we will depart, in some instances substantially, from the Recommendations of the Master.

 

  1. THE MASTER’S 55/45 DISTRIBUTION SCHEME IN FAVOR OF HUSBAND

 

Under Pennsylvania’s Divorce Code, “equitable” distribution does not necessarily mean “equal” distribution. Mercatell, 854 A.2d at 612. In distributing property, we are required to consider all of the factors set forth in the Divorce Code. See 23 Pa.C.S.A. §3502(a). However, we are not compelled to consider each factor equally. In Weng v.Feng, 888 A.2d 882 (Pa. Super. 2005), the Superior Court stated:

There is no simple formula by which to divide marital property. The method of distribution derives from the fact of the individual case. The list of factors [in the Code] serves as a guideline for consideration, although the list is neither exhaustive nor specific as to the weight to be given the various factors. Thus, the Court has flexibility of methods…

 

Id. at 887, quoting Fonzi v. Fonzi, 633 A.2d 634, 638 (Pa. Super. 1993).

Finding three of eleven factors in the Divorce Code weighed in favor of unequal distribution to HUSBAND and the remaining eight factors were neutral, the Master recommended a 55/45 distribution scheme in HUSBAND’s favor. Specifically, the Master found that factors (a)(3), (a)(5) and (a)(6) weighed in favor of unequal distribution and offered credible support for those conclusions. We do not disagree with the Master’s determination regarding those three factors or with the 55/45 percentage scheme he derived based upon that determination, with one important exception.  The percentages recommended by the Special Master are not appropriate for one particular marital asset– the residence at 617 Horseshoe Drive.

Subsection (a)(7) of §3502 requires consideration of the contribution of each party in the acquisition of the marital property. The Master found this factor to be neutral. We disagree, as the Master’s determination ignores HUSBAND’s significantly greater contribution to the acquisition of the marital residence. As we noted at the outset of this Opinion, the parties would never have been able to acquire this valuable marital asset apart from the largesse of PULASKI. It was HUSBAND—because he was the son of PULASKI–who was able to secure the $200,000.00 gift to augment the couple’s resources such that they could purchase a $525,000.00 marital home. We recognize that the balance of the purchase price was funded by a $325,000.00 mortgage to which both HUSBAND and WIFE contributed in subsequent years. WIFE is certainly entitled to some benefit from her contribution to those mortgage payments, as HUSBAND is from his. However, HUSBAND’s overall contribution to the acquisition of that specific marital asset—as the result of the financial contribution he secured through his mother–was significantly greater than that of WIFE. Economic justice requires we acknowledge that greater contribution.

The Divorce Code permits us to assign different percentages to different assets or different classes of assets. Section 3502(a) states, in pertinent part: “The court may consider each marital asset or group of assets independently and apply a different percentage to each marital asset or group of assets.”  23 Pa.C.S.A. § 3502.  We will be utilizing that option in the instant case.

For the proceeds of the marital residence only, we will assign HUSBAND 75% of the proceeds of the marital residence and WIFE 25% of those proceeds.  We believe that percentage scheme accounts for both parties’ ongoing contributions to the mortgage of the property while giving proper weight to HUSBAND’s significant initial contribution. For the remainder of the marital assets, we will affirm and adopt the percentages recommended by the Special Master. HUSBAND shall be entitled to 55% of remainder of the marital assets, and WIFE will be entitled to 45% of the remainder of the marital assets.

  1. CREDITS

Having rejected the analytical paradigm used by the Special Master to address the parties’ marital residence, we must also– under our de novo review duty—evaluate the other aspects of the Special Master’s residence-related analysis. Specifically, we must also evaluate whether the credits recommended by the Special Master should be awarded.[10]

A spouse who has been excluded from the marital estate is presumed responsible for the upkeep of her interest in the marital home. Cerny v. Cerny, 656 A.2d 507, 556 (Pa. Super. 1995). Therefore the Court may, in its discretion, award a credit to a spouse who maintains full financial responsibility of the marital home. Id. at 556-57.

The record establishes that, upon separation in May of 2014, HUSBAND remained in the marital residence until it was sold in May of 2016, while WIFE resided elsewhere. Although WIFE was no longer living at the residence, the parties split the mortgage payment of $2,600.00 each month from the time of separation in May 2014 through October of 2015, after which WIFE was no longer able to pay her $1,300.00 share. From that point, until May 2016, HUSBAND alone made the $2,600.00 payments.

As a result, the Master determined that HUSBAND was entitled to an additional credit of $10,400.00, one-half of the mortgage payments made by HUSBAND alone from November of 2015 through May of 2016.  Because the Master failed to account for the rental value of property enjoyed exclusively by HUSBAND following separation, we will be rejecting the Special Master’s recommendation with respect to mortgage credit.

While a dispossessed spouse is still presumed responsible for the upkeep of her financial interest and responsibilities in the marital home, that spouse may also be entitled, within the court’s discretion, to a credit for the fair rental value of the marital home as compensation for the use of the premises by the spouse in possession. Id. See also Liciardello v. Liciardello, 570 A.2d 1062 (Pa. Super. 1990); Gee v. Gee, 460 A.2d 358 (Pa. Super. 1983) In the instant case, although WIFE retained an ownership interest in the marital residence, it was HUSBAND who enjoyed exclusive possession of the home from May of 2014 until May of 2016, while WIFE resided elsewhere.

The Special Master’s recommendation does not contemplate WIFE’s entitlement to rent during the time HUSBAND enjoyed exclusive possession.  This was an error.  HUSBAND enjoyed exclusive possession of the marital residence for 24 months.  Despite living elsewhere, WIFE still contributed funds amounting to half of the monthly mortgage payment of $2600.00 for the first 18 months of the couple’s 24-month separation, stopping those payments when she ran out of assets to continue making that contribution. (N.T. December 14, 2017 at 25)  Moreover, up until the sale of the marital residence, WIFE still contributed manual labor to its upkeep. (N.T. December 14, 2017 at 25)

Under the circumstances outlined above, we believe that WIFE would be entitled to rental value credit for the 24 months HUSBAND exclusively resided in the marital home. Unfortunately, no testimony was presented at any of the four evidentiary hearings held in this matter as to the fair market rental value of the property, such that this Court can precisely determine what that credit should be. Rather than open up this matter for a fifth evidentiary hearing in divorce proceedings that have already spanned five years, our intent is to treat the issue of outstanding mortgage credit to HUSBAND and rental value credit to WIFE as a “wash”.[11] Therefore, WIFE will not be entitled to rental credit from HUSBAND for the two years he resided in the marital residence without WIFE. HUSBAND will not be entitled to a mortgage credit from WIFE for the months of November 2017 to May 2018, when he was the exclusive payor of the outstanding mortgage obligation.

 

 

 

  1. THE MASTER’S DETERMINATION THAT THE PULASKI GIFT IS MARITAL DEBT

 

 

 

WIFE’s second and third exceptions challenge the Special Master’s determination that the Judgment obtained by PULASKI against the parties is marital debt. WIFE essentially argues that this debt is not really debt at all, but rather the depreciation[12] of an invested intervivos inheritance given to HUSBAND to purchase the marital home. The factual record established over four hearings in this case lends support to WIFE’s position. We note the following:

  • PULASKI gave identical gifts of $200,000.00 to both of her children when she redeemed her retirement funds. This fact is consistent with WIFE’s assertion that the gift made to HUSBAND and WIFE to purchase their marital home was an intervivos inheritance.

 

  • At the initial evidentiary hearing on December 14, 2017, HUSBAND’s description of the $200,000.00 gift was consistent with that of an intervivos inheritance. HUSBAND stated: “She [PULASKI] had given me and Megan and along with my brother and his wife, instead of dying and willing us money, she preferred basically to give us the money and watch us enjoy it….” (N.T. June 14, 2017 at 114)

 

  • The $38,000.00 and $30,000.00 “payments” HUSBAND made to PULASKI on the conditional gift “debt” in June of 2016 were surreptitiously funneled back to HUSBAND exactly one month later, from PULASKI, as two deposits totaling approximately $68,000.00 into his personal Northwest Checking Account. HUSBAND used those funds as down payment money to purchase his new home on Shanamantown Road.

 

  • Although PULASKI has described the $68,000.00 as a “short-term loan” to HUSBAND, she did not require HUSBAND to endorse loan documents memorializing such a loan, nor did she require HUSBAND to sign a conditional gift agreement for the deposits.

 

  • At no time since PULASKI provided HUSBAND with the $68,000.00 “short-term” loan in July of 2016 has HUSBAND made payments on that “loan.”[13]

 

  • HUSBAND did not list a loan for $68,000.00 on the Income and Expense Statement prepared for the Special Master in advance of the hearing on December 15, 2017.

 

  • Both HUSBAND and PULASKI have displayed a disappointing and frankly concerning lack of transparency regarding their financial interrelationship. It took four evidentiary hearings and two Orders entered by this Court to get what we can only hope is an accurate picture of the financial exchanges between HUSBAND and PULASKI since September of 2008.

 

  • The fourth evidentiary hearing was required because HUSBAND failed to comply with our Order of February 15, 2019, which had required HUSBAND, in very direct language, to submit a complete accounting of financial transactions between mother and son since September of 2008. Specifically, HUSBAND’s March 15, 2019 correspondence to this Court made no mention of the $30,000.00 deposit from PULASKI into his checking account on July 15, 2016. Likewise, HUSBAND’s March 15, 2019 correspondence to this Court made no mention of the $22,260.50 renovation loan from PULASKI to HUSBAND.

 

  • Even at the fourth and final evidentiary hearing before this Court on May 16, 2019 – necessitated by HUSBAND’s failure to comply with our Order of February 15, 2019 – both PULASKI and HUSBAND provided evasive and sometimes contradictory answers to direct questions regarding the exchange of funds between them. HUSBAND frequently indicated “I don’t recall.” (N.T. May 16, 2019 at 30, 33, 34) PULASKI did not answer questions directly and instead in numerous instances attempted to circumvent them. (N.T. May 16, 2019 at 5-7, 16-18, 24)

 

From the evidence and circumstances outlined above, it would be very easy for this Court to conclude that the accounting slights of hand performed by PULASKI and HUSBAND were intentionally meant to mask the true nature of PULASKI’s contribution of $200,000.00 to HUSBAND and WIFE for their purchase of the marital home on Horseshoe Trail Drive. Rather than a marital debt owed by both parties for which PULASKI expected payment, PULASKI’s $200,000.00 contribution was instead, as WIFE asserts, an intervivos inheritance to HUSBAND for which PULASKI never expected repayment. Indeed, based upon the almost immediate turnaround of payments from mother to son, the record suggests that PULASKI still doesn’t expect authentic repayment from HUSBAND, only from WIFE.[14]

 

Based upon these considerations, WIFE urges us to conclude that the conditional gift “obligations” to PULASKI should not be treated as marital debt, but rather as an intervivos inheritance invested in an asset that depreciated in value. Unfortunately, that path is not open to us. Nor was it open to the Special Master.

The doctrine of collateral estoppel requires that when an issue of ultimate fact has once been determined by a valid and final judgment, that issue cannot be litigated between the same parties in any future lawsuit.  Ashe v. Swenson, supra, 397 U.S. at 443, 90 S.Ct. at 1194, 25 L.Ed.2d at 475; Com. v. Winter, 471 A.2d 827, 829, 324 Pa.Super. 258, 262 (Pa.Super. 1984)     In the instant case, the Order entering judgment in the collateral gift litigation at CP-52-CV-01588-2016 looms large. In that Order, Judge Kline decreed that the monies still owed[15] by virtue of the Conditional Gift Agreement were marital debt. Even though Judge Kline was not afforded anything close to the factual insight we now possess on the issue, we are collaterally estopped from reaching a different conclusion with regard to an action involving HUSBAND and WIFE, who were both parties to that suit.   Constrained by the language of the Order of Judgment entered by Judge Kline declaring the obligations flowing from the Conditional Gift Agreement to be marital debt, we will affirm the Special Master’s conclusion in this case in that regard.

With the above being recognized,  our de novo review of the instant case permits us to allocate debt just as it permits us to allocate assets. It is this mechanism we will utilize to resolve the tension we feel between the limitations imposed upon us by the doctrine of collateral estoppel and the obligation we have to seek economic justice based upon the full record before us – a complete record to which Judge Kline did not have access to when he entered the Order at CP-52-CV-01588-2016. Thus, while we are constrained to treat the Judgment entered by Judge Kline as marital debt, we are free to allocate that debt as we believe is equitable. The Master divided that debt equally between the parties. We will not do so.

As suggested in our discussion regarding WIFE’s second exception, we do not believe that HUSBAND has, in actuality, made any “real” payments on the Judgment at CP-52-CV-01588-2016. While PULASKI testified that HUSBAND has paid $79,000.00 towards his total obligation of $105,088.50 flowing from that action, all of those payments—and then some—have been returned to him as “short-term loans” amounting to $90,260.50 ($68,000.00 + $22,260.50 = $90,260.00). There are no loan documents memorializing these “short term loans”. There is no conditional gift agreement protecting PULASKI’s interest in the assets secured with these loans. HUSBAND is to pay off the loans “when he can”, but neither he nor his mother can document any payments on either of those loans. Meanwhile, he has used money he had “just laying around the house” to gamble and purchase recreational land.

Since we are constrained to find that the Judgment at CP-52-CV-01588-2016 is marital debt, we find that the actions of PULASKI suggest that she has forgiven that debt with regard to HUSBAND. We further find that it would be grossly unfair to saddle WIFE with debt of $105,088.50–as the Master did when he allocated half of the gross amount of $210,177.00 to her– when HUSBAND appears to be free of the responsibility to pay anything, much less anything comparable, to his mother.  Moreover, our decision to impose the entire PULASKI debt to HUSBAND is also tied to our decision to allocate 75% of the value of the marital home to him.  Had WIFE been required to repay any of the PULASKI loan, we would have divided the proceeds of the house sale in a far different manner.

For these reasons, we will overrule the Master’s 50/50 allocation of the marital debt affiliated with the Judgment at CP-52-CV-01588-2016. We will instead allocate that debt exclusively to HUSBAND. It is up to PULASKI whether she seeks to collect on that debt or not.

 

  1. CONCLUSION

          We will be rejecting the equitable distribution scheme determined by the Special Master in three respects. All of our departures from the Recommendation of the Master relate to the marital residence at 617 Horseshoe Drive.

 

1) To properly account for HUSBAND’s greater contribution to the acquisition of the marital residence stemming from the $200,000.00 contribution of his mother to the original purchase price, we will employ a 75%-25% distribution scheme in favor of HUSBAND for that asset alone. For the remainder of the assets of the marital estate, we will affirm the Special Master’s distribution percentages of 55%-45% in favor of HUSBAND.

 

2) We will overrule the Master’s award of post-separation mortgage credit to HUSBAND. Since HUSBAND remained in the marital home while WIFE resided elsewhere for 24 months, WIFE is theoretically entitled to rental value credit. Because the Special Master did not allocate rental value credit to WIFE and the record does not provide us with the necessary factual predicate for determining such a value, we will consider HUSBAND’s entitlement to mortgage credit for the months he was the exclusive payer of the mortgage and WIFE’s entitlement to rental value credit for the 24 months HUSBAND exclusively resided in the marital residence to offset each other. HUSBAND will receive no mortgage credit for the period of November 2015 to May 2016. WIFE will receive no rental value credit for the period of May 2014 until May 2016.

 

3) We are collaterally estopped from determining that the $210,177.00 Judgement entered at CP-52-CV-01588-2016 and owed to PULASKI is anything other than marital debt. We affirm the Master’s determination in that regard. However, we will reject the Special Master’s 50%-50% allocation of that debt.  Instead, we will allocate 100% of that debt to HUSBAND.

 

We recognize that the net effect of what we have done today results in additional liquid assets flowing to HUSBAND. We believe that result is mandated by his greater contribution to the marital estate by virtue of the $200,000.00 conditional gift provided by his mother towards the purchase price of 617 Horseshoe Trail Drive. While affording HUSBAND the benefit of that greater contribution, however, we have also tasked him with the ongoing responsibility for the obligations flowing from it.

On an objective balance sheet, those additional assets would appear to be offset and arguably overshadowed by the large debt now assigned to HUSBAND. That objective balance sheet, though, must be viewed in the context of the record. If history is any guide—and we believe based upon our assessment of the credibility and demonstrated intention of the parties it is–HUSBAND will not be required to make any real payments on that debt.

As to WIFE, we believe the removal of the albatross of debt only she was going to be required to carry for the next ten years is a fair exchange for the additional 401(K) monies she must pay HUSBAND under the scheme we have developed. We believe this is the most equitable means to deal with the unusual circumstances in this case, particularly the tension between the conclusions we would like to draw from the record and the conclusions we are required to draw from the record based upon the doctrine of collateral estoppel.

We have examined all of the other recommendations of the Special Master and conducted our own independent examination of how our decision today affects the totality of the equitable distribution scheme for HUSBAND and WIFE.  Under all of the facts and circumstances presented, we conclude that this is a fair and equitable result, and one that comports with §3502 of the Pennsylvania Divorce Code.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[1] The $63,000 is not listed as either a loan or a gift on the Income and Expense Statement of HUSBAND submitted to Court. As will be discussed infra, at subsequent proceedings, both PULASKI and HUSBAND later sought to characterize the $63,000 down payment money, as part of a total sum of $68,000 deposited by PULASKI into HUSBAND’s bank account over the course of two deposits in July of 2016, as a “short-term loan.”

[2] At a later hearing held on May 16, 2019 before this Court, PULASKI testified that the amount of the conditional gifts provided to both of her sons was $220,000.00. (N.T. May 16, 2019 at 10-11) Exhibit 22, however, lists the amount of the gift to HUSBAND as $200,000. The parties and PULASKI do not dispute that both sons received the same amount under conditional gift agreements.

[3] Docket entries maintained by the Prothonotary of Lebanon County indicate that PULASKI filed suit against HUSBAND and WIFE on October 19, 2016, alleging default of their obligations under of the Conditional Gift Agreement. Pulaski v. Pulaski, CP-52-CV-01588-2016. Pursuant to the terms of the Agreement, the amount due included the $200,000.00 original gift, plus costs and attorney’s fees, for a total of $210, 177.00.

[4] The Special Master did not include a joint savings account with a balance of $34.00 or the value of a joint vacation club in his calculations of marital assets.  No directive was entered regarding the savings account balance. The Master recommended, in accordance with the agreement of the parties, that the joint vacation club be sold and the proceeds divided equally.

[5] Though not challenged by exception from either party, this amount calculated by the Master is erroneous. The Master found that WIFE had $48,564.37 more assets in her possession than she was entitled to under the recommended distribution scheme. However, when the Master sought to add the mortgage credits to that amount, the Master used a different amount in the equation: $47,214.383. This number is clearly mistaken.

[6] WIFE filed the ordered Supplemental Brief on April 5, 2019. HUSBAND filed a Supplemental Brief on April 8, 2019.

[7] The submitted documentation indicated additional “payments” of $6,500.00 from HUSBAND to PULASKI since the initial Master’s hearing on December 14, 2017, bringing the total of payments made by HUSBAND to PULASKI to $79,000.00. Documentation of those payments was also presented at the May 16, 2019 hearing before this Court. (Exhibit 61)

[8] The supporting documentation also included unsolicited argument and a letter from PULASKI outlining her intent with regard to a $38,000.00 “loan” she made to her son.

[9] Curiously, while the attached statement from PULASKI characterized the $38,000.00 sum as a “loan,” the cover letter authored by HUSBAND’s counsel characterized the $38,000.00 sum as a “gift”.

[10] Neither party challenged the Master’s award of mortgage credit to HUSBAND, or the related issue of rental value credit to WIFE. However, as we have undertaken review of the Master’s proposed distribution of both the residence’s value and its associated debt and we will be deviating from those recommendations; we are permitted to evaluate, de novo, other considerations in the quest for economic justice. See Morschhauser v. Morschhauser, 516 A.2d 10 (Pa. Super. 1986)

[11] Offsetting rental credits and mortgage credits is a methodology routinely employed by both this Court and Pennsylvania appellate courts. See, e.g.,   Cerny v. Cerny, 656 A.2d 507, 556-57 (Pa. Super. 1995); Nuttall v. Nutall, 562 A.2d 814, 846 (Pa. Super. 1989); Middleton v. Middleton, 812 A.2d 1241 (Pa. Super. 2002) ; Trembach v. Trembach, 615 A.2d 33 (Pa. Super. 1992); Foehl v. Foehl, CP-38-CR-20674-2005); See also 15 Summ. Pa. Jur. 2d Family Law § 5:81 (2d ed.)

 

[12] PULASKI testified that the home was built for more than $500,000.00 in 2007. (N.T. May 16, 2019 at 15) HUSBAND and WIFE purchased the property from PULASKI in 2008 for a total purchase price of $525,000.00.  (Exhibit 22; N.T. December 14, 2017 at 46) The parties sold the property in May of 2016 for $395,000.00, after it had been on the market for approximately 18 months. (N.T. December 14, 2017 at 26)

[13]  PULASKI has attributed all payments made by HUSBAND, which by her calculation total $79,000.00, to the obligation flowing from the Conditional Gift Agreement, not to the $68,000.00 “short-term” down payment loan or to the $22,260.50 renovation loan. HUSBAND was unable to testify as to a total of payments made and was unclear as to what obligation those payments applied. (N.T. May 16, 2019 at 29-35)

[14] We recognize that PULASKI brought suit and obtained Judgment against both HUSBAND and WIFE. However, we also recognize that PULASKI brought that suit during the context of rancorous divorce proceedings between Pulaski’s son and WIFE. In that context, PULASKI’s suit against HUSBAND and WIFE may not be indicative of her true intent, particularly in light of the circumstances in which she originally gifted equal amounts to both sons and in her treatment of HUSBAND’s “payments” to her afterwards. Moreover, the furtive back and forth transactions and the subsequent lack of transparency of both HUSBAND and PULASKI about those transactions has certainly damaged, badly, the credibility of both HUSBAND and PULASKI with this Court.

[15] Accepting that HUSBAND had already made $72,500.00 in payments on the debt, Judge Kline determined the amount still owed to be $137,677.00. The record of that case does not indicate that Judge Kline was aware of the $68,000.00 in deposits PULASKI made into HUSBAND’s Northwest account one month after he made corresponding payments to PULASKI.

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