Judges Opinions, — July 2, 2024 16:02 — 0 Comments

Alison Tobias v. Robert Tobias

Alison Tobias v. Robert Tobias

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The parties, who were married over thirty-four (34) years, each filed Exceptions to the Report and Recommendation issued by the Special Master in Divorce distributing the marital estate.  The basis for Exceptions include that the Special Master erred and/or abused his discretion by failing to award credits to both parties for rental values and payments of mortgages and other expenses upon properties owned by the parties, failing to find that funds of the parents of Alison Tobias (“Wife”) represented loans to the parties, failing to find that the financial contributions of Wife’s parents to acquisition and maintenance of the marital estate were not a factor warranting an award of a greater portion of the marital estate to Wife and failing to award alimony to Wife,

1.  A court may award credit for rental value of a property and/or for payments made to maintain the property.

2.  An award of credit is not mandatory and may be denied as long as the total distribution scheme is equitable.

3.  While in certain instances an award of credit may be necessary to avoid injustice, marital property should not be distributed via the procedural vehicle of credit, as the driving force behind an equitable distribution award always should be the factors enumerated in the Divorce Code.

4.  In light of the fact that the overall distribution scheme will accomplish economic justice for the parties, the Court will not award the credits requested to either party.

5.  If a parent furnished purchase money and title to properties taken in the name of a child, a presumption arises that the parent intended the funds to be a gift.

6.  In order to rebut the presumption of a gift, the individual seeking to declare a financial transfer to be a loan must establish the intent by clear and convincing evidence.

7.  Where the Special Master did not find Wife’s parents to be credible, Wife’s parents did not make any discernable legal effort to collect upon the funds provided prior to separation and no documentation was provided of loans, the record fails to rebut the presumption that the financial contributions provided by Wife’s parents to the parties to buy and maintain marital assets were gifts.

8.  Pennsylvania law requires that the court consider sources of income of the parties and the contribution of each party to the acquisition, preservation, depreciation or appreciation of marital property in equitable distribution. 

9.  Where the financial contribution of Wife’s parents occurred primarily because of their relationship with Wife, the financial contribution of Wife’s parents is a factor that, with all of the other relevant factors, supports adjustment of the percentage of the marital estate awarded to Wife from fifty-five percent (55%) to sixty-two percent (62%).

10.  In determining whether a spouse lacks sufficient property to provide for his or her reasonable needs pertaining to an award of alimony, the court must consider any property distributed to that spouse under the equitable distribution award.

11.  Where Wife will be receiving a greater percentage of the marital estate, Wife has job skills and has worked outside of the home and Robert Tobias (“Husband”) is approaching retirement age and paid alimony pendente lite to Wife for two (2) years, Wife will be able to meet her reasonable needs through employment and use of assets awarded in equitable distribution.

L.C.C.C.P. No. 2019-20625, Opinion by Bradford H. Charles, Judge, August 7, 2023.

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY, PENNSYLVANIA

CIVIL ACTION – DIVORCE

ALISON TOBIAS,                                        :

Plaintiff                                                                      :

                                                                                    :

            v.                                                                     :           2019-20625

                                                                                    :

ROBERT TOBIAS,                                      :

Defendant                                                                  :          

                                                                                    :

                                                                                    :

ORDER OF COURT

AND NOW, this 7th day of August, 2023, upon consideration of the Report of the Special Master, the exceptions filed by the parties and all briefs and arguments submitted, the Order of this Court is as follows:

  1. Robert Tobias (hereafter HUSBAND) and Alison Tobias (hereafter WIFE) are hereby divorced from the bonds of matrimony.
  2. All requests for all credits pertaining to rent, rental value, payment of preservative expenses, or fees pertaining to litigation are DENIED with the understanding that this Court has considered all aspects of the parties’ economic history, including those aspects that could implicate an award of credits, when we rendered other decisions that will be outlined in this Court Order.
  3. The parties’ marital estate is to be divided as follows: 62% to WIFE and 38% to HUSBAND.  To effectuate said division, we will set forth specific directives as outlined below.
  4. WIFE’s request for alimony is DENIED.
  5. WIFE’s request for reimbursement of counsel fees is DENIED.
  6. The parties’ former marital residence located at 635 East Maple Street is awarded to WIFE. WIFE shall remain responsible for paying any debts or encumbrances pertaining to said real estate, and WIFE shall indemnify and hold harmless HUSBAND from any responsibility to contribute toward the cost of the same.  WIFE may choose for up to five (5) years to retain the current mortgage and/or encumbrances on the property provided that she continues to pay those obligations regularly without any contribution from HUSBAND.  If WIFE becomes more than five (5) months in arrears on any obligation, HUSBAND shall be authorized to file a Petition for Special Relief seeking a Court Order requiring the sale of the East Maple Street property. 
  7. The parties’ real estate located at 201 Ridge Road is awarded to HUSBAND. HUSBAND shall remain responsible for paying any debts or encumbrances pertaining to said real estate, and HUSBAND shall indemnify and hold harmless WIFE from any responsibility to contribute toward the cost of the same.  HUSBAND may choose for up to five (5) years to retain the current mortgage and/or encumbrances on the property provided that he continues to pay those obligations regularly without any contribution from WIFE.  If HUSBAND becomes more than five (5) months in arrears on any obligation, WIFE shall be authorized to file a Petition for Special Relief seeking a Court Order requiring the sale of the Ridge Road property. 
  8. The parties’ real estate located at 1103-1105 West Main Street, is awarded to WIFE. WIFE shall remain responsible for paying all debts or encumbrances, including any amount potentially owed by the parties to Daniel and Ronnie Klim, pertaining to said real estate, and WIFE shall indemnify and hold harmless HUSBAND from any responsibility to contribute toward the cost of the same.  WIFE may choose for up to five (5) years to retain the current mortgage and/or encumbrances on the property provided that she continues to pay those obligations regularly without any contribution from HUSBAND.  If WIFE becomes more than five (5) months in arrears on any obligation, HUSBAND shall be authorized to file a Petition for Special Relief seeking a Court Order requiring the sale of the West Main Street property. 
  9. The parties’ property located at 109 South White Oak Street is awarded to WIFE. WIFE shall remain responsible for paying all debts or encumbrances pertaining to said real estate, and WIFE shall indemnify and hold harmless HUSBAND from any responsibility to contribute toward the cost of the same.  WIFE may choose for up to five (5) years to retain the current mortgage and/or encumbrances on the property provided that she continues to pay those obligations regularly without any contribution from HUSBAND.  If WIFE becomes more than five (5) months in arrears on any obligation, HUSBAND shall be authorized to file a Petition for Special Relief seeking a Court Order requiring the sale of the South White Oak Street property. 
  10. The parties’ ownership interest in property located at 187 Pamlico Parkway, Beaufort, North Carolina is awarded to WIFE.  WIFE shall remain responsible for paying all debts or encumbrances pertaining to said real estate, and WIFE shall indemnify and hold harmless HUSBAND from any responsibility to contribute toward the cost of the same.  WIFE may choose for up to five (5) years to retain the current mortgage and/or encumbrances on the property provided that she continues to pay those obligations regularly without any contribution from HUSBAND.  If WIFE becomes more than five (5) months in arrears on any obligation, HUSBAND shall be authorized to file a Petition for Special Relief seeking a Court Order requiring the sale of the Pamlico property.
  11. The parties’ 2007 Chrysler Town & Country vehicle is awarded to WIFE.
  12. The parties’ trailer is awarded to WIFE. 
  13. The amounts contained in HUSBAND’s IRA, including the balance as of separation of $256.35 and withdrawals that HUSBAND received of $4,500.00 are awarded to HUSBAND.
  14. WIFE shall be exclusively responsible to pay the amount owed by the parties to Daniel and Ronnie Klim pertaining to the West Main Street property totaling $117,500.00.  WIFE shall indemnify and hold harmless HUSBAND from any responsibility to pay anything to the Klims pertaining to this debt or any other debt that WIFE has alleged during the course of this divorce litigation.
  15. WIFE is to be responsible for paying the parties’ marital debt to the Navy Federal Credit Union of $12,540.00.  To the extent that said debt has not already been paid, it is the exclusive responsibility of WIFE to pay the same.  WIFE is to indemnify and hold harmless HUSBAND from any further obligation to pay anything toward the Navy Federal Credit Union debt.
  16. The parties jointly owe $7,000.00 to their daughter Brionna.  Both parties are to equally share the responsibility to repay Brionna.  HUSBAND shall pay Brionna $3,500.00 and WIFE shall pay Brionna $3,500.00 in such installments and at such times as the parties and Brionna may agree.  If either HUSBAND or WIFE fails to pay their respective share owed to Brionna within twenty-four (24) months, leave is granted for the other party to file a Petition for Special Relief regarding the amount owed to Brionna.
  17. Within thirty (30) days following a written request, both parties are directed to sign any and all deeds, titles, or other documents needed to effectuate the awards of property as outlined above.  To the extent that any liens or encumbrances have not been satisfied within five (5) years, the party with the obligation to pay shall be responsible for obtaining loans necessary to satisfy any joint obligations that still may exist so that the other party can have his/her name removed from any further joint obligations.  It is the intent of the Court that both HUSBAND and WIFE shall be officially removed as debtors on all joint marital obligations by no later than August 1, 2028.
  18. To effectuate the 62% distribution of property outlined above, HUSBAND is to pay to WIFE the sum of $30,136.86 in one of the following two ways:
  19. Commencing on October 1, 2023, and extending for a period of twenty-four (24) consecutive months, HUSBAND shall pay the sum of $1,255.70 to WIFE; or
  20. HUSBAND shall obtain a loan and pay WIFE a lump sum of $30,136.86 on or before October 1, 2023.

HUSBAND shall notify WIFE on or before September 15, 2023, of which option for repayment he has chosen.

  1. The parties shall equally divide the costs of the Special Master.

BY THE COURT:

                                                                                    __________________________J.

                                                                                    BRADFORD H. CHARLES

BHC/pmd

cc:        Court Administration (order only)

Max J. Smith, Esq.

Loreen Burkett, Esq.

Keith Kilgore, Esq.

Table of Contents

Preamble1-2

I.      Facts and Procedural History2-6

II.     Discussion6-53

  1. Credits.8-12
  2. Contributions of the Klims.12-18
  3. Transposition of Expenses Between Ridge Road & Pamlico18-20
  4. Alimony20-26
  5. Percentage of Equitable Distribution Award26-37
  6. The Ridge Road Property37-38
  7. Rental Value Credit.38-41
  8. Tree Removal and Wall Repairs41-44
  9. Limiting the Parties’ Obligations to Wife’s Parents to $117,50044-45
  10. Failing to Consider the KLIMS’ Financial Contributions45
  11. Reimbursable Expenses Pertaining to Ridge Road45-47
  12. WIFE’s Expenses.47-48
  13. Request for Possession of Pamlico Property48-49
  14. Expenses Pertaining to Pamlico49-50
  15. WIFE’s Counsel Fees50
  16. Post-Separation Credits51
  17. Withdrawal from Joint Account.51-52
  18. Rent of $5,000 from Casey Berdiner52
  19. Rental Income from Pamlico52-53

III.       Decision53-57

  1. Marital Assets.54
  2. Marital Debts54
  3. Possession of Assets and Debts54-55
  4. Award of Assets and Debts55-56
  5. Recapitulation56-57

IV.       Conclusion57-58

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY, PENNSYLVANIA

CIVIL ACTION – DIVORCE

ALISON TOBIAS,                                        :

Plaintiff                                                                      :

                                                                                    :

            v.                                                                     :           2019-20625

                                                                                    :

ROBERT TOBIAS,                                      :

Defendant                                                                  :          

                                                                                    :

APPEARANCES

Max J. Smith, Esq.                                                    For Plaintiff

Loreen Burkett, Esq.                                                            For Defendant

Keith Kilgore, Esq.                                                   Special Master

OPINION BY CHARLES, J.,  August 7, 2023

Before us are no fewer than eighteen (18) Exceptions to a decision rendered by a Special Master in Divorce (hereafter SM).  Because both Alison Tobias (hereafter WIFE) and Robert Tobias (hereafter HUSBAND) agree that the SM erred in his valuation of real estate owned by the parties on West Main Street in Annville, Pennsylvania, we will be required to re-evaluate what the SM recommended.  Before doing so, we will, of course, address all of the exceptions to the SM’s report and recommendation.  Although we respect the commendable work undertaken by the SM in a complicated and difficult case, we have ultimately chosen to go in a different direction.  Our reasoning will be set forth below.

I.          FACTS and PROCEDURAL HISTORY

            HUSBAND and WIFE were married on June 17, 1989.  This was a first marriage for both parties.  After living together for thirty (30) years and raising four (4) children, the parties separated in July of 2019.  As of the time of the SM hearing, WIFE was 58-years of age, and HUSBAND was 57-years of age.  The parties’ children were 26, 24, 19 and 18.  WIFE’s parents, Daniel and Ronnie Klim (hereafter the KLIMS) helped the Tobias family with frequent financial assistance.

During the marriage, WIFE served as primary caregiver for the children.  In addition to their own children, the parties also raised WIFE’s three cousins as a result of premature deaths of their caregivers.  The cousins raised by the parties are now 41, 38 and 37.  In addition, the parties also provided primary caregiving for another child who is now 29 years of age. 

            WIFE is a graduate of the Pennsylvania State University.  She has a degree in secondary education specializing in mathematics.  She also has experience as an air traffic controller through her service with the United States Marine Corps.  Although WIFE did not work outside the home, she did manage three of the parties’ parcels of real estate.  A qualified vocational expert, Brian Bierley, opined that WIFE had the capability of earning between $37,000 and $41,000 annually.  (N.T. 12; Exhibit 40).  WIFE did not seek employment because she was busy managing the parties’ rental properties. 

            HUSBAND was also an air traffic controller while a member of the United States Marine Corps.  For eleven years prior to separation, HUSBAND was employed at Cedar Electric Company.  HUSBAND possesses a Master Electrician license.  (N.T. 318, 408).  In 2020, he earned $111,000.  In 2021, he earned $130,000. (Exhibit 2; N.T. 102).  HUSBAND testified that he transitioned away from field work to an “office job” in 2022.  However, he still earned $50 per hour for a 40-hour work week, which equates to roughly $104,000 per year. (Exhibit 3; N.T. 314-315; 437). 

            The parties’ marital home was located at 635 East Maple Street in Annville.  As of May 31, 2022, the home had a net value of $248,925.  (SM Finding 1 on page 8).  WIFE has continued to reside in the East Maple Street property since separation.  In addition, one of the parties’ daughters and one of the cousins raised by the parties have also resided in that structure.  WIFE requested that the SM award her possession of the marital residence.  HUSBAND believed that the residence should be sold, with the proceeds to be divided equally.

            In addition to the marital residence, the parties also possess four other parcels of real estate that we will summarize as follows:

West Main Street Property

            The parties own a duplex at 1103-1105 West Main Street in Annville.  Each duplex contains two bedrooms.  At the time of the SM report, both units were rented.  One yielded $1,225 per month and the other yielded $1,100 per month.  (SM Finding 2 at page 9).   Although the SM determined that the West Main Street property should be valued at $330,000, both parties have agreed that the West Main Street property should be valued at $230,000. The Main Street property was purchased with assistance provided by the KLIMS; both HUSBAND and WIFE agree that they owe $117,500 to repay a loan given to them by the KLIMS relating to this property.

Ridge Road Property

            The parties own a rental house located on Ridge Road in western Lebanon County.  This property was valued by the SM at $339,900.  After deducting the amount owed on a home equity line of credit, the SM determined that the Ridge Road property had a net value of $284,373. (SM Finding 1 on page 9). The Ridge Road property has generated rental income of $1,425 per month (N.T. 117-118:171).[1]  HUSBAND has been primarily responsible for possession and management of the Ridge Road property since separation. 

South White Oak Street Property

            In 2013, the parties purchased an investment property located on South White Oak Street in Annville.  This home has four bedrooms.  The SM determined that the structure had a value of $204,000, a mortgage balance of roughly $45,000 and a net value of $158,000.  (SM Finding 1 at page 10).  This property generated rental income of $1,200 per month. WIFE was responsible for managing this property following separation, and she paid over $5,000 for repairs and maintenance of this property.

Pamlico Parkway, North Carolina Property

            Together with the KLIMS, HUSBAND and WIFE purchased another investment property located on Pamlico Parkway in Beaufort, North Carolina in 2006.  As of 2022, the SM determined that the property was valued at $220,800.  (SM Finding 2 at page 10).  This property had not historically been rented.  The SM determined that the property “is currently not rentable and does not have a functioning heat system.” (SM Finding 4 at page 10).

            Following separation, a Divorce Complaint was filed by WIFE on June 8, 2020.  On March 24, 2021, the SM was appointed.  An initial hearing was conducted before the SM on June 17, 2021.  A second day of testimony occurred on February 24, 2022.  The final day of testimony took place on May 11, 2022. On December 5, 2022, the SM issued a 41-page report with recommendations.  On December 27, 2022, WIFE filed timely Exceptions.  On January 4, 2023, HUSBAND filed cross-Exceptions. 

            The parties’ Exceptions were listed for the May 2023 term or Argument Court.  Both parties filed briefs.  On May 5, 2023, this Court received the benefit of oral argument.  At oral argument, we received a stipulation from the parties that the West Main Street property should have been valued at $230,000 instead of $330,000.  Thereafter, we asked the parties to identify their “best” argument.  WIFE stated that the SM should have awarded her with a greater share of marital assets due to the robust contributions of the KLIMS toward creation of the marital estate.  HUSBAND argued that the SM erred by “transposing” expenses related to the Pamlico, North Carolina property and the Ridge Road, Lebanon County property.  Although we will place greater emphasis on the arguments outlined above, we will separately address all 18 issues that are now before this Court.

II.        DISCUSSION

            Before we address the parties’ disagreements, we want to begin with something about which there is consensus.  Both HUSBAND and WIFE agree that the SM improperly valued the jointly-owned real estate located at West Main Street in Annville.  The SM assigned a value of $330,000 to that asset.  The parties agree that the value should have been assessed at $230,000.  This difference of $100,000 is not de minimus.  By itself, this difference will require the Court to re-evaluate the SM’s distribution scheme. 

            This is a difficult dispute.  We need to acknowledge and commend the significant work undertaken by the SM to evaluate this case.  The assets of the parties are numerous, and their marital history is complicated.  The parties’ exhibit packet is approximately 1-½ feet thick.  502 pages of transcripts were generated during three hearings.  Sorting through everything presented was not an easy assignment.  In addition, we must respect the fact that the SM had the ability to eyeball all of the witnesses who provided testimony.  As such, the SM had a perspective about credibility that this Court simply does not.  

The extent of WIFE’s ire at the SM’s decision is obvious.  She has challenged almost all of the SM’s decisions, whether of significant or minimal import.  WIFE has filed seventeen (17) exceptions that we will be required to address.  Multiple exceptions implicate what her attorney describes as an “overarching concern” – that the SM failed to properly consider the robust financial assistance provided to the parties by the KLIMS.  Many other exceptions, including the lone one filed by HUSBAND, are focused upon credits that each party sought or contested.  Because these two issues are transcendent in the parties’ arguments, we will begin by addressing credits and the situation regarding the KLIMS’ financial assistance before we proceed to assess each of the parties’ separate arguments.

  1. Credits

The number of pages devoted by the parties to concerns about “credits” exceeds by a significant degree the space devoted to any other topic.  Both parties have claimed a plethora of credits, including ones for rent, rental value, payment of mortgages, payment of taxes, payments made for repairs, payments to upgrade real estate and credits for fees expended during litigation.  Both parties want monetary reimbursement for the credits to which he/she feels entitled.  Both parties have also proffered objections to credits sought by his/her spouse and both parties have provided reasons why the other has benefitted from a tax perspective as a result of the amounts for which credits are claimed. 

Under Pennsylvania law, a court may award credits for rental value of a property and/or for payments made to maintain the property.  See, e.g., Trembach v. Trembach, 615 A.2d 33 (Pa. Super. 1992); Gee v. Gee, 460 A.2d 358 (Pa. Super. 1983).  However, our Superior Court has clearly articulated that the award of credits “is not mandatory and may be denied as long as the total distribution scheme is equitable.”  Massar v. Massar, 2022 WL1235144 (Pa. Super. 2022).[2]  The en banc decision of Pennsylvania’s Superior Court in Middleton v. Middleton, 812 A.2d 1241 (Pa. Super. 2002) is particularly pertinent. In Middleton, a husband requested numerous credits, including sums paid for a mortgage, a second mortgage, utilities, lawn care and other items pertaining to the house where his wife and children resided.  The trial court rejected husband’s request for credits and stated:

“Voluntary payment from husband’s own resources will not be credited at equitable distribution.  In fact, and as the trial court apparently realized upon reconsideration, if husband were credited with 15 years of these payments, $78,224, and also credited with one-half of the rental value of the marital residence, $104,105, this would wipe out all of wife’s share of the marital estate.”

Id at page 1247.

In Middleton, the Court emphasized that an award of credits “is not mandatory”.  Rather the Court focused on the question of whether the total distributary scheme was equitable.  See also, Schneeman v. Schneeman, 615 A.2d 1369 (Pa. Super. 1992) (“The trial court need not compute [rental value] as a credit to the non-possessory spouse, so long as the total distributary scheme is equitable.” Id at page 1377).

            This Court has never believed that marital property should be “distributed” via the procedural vehicle of credits.  In certain instances, the award of credits can be necessary in order to avoid injustice.  However, the driving force behind an ultimate equitable distribution award should always be the factors that we are required to consider under Pennsylvania’s Divorce Code.  As noted above, the award of credits can become problematic when the parties’ separation is lengthy and where the amounts of credits sought become monetarily considerable.[3]  Similarly, the issue of credits can become complicated when, like here, the parties’ own numerous assets; in such situations the contest over credits can take on out-sized importance within the equitable distribution litigation. 

            In this case, we strongly suspect that the SM was troubled by the nature and extent of the parties’ claims for credits.  He denied many of the credit claims, including obvious ones related to receipt of rental income.  Still, the SM did award numerous credits.  Most problematic from our perspective are what we would label as “non-quantified credits.”  In some instances, the SM recommended that certain credits should be determined at a later date based upon amounts that had not yet been paid and for which there was no specific end-date.  As we see it, the SM’s decision could trigger future litigation, and it could also incentivize an appeal on the part of a party who perceives that he/she will financially benefit by the accumulation of credits during the pendency of the appeal. 

            Candidly, we did not undertake the math necessary to ascertain which party would benefit more by a paradigm that prioritizes the award of credits.  However, our visceral sense is that the amount of benefit that would accrue to either party would not be substantial. 

            We are well aware that the post-separation division of responsibility relating to the parties’ real estate assets was implemented voluntarily by the parties…and this division of responsibility was agreed upon at a time when both parties were governed by self-interest and a sense of apprehension about the future.  Both parties undoubtedly viewed the post-separation division of responsibility to be fundamentally fair or they would not have agreed to it.  Our independent review of the record with the benefit of hindsight convinces us that the arrangement implemented by the parties following separation was indeed fundamentally fair and that an award of copious credits based on that arrangement would not be an undertaking that would effectuate economic justice. 

            In the end, we have decided to generally consider all economic factors relevant to the acquisition and preservation of the parties’ assets, including factors that triggered the parties’ copious requests for credits.  While all of those considerations will be included within our percentage of equitable distribution scheme, we will not award any dollar credits to either side for rents, rental value, preservative payments or expense pertaining to the litigation.  Without question, the claims for credits by both parties would to some degree offset one another.  Even to the extent that the claims for credits do not completely offset, we simply do not believe that this is a case where distribution of assets should be accomplished to any degree via an analysis of credits. 

            We are well aware that WIFE has filed numerous exceptions that either seek credits that the SM denied or object to credits that the SM awarded.  To be sure, if we were to grant all of WIFE’s exceptions, the amount of financial windfall that would accrue to WIFE would be considerable.  Adopting WIFE’s various positions regarding credits was never an option for this Court.  Rather, our decision to eschew the award of dollar credits is one we made based upon all of the arguments made by the parties in favor of and in opposition to requests for credits on the part of the other party, and it is particularly based upon our firm belief that the overall distribution scheme we will be employing will accomplish economic justice for both parties.

  • Contributions of the KLIMS

During the proceedings before the SM, WIFE sought to characterize a plethora of financial contributions from her parents as loans that would have to be repaid.  In support of this theory, WIFE presented testimony from both of her parents.  Unfortunately for WIFE, the SM did not find the KLIMS to be credible, nor could he endorse WIFE’s theory that amounts gifted to the couple were loans.  The SM stated:

“Testimony at the hearing revealed that WIFE was the one who wrote the letter to HUSBAND as to money owed.  Daniel Klim did not recall writing any letter and was unable to attest to any expenses or amounts paid by him or owed by the parties.  Mrs. Klim had some vague knowledge that money was owed but did not know how the amounts requested in the letter were calculated or what they were for.  Mrs. Klim did not write the letter since she did not know how to type.  The Special Master did not find the parents’ testimony to be persuasive.  As a result, the Special Master will only recommend the $117,500 for West Main Street to be paid to the KLIMS at the time of the transfer of the home either to a third party or to WIFE.” (SM Report at page 25).

            The SM did not err in how he characterized monies contributed by the KLIMS to the Tobias family.  Under Pennsylvania law, “if a parent furnished the purchase money and title to properties taken in the name of a child, a presumption arises that the parent intended the funds to be a gift.” Kohr v. Kohr, 413 A.2d 687 (Pa. Super. 1979).  In order to rebut the presumption of a gift, the individual seeking to declare a financial transfer to be a loan must establish their intent by clear and convincing evidence.  See, Hornyak v. Sell, 629 A.2d 138 (Pa. Super. 1993).  The term “clear and convincing evidence” has been characterized as testimony that is “so clear, direct, weighty, and convincing as to enable the jury to come to a clear conviction, without hesitancy, of the truth of the precise facts in issue.” Lessner v. Rubinson, 592 A.2d 678, 681 (Pa. 1991), citing In Re: Estate of Fickert, 337 A.2d 592, 594 (Pa. 1975). 

Given that the SM did not find THE KLIMS to be credible, given that the KLIMS did not make any discernable legal effort to collect the purported “loans” prior to the parties’ separation, given the lack of any formalistic documentation of the purported loans, and given the close familial relationship between WIFE and the KLIMS, we agree with the SM that the evidence in this case falls far short of being able to rebut the presumption that most financial contributions made by the KLIMS were in fact gifts.  Also supporting the conclusion that the KLIMS’ contributions were gifts to both parties is the initial sentence in a letter signed by the KLIMS to HUSBAND dated May 10, 2021: “We have loved you as our son since you married our dear daughter, Alison, on June 17, 1989.” (Exhibit 49).

            Having concluded that the SM did not err by characterizing the KLIMS’ contributions as gifts does not end our discussion.  Determining a percentage of distribution of marital assets via equitable distribution is a process that must be premised upon thirteen different factors set forth in Pennsylvania’s Divorce Code.  The SM evaluated each of these factors at pages 26-28 of his report.  We reviewed the entirety of the SM’s analysis.  The only place in the SM’s analysis where the KLIMS are mentioned is in the brief paragraph pertaining to the parties’ standard of living during the marriage.  There, the SM stated:

“The parties obtained a middle-class standard of living.  A large part of their standard of living was the extensive gifts from WIFE’s parents.  This factor is neutral.” (SM Report at page 28).

We agree with WIFE that the SM erred by not considering the extensive nature of the KLIMS’ contributions as a factor that should inure to her benefit in terms of equitable distribution.

            Pennsylvania law requires a Court to consider the “sources of income” of the parties, and the “contribution” of each party in the “acquisition, preservation, depreciation or appreciation of marital property”. In the opinion of this Court, all of the above are implicated when a couple receives copious financial assistance from one spouse’s family. 

            We could not locate any specific Pennsylvania Appellate decision regarding the above.  However, a respected commentator evaluated decisional precedent from across the country and concluded as follows:

“Property acquired by gift from a third party is generally marital property where the transferor intended to make a gift to both spouses…If the court nevertheless finds a gift, often because a strong presumption of gift has not been rebutted, the situation is therefore more similar to an interspousal gift because the donor lacked actual intent to confer equal beneficial ownership upon both spouses.  Thus, a division factor should exist in favor of the spouse to whom the donor intended to give beneficial ownership.”

See¸ Equitable Distribution of Property; Division of Assets, Section 8:6 “Contributions to specific assets”.

See also, Marino v. Marino, 123 N.Y.S. 3d 638 (Second Department 2020) (Court considered the fact that wife’s father’s company completely reconstructed the marital home and that wife’s parents paid off a home equity loan as supporting a decision to award wife 60% of the value of that home.)

            In this case, copious evidence was presented regarding the contributions made by the KLIMS toward creation of the parties’ marital estate.  WIFE even submitted an exhibit in which she claimed that the KLIMS should be repaid a whopping $486,132.92 (See, Exhibit 81C).  We certainly do not totally accept WIFE’s claim, but we can and will acknowledge some of the evidence that was presented regarding THE KLIMS’ contributions to benefit the parties: 

  • WIFE testified that the KLIMS paid for the construction of an addition to their first marital home located on Ridge Road. (N.T. 75).  In addition, the KLIMS paid off the mortgage on said property.  Combined, WIFE testified that the KLIMS paid slightly more than $150,000 with respect to the Ridge Road property.  (Exhibit 81C N.T. 75). HUSBAND did not dispute this testimony.
  • Everyone acknowledges that property located in Beaufort, North Carolina was purchased jointly by HUSBAND, WIFE and the KLIMS.  WIFE testified that the downpayment needed to procure that property of $50,000 was paid entirely by the KLIMS. (N.T. 110-117).  Thereafter, mortgage payments were made mostly by the KLIMS.  WIFE testified that all but two mortgage payments were made by the KLIMS. (N.T. 117) and that “without a shadow of a doubt, there’s no way [the parties would still possess the Pamlico property without assistance from the KLIMS.]” (N.T. 117).  We concur that most of the funds needed to purchase and maintain the Pamlico property were provided by the KLIMS.
  • In 2017, the parties purchased property on West Main Street in Annville.  WIFE testified that the KLIMS contributed roughly $125,000 toward the acquisition of this property. (N.T. 124-132; Exhibit 81C).  HUSBAND acknowledged that the financial contributions of the KLIMS relating to the West Main Street property represented a loan and not a gift. (N.T. 344-352). HUSBAND stated that the initial contribution of $125,300 less a gift of $7,800 for repairs to a wall represented the amount of the loan that he acknowledged should be repaid to the KLIMS. (N.T. 351-353).  By implication, HUSBAND also acknowledged that the KLIMS contributed money as gifts that were used to pay for repairs on the West Main Street property. 
  • During his testimony, HUSBAND acknowledged that the KLIMS “stepped in and assisted” during periods of time when HUSBAND and WIFE were having financial difficulties. (N.T. 453-463).  Included within this “assistance” were monthly mortgage payments and amounts needed to bring mortgages current. (N.T. 463). 
  • HUSBAND conceded that the KLIMS contributed more toward the financial well-being of the parties than did members of his family. (N.T. 467-468).

We have reviewed the entirety of the record in an effort to quantify the nature and extent of the KLIMS’ financial contributions toward creation of the parties’ marital estate.  It is literally impossible to itemize those contributions.  We certainly cannot adopt the hyperbolic claims of WIFE.  On the other hand, we cannot ignore HUSBAND’s acknowledgement that the KLIMS provided significant assistance.  In terms of a concrete finding, we will state this: HUSBAND and WIFE would not have been able to afford to purchase and retain the properties at Ridge Road, West Main Street and Pamlico without the financial assistance of the KLIMS.

While we accept the premise that the vast majority of the contributions outlined above were technically “gifts” to both HUSBAND and WIFE, we cannot ignore the reality that the gifts would not have been made but for the familial relationship between WIFE and the KLIMS.  In other words, the financial contributions of the KLIMS occurred primarily because WIFE was the daughter of the donors; those gifts cannot be viewed through any lens that excludes recognition of this reality.  Unfortunately, the SM’s analysis employed precisely such a lens. 

As we undertake our own analysis of how the parties’ marital estate should be divided by percentage, we will consider in WIFE’s favor the KLIMS’ robust financial contributions toward the creation of that marital estate.  Those contributions certainly do not dwarf those of the parties themselves, but they are in no way inconsequential.  Considering the contributions of the KLIMS as a factor favoring WIFE will cause us to adjust in WIFE’s favor the percentage by which marital assets are distributed. 

  • Transposition of Expenses Between Ridge Road and Pamlico

HUSBAND’s primary argument is that the SM erred in his assessment of credits relating to the Ridge Road property.  The SM afforded a credit of $7,253 for such expenses.  HUSBAND argues that this amount reflected expenses paid for the Pamlico property.  He points to Exhibits 15, 16, 17, and 18 as reflecting expenses he paid for the Ridge Road property.  Those expenses included a payment of $12,681 to the Navy Federal Credit Union, $3,639 for real estate taxes and $645 for water and sewer payments.  The total of the Ridge Road expenses, set forth in Exhibits 15-18 total $16,957 and not $7,253. 

Interestingly, WIFE did not expend significant time or energy to address HUSBANDs argument regarding Ridge Road property credits.  Rather, she simply stated: “WIFE hereby incorporates the arguments made in sub-paragraph I above” and those arguments merely recited WIFE’s contributions toward the Ridge Road property and did not address those made by HUSBAND.

We agree with HUSBAND that the SM erred in his calculation of contributions paid by HUSBAND for the Ridge Road property.  Rather than $7,253, we find that HUSBAND paid $16,957.51 for the Ridge Road property during calendar year 2021.  The amount of $7,253 determined by the SM was obviously taken from HUSBAND’s 2021 income tax return (Exhibit 102), and we agree that such expenses related to the Pamlico property and not the one on Ridge Road.[4]

Having stated all of the above, we will again articulate what will become a theme for this Opinion.  We have and will consider HUSBAND’s contributions toward the Ridge Road property (and also toward Pamlico).  However, we will not be awarding dollar-for-dollar credit for those contributions.  As we articulated in Section II, A, above, this Court has decided to eschew awarding copious credits to both parties.  Our conclusions about what the parties have contributed to the preservation of all of their assets will be incorporated in our analysis of how property should be divided by percentage between the parties. 

  • Alimony

The second argument listed in WIFE’s brief relates to alimony.  She objects to the decision of the SM that refused to provide her with $2,000 per month in alimony that she sought.  WIFE points out that “for the vast majority of [the parties’ marriage], WIFE was a stay at home parent, caring for and homeschooling the parties’ four biological children, as well as other children who came into their care.” (WIFE’s brief at page 13).  She disputes the SM’s findings regarding her earning capacity and states: “The income that she could conceivably earn, according to the Vocational Assessment, is [not] sufficient to meet her needs.” (WIFE’s brief at page 14).

HUSBAND disagrees with WIFE’s claim.  HUSBAND points out that WIFE possesses a college degree, has experience teaching, served as an air traffic controller and worked as a sexual assault counselor.  In addition, WIFE has been managing the parties’ rental properties.  HUSBAND argues that WIFE would be able to work, but “WIFE has made it eminently clear throughout the course of this litigation that she has absolutely no intention of returning to the workforce (N.T. 11, 240-243).” (HUSBAND’s brief at page 14).  Finally, HUSBAND argues that WIFE’s equitable distribution award should be considered because the award will enable WIFE to possess assets and income that would mitigate her need for financial support. 

Section 3701 of Pennsylvania’s Divorce Code governs alimony.  Among other things, that Section establishes seventeen factors that should be considered by a court when assessing whether alimony should be awarded.  Those factors are:

“(1) The relative earnings and earning capacities of the parties;

(2) The ages and physical, mental and emotional conditions of the parties;

(3) The sources of income of both parties…;

(4) The expectancies of inheritances of the parties;

(5) The duration of the marriage;

(6) The contribution of one party to the education, training or increased earning power of the other party;

(7)  The extent to which [the finances] of a party will be affected by reason of serving as the custodian of a minor child;

(8)  The standard of living of the parties established during the marriage;

(9)  The relative education of the parties…;

(10)  The relative assets and liabilities of the parties;

(11)  The property brought to the marriage by either party;

(12)  The contribution of a spouse as homemaker;

(13)  The relative needs of the parties;

(14)  Marital misconduct;

(15)  [Tax] ramifications of the alimony award;

(16)  Whether the party seeking alimony lacks sufficient property, including, but not limited to, property distributed under [equitable distribution] to provide for the party’s reasonable needs;

(17)  Whether the party seeking alimony is incapable of self-support through appropriate employment.

23 Pa.C.S.A. § 3701

            The SM acknowledged that Factors (1), (3), (8) and (12) all should be weighed in favor of an alimony award.  However, the SM determined that Factors (16), (17) and (9) should all be weighed against an award of alimony.  The remaining Factors were deemed to be “neutral”.

            We will begin our analysis of alimony with the recognition that “both equitable distribution and alimony are part of the Legislative scheme to do economic justice in the course of marital dissolution, and to achieve this goal, the court must consider the distribution of property in determining whether and to what extent to award alimony.” Standard Pennsylvania Practice 2d § 126:163, “Interrelation of alimony with equitable distribution.”  As stated by our Superior Court: “In determining whether plaintiff-wife lacks sufficient property to provide for her reasonable needs, the court must consider any property distributed to the wife pursuant to the equitable distribution award.” Braderman v. Braderman, 488 A.2d 613 (Pa. Super. 1985).  See also, O’Callaghan v. O’Callaghan, 607 A.2d 735 (Pa. 1992) (Denial of alimony affirmed in part because wife was awarded 60% of marital assets.)  In fact, where our Appellate Courts perceive that the trial court failed to analyze the equitable distribution award in its alimony determination, this omission can constitute reversable error.  See, Geyer v. Geyer, 456 A.2d 1025 (Pa. Super. 1983). 

            In this case, we will be awarding a greater percentage of marital assets to WIFE.  Moreover, several of the assets to be awarded to WIFE are income producing and can generate rent that will accrue to WIFE’s benefit.  In the opinion of this Court, the equitable distribution award we will be directing today is a factor that should be weighed heavily against the award of alimony. 

            As it relates to WIFE’s employability, we largely agree with the SM.  WIFE’s decision not to work outside the home is one that she voluntarily made.  WIFE is intelligent and she has skills that are readily transferrable into the job market.  As the SM concluded: “WIFE does have job skills, she has worked outside the home and, according to the Vocational Expert, has income potential of between $37,440 and $41,600.” (SM Report at page 35). 

This Court is well aware of the job market that currently exists in Lebanon County.  According to reports provided to this jurist by the Lebanon County Domestic Relations Office on a weekly basis, 13,820 jobs are available within 25 miles of the Lebanon County Courthouse.  Lebanon County’s unemployment rate as announced on June 20, 2023, was 3.1%, which is a near record low for our community.  A multitude of large-scale employers have opened facilities in Lebanon County, including a WalMart Distribution Center, an Amazon Distribution Center, an Ace Hardware Distribution Center, a Sherwin-Williams Center, and a distribution center for TE Connectivity.  In addition, the Hershey Company operates numerous facilities in Lebanon County, as does the pharmaceutical companies Bayer and Schott.  On top of all of the above, Lebanon County is home to a major VA Medical Complex and a sprawling military/National Guard facility at Fort Indiantown Gap.  We state the above because we agree with the SM’s determination that WIFE could obtain employment almost immediately if she chose to do so.

While it is true that HUSBAND’s earning capacity exceeds that of WIFE, we cannot ignore the fact that HUSBAND is nearly 60 years of age and is already in the process of cutting back the nature and extent of his employment obligations.  In addition, HUSBAND will be encumbered with the obligation to pay monies to WIFE via our equitable distribution decision.  This will likely take the form of monthly payments that HUSBAND will have to pay to WIFE for several years. 

            As with most contentious divorces, the issue of marital misconduct has taken outsized importance to the parties.  The SM found the factor of marital misconduct to be “neutral”.  WIFE believes that HUSBAND abandoned her and that this has “had a long-lasting negative impact on her mental health.” (WIFE’s brief at pages 14-15).  HUSBAND believes that WIFE was guilty of “extreme anger towards and mistreatment of HUSBAND…” (HUSBAND’s brief at page 16).  He therefore argues that the factor pertaining to marital misconduct should have been weighed in his favor.  As with most cases where marriages fail, there is fault to be ascribed to both parties.  Like the SM, we will not embark upon a fruitless effort to quantify a percentage of fault attributable to each party. 

            The parties also disagree regarding how the contributions of the KLIMS should be considered relative to alimony.  WIFE suggests that we should consider those contributions in her favor under the rubric of considering alimony Factor (11), i.e. “The property brought to the marriage by either party.”  HUSBAND agrees that “WIFE’s parents are undoubtably assisting WIFE financially and providing WIFE with financial resources as they did throughout the course of the marriage and continue to do since separation.” (HUSBAND’s brief at page 16).  HUSBAND argues that this should be considered against alimony because it minimizes WIFE’s needs (Factor (13)), because it implicates WIFE’s ability of self-support (Factor (17)) and because it also is relevant to WIFE’s expectancy of an inheritance (Factor (4)).  As it relates to equitable distribution, we agree with WIFE that the KLIMS’ contributions are a factor that should be weighed in her favor.  As it relates to alimony, we agree with HUSBAND that the KLIMS’ continued support of their daughter is a consideration that weighs against an award of alimony. 

            In addition to all of the above, we cannot ignore the fact that HUSBAND has paid alimony pendente lite (APL) to WIFE since August of 2021.  The SM found that the amount of APL was $1,633 per month (See, Finding of Fact 11 on page 5 of SM Report), but the documents contained in the file reflect a slightly different amount. (See, Exhibit 7-8).  Regardless, it is clear that HUSBAND has paid WIFE almost $20,000 per year for the past two years in APL.  Thus, for at least two years, WIFE has received financial support from HUSBAND and she could have utilized this support to position herself for self-sufficiency in the Lebanon County job market. 

            When we examine all of the factors set forth in § 3701 of the Divorce Code, we concur with the SM that an award of permanent alimony is not appropriate.  We believe WIFE will be able to meet her own reasonable needs through a combination of employment and use of assets awarded to her in equitable distribution.  The contributions that WIFE will also receive from her own parents represents simply the cherry on top of the sundae that is her future economic prospects.  Accordingly, we reject WIFE’s exception regarding the SM’s denial of alimony.

  • Percentage of Equitable Distribution Award

The SM recommended that WIFE receive 55% of the marital estate.  WIFE disagrees with almost all aspects of the SM’s evaluation of the equitable distribution factors.  WIFE believes that she should be awarded 75% of marital assets. 

In Section II A above, we analyzed the import of the contributions made by the KLIMS to the Tobias couple.  We concluded that HUSBAND and WIFE would not now own the Ridge Road property, the Main Street property or the Pamlico property had it not been for the contributions of the KLIMS.  We also concluded that the SM erred by failing to include the KLIMS’ contributions in his analysis of the equitable distribution factors.  By itself, the conclusions we articulated in Section II A above require that we award more than 55% of marital assets to WIFE.  But how much more?  That is the question we must now address.  To do so, we will separately evaluate all of the equitable distribution factors established by Pennsylvania’s Divorce Code.

  • The length of the marriage.

The parties were married on June 17, 1989.  They separated on July 9, 2019.  Their marriage was thus thirty (30) years in duration.  This is not a factor that can be weighed for or against either party.

  • Any prior marriage of either party.

This was the first marriage for both parties.  This is not a factor that can be weighed for or against either party.

  • The age, health, station, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each of the parties.

HUSBAND was 58 years of age at the time of the SM Report.  The SM noted that HUSBAND has no health issues that would prevent him from working. (SM Report at page 5).  HUSBAND has earned a Master Electrician’s license.  His primary employment has been as an electrical contractor with Cedar Electric.  In 2020, HUSBAND earned $111,000.  In 2021, he earned $130,000. (SM Report at page 7).  In addition, HUSBAND does part-time catering and electrical work that has earned him roughly $2,000 per year. (SM Report at page 7).  Recently, HUSBAND stopped working in the field as an electrician. He is now working primarily in the Cedar Electric office earning $50 per hour for a 40-hour work week.  This will equate to earnings of $104,000 annually. (SM Report at page 7).  In addition to the above, HUSBAND has experience as an aircraft traffic control officer.  (SM Report at page 7).

WIFE is 59 years old.  She is also in good health.  WIFE has a degree from the Pennsylvania State University in Secondary Education with a specialty in mathematics.  She also had experience as a military air traffic control officer.  In addition, WIFE has managed rental properties possessed by the parties.

WIFE does not hold a current teaching certificate, and she has not worked outside the home for nearly twenty years. (SM Report at page 6). Brian Bierley, a qualified vocational expert, testified that WIFE is capable of working in the human services field.  According to Mr. Bierley, WIFE has the ability to earn between $37,440 and $41,600 annually. (SM Report at page 6).  As it relates to employability, we incorporate by reference everything we articulated about that topic in our discussion about alimony.

To be sure, HUSBAND has maintained long-term employment and has developed the experience and reputation necessary for him to transition from field work to supervisory work in an office environment. This will enable HUSBAND to continue earning a six-figure salary even as he continues to age into his sixties.  WIFE cannot match HUSBAND’s job experience or earning capacity. This is a factor that we must weigh in WIFE’s favor. 

Considering everything, we will weigh equitable distribution factor (3) in favor of WIFE, but we stop well short of declaring that WIFE needs a significant percentage of the marital estate in order to avoid becoming a pauper.  In addition, we recognize realities associated with the parties’ ages, namely, that health, vocational skills and employability are all likely to decline for both parties over the next ten years.  Thus, we will not weigh this factor as heavily in favor of WIFE as she would seek. 

  • The contribution by one party to the education, training or increased earning power of the other party.

The SM determined that HUSBAND earned his certified electrician license during the marriage as a result of attending school two evenings per week for four years.  Although this schooling was funded by HUSBAND’s employer, it did require WIFE to handle additional household duties while HUSBAND attended school.  The SM concluded: “This factor slightly favors a greater distribution to the wife.” We agree with the SM’s analysis.

  • The opportunity of each party for future acquisitions of capital assets and income.

At least for the next several years, HUSBAND will have a greater earning capacity than will WIFE.  He will be able to earn slightly in excess of $100,000 per year, while WIFE will be limited in her income potential to about $40,000 per year.  This is, of course, a factor that we must weigh in favor of WIFE.  That said, we again note the ages of the parties.  Given those ages, the number of years during which the parties’ earning capacities will be disparate will be limited, and likely will not exceed another 5-10 years.  In addition, we cannot forget the robust assistance that the KLIMS have historically provided to WIFE.  We have absolutely no fear that the KLIMS will suddenly cut their daughter off from the type of assistance they have routinely provided up to this point in time.  Depending upon the nature of future gifts from the KLIMS, WIFE may have an even greater opportunity for acquisition of assets than will HUSBAND.

As we consider everything outlined above, we will not weigh the opportunity of each party for future acquisitions heavily.  In this regard, we disagree with the SM’s assessment that this factor favors a greater distribution to WIFE.

  • The sources of income of both parties, including, but not limited to, medical, retirement, insurance or other benefits.

The sources of income available to each party were outlined extensively in the SM’s Report, and we have summarized some of the key sources of income earlier within this Opinion.  In addition, we note that both HUSBAND and WIFE are eligible for healthcare through the VA system, and both parties will be eligible for Social Security.[5]  On the other hand, WIFE has no pension that will afford her with any type of post-retirement income.  HUSBAND, on the other hand, has a non-marital post-separation 401(k) plan with a relatively small balance of $15,616. 

We will weigh factor (6) in favor of WIFE, but only slightly. We view HUSBAND’s ability to contribute pre-tax dollars to a 401(k) as an economic advantage that WIFE does not possess, but we note that HUSBAND does not now have anything remotely close to the type of retirement fund that would enable him to maintain his standard of living post-retirement. 

  • The contribution or dissipation of each party in the acquisition, preservation, depreciation or appreciation of the marital property, including the contribution of a party as homemaker.

This is a significant factor in this case.  As noted above, the parties own five parcels of real estate, four of which are capable of generating rent.  The aggregate value of the parties’ real estate is north of seven figures.  Without question, the parties were able to accumulate such significant assets for three reasons: (1) HUSBAND’s efforts; (2) WIFE’s efforts; and (3) the financial assistance provided by the KLIMS.  Without any of the above, the parties would not possess a marital estate close in value to the one they now enjoy.

In his report, the SM discusses this factor with only seven sentences.  We will be far more verbose. 

In many ways, HUSBAND and WIFE should be proud of the life they built together during thirty years of marriage.  They successfully raised four children.  It is beyond commendable that they took in additional children who were orphaned and provided those children with a loving home.  At the same time, HUSBAND and WIFE were able to accumulate a significant portfolio of assets that will enable each to live comfortably as senior citizens despite the lack of any significant pension portfolio.  Notwithstanding the turmoil of the past few years, most people would view with envy what HUSBAND and WIFE accomplished during their thirty years together. 

Nothing achieved by the Tobias couple occurred by accident.  More to the point, nothing occurred unilaterally.  What HUSBAND and WIFE achieved, they achieved together.  They did so by maintaining a partnership where both parties had different defined roles.  We accept as a given that had either party abdicated the responsibilities of his/her agreed-upon defined role, the marital estate now before this Court would look vastly different. 

We understand that HUSBAND was the primary breadwinner during the marriage.  We also understand that WIFE was the primary homemaker.  Both roles were important; we will not depreciate either by arbitrarily assigning greater weight to the role that each party undertook with the consent of the other.

What requires us to view this factor more than neutrally is the contributions afforded to the parties by the KLIMS.  As highlighted in Section A above, we cannot and will not ignore the reality that the KLIMS’ robust financial assistance would not have been provided but for the blood relationship between them and WIFE.  We are confident that some degree of affection developed between HUSBAND and the KLIMS – the KLIMS said as much in their letter to him. (See, Exhibit 49).  However, there can be absolutely no debate about the fact that the KLIMS primary motivation to gift monies to the parties was WIFE’s status as their daughter. 

Also of note within this analysis are the contributions of both parties that have been argued extensively under the rubric of “credits.”  As noted above, we will not be awarding monetary credits but we have and will consider all of the parties’ credit-related arguments when weighing this important factor pertaining to equitable distribution.

Given everything articulated above, we must weigh equitable distribution factor (7) solidly in favor of WIFE.  Doing so is not intended to depreciate the contributions of HUSBAND.  Rather, it is to simply recognize the realities referenced above.

  • The value of the property set apart to each party.

At this point, the parties have very little in the way of assets that could be described as non-marital.  HUSBAND does have a minimal retirement account that accrued after separation.  Otherwise, the SM noted no significant non-marital property in the possession of either party, and neither HUSBAND nor WIFE argued that the SM missed something.  This is not a factor that we will weigh heavily in this case.

  • The standard of living of the parties established during the marriage.

HUSBAND and WIFE established a middle to upper-middle class standard of living.  This standard of living could be attributable to all three factors we articulated in our discussion of factor (7) above.  This is not a factor that we will weigh for or against either party as it relates to equitable distribution.

  • The economic circumstances of each party, including Federal, State and local tax ramifications, at the time the division of property is to become effective.

Somewhat incongruously, this factor requires us to analyze how the Court’s ultimate decision will impact the parties.  Leaving aside that this factor requires a somewhat circular logical analysis, we will say this.  Our decision today will afford WIFE with a greater percentage of marital assets than did the decision of the SM.  Given the extent of the parties’ marital estate, WIFE will be left with financial resources valued at considerably more than what HUSBAND will be receiving.  On the other hand, HUSBAND will, for at least the near future, leave this marriage with a higher earning capacity than will WIFE.  To be sure, there will be capital gains tax implications in the future, just as there will be income tax that HUSBAND will have to pay from his earnings.  (See, Exhibit 103).  We simply will not weigh this factor heavily in favor of either party.[6]

  •  Whether the party will be serving as the custodian of any dependent minor children.

Neither party will be serving as custodian of any dependent children.  This factor is not applicable to this case. 

            The SM determined that WIFE should be awarded 55% of marital property.  WIFE argues that she should receive 75%.  We are not completely in alignment with either the SM’s decision or with WIFE’s proposal.  Based upon our global review of all equitable distribution factors, we agree with the SM that WIFE should receive a greater percentage of marital assets.  However, an award of 75% would be excessive given all of the factors we are required to consider.  Based upon all of those factors, and based upon our decision to eschew credits and an award of alimony, we have landed on 62% as an appropriate percentage of distribution in favor of WIFE.  Therefore, WIFE’s exception as to the percentage of marital property distribution recommended by the SM will be granted. 

  • The Ridge Road Property

Both HUSBAND and WIFE have requested ownership of the Ridge Road property.  (SM Report at page 9).  WIFE points out that Ridge Road is an income-producing parcel of real estate that would provide her with an income stream that she will need given her lesser earning capacity.  HUSBAND points out that the Ridge Road property is encumbered by a line of credit that he has been exclusively paying since separation.  He also points out that neither the Pamlico property nor the West Main Street property that were awarded to WIFE are encumbered by mortgages, and both of those properties are tied in some way to the KLIMS.[7]        

The parties have an ownership interest in five parcels of real estate.  WIFE has been in possession of the marital home, and it makes logical sense for that property to be awarded to her.  WIFE’s parents have a loan relating to the West Main Street property, and it makes sense for WIFE to be awarded the West Main Street parcel so that she can work with her parents regarding that debt.  Similarly, the Pamlico property is owned jointly between the parties and the KLIMS.  Once again, it will be easier for WIFE to work with her own parents regarding the future of the Pamlico property than it would be to force HUSBAND to deal with ex-in-laws.  The above leaves only the Ridge Road property and the South White Oak Street property.  Even though WIFE will be awarded a greater percentage of marital assets, and even though the West Main Street property value will be reduced by $100,000, something must be awarded to HUSBAND so that he will possess something close to the 38% share of marital assets to which he is entitled. 

The SM concluded that it made logical sense for HUSBAND to receive the Ridge Road property.  We tend to agree.  While our recapitulation will of necessity be somewhat different than the one employed by the SM, we affirm the SM’s decision to award HUSBAND with the Ridge Road property, and our Court Order will reflect this decision. 

  • Rental Value Credit

The SM extensively discussed the issue of credits.  (See, SM Report at pages 20-25).  The most significant credit was the $1,865 per month rental credit regarding the marital home that HUSBAND requested.  The SM noted that an award of credits is not mandatory.  See, Cerny v. Cerny, 656 A.2d 507 (Pa. Super. 1995).  He stated: “It is not necessary to award a dispossessed spouse a credit for his share of the fair rental value of the marital asset provided the total distribution scheme is fair and equitable.” (SM Report at page 21, citing Schneeman v. Schneeman, 615 A.2d 1369 (Pa. Super. 1992). 

At the SM hearing, WIFE accused HUSBAND of basically abandoning her.  She stated that HUSBAND voluntarily and abruptly moved out of the marital home without warning and without any demand to leave having been communicated. (WIFE’s brief at page 17).  Even though WIFE acknowledges that she has retained possession of the marital home to the exclusion of HUSBAND since separation, she argues that HUSBAND was not a “dispossessed spouse”.  As such, WIFE argues that HUSBAND should not be entitled to any rental value credit.

The SM made a credibility determination about the parties’ separation.  The SM stated:

“The Special Master is persuaded by the testimony of HUSBAND and WIFE’s demeanor at the Special Master’s Hearing [that] he is a dispossessed spouse from the martial home.” (SM Report at page 22).

In addition, the SM determined: “During the marriage, WIFE had anger issues which intensified and became out of control which was directed at HUSBAND and the children, creating a toxic environment.” (SM Report at page 13; Exhibits 41-43).  The SM also noted that WIFE has not permitted HUSBAND to return to the marital home since separation absent a prearranged prior agreement.  (SM Report at page 13).

            Credibility is an issue uniquely within the purview of a finder of fact.  Our Superior Court has stated the following as it relates to credibility:

“[The factfinder] possesses an advantage not granted to [appellate courts]. He sees the parties and their witnesses face to face and observes their appearance and demeanor as they testify. We are restricted to the cold type of the record from which temperament and personality have been subtracted. Yet the demeanor of witnesses is the very touchstone of credibility; in the absence of reactions produced by other applicable tests, the appearance and demeanor of witnesses are the litmus by which the presence of truth is revealed. They are trifles light as air, imponderables, but for all that they are luminous integrants which ineluctably enter into the calculation by which trustworthiness is appraised. The spontaneous gesture, the lifting of an eyebrow, the shrug of the shoulders, the intonation of the voice, the flash of the eye, the facial expression,-these are a few of the vital and influential indicia of credibility which the [factfinder] observes and by which he is guided. The mental and psychological impact of these inarticulate expressions experienced by a [factfinder] form the basis for a conclusion which . . . ‘will depend upon a judgment or intuition more subtle than can be objectively demonstrated.’ Frequently they speak more eloquently and possess greater significance than the verbal utterance which they accompany, yet they cannot be reproduced upon the record submitted to the reviewing court.”

Smith v. Smith, 43 A.2d 371, 583­–84 (Pa. Super. Ct. 1945) (emphasis added) (citations omitted).

            In this case, the SM made a specific credibility determination regarding the parties’ separation that favored HUSBAND.  We must and will respect the fact that the SM was in a far better position to make this type of credibility determination than is this Court.  Thus, we will accept the SM’s credibility determination that HUSBAND was justified in leaving the marital home and that he was thereafter “dispossessed” of that home.

            Having concluded from a general perspective that HUSBAND should be entitled to some benefit by virtue of being dispossessed from the marital residence, we will technically reject WIFE’s exception regarding fair rental value.  That said, we will not be affording HUSBAND with a monetary amount to be assessed as a “credit”.  Rather, we will be including HUSBAND’s general entitlement to rental value as a component of our global decision regarding distribution of the marital estate. 

            In his report, the SM declared that WIFE should be entitled to an aggregate of $21,637.24 for expenses she paid post-separation pertaining to the marital home.  (See, page 32 of SM Report).[8]  On the other hand, HUSBAND was awarded a credit for fair rental value of $932.50 per month.  For the roughly two years that have elapsed since the parties’ minor daughter has graduated from high school, the rental value to which HUSBAND would be entitled would total $22,380.  Thus, the amount of rental value and mortgage credits claimed by the parties are comparable. 

            As we set forth in more detail in Section A above, both parties have submitted copious requests for credits for a wide variety of reasons.  After evaluating all of the parties’ various claims, we have chosen a paradigm that eschews focus on credits in favor of one that focuses upon a percentage distribution scheme.  Our decision to basically offset rental value and preservative expenses credits pertaining to the marital home is only one component of this fundamental approach.

  • Tree Removal and Wall Repairs

WIFE claimed a credit for an expense pertaining to tree removal at the Ridge Road property totaling $8,500.  She also requested a credit for repair of a wall at the West Main Street property totaling $7,800.  The SM denied both of these credits, reasoning that the tree removal was undertaken without HUSBAND’s knowledge and he was not in agreement with the necessity to replace the wall.  (SM Report at page 24).  Further comment is required regarding these requested credits. 

As it relates to the wall at the West Main Street property, WIFE described the condition as follows:

“There were a few stones that had fallen out…the cement cap was crumbling and falling apart…it was an eyesore, and it was also a safety hazard…without a shadow of a doubt that was something that we wanted to renovate…” (N.T. 128)

HUSBAND agreed that the condition of the wall was “an eyesore”, but he stated that “It was not something that would cause the property not to be rentable…” (N.T. 347).  HUSBAND then stated that he did not want the wall to be repaired and he told WIFE of his preference.  Nevertheless, WIFE repaired the wall at a cost of $7,800.  WIFE then testified:

“Q: …your parents paid for that to be repaired?

A: That’s correct.”

            It does not matter to this Court whether HUSBAND and WIFE agreed to make repairs or not.  If work was necessary to repair a condition that the parties agreed was an “eyesore”, and if that work enhanced the value of the property, then the cost of repairs should have been shared by the parties.  As it is, though, neither HUSBAND nor WIFE paid to have the wall repaired; that responsibility was undertaken by the KLIMS.  We consider the $7,800 paid by the KLIMS to repair the wall at West Main Street to be simply another gift of the KLIMS.  The totality of all of the KLIMS’ gifts is a key reason why WIFE will be receiving 62% of marital assets.  We will not afford her with an additional credit for $7,800 in repairs when that contribution was considered as part of our decision to award WIFE with 62% of the marital estate.[9]

            As it relates to trees at the Ridge Road property, WIFE apparently paid $8,500 for the removal of several trees.  (See, Exhibit 88D).  HUSBAND stated that these trees were removed without his approval.  He stated that he first learned about the removal of a huge three-foot wide oak tree when a tenant called to complain about the removal. (N.T. 425).  HUSBAND stated that the tree could have been pruned. (N.T. 427). 

            We have searched the record of this case for information regarding the necessity of tree removal at the Ridge Road property.  The only thing we found was Exhibit 88D, which included a proposal from Long’s Tree Service.  That document stated:

“It is our recommendation that the large oak tree on west property line is dying and should be removed due to decay and large amounts of dieback in crown of tree, removal of tree would be $8,200, pruning tree to remove deadwood would be $4,800, grinding stump six to eight inches below grade for grass would be $650.” (Exhibit 88D).

            The SM denied WIFE’s request for a credit relating to tree removal.  The SM reasoned that because tree removal was accomplished “without HUSBAND’s knowledge or consent”, he should not be required to contribute toward the cost thereof.  We disagree with this reasoning.  If a repair cost is necessary – and removal of a large dying tree falls within that category – both owners should have the responsibility to pay for the costs pertaining thereto.  If one party can avoid the necessity of contributing toward the cost of needed repairs simply by saying “No”, that could lead to devaluation of marital assets due to neglect following separation.[10] 

            We will grant WIFE’s exception to the extent that it challenges the SM’s reasoning.  However, once again, our decision to affirm a credit will not necessarily require dollar-for-dollar reimbursement; we will consider this claim within our overall consideration of equitable distribution.

  1. Limiting the Parties’ Obligation to WIFE’s Parents to $117,500

WIFE complains that her parents are owed far more than $117,500 that HUSBAND agrees was a loan.  As noted above, WIFE presented a document to the SM claiming that her parents should be owed $486,132.92. (See, Exhibit 81C).  In her brief, WIFE indicated that she and HUSBAND should be found to owe $328,959 to her parents. (WIFE’s brief at page 19).  While WIFE’s position regarding the extent to which the KLIMS are owed money as loans has been a moving target, it is clear that WIFE believes the SM erred by declaring that “only” $117,500 was owed to the KLIMS by the parties.

The SM listened to WIFE’s claims about the extent to which the KLIMS should be repaid money as loans.  The SM then listened to the KLIMS testify.  After eyeballing and listening to everyone, the SM made a credibility decision.  He considered most of the amounts paid by the KLIMS to be gifts, but he determined that $117,500 was a loan based upon HUSBAND’s acknowledgement of the same.  We cannot and will not disturb the credibility decision of the SM regarding the extent to which the KLIMS’ contributions should be considered as loans. WIFE’s exception regarding the SM’s loan decision will be rejected.

  • Failing to Consider the KLIMS’ Financial Contributions

WIFE’s next argument is related to her previous one, and to the issue she raised regarding percentage of distribution.   She simply claims that the SM erred by failing to give proper consideration to the gifts that her parents made to the parties during the marriage.  Generally speaking, we agree with WIFE’s argument, as set forth extensively in Section B above.  We stop far short of using THE KLIMS’ contributions as justification to afford WIFE with 75% of the marital estate.  Nevertheless, we do consider the KLIMS’ contributions as a factor in WIFE’s favor, and we have increased the percentage of distribution that should be afforded to WIFE as a direct result of that finding.

  • Reimbursable Expenses Pertaining to Ridge Road

Emblematic of the parties’ acrimonious post-separation relationship are events that occurred relative to the parties’ Ridge Road property.  As noted above, WIFE unilaterally cut down trees that HUSBAND believed should not have been removed.  In addition, HUSBAND received income and paid expenses pertaining to Ridge Road.  Those income and expenses were accounted for in the parties’ joint tax returns filed in 2019 and 2020.  However, in 2021, the parties filed individual tax returns.  WIFE claimed a tax deduction for expenses pertaining to the Ridge Road property that HUSBAND had paid.  In addition, she claims a credit in this transaction for $11,916.84 which she claims to have paid pertaining to Ridge Road. 

The SM addressed the parties’ competing requests for credits pertaining to Ridge Road.  At page 13 of his report, the SM determined that HUSBAND paid $7,253 in expenses pertaining to Ridge Road, but those expenses were declared by WIFE on her 2021 tax return. (SM Report at page 13).  Later, the SM stated:

“The Special Master will not recommend WIFE receive a credit for any income, expenses and depreciation, for the rental properties set forth on her 2021 individual tax return and the State and local real estate taxes paid for the marital home in 2021.  WIFE included income, expenses, depreciation on the return including Ridge Road which income and expenses belong to HUSBAND.  The WIFE’s income and expenses and depreciation listed on her tax returns reduce any tax obligation she may have.”

(SM Report at pages 22-23).

            The competing claims for credits regarding Ridge Road and the impact of those claims upon taxes is just one more reason why we have chosen to avoid a distribution scheme that focuses upon dollar-for-dollar reimbursements from one party to the other.  We will consider all of the expenses paid by both parties relating to Ridge Road, we will consider the income generated from rent as a result of Ridge Road, and we will consider the tax ramifications of the income and expenses pertaining to Ridge Road within the ambit of our global decision to avoid payment of credits in favor of a scheme that focuses upon a percentage distribution of assets if and as they now exist. (See, Section A above for more details regarding our analysis.).

  • WIFE’s Expenses

WIFE’s next exception posits that the SM erred by declaring her monthly expenses to be only $2,400.  WIFE points out that her expenses are low because her income is low.  She claims that she has and will continue to have expenses that exceed $2,400, but she will be unable to pay those expenses until after she receives a divorce settlement and/or alimony. 

The SM mentioned WIFE’s expenses in one sentence found on page 7 of his report.  He mentioned those expenses based upon an Exhibit that WIFE herself had submitted.  Other than in one sentence found in a section of his report that was basically introductory in nature, the SM did not rely upon WIFE’s claimed expenses as justification for any of the decisions he rendered. 

This Court is well aware that monthly expenses are difficult to quantify during the pendency of a divorce, especially where the divorcing parties have so much in the way of comingled assets and liabilities.  So that we are very, very clear, this Court has not considered WIFE’s claimed expenses of $2,400 per month as a factor that it relied upon in rendering decisions.  Whether or not WIFE’s expenses are greater or lower than $2,400 per month is not germane to any of the decisions we render today.

  • Request for Possession of Pamlico Property

WIFE points out that the SM concluded that she requested ownership of the Pamlico property as part of her share of distribution.  (SM Report at page 10).  WIFE also points out that in her post-hearing memorandum, she specifically proposed that HUSBAND receive the Pamlico property.  (WIFE’s memorandum at page 22).  In her memorandum, WIFE states: “WIFE did not want Pamlico awarded to her as part of the equitable distribution scheme.”

HUSBAND concedes that WIFE did not request that the Pamlico property be awarded to her.  It is HUSBAND’s position that the Pamlico property should be sold.  In addition, HUSBAND states: “It would have been impractical and nonsensical for the Master to award the Pamlico property to HUSBAND when WIFE’s parents own 50% of that property.” (HUSBAND’s brief at page 35).

If in fact the SM relied upon the premise that WIFE desired the Pamlico property, the SM erred.  That said, the SM’s ultimate decision to award the Pamlico property to WIFE was a correct one. As HUSBAND points out, the KLIMS own 50% of the Pamlico property.  Following the parties’ divorce, whoever is left with Pamlico will have to work closely with the KLIMS in order to either sell or renovate said property for meaningful use.  Given the familial relationship between WIFE and THE KLIMS, it will be far easier for her to navigate these issues than it would be for an ex-husband to do so.  For this reason alone, we agree with the SM’s decision to award WIFE with the parties’ share of the Pamlico property.

  • Expenses Pertaining to Pamlico

The SM determined that HUSBAND should be entitled to reimbursement for one-half of the mortgage payments he made on the Pamlico property following separation and until the mortgage on said property was satisfied.  (SM Report at page 24).  However, at page 32 of his report, the SM also stated: “HUSBAND’s credit for expenses made by him for Pamlico in 2021 is denied.”  In addition, the SM stated at another location in his report that HUSBAND should not receive “a credit for any income or expenses and depreciation for Pamlico since he declared the same on his Federal Income Tax returns for 2021.” (SM Report at page 23).  Needless to say, these seemingly inconsistent proclamations by the SM are confusing.  Complicating the issue even further is the fact that the KLIMS made significant payments toward preservation of the Pamlico property as well.  In fact, at page 38 of his brief HUSBAND acknowledges that he and WIFE paid only 41.9% of the total expenses pertaining to the Pamlico property; the KLIMS paid the remaining 58.1%.  (HUSBAND’s brief at page 38).

Once again, this exception highlights the difficulty that would exist to accurately assess and equitably afford dollar credits for everything that was paid subsequent to separation.  While we certainly will consider the fact that both the KLIMS and HUSBAND have paid expenses pertaining to the Pamlico property, we will not be awarding dollar-for-dollar credits to either for the amounts that they have paid.  Rather, we will be considering all payments to preserve all assets and all privileges possessed by the parties to enjoy the benefits of possession within our global analysis of how the parties’ marital estate should be divided.  To the extent that WIFE asks us not to consider HUSBAND’s payments pertaining to Pamlico, we reject her exception.

  • WIFE’s Counsel Fees

WIFE argues that the SM erred by awarding her only $3,000 in counsel fees.  She indicates that she incurred fees of $13,443, and HUSBAND should have paid all of these fees.  We disagree.  Via this divorce, WIFE will be receiving assets valued in the hundreds of thousands of dollars.  With the assets she will be receiving, WIFE will be well able to pay her counsel fees.  Under Pennsylvania law, a party’s ability to pay counsel fees with property awarded to him/her in the divorce can, by itself, defeat a claim for counsel fees. See, e.g., Brubaker v. Brubaker, 201 A.3d 180, 191 (Pa. Super 2018), citing Busse v. Busse, 921 A.2d 1248, 1258 (Pa. Super 2007) appeal denied, 934 A.2d 1275 (2007).  In this case, we conclude that WIFE will have more than enough assets from which she can pay her attorney.  We will not require HUSBAND to do so.

  • Post-Separation Credits

WIFE generally complains about how the SM handled the issue of credits.  Because we also have a concern about how the issue of credits was handled, we will affirm WIFE’s exception.  However, for all of the reasons set forth in Section II, A above, we have decided not to award either party with credits.  To the extent that this comports with WIFE’s general exception about credits, that exception will be affirmed.  To the extent that this is contrary to WIFE’s position, WIFE’s exception will be denied. 

  • Withdrawal from Joint Account

In his report and recommendation, the SM stated: “WIFE claims HUSBAND retained $1,489.13 from a joint account but no citation was provided and none could be located.” (SM Report at page 11).  WIFE objects to this finding, stating: “WIFE testified credibly to a specific dollar amount. HUSBAND did not refute that testimony.” (WIFE’s brief at page 27).  HUSBAND argues that the amount to which WIFE referred occurred after separation, “thus making the withdrawal by HUSBAND of his own money a non-marital event.” (HUSBAND’s brief at page 47). 

It is patently obvious from the entirety of the SM’s Report that the SM did not find WIFE to be completely credible.  As it relates to this amount claimed by WIFE, the SM would not simply accept her word that HUSBAND removed $1,489.13 from a joint account.  Because the SM did not accept WIFE’s testimony without further documentation to corroborate it, neither will we.  WIFE’s exception regarding a withdrawal from a joint account will be rejected.

  • Rent of $5,000 from Casey Berdiner

Casey Berdiner is WIFE’s cousin.  She was raised by the parties after her parents died when she was 8-years of age.  Apparently, Ms. Berdiner and her children lived with WIFE for a period of time following the parties’ separation.  Some testimony was presented that Ms. Berdiner paid rent to WIFE during this period of time.  The SM awarded a credit to HUSBAND for the rent WIFE received from Ms. Berdiner.  WIFE objected to such an award. 

As stated above, this Court has chosen not to become enmeshed in the “tit-for-tat” arguments of the parties regarding credits.  We will consider the fact that WIFE received rental payments from Ms. Berdiner, just as we considered the fact that she paid expenses pertaining to the marital home and that HUSBAND paid expenses after separation regarding other parcels of real estate.  However, we will not afford dollar-for-dollar credits for any of these amounts, including the rental amounts paid by Ms. Berdiner. 

  • Rental Income from Pamlico

WIFE complains about the SM’s conclusion that the Pamlico property “is currently not rentable.” WIFE claims that she found a tenant who would lease the property in 2019.  She also states that HUSBAND agreed that he would find a tenant, thus implying that the property was in fact rentable. 

We view the Pamlico property as a vacation destination that may or may not have been rentable on a short-term or long-term basis.  We also view the Pamlico property as falling within the control of both the parties and the KLIMS.  As with other parcels of property, we will not be awarding any credits pertaining to Pamlico, nor would we even consider it fair or appropriate to attribute consideration of Pamlico’s purported rental value solely to HUSBAND.  We therefore reject WIFE’s arguments regarding rental value of Pamlico.

III.       DECISION

            As is evident from the above, this Court has decided not to award credits to either party.  We have also decided to increase WIFE’s share of marital property from the 55% recommended by the SM to 62%.  Because the parties have not objected to the valuations ascribed to the parties’ assets by the SM – other than their agreement that West Main Street’s value should be reduced by $100,000 – we will set forth the following recapitulation of those assets and will then apply our percentage of distribution to the net result of that recapitulation. 

A. Marital Assets

We determine that the parties’ marital estate consists of the following:

Net value of East Maple Street$248,925.57
Net value of West Main Street$113,000.00
Net value of Ridge Road$284,373.50
Net value of South White Oak Street$158,002.08
Net value of Pamlico property (½ interest)$110,400.00
2007 Chrysler Town & Country$2,597.00  
Trailer$1,500.00
IRA$256.35
IRA withdrawals by HUSBAND$4,500.00
TOTAL$923,554.50

B. Marital Debts

Other than mortgages from financial institutions that may still encumber marital property, we have identified the following marital debts:

Amount borrowed from daughter Brionna$7,000.00
Navy Federal Credit Union$12,540.00
The KLIMS (for West Main Street)$117,500.00

C. Possession of Assets and Debts

As of the date of the SM’s Report, the following marital assets were deemed to be in possession of HUSBAND:

Ridge Road$284,373.50
IRA$256.35
IRA withdrawals$4,500.00
TOTAL$289,912.85

The following marital assets were deemed to be in possession of WIFE:

The marital home$248,925.57
West Main Street$113,000.00
South White Oak Street$158,002.08
2007 Chrysler Town & Country$2,597.00
Trailer$1,500.00
TOTAL$524,024.65

In terms of marital debts, WIFE has already paid the amount due to the Navy Federal Credit Union of $12,540.00.  Neither party has paid anything to Brionna or the KLIMS. 

D. Award of Assets and Debts

We will award each party the marital assets that are currently in their possession.  In addition to the properties already in WIFE’s possession, we will award her with the parties’ value of the Pamlico property totaling $110,400.00. 

            In terms of marital debts, we will attribute to WIFE the responsibility to repay the KLIMS[11] and the $12,540.00 that she has already paid to Navy Federal Credit Union.  We will equally divide responsibility for the parties to repay their daughter Brionna.[12]  By virtue of the above, we will reduce WIFE’s awarded marital assets by the $133,540 in debt that we will attribute to her, and we will reduce HUSBAND’s award of marital assets by the $3,500.00 in marital debt we will attribute to him.

E. Recapitulation

Our recapitulation of everything outlined above is as follows:

Marital property awarded to WIFE 
Marital home$248,925.57
West Main Street$113,000.00
South White Oak Street$158,000.08
Pamlico$110,400.00
Chrysler Town & Country$2,597.00
Trailer$1,500.00
TOTAL ASSETS$521,537.65
Less Marital Debt Paid/Payable by WIFE 
KLIMS re: West Main Street$117,500.00
Navy Federal Credit Union$12,540.00
Brionna$3,500.00
TOTAL$133,540.00
NET MARITAL AWARD TO WIFE$387,997.65
Marital property awarded to HUSBAND 
Ridge Road$284,373.50
IRA$256.35
IRA Withdrawals$4,500.00
TOTAL ASSETS$289,912.85
Less Marital Debt Payable by HUSBAND 
Brionna$3,500.00
TOTAL$3,500.00
NET MARITAL AWARD TO HUSBAND$286,412.85
TOTAL NET MARITAL ESTATE$674,410.50
62% to which WIFE is entitled$418,134.51
Net amount awarded to WIFE$387,997.65
Additional amount owed to WIFE$30,136.86

IV.    CONCLUSION

            Without question, the most controversial aspect of today’s decision is our conclusion that no credits should be awarded to either party.  We need to emphasize that our decision regarding credits is based upon the unique circumstances of this case.  From a general perspective, we do not believe that marital property should be divided significantly through the process of awarding credits.  However, we recognize that sometimes credits can be a valuable tool to effectuate economic justice.[13] 

            All aspects of our decision today including the conclusions that neither credits nor alimony are appropriate, are in direct response to the unique circumstances presented to us.  Moreover, we need to very clearly declare that our decision to award WIFE with 62% of marital assets is not severable from the other decisions we have rendered.  Had we awarded alimony or credits, our decision to award WIFE 62% of marital assets would likely have been different.[14] 

            The approach we have used is intended to sever the parties’ 30-year marital ties as cleanly and simply as possible.  We have awarded WIFE with marital real estate in which her parents have an interest.  We have avoided a shift of property management responsibilities whenever possible, and we have eliminated the need for the parties to calculate – or dispute – entitlement to rent or payment of preservative expenses since the date of the SM hearing.  In addition, we have knowingly structured all decisions within the umbrella of equitable distribution rather than employing credits or alimony as vehicles to create economic justice.[15]

We have little doubt that both parties will be disappointed with the outcome of our decision, because it is less favorable to HUSBAND than was the SM’s decision and it does not come close to affording WIFE with what she fervently sought.  So be it.  Our decision represents the best effort of this Court to sort through the thousands of pages of information that was presented in the record.  We stand by our decision as appropriate to “effectuate economic justice between the parties.”

             A Court Order to effectuate the decisions of this Opinion will be entered today’s date.


[1] WIFE pointed out in her Brief that this rent increased to $1,900 per month effective in July of 2022.  We could not find anything in the record to support this.

[2] The Massar case emanated from Lebanon County.  The Opinion generated from the Superior Court includes the quote mentioned above and affirmed the decision of this Court to deny a husband’s request for credits.  We cite Massar as persuasive precedent and because the principle articulated in Massar is in accord with numerous published Superior Court decisions.

[3] Sometimes, we wonder if the parties are incentivized to delay divorce proceedings because they know that credits will be awarded that might dilute what the other party could expect to receive via equitable distribution. 

[4]We stop short of adopting the entirely of HUSBAND’s arguments pertaining to his contributions toward the Ridge Road property.  HUSBAND appended as Exhibit B to his brief a summary of contributions he made toward the Ridge Road property during calendar year 2022.  Those contributions totaled $27,488.08.  The document appended to HUSBAND’s brief was not submitted in any of the factual hearings that were conducted before the SM, and WIFE’s attorney did not have the ability to cross-examine HUSBAND regarding that document. Still, we recognize that HUSBAND was and continues to be responsible for managing the Ridge Road property and paying all of its expenses. We have considered this reality when crafting a percentage distribution scheme.

[5] The SM determined that WIFE is eligible to receive $1,114 per month from HUSBAND’s Social Security entitlement when he reaches age 67 if she does not remarry.  The SM also noted that if WIFE remarries, she would be eligible to receive $836 per month from Social Security.  (SM Report at page 6).

[6] Equitable distribution factors (10.1) and (10.2) are related to factor (10).  We have reviewed and considered Exhibit 103, which is a letter from Smoker and Company LLC outlining future costs pertaining to the parties’ assets.  We will not separately address factors (10.1) and (10.2) because, as we stated above, we do not believe that future tax ramifications will be a factor that significantly benefits one party over the other.

[7] The West Main Street property is subject to a loan to the KLIMS and the Pamlico property is owned jointly with the KLIMS.

[8] WIFE’s payment of the mortgage totaled $53,274.47. One-half of this payment was calculated at $26,637.24. The SM deducted rents WIFE received for the marital home of $4,800 in order to reach his total credit of $21,637.24.

[9] We remember that the KLIMS had a financial incentive to complete repairs at the West Main Street property because their loan of $117,000 to the parties related to the West Main Street property. 

[10] To be sure, WIFE should have notified HUSBAND before undertaking a repair cost of $8,500.  That said, “punishing” WIFE for failing to notify HUSBAND strikes us as unfair.

[11] We do so with full expectation that the KLIMS might forgive this debt to WIFE and they would not have even considered forgiveness of this debt had we attributed it to HUSBAND.

[12] We are unaware of the family dynamics involving the parties’ children.  Even though the amount owed to Brionna is relatively modest, we do not want to aggravate what already may be a fragile relationship between Brionna and one or both of her parents.  Therefore, we have decided that the safest manner by which to divide the debt owed to Brionna is to impose equal responsibility on both parents to repay her.

[13] Thus, today’s decision to avoid an award of any credits should not be viewed as having precedential effect. 

[14] Therefore, to the extent that either party contemplates an appeal, everyone must be aware that a successful appeal will require a return to the proverbial “drawing board” because an alteration of any aspect of our decision will necessarily require a re-evaluation of everything. 

[15] We need to advise both parties that our decision to require HUSBAND to pay $30,136.86 to effectuate equitable distribution was intentional.  We are aware that we could have structured payments from HUSBAND as alimony, and that doing so would have benefitted HUSBAND from a tax perspective.  In addition, in part because we have structured the $30,136.86 payment owed by HUSBAND as an equitable distribution payoff, we have consciously decided not to add interest to HUSBAND’s pay-out.  Had we chosen alimony as a vehicle to distribute this amount, WIFE would have been required to pay taxes on the amounts she received. 

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