Karen M. Raugh, v. Rodney L. Raugh

Karen M. Raugh, v. Rodney L. Raugh

Civil Action-Family Law-Divorce-Equitable Distribution-Division of the Marital Estate-Economic Justice-Fees-Expert Witness-Credit-Fair Rental Value-Valuation of Assets-Average of Appraisals-Purchase Offer-Alimony

Before the Court are voluminous Exceptions to the Order adopting the Report and Recommendation of the Special Master in Divorce.  Some of the assertions include that the Special Master erred and/or abused his discretion by awarding fifty-five percent (55%) of the marital estate to Defendant (“Husband”) and forty-five percent (45%) of the marital estate to Plaintiff (“Wife”), awarding credit to Husband for care of one (1) of the parties’ horses, failing to divide the costs of the testimony of a vocational expert between the parties when the vocational expert’s testimony was required because Husband would not permit admission of the report in lieu of testimony, awarding Wife fair rental credit for the marital residence, averaging the values provided in two (2) appraisals with regard to the value of the marital residence and failing to award Husband alimony,

1.  In distributing the material estate, the court should consider the distribution in its entirety to effectuate economic justice.

2.  Where a vocational expert testified that jobs exist in Central Pennsylvania suitable for Husband that pay between $69,000.00 and $131,000.00 per year, the Department of Veterans Affairs will pay 100% of the cost for Husband to obtain an advanced degree, Husband will be entitled to monthly payments from a military pension in four (4) years, Wife worked and earned income in addition to her role as primary homemaker, the parties youngest daughter lived with Wife after separation and the parties worked as a team to raise children and to acquire a portfolio of assets, economic justice warrants an award of fifty percent (50%) of the marital estate to each party.  

3.  No credit will be afforded to either party for care each provided to the respective horse in their possession after separation.

4.  A party who procures an expert witness generally should be responsible for paying the costs.

5.  When Husband demanded that the vocational expert testify and did not permit admission of the generated report in lieu of live testimony and the testimony did not provide new or materially different information than the information contained in the report, Husband will be directed to pay for part of the cost for the testimony of the vocational expert. 

6.  Equitable distribution may include a credit for one-half (1/2) of the rental value of the marital home to the non-possessing spouse.

7.  Rental value credit is not mandatory and may be offset by a non-possessing spouse’s share of the costs of maintaining the home.

8.  In light of the fact that the goal of the Divorce Code is to distribute equitably the marital estate without regard to marital conduct and people who live in the marital residence should be expected to pay for that privilege, Wife was not entitled to credit for fair rental value of the marital residence after she vacated the marital residence.

9.  A court may be within its discretion in averaging the value of two (2) appraisal amounts offered by the parties with regard to the marital residence. 

10.  Where two (2) appraisals differ dramatically and evidence exists that a third party offered a purchase price for the marital residence near the time of separation, the offered purchase price will be adopted as the value of the marital residence.

11.  The purpose of alimony is to ensure that a financially dependent spouse can maintain his or her reasonable needs after the divorce.

12.  Where Husband has enjoyed two (2) lucrative careers, has the potential to earn comfortable income, has presented no evidence why he physically is unable to perform the job he left, receives a stipend from the Department of Veterans Affairs for additional schooling and has available funds in bank accounts, Husband is able to maintain his reasonable needs after the divorce without an award of alimony. 

L.C.C.C.P. No. 2020-20396, Opinion by Bradford H. Charles, Judge, September 12, 2023. 

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY, PENNSYLVANIA

CIVIL ACTION – DIVORCE

KAREN M. RAUGH,                                               :

Plaintiff                                                                      :

                                                                                    :

            v.                                                                     :           2020-20396

                                                                                    :

RODNEY L. RAUGH,                                             :

Defendant                                                                  :          

                                                                                    :

ORDER OF COURT

AND NOW, this 12^th day of September, 2023, in accordance with the attached Opinion, the Order of this Court is as follows:

1. Rodney L. Raugh (hereafter HUSBAND) and Karen M. Raugh (hereafter WIFE) are divorced from the bonds of matrimony.
2. The request of HUSBAND for alimony is DENIED.
3. HUSBAND is awarded all items of property listed on Chart E set forth on page 62 of the attached Opinion.^[1]
4. WIFE is awarded all items of property listed on Chart D set forth on page 60 of the attached Opinion.
5. Both HUSBAND and WIFE shall pay all existing mortgages, liens or other encumbrances pertaining to any property awarded to him/her.  Both parties are to indemnify and hold harmless the other with respect to said mortgages, liens or encumbrances.  If any party fails to pay a mortgage, lien or other encumbrance that is in joint names for a period of three (3) months or more, the party who is not responsible for paying the amount of the mortgage, lien or encumbrance shall have the right to petition this Court for permission to require a sale of the asset to which the mortgage, lien or encumbrance applies.  Both parties shall be required to satisfy or re-finance any joint mortgages, liens or other encumbrances within three (3) years from the date of this Court Order.
6. The decision of the Special Master pertaining to personal property is affirmed.  The parties shall be awarded all items of personal property that were awarded to him/her by the Special Master.  If an item of personal property was not specifically addressed by the Special Master, it shall be sold and proceeds from the sale should be divided equally between the parties. 
7. The Court confirms that the New Holland tractor was sold for $4,000.00.  The proceeds from the sale of the tractor will be included as a marital asset and will be awarded to HUSBAND via Chart E on page 61 of this Opinion. 
8. Within thirty (30) days following today’s date, HUSBAND shall provide to WIFE all copies of all surveillance photographs, videotapes, DVDs, GPS tracking documentation or any other depictions or documentation he procured via the installation of surveillance cameras inside the parties’ marital home.  When HUSBAND produces all copies of photographs videotapes, DVDs, GPS tracking documentation or any other depictions or documentation, he is to also produce an Affidavit signed under penalty of perjury outlining that he does not possess any additional copies of any photographs, videotapes, DVDs, GPS tracking documentation or any other depictions or documentation procured via surveillance cameras he installed at the marital residence.  This Court will retain jurisdiction to enforce the terms of this directive via the contempt powers of this Court should HUSBAND be found in violation of his obligations under this paragraph at any time in the future.
9. As it relates to the 2013 Chevy Sonic motor vehicle that WIFE sold in return for a price of $8,000.00, the intent of this Court is to ensure that said proceeds benefit the parties’ daughter Arielle.  Provided that WIFE produces proof that she purchased another vehicle for Arielle or that Arielle is satisfied that nothing further is owed to her, then the $8,000.00 proceeds from the sale of the Chevy Sonic will not be considered as marital property subject to division.  If WIFE does not produce proof that she purchased a vehicle for Arielle or that Arielle is satisfied that nothing further is owed to her, then the $8,000.00 amount received by WIFE will be considered a marital debt owed to Arielle that WIFE will be exclusively responsible to pay.
10. The parties’ horses, Clint and Moon, are awarded to WIFE. 
11. In accordance with the attached Opinion, WIFE is to pay to HUSBAND the sum of $51,187.81.  For a period of three (3) years from the date of this decree, WIFE may choose to pay this sum at the rate of $750.00 per month, $150.00 of which will be deemed to be interest and $600.00 of which will be deemed to be payment upon principle.  During this period of time, WIFE shall be exclusively responsible for paying all liens or encumbrances on the marital residence as outlined in Paragraph 5 above. 
12. No later than thirty-six (36) months following the date of the decree, WIFE shall pay the full amount due and owing to HUSBAND and WIFE shall remove HUSBAND’s name from any existing mortgages, liens or encumbrances on the marital residence.
13. This Court’s analysis regarding marital assets, marital debts and credits were all incorporated into the calculation of the amount set forth in the previous paragraph.  To the extent that either party has requested credits in addition to those incorporated into the Court’s analysis contained in the attached Opinion, any such request for credits will be DENIED.

BY THE COURT:

                                                                                    __________________________J.

                                                                                    BRADFORD H. CHARLES

BHC/pmd

cc:        Court Administration (order only)

Loreen Burkett, Esq.

Colleen Gallo, Esq.

Keith Kilgore, Esq.

Table of Contents

Preamble1-2

I.      Facts and Procedural History2-5

II.     Discussion5-56

1. Introduction.5-7
2. Percentage Distribution of the Marital Assets8-17
3. Summary of Percentage Distribution17-18
4. Marital Debt18-19
5. Valuation & Distribution of Personal Property19
6. Value of Personal Property19-21
7. Vehicle Ramps.22-23
8. Photographs & Video Footage from Hidden Cameras23-24
9. Vehicles25-26
10. Clint the Horse26-27
11. Sun Dolphin Kayak, Accessories & Wrought Iron Chairs27-28
12. Credits Awarded by Special Master.28
13. Cost of the Second Personal Property Appraisal28-29
14. Animal Care29-30
15. Credit Card Debt & Unreimbursed Medical Bills30-32
16. Vocational Expert32-34
17. Real Estate Appraisals.34-35
18. Stimulus Refunds35-36
19. Discover Bank Account36-39
20. Loan to Arielle39-42
21. Rental Value of Marital Residence42-44
22. HUSBAND’s VA Disability Income44-46
23. Fair Market Value of Marital Residence.46-49
24. Attorney’s Fees50-52
25. Alimony52-54
26. Cost of Selling Marital Home54-56

III.      Conclusion57-67

1. List of Marital Assets.58-60
2. List of Marital Debts Paid After Separation61
3. List of Non-Marital Assets61
4. Marital Assets Currently Possessed by WIFE62
5. Marital Assets Currently Possessed by HUSBAND62-63
6. List of All Credits to Which the Parties are Entitled63
7. Recapitulation63

IN THE COURT OF COMMON PLEAS OF LEBANON COUNTY, PENNSYLVANIA

CIVIL ACTION – DIVORCE

KAREN M. RAUGH,                                               :

Plaintiff                                                          :

                                                                                    :

            v.                                                                     :           2020-20396

                                                                                    :

RODNEY L. RAUGH,                                             :

Defendant                                                      :          

                                                                                    :

APPEARANCES

Loreen Burkett, Esq.                                                            For Plaintiff

Colleen Gallo, Esq.                                                   For Defendant

Keith Kilgore, Esq.                                                   Special Master

OPINION BY CHARLES, J.,  September 12, 2023

            This case takes the term “pissing contest” to a new level.  We have often marveled at – and lamented – how divorce litigants can expend so many resources to argue about property that can objectively be characterized as meager.  This case represents a perfect example of this unfortunate dynamic.  Here, the parties have proffered twenty-one (21) exceptions^[2] to a decision rendered by a Special Master in Divorce (hereafter SM).  Some of their arguments involved horses, dog food and property that was appraised at little or even no value.  Unfortunately, we will now have to expend valuable judicial time and energy to address many of these arguments.  As we do so, we must recognize and remember that some of the parties’ arguments are legitimate and deserve robust analysis.  This Opinion represents our best effort to separate wheat from chaff in order to effectuate economic justice between the parties. 

I.          FACTS and PROCEDURAL HISTORY

            Rodney Raugh (hereafter HUSBAND) and Karen Raugh (hereafter WIFE) were married on May 28, 1994.  This was WIFE’s first marriage and the second marriage for HUSBAND. HUSBAND had one (1) daughter from his previous marriage, whom WIFE adopted. The parties had two (2) other biological daughters. After periods of trial separations, the parties’ final physical separation occurred on September 3, 2020. Their daughters were adults at the time of final separation.  WIFE filed a Claim in Divorce on August 25, 2020, on grounds that, “The marriage is irretrievably broken.”.  HUSBAND filed a Counterclaim on September 4, 2020, alleging that, “Plaintiff did commit adultery or did offer such indignities to the person of the Defendant to render his condition intolerable and life burdensome.”.

            At the time of the SM hearing, WIFE was 50-years of age.  She was employed by Brick Property Services as the Executive Director of Lebanon County Housing and Redevelopment Authority.  HUSBAND was 56-years of age.  He retired from military service and then had a civilian career working with various contractors that provide training for the military.  During the marriage he was deployed twice for a total of 28 months.  He also travelled extensively in his civilian career.  HUSBAND suffers from multiple sclerosis, and he had numerous shoulder surgeries over the years.  In addition, he was diagnosed with PTSD.  HUSBAND worked until he voluntarily quit his job in January 2022, the day before the hearing for alimony pendente lite.  The military determined that HUSBAND is 80% disabled; in August 2022 he began receiving disability benefits.  HUSBAND is currently working on obtaining a master’s degree. 

            WIFE has a BS Degree in accounting from Pennsylvania State University, and she possesses a real estate license.  She has enjoyed an 18-year career working for the Lebanon County Housing and Redevelopment Authority, the Lehigh County Housing and Redevelopment Authority, and her current employer.  Over her career, WIFE earned generous salaries plus benefits from her employers.  At the time of the hearing, her annual salary was $110,000.00, and she received medical, dental, and vision coverage, six (6) weeks of leave, and short and long-term disability, all paid by her employer at no cost to her.  In addition, her employer contributes 10.5% of her annual salary to her retirement plan without any matching contributions from WIFE. (N.T. 163-173; Exhibit 162).  During the marriage WIFE was primarily responsible for chores inside the home, finances, and childcare. 

            HUSBAND has a BS Degree in Exercise and Sports Science from Pennsylvania State University.  He is currently using his VA benefits to obtain a Master’s Degree at Aquinas Institute of Theology.  He served in the military for 22 years.  For about 20 years HUSBAND worked as a military trainer; his last position was as a Senior Military Trainer and Advisor for Valiant Integrated Services.^[3]  Until recently, HUSBAND remained employed at an annual salary of $67,000.00.  (N.T. 37, 217-220).  As noted above, he stopped working in January of 2022.   Once the divorce is final, HUSBAND’s disability payment will be $1,759.33 per month.  (N.T. 244, Exhibits 74, 87-89). The VA pays 100% of his books, tuition, and school related fees, and he receives a cost-of-living stipend of $800.00 per month to attend college. (N.T. 429).  HUSBAND receives medical coverage through the V.A. 

HUSBAND cited health concerns when he quit his job.  Brian Bierley, a Vocational Expert, performed a vocational assessment of HUSBAND.  (N.T. 530-531, Exhibit 200).  Mr. Bierley determined that HUSBAND has a vocational ability at present to earn between $64,000.00 and $75,000.00 annually. (Exhibit 200; N.T. 538). 

            The parties’ marital home is located at 753 Gravel Hill Road in Palmyra.  It is a four-bedroom farmette on 10 acres, including a barn where the couple housed horses.  Although HUSBAND remained in the marital home and WIFE rented an apartment until January 6, 2023, the parties agree that WIFE should be awarded the marital home.  One of the most significant issues in this case centers around the value of the home.  As we will discuss in detail below, the parties had two separate real estate appraisals completed by different companies, and the gap between the appraisals was $165,000.00 (Exhibit 61, 70).

            In addition to the marital residence, the parties possess extensive personal property, numerous institutional accounts, and several retirement funds.  Unfortunately, the parties could not agree on how to divide or value their marital assets.  Most of the Exceptions filed by the parties are disputes over who should get certain property, what value should be placed on items, and which party is responsible for unnecessary costs to this litigation.    

II.        DISCUSSION

1. Introduction

Before we dissect the specifics of the Exceptions filed in this case, this Court makes two observations. First, while we will be reaching conclusions that have monetary consequences for the parties, this case has less to do with money than it does with the parties’ individual desires to “win”.  The behavior of both parties has caused this proceeding to be unnecessarily protracted and has cost them way more than it should have. At times, both parties have “stepped over dollars to save pennies”.  The biggest cost may be in the significant damage that has been inflicted on the parties’ relationships with their adult children.  Second, whatever decisions this Court makes regarding equitable distribution, attorney fees and alimony, neither of the parties will be left destitute.  As the SM noted in his Report, “The parties [enjoyed] an above average standard of living”.  We are confident that while both parties may not like our decision today, they will each be left with ample assets and opportunities to continue to live comfortably for the rest of their lives.

            When a transcript of the SM Hearing exists, as in this case, the standard of review to be employed is:

“Our Superior Court has provided guidance with respect to the scope of review that we should ordinarily employ.  In reviewing a DRM’s report, we must give “fullest consideration” to the credibility findings of the DRM, who was present to observe the demeanor of witnesses and hear their testimony. Schuback v. Schuback, 603 A.2d 194 (Pa.Super. 1992); Dukmen v. Dukmen, 420 A.2d 667 (Pa.Super. 1980).  A DRM’s report should not be lightly disregarded.  Pasternak v. Pasternak, 204 A.2d 290 (Pa.Super. 1964).  However, the DRM’s report is only advisory, and we are not bound by its conclusions.  When we have a transcribed record to review, we must consider all of the evidence de novo and make an independent determination of the amount of support due and owing.  Id. (citing Rankin v. Rankin, 124 A.2d 689 (Pa.Super. 1956).”

     Lippi v. Lippi, C.P.Leb.Co. No. 2007-5-0676 (May 7, 2013)

With the above having been noted, we can and must respect the credibility decisions of the SM.  This Court has frequently cited Smith v. Smith, 43 A.2d 371 (Pa.Super. 1945) with respect to credibility determinations. In Smith, the Superior Court stated:  

“Although we are not concluded by a master’s findings upon credibility, his judgment upon that vital factor is entitled to the fullest consideration, and especially in a contested case.  He possesses an advantage not granted to us.  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 in electable 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 an eye, the facial expression – these are a few of the vital and influential indicia of credibility which the master observes and by which he is guided.  The mental and psychological impact of these inarticulate expressions experienced by a master form the basis for a conclusion which, to borrow the telling phrase of an anonymous master, “will depend upon a judgment or intuition more subtle that 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.”

• Percentage Distribution of the Marital Assets

            This discussion encapsulates Exceptions filed by both parties^[4].  The SM determined that the marital assets should be awarded fifty-five percent (55%) to HUSBAND and forty-five percent (45%) to WIFE before adjustment for credits.  WIFE contends that the SM should have awarded the parties a 50-50% split.  HUSBAND agrees with the percentages awarded by the SM for the marital assets but asserts that the marital debt should have been distributed 55% to WIFE and 45% to HUSBAND.

            The Divorce Code requires that upon a request by either party in a divorce proceeding, the Court must distribute the marital property between the parties without regard to marital misconduct.  23 Pa.C.S.A §3502(a) (hereafter §3502(a)).  The statute enumerates eleven (11) relevant factors to be considered in equitable distribution of the marital property.  The Court must distribute the property in such percentages as it deems appropriate when considering the relevant factors.  There is no standard formula, but the method of distribution must be derived from the facts.  Isralsky v. Isralsky, 824 A.2d 1178, 1191 (Pa. Super.2003).  The Court should consider the distribution in its entirety to “effectuate economic justice”.  Harvey v. Harvey, 167 A.3d 6, 16 (Pa. Super. 2017).

            In the instant case, the SM determined that seven (7) of the factors were neutral, three (3) of them were in favor of HUSBAND, and one (1) of them was in favor of WIFE.  This was how the SM analyzed the equitable distribution factors:

Neutral:

(1) Length of marriage– The parties lived together for 26 years.  By itself, this does not favor either party.

(2) Any prior marriages of either party– Even though HUSBAND was married and divorced before, the length of the marriage between HUSBAND and WIFE rendered this factor immaterial.

(4) Contribution of one party to the education, training or increased    earning power of the other party- The SM determined that both parties contributed to the education, training or earning power         of the other. WIFE obtained a real estate license during the      marriage, and raised the children while HUSBAND was deployed.     HUSBAND worked while she studied for the real estate license.

(8) Value of the property set aside to each party– The SM determined that each party would have relatively equal assets at the time of divorce.

            (9) Standard of living of the parties established during the         marriage–       The parties obtained an upper middle-class standard of      living.  Both of those standards have decreased since separation.

(10) Economic circumstances of each party, including federal, state, and local ramifications, at the time of the division of the property is to become effective^[5]– The SM incorporated the discussion about the parties’ economic standard of living from above. There was no testimony as to tax ramifications associated with equitable distribution.  The parties agreed to a 7% cost of sale of the real estate, and the SM included this cost as part of his credit analysis.

            (11) Whether the parties will be serving as custodian of any       dependent children– There are no minor children, so the SM did not      consider this factor.

In Favor of HUSBAND:

(3) Age, health, station amount and sources of income, vocational skills, employability, state, and liability in the needs of each of the parties– HUSBAND is six (6) years older than WIFE and is in fragile health. The parties are equally educated.  HUSBAND’s earning capacity is less than what WIFE will be earning indefinitely, and the SM considered this in HUSBAND’s favor.

            (5) Opportunity of each party for future acquisitions of capital assets and income– WIFE is younger and has a greater opportunity           as a      result of her greater earnings and extensive fringe benefits           from her employer.

            (6) Sources of income for both parties, including, but not           limited to        medical, retirement, insurance benefits, or other     benefits– SM considered WIFE’s greater income and generous             contributions by her employer into her retirement account.  SM       acknowledged that HUSBAND has medical coverage through the             VA and will be receiving a military pension in four (4) years.  This             factor was        decided slightly in favor or HUSBAND.

In Favor of WIFE:

            (7) 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–             WIFE was the primary homemaker and caregiver of the children,    particularly when HUSBAND was deployed.

            WIFE argues that the SM abused his discretion, and that he should have found that seven (7) of the factors should have been decided in her favor. Below are the factors that she believes that should favor her and her reasoning why they should be:

            (2) WIFE wants consideration given to the fact that she adopted     HUSBAND’s daughter from his first marriage.

            (3) WIFE believes she should get greater distribution because         HUSBAND is working on a Master’s degree, and he quit an          established career the day before and APL hearing.  She indicated that he would have an opportunity to improve his earnings after he        obtains the degree, and that she has no room for advancement.

(4) WIFE asserts that her employer paid for her real estate license, so it did not cost HUSBAND anything.  She points out that she was solely responsible for running the household while HUSBAND was deployed, and that he took computer training classes.  WIFE avers that she made greater contributions to HUSBAND’s earning power than he made to WIFE’s earning power.

(6) WIFE contends that this factor should have weighed heavily in her favor.  She noted the HUSBAND has disability payments for life, and that he receives college tuition, books, and a stipend from the military.  WIFE calculated that HUSBAND’s retirement accounts total about $450,000, and that hers are only worth about $200,000.  She avers that HUSBAND has not assisted the parties’ children since the separation.

(7) SM found this factor in WIFE’s favor.

(10) WIFE’s argument is that HUSBAND refused to vacate the marital residence and that she was forced to move out and rent an apartment.  She admits that HUSBAND paid the mortgage and HELOC payments while living there, but then he vacated the home in January 2023, without giving her notice, and left the house in a “deplorable” condition.

(11) WIFE argues that she should have been considered as serving as the custodian of their youngest daughter, because she was sole financial and emotional support for the daughter throughout the separation.  WIFE admits that the daughter was not a minor child but insists that the daughter remained “dependent” on WIFE.

            We respect many of the SM’s findings regarding the equitable distribution factors.  In particular, we note and understand how the SM considered WIFE’s younger age, better health and robust income as factors weighing in HUSBAND’s favor.  However, we also believe that the SM underestimated the value of HUSBAND’s military benefits and his ability to earn future income through employment.  Ultimately, we disagreed with the SM’s evaluation of certain factors, and we will set forth our analysis below:

Factor (3)

            The SM determined that because HUSBAND is 6-years older than WIFE and is in poor health, this factor should be weighed in HUSBAND’s favor.  While we understand and respect these findings, we note that HUSBAND is working on a Master’s degree.  He is obviously a hardworking individual and he has the benefit of being able to place military experience on a resume.  Without question, HUSBAND suffers from Multiple Sclerosis and that impacts his ability to perform certain functions. (See, Page 10 of SM Report).  However, an expert determined that jobs exist in Central Pennsylvania that would be suitable for HUSBAND that pay between $69,000.00 and $131,000.00 annually. (Page 10 of SM Report).  Moreover, the SM noted that the Veteran’s Administration will pay 100% of the cost for HUSBAND to obtain an advanced degree. (Page 9 of SM Report).  In addition, HUSBAND will be entitled to access monthly payments from a military pension in four (4) years. 

            As it relates to equitable distribution Factor (3), the scales may tip very slightly in favor of HUSBAND. However, we will not weigh this factor as heavily in HUSBAND’s favor as the SM apparently did. 

Factor (6)

            In comparing the parties’ retirement accounts, we begin with the premise that both HUSBAND and WIFE will enter retirement with greater financial resources than most in their age group.  Both HUSBAND and WIFE will receive Social Security benefits.  HUSBAND possesses IRA accounts as well as a military pension.  WIFE has a retirement plan with her current employer.  As of separation, HUSBAND’s retirements plans were worth considerably more that WIFE’s, but WIFE is younger and her employer will continue to contribute 10.5% of her income into her retirement plan.  The SM viewed this factor to weigh “slightly” in favor of HUSBAND.  We view this factor as neutral.

Factor (7)

            The SM recognized that this factor should be weighed in favor of WIFE due to her historic role as primary homemaker.  We agree, but we will weigh this factor even more heavily in WIFE’s favor than did the SM.  We do so because WIFE also worked and earned income in addition to her role as primary homemaker.  In addition, there were times when HUSBAND was absent due to his military commitments.  During this period of time, WIFE earned money, she performed all necessary homemaking duties and she raised children by herself.  We certainly do not depreciate HUSBAND’s efforts in serving our country during these periods of time, but as it relates to equitable distribution, we will weigh WIFE’s unilateral maintenance of the so-called “home front” as significantly impactful.  Like the SM, we will weigh this factor in favor of WIFE, and we will weigh it heavily. 

Factor (10)

            The SM determined that the “current economic circumstances” of the parties are neutral.  WIFE believes that her willingness to accept possession of the marital home and the fact that HUSBAND allowed that home to deteriorate should weigh in her favor.  In support of her argument, WIFE provided photographs. (See, Exhibit 217).  However, she admitted that the interior of the home was kept “fairly well” and that HUSBAND’s medical condition made it difficult for him to maintain exterior areas of the home. (N.T. 80).

            As it relates to the marital home, its value was determined via a bona fide offer made before the condition of the home deteriorated due to HUSBAND’s lack of upkeep.  The condition of the home and who did what to maintain it is simply not a factor that we believe should be considered.  We therefore reject WIFE’s argument that this factor should be weighed in her favor.

Factor (11)

            This factor pertains to the parties’ responsibility to care for “dependent” children.  Because all of the parties’ children were over the age of 18 at the time of separation, the SM determined that this factor was “neutral”.  We do not agree.

            Parents do not stop being parents when a child turns 18.  Even though Pennsylvania law does not impose a legal duty upon parents to pay child support for a college-aged child, it is an economic reality that most college-aged children are dependent upon one or both parents until they graduate and enter the so-called “real world.”  We consider the language used by the General Assembly in equitable distribution factor (11) to be important.  The General Assembly could have easily used the words “minor children” in this factor; they instead chose the words “dependent children”.  The difference transcends mere semantics.  We believe that Pennsylvania law was crafted to require a court to consider parents’ contributions to college-aged children who are still “dependent” on those parents. 

            In this case, the parties’ youngest daughter resided with WIFE following separation.  This is a dynamic that we cannot ignore.  In addition, both parties co-signed college education expense loans for their daughters.  Specifically, WIFE co-signed for $66,700.00 in college debt for Arielle and Abigail.  HUSBAND co-signed for $31,000.00 in debt relating to Abigail.

            To be sure, the college loans co-signed by the parties are contingent liabilities; the parties themselves will be required to pay only if their daughters default.  Still, those co-signed loans will show up on any future credit applications, and the contingent responsibility to pay is a financial reality that will follow both HUSBAND and WIFE into the future.  The fact that WIFE’s contingent liability is far greater than that of HUSBAND is something we must also consider.

            We will weigh equitable distribution factor (11) in favor of WIFE.  By itself, this is not so significant as to require us to establish a percentage of distribution favoring WIFE.  However, it does help offset some of the factors that weigh in favor of HUSBAND.

• Summary of Percentage Distribution

            We view HUSBAND and WIFE as a quintessential Lebanon County married couple.  Both HUSBAND and WIFE worked as a team to raise children and acquire a portfolio of marital assets.  To be sure, the roles of both team members were different, and those roles shifted as time went by.  However, neither HUSBAND nor WIFE could have done it all alone.  Together, HUSBAND and WIFE accomplished things that most other married couples would view with envy. 

            In the opinion of this Court, it would not be appropriate to disproportionately divide marital assets in favor of either HUSBAND or WIFE.  While some factors of the equitable distribution statute favor HUSBAND, others favor WIFE.  In the end, we conclude that all offset one another.  We will therefore establish a 50-50 percentage distribution paradigm.  WIFE’s exception as to the 55%-45% scheme adopted by the SM will therefore be sustained. 

• Marital Debt

            Not surprisingly, HUSBAND is satisfied with the decision that he receive a larger percentage of the marital assets.  His complaint is that SM assigned the debt between the parties equally, and that “frustrates” the 55/45 distribution.  HUSBAND contends that WIFE should assume 55% of the debt to stay consistent with the distribution of the assets.

            WIFE asserts that classifying the parties’ debt as “marital” gives the court the authority to divide the debt as it sees fit.  Drake v. Drake, 725 A.2d 717 (Pa.1999); Biese v. Biese, 979 A.2d 892 (Pa. Super. 2009).  WIFE noted that the only marital debt was the mortgage and the HELOC, which totaled about $5000.00^[6], and HUSBAND was required to pay $2,500.00.  She avers that even if WIFE was assigned 55% of the debt, that would mean that HUSBAND would be required to pay $2,250.00, and that is a de minimis amount and is within the discretion of the SM to determine in his distribution scheme.

            Debts that accrue jointly prior to separation are marital debts.  Duff, supra at 371.  The SM had discretion to distribute marital expenses among the parties when considering the whole distribution scheme.  Winters v. Winters, 512 A. 2d 1211, 1216 (Pa. Super. 1986).  We do not believe the SM erred in dividing marital debt equally, especially since that percentage has now been adopted with respect to marital assets.

• Valuation and Distribution of Personal Property

            There were numerous Exceptions^[7] that contest the value and the distribution of the personal property.  Frankly, some of the claims were petty arguments over property that has little to no value.  The number of items, two separate appraisals, and discrepancies in the SM Report cause us confusion as it relates to personal property.  We have attempted to sort it all out, but we acknowledge that our decision will require the parties to sell items for less than their utility-value.  When the parties receive pennies on the dollar for items at auction, we say this: “You reap what you sow.”

• Value of Personal Property

The situation involving the parties’ personal property is confusing.  Both HUSBAND and WIFE procured separate personal property evaluations.  One was undertaken by Kleinfelter’s Auction.  Another was undertaken by Roy Shirk.  Unfortunately, the evaluations did not include the exact same items. ^[8]

In her brief, WIFE asserts that the SM made a mathematical error when evaluating personal property awarded to HUSBAND.  According to WIFE, the personal property awarded to HUSBAND should have been valued at $2,865.00, which exceeded the SM’s determination by $926.50.  In addition, WIFE asserted that fifteen (15) items of personal property possessed by HUSBAND were included in the Kleinfelter’s Auction evaluation but were omitted from the one undertaken by Roy Shirk.  To further add the confusion, the SM’s Report contained a list of personal property that was not identical to either the Kleinfelter’s or Shirk appraisals.  In fact, several items were found on both property appraisals but did not make their way into the SM’s list of personal property considered for equitable distribution. 

In his report, the SM included an omnibus provision regarding personal property that was not specifically awarded to either HUSBAND or WIFE.  At Page 23 of his report, the SM stated:

“The balance of any personal property not awarded to either party, be sold at a public auction with a mutually agreeable auctioneer.  If the parties cannot agree on an auctioneer, each shall submit a name to the Special Master who will make a decision which shall be binding upon the parties.  The cost of the auction be shared equally between the parties and the net proceeds be divided equally pursuant to their agreement.  If the parties are unable to obtain an auctioneer, they shall agree as to the method of disposition of the personal property with the cost of the same being shared equally and the proceeds be equally divided pursuant to their previous agreement.”

            A specific issue arose with respect to a 2008 New Holland tractor.  This tractor was appraised at $4,250.00.  HUSBAND reportedly sold the tractor post-separation and received $4,000.00 for it.  The SM did not include the tractor in his list of personal property awarded to HUSBAND, but he did add the $4,000.00 that HUSBAND received from the sale of the tractor in his list of marital assets. 

            We will not disturb the SM’s distribution of personal property scheme.  To the extent that the personal property distribution list is confusing, the parties have no one but themselves to blame.  The SM did a commendable job trying to sort through everything.  We will respect his efforts and adopt his conclusions.  That said, we will for the sake of clarity make sure that HUSBAND’s share of the marital estate will include the $4,000.00 he received for the New Holland tractor.  Implicit in our decision to adopt the SM’s decision is the recognition that all marital person property other than what is specifically awarded will have to be sold, with the proceeds to be divided equally.

• Vehicle Ramps

            The SM awarded HUSBAND a set of vehicle ramps (at no value).  The SM also concluded in his Report (page 19) that WIFE’s father’s tools were non-marital property.  HUSBAND requested the vehicle ramps (SM Report at page 14).  WIFE claims that the ramps were a part of a lot “miscellaneous tools” that she inherited from her father.

            Clearly the SM declared that the inherited tools are non-marital property of WIFE.  If the ramps were part of that lot, they should be classified as “tools”.  The problem is that neither appraisal specifically mentions vehicle ramps.  There is an email to WIFE’s Attorney from Ken Horst at Kleinfelter’s, enumerating items that were part of “Miscellaneous Tools”, in their appraisal (Exhibit 63).  The ramps are not on the list, and we are not convinced that these are the same “miscellaneous tools” that WIFE is referring to that would have belonged to her father.

            In her brief WIFE did note that she sent a letter to the SM on February 6, 2023, stating that HUSBAND had removed the vehicle ramps from her father’s tool collection (Exhibit 219).  On February 8, 2023, Attorney for HUSBAND replied and admitted that HUSBAND did retain the ramps.  HUSBAND “kindly” asked that the ramps be awarded to him as personal property.  He indicated that they had not been appraised due to their age and condition, but he never admitted that they had been part of WIFE’s father’s tools.

            The minimal value of the ramps illustrates the pettiness between the parties.  Moreover, we cannot imagine that old vehicle ramps could have “sentimental value” to WIFE.  This Court does not think WIFE would have requested the vehicle ramps be returned to her unless she is convinced that they belonged to her father.  We suspect that HUSBAND is well aware that the ramps originally belonged to WIFE’s father, but he chose nevertheless to retain those items to deprive WIFE of their use.  We will order the vehicle ramps should be given to WIFE, and we do so knowing that the cost that will be expended to return them to WIFE will be greater than their value.

• Photographs and Video Footage from Hidden Cameras

            HUSBAND was obsessed with proving that WIFE undertook an emotional and physical affair with her co-worker.  He therefore had hidden cameras installed in the home.  HUSBAND introduced photos from the cameras at the hearing.^[9]  WIFE said that was the first time that she learned about the hidden cameras, and she estimates that HUSBAND had been taking photos of her, without her knowledge or consent, for over a year and a half.  WIFE claims that she requested an award of all photos taken with the hidden cameras, but the SM’s Report was silent on the ownership of the photos.

            We do not agree that the SM’s Report was silent about the photos.  SM awarded WIFE Fair Rental Value because he found that WIFE left the marital residence for good reason.  Essentially, the SM found that HUSBAND drove her from the residence with his insistence that WIFE was having an affair, searching her internet history, looking at her cellphone, tracking her by GPS, changing the locks, and “installing hidden cameras”.  Also, in the distribution of the marital property under “Miscellaneous”, it states that HUSBAND is to deliver to WIFE all family photos and videos within 30 days after the final divorce decree. (SM’s Report pages 28, and 43). 

            Even though the SM’s Report mentioned the surreptitious photos/video, the SM did not order that the results of the surveillance be turned over to WIFE.  We will rectify that oversight.  Our Court Order will specifically direct that HUSBAND turn over all photographs, videotape, DVD’s, GPS tracking documentation or any other depictions or documentation that HUSBAND possesses as a result of his surreptitious surveillance of WIFE.  We will also direct that HUSBAND not retain copies of anything he turns over to WIFE.  These directives will be entered with a warning to HUSBAND that he WILL be punished via the contempt powers of this Court if he does not fulfill his obligation relative to the surreptitious surveillance information and depictions that he gathered. 

1. Vehicles

            The SM’s report mentions several vehicles.  The SM determined that a 2013 Chevy Sonic vehicle was non-marital property belonging to the parties’ daughter Arielle. (SM Report at pages 12, 19 and 43).  The SM similarly determined that a 2012 Toyota Highlander vehicle was non-marital property. (SM Report at pages 19 and 43).  In addition, the SM stated that a 2014 Honda CR-V was also non-marital property belonging to the parties’ daughter Abigail. (SM Report at page 12). 

            Apparently, WIFE sold the 2013 Chevy Sonic after separation and received $8,000.00 as a result.  This $8,000.00 figure was retained by WIFE.  The SM instructed WIFE to use these funds to purchase another vehicle for Arielle.  (SM Report at pages 12, 19 and 43). 

            Confusion existed as a result of the SM’s apparent transposition of the 2012 Toyota Highlander and the 2014 CR-V.  The SM listed the Toyota Highlander vehicle as part of WIFE’s marital assets. (SM Report at pages 23, 25 and 39).  However, the SM also characterized the 2012 Toyota Highlander as non-marital property. (SM Report at pages 19 and 43).  This was confusing to the parties and to the Court. 

            After reviewing the totality of the SM Report, we determine that the SM intended that the value of the 2013 Chevy Sonic should belong to Arielle and the value of the 2014 Honda CR-V should belong to Abigail.  As such, we conclude that the SM intended to declare both the Honda and Chevy vehicles to be non-marital property that were gifts from the parties to their children.  On the other hand, the 2012 Toyota Highlander was never characterized as a gift or belonging to another family member.  We therefore conclude that the SM made a typographical error when he included the Toyota Highlander as non-marital property. We conclude that the SM intended to declare the Highlander vehicle as marital property belonging to WIFE. 

            The situation involving the Chevy Sonic is a bit more difficult.  If in fact the Chevy Sonic was non-marital property belonging to Arielle, then WIFE should not have legitimately retained $8,000.00 from the sale of that vehicle.  On the other hand, Arielle is not a party to this litigation, and she has not asserted a formal legal right to possession of the $8,000.00 retained by WIFE.  In order to effectuate economic justice regarding the $8,000.00 proceeds from the sale of the Chevy Sonic, we will afford WIFE with an opportunity to provide proof that either: (1) $8,000.00 has been provided to Arielle; or (2) Arielle is satisfied that nothing should be owed to her.  In absence of such proof, we will declare the $8,000.00 to be a marital debt from the parties to Arielle and we will require WIFE to pay the entire amount of that debt. 

• Clint the Horse

            During the marriage, the parties owned two horses that they boarded at the marital residence: “Clint” and “Moon”.  Neither horse was afforded any monetary value by the SM.  When the parties separated, WIFE took Moon with her.  Clint remained at the marital residence.  Thereafter, the parties each provided boarding, food and other necessities for the horses. 

            The SM awarded both horses to WIFE.  HUSBAND objected because he wanted to retain possession of Clint.  WIFE points out that the SM awarded her the horses because she will possess the marital residence and the horses can be boarded there far less expensively than they could be boarded somewhere else.  As it relates to future care of Clint, HUSBAND provided no specific alternative plan. (N.T. 469-471). 

            Clint is 37-years old.  It is unlikely that he will survive much longer.  Allowing Clint to live out the rest of his days at the home he has known for years seems to be the most compassionate and logical approach.  HUSBAND’s request for possession of Clint will be denied.

• Sun Dolphin Kayak, Accessories, and Wrought Iron Chairs

            This request is confusing because the SM awarded HUSBAND a kayak (SM’s Report page 37) and valued it at $125.00.  The Sun Dolphin kayak is the only kayak mentioned in both personal property appraisals.  The issue may be that the paddles, life jacket, and roof mounts were not mentioned.  In her reply to HUSBAND’s Exceptions, WIFE said that she has no objection to HUSBAND having those items if it is accounted for in HUSBAND’s marital property values. The kayak accessories seem to be a non-issue now, but WIFE is instructed to give HUSBAND the paddles, life jacket, and roof mounts if she has not already done so.

            As for the wrought iron chairs, they are not on the marital property list.  Both parties desire to possess the chairs.  HUSBAND was awarded a wrought iron love seat and coffee table valued at $25.00.  Presumably the chairs match those two items.  WIFE wants them because they are currently inside the marital residence, and she would like them to stay there. 

            The chairs have little value.  If the parties cannot agree on how the items are to be divided, they should be sold at auction.^[10]

• Credits Awarded by the Special Master

            The parties dispute many of the recommendations by the SM for credits that were awarded.  In no order of importance, we will discuss WIFE’s Exceptions 4 and 6, and HUSBAND’s Exceptions 7, 8, 9, 10, 11, and 12.

• Cost of the Second Personal Property Appraisal

            The SM awarded HUSBAND credit for the personal property appraisal done by Roy Shirk.  After the parties could not come to an agreement on the value of their personal property, they agreed to hire Kleinfelter’s to do an appraisal.  The parties split the cost of that appraisal.  HUSBAND was not satisfied with the first appraisal, and he hired Roy Shirk to do a second one. 

            WIFE does not believe that HUSBAND should get credit for the second appraisal because she did not agree to it and the two appraisals were not remarkably different.  WIFE also claims that during testimony she was instructed by the SM that she would not be financially responsible for the second appraisal.

            Looking at the transcript this Court agrees with WIFE that the SM indicated that HUSBAND would be solely financially responsible for the second appraisal (N.T. 133-134).  Attorney Gallo for HUSBAND asserted to the SM that HUSBAND never agreed to use Kleinfelter’s for the personal property appraisal, and it is not whom he wanted to do the appraisal.  Attorney Gallo said, “He understands if he’s getting his own appraisal he’s paying for it.”.  The SM responded, “Right.  Let’s do it that way.”.  Attorney Burkett for WIFE added, “That’s fine as long as she’s not going to be charged for it because—” (then the SM took the conversation in the direction of recommendations for whom should do the second appraisal).

            We find that the SM determined that HUSBAND should be solely responsible for paying for the second personal property appraisal.  The award for $500.00 credit for HUSBAND for the cost of the second appraisal will be removed.

• Animal Care

            The SM awarded HUSBAND a credit of $2,652.62 for his care of the horse, Clint.  As noted above, WIFE took possession of Moon when the parties separated, and she paid to have the horse boarded elsewhere.  WIFE’s argument is that she paid more for pet care, because she had to pay for boarding for the other horse, and she had expenses for care of the dog.^[11]  She either wants HUSBAND to get no credit, or she wants to get a credit equal to his so that they offset.

            WIFE admits that she did not bring this issue up at the hearing because she felt that it was petty.  We cannot disagree with the notion that arguing over animal and pet care can be “petty”.  Still, the SM did award HUSBAND with a credit for $2,652.62 that was expended to provide care for the parties’ horse, Clint.  We disagree with this decision. 

            The parties owned two (2) horses during their marriage.  At separation, HUSBAND retained possession of Clint and provided care for him.  WIFE took possession of Moon and provided care for that horse.  Because each party received possession of a horse and provided care for that horse, we do not believe that monetary compensation should be paid by either party to the other for care of horses. No credits will be awarded to either party for care of animals.^[12]

• Credit Card Debt and Unreimbursed Medical Bills

            The SM found that WIFE was entitled to a credit of $2,976.98 for payments on two credit cards, and $2,520.00 for unreimbursed medical expenses. (SM Report page 41).  HUSBAND argues that WIFE should not be given credit for paying off two credit cards after separation, because she was the only one using the cards and she used some of the proceeds to pay legal fees.  WIFE claims that the credit card debt was accrued before separation, and she paid the balances off after separation. 

            HUSBAND asserts that WIFE should not get credit for paying unreimbursed medical expenses because he was providing her health insurance coverage after separation, and she was still using his HSA^[13] card.  He also argues that he obtained the health insurance, when he did not need it for himself, and that he should get a credit for $1,104.24 for the payments made on behalf of the WIFE following separation. 

            WIFE agrees that HUSBAND paid her medical insurance premiums, because he was required to per a Domestic Relations Order. (Ex. 49).  WIFE claims that she reimbursed HUSBAND for her insurance until the support hearing.  She also noted that she was permitted to utilize HUSBAND’s HSA as part of the Domestic Relations APL Order (Ex. 49).  The APL Order was entered February 5, 2021, and HUSBAND paid WIFE’s health insurance until June 14, 2021, when WIFE asked for it to be terminated because she started receiving her healthcare insurance through her employer.   WIFE stated that she had an outstanding medical bill of $2,520.00 at the time of separation, which she paid off after separation.  She argues that the medical bill was marital debt, and both parties are responsible for it.  Duff v. Duff, 507 A.2d 371 (Pa. 1986).

            Reading through the relevant portions of the transcripts and looking at the exhibits, the facts are on WIFE’s side. (N.T. 310-313, 465-469, 564-565). This Court finds that both the credit card and the medical expense were marital debts.  As such, we will add $5,496.98 to the ledger of marital debts, and we will credit WIFE for the $2,748.49 that she paid to satisfy HUSBAND’s share of that debt.  HUSBAND’s request for a credit for $1,104.24 for the payments made on behalf of the WIFE following separation is denied because he was under obligation to do so per the Domestic Relations APL Order.

• Vocational Expert

            The SM found that WIFE is entitled to $1500.00 for a Vocational Assessment by Brian Bierley, and another $1500.00 for his expert testimony at the hearing.  WIFE hired Mr. Bierley to do a vocational assessment on HUSBAND after he quit his job and was not seeking other employment.

            HUSBAND does not believe that he should have to share the costs of paying for an expert that WIFE chose to employ.  He stated that WIFE is insisting that he shoulder a portion of the costs because he would not agree to submission of the report.  HUSBAND argues that he did not agree to the submission of the report because he would not have been afforded the right to question the findings of the report.  He asserts that the report was solely for the benefit of WIFE, and she did not submit a request for the expert fees by the conclusion of the hearing.

            WIFE points out that she requested reimbursement for the expert fees in her initial brief.   She notes that Mr. Bierley’s bill was submitted at the conclusion of the hearing.  She contends that she hired Mr. Bierley with the intention that he would testify at the Hearing.  WIFE argues that the assessment was not solely for her benefit, because HUSBAND had quit his job and had filed a claim for alimony against WIFE.  She noted that the SM relied on the vocational assessment in determining that HUSBAND was capable of self-support. (SM Finding of Facts pages 16,33). 

            WIFE did request reimbursement for a total of $3,000.00 for the expert’s report and testimony. (SM Report page 29). HUSBAND asked for alimony, and he willingly submitted to the assessment by Mr. Bierley. (Exhibit 200).  WIFE was entitled to defend against HUSBAND’s assertion that he was unable to work. She asserts that since she was successful in defending her claim that HUSBAND is able to work, equity demands that he share in the cost of the assessment.

Counsel for HUSBAND cross-examined Mr. Bierley to assure that he had considered the Physician’s Verification Form and information from the Veteran’s Readiness and Employment Program.  Mr. Bierley stated that he did, and it did not change his conclusions on HUSBAND’s earning capacity, even with the disability and limitations. (SM Report page 10). HUSBAND objects to sharing in the cost of the evaluation.

            Generally speaking, a party who procures an expert witness should be responsible for paying the cost thereof.  However, when an expert report is generated and a request is made that the report be admitted in lieu of live testimony, we can consider the reasonableness of the demand for live testimony when determining how the cost of such testimony should be allocated.  In this case, HUSBAND demanded that Mr. Bierley testify in Court.  When this occurred, it was obvious that Mr. Bierley was aware of HUSBAND’s medical issues; the cross-examination of Mr. Bierley by HUSBAND’s attorney made this perfectly clear.  In the end, requiring Mr. Bierley to testify in person did not provide the SM with new or materially different information from what was in the report.  As such, we will order HUSBAND to pay the $1,500.00 testimony fee.  WIFE will remain responsible for paying the entire amount necessary for Mr. Bierley to draft a written report.

• Real Estate Appraisals

            As will be discussed in more detail below, the parties had separate real estate appraisals completed.  The SM granted WIFE a $750.00 credit for the difference in the price between the two appraisals.  HUSBAND argues that he should not be penalized because WIFE chose an appraiser who charged more.  WIFE noted that HUSBAND chose to rely upon the appraisal obtained by WIFE, but he does not want to make any contribution to the extra cost of that appraisal. 

From a very general perspective, we believe that a party who hires an expert should be required to pay the costs of the expert’s opinion.  If one of the parties’ experts charges more for an opinion, so be it.  It sets a bad precedent for courts to equalize the cost of expert testimony, because that would incentivize parties to hire more numerous and/or more expensive experts.  We will reject the SM’s decision to afford WIFE with a $750.00 credit based upon her choice of a more expensive expert witness. 

• Stimulus Refunds

            After separation the parties received COVID stimulus checks. HUSBAND stated that WIFE shared proceeds from the first two checks with him in their joint account.  Subsequently, WIFE closed that account, and she received at least one more stimulus check.  HUSBAND claims that she received a total of four (4) stimulus checks, and that he never received any of the funds from the latter two.

            Testimony regarding the stimulus payments was not completely clear.  Most of what we gleaned came from WIFE because she actually sought and received the funds.  WIFE stated that she received a check for $1,400.00, and she paid HUSBAND $700.00 out of that amount. She said that she received another stimulus money check for $4,200.00 for three people that were on their 2019 tax return: HUSBAND, WIFE, and their daughter Abigail.  WIFE claims that she paid HUSBAND $1,400.00 from that check.  She admits that she received a third check for $700.00 based on her 2020 tax return, which was an individual return, and the money went into her personal checking account.   WIFE states that she never received a fourth check. 

            Based upon everything presented, we conclude that the parties collectively received $6,300.00 in Federal stimulus payments.  It is also apparent that almost all of those amounts were paid by the Federal Government for periods of time when the parties were together as a couple.^[14]  In addition, the parties agree that HUSBAND received $2,100.00 from these Federal payments and WIFE received the remaining $4,200.00. 

            We consider the entire $6,300.00 Federal tax stimulus payments to be marital property.  As such, HUSBAND should be entitled to 50% of the payments, or $3,150.00.  Because HUSBAND received only $2,100.00 from these payments, he should be entitled to receive another $1,050.00 so that the stimulus receipts are equalized.  Such credit will be a part of our final equitable distribution award.

• Discover Bank Account

            Emblematic of the parties’ dysfunctional relationship is how they handled a joint Discover Bank account.  The parties agreed that they separated their finances in August of 2019, roughly one (1) year prior to separation.  (N.T. 45, 448).  Initially, the parties each agreed to pay a portion of marital debt from their own individual accounts.  However, WIFE claims that HUSBAND stopped paying his share in mid-2020.  Accordingly, WIFE stated that she withdrew $4,804.96 from a joint Discover Bank account and used that amount to pay the outstanding marital debt.  WIFE testified that she detailed for HUSBAND in writing why she withdrew the money and for what it would be used. (N.T. 66-67, 131-132; Exhibit 14A, Exhibit 55).  WIFE also pointed out that shortly after she withdrew money from the Discover Bank account, HUSBAND removed $33,095.59 from the same joint account and transferred it into his personal savings account.  (N.T. 273-280; Exhibit 105; Exhibit 107). 

The SM’s report is confusing regarding the above sequence of events.  On page 17 of his report, the SM lists HUSBAND’s request for reimbursement of the amount WIFE withdrew from the Discover account.  At page 30 of the SM report, under the sub-heading “Additional Credits/Reimbursements”, HUSBAND’s request for reimbursement of the amount WIFE withdrew from the Discover account was again listed.  Thereafter, the SM stated: “The Special Master does not find HUSBAND’s testimony persuasive regarding additional credits requested.  As a result, the recommendations will not include any additional credits for HUSBAND other than as set forth herein.” (SM Report at page 30).  In the conclusion of his report, the SM omitted any reimbursement to HUSBAND for the amount withdrawn by WIFE from the Discover account.  

Our own independent review of the record reveals the following:

• At the time of the hearing before the SM, the Discover Bank account contained $3,575.28.  On July 16, 2019, WIFE withdrew half of this amount, or $1,790.76.
• In October of 2019, HUSBAND started using the Discover account as his own.  (N.T. 63-64). He apparently deposited at least $10,000.00 post-separation into the account.  On paper, the account was still considered to be jointly owned by the parties. 
• HUSBAND testified that he used the Discover account as his primary savings account.  At page 15 of his report, the SM noted that $33,095.59 was “contributed” to this account by HUSBAND. 
• On September 30, 2020, WIFE withdrew $4,804.96 from the joint account, claiming that is what HUSBAND owed for unpaid marital expenses. (N.T. 66-67). 
• According to exhibits presented at the SM Hearing, HUSBAND removed $33,09559 from the Discover Bank account in 2020 and transferred it to a personal savings account. (Exhibit 105; 107).

Although we confess that our confidence level regarding the Discover Bank account is not as high as we would like, our conclusion is that most of what took place with the account occurred after separation.  As best as we can discern, the parties equally divided the amount contained in the account as of separation. Thereafter, HUSBAND alone continued to contribute money into the account.  Because WIFE’s name remained on the account, she removed $4,804.96 and used it to pay marital debts.  If in fact this money was used to pay marital debts – and we believe the quantum of evidence supports this – the net effect is that HUSBAND’s post-separation contributions to the account were used to pay marital debts owed by both parties.  Effectively, HUSBAND paid not only his share of those marital debts, but also WIFE’s share.  Any final decision we render must reflect that reality.

We will consider the $4,804.96 payment of debt from the Discover Bank account to be an act by HUSBAND to pay marital debt post-separation.  Because one-half of that debt benefitted WIFE, HUSBAND should be entitled to some consideration of this reality. 

• Loan to Arielle

            The parties gave their daughter Arielle $10,000.00 to help her purchase a home.  WIFE executed a Gift Letter that was provided to the lender for her to secure a mortgage.  HUSBAND contends that the parties and Arielle intended for this to be an interest-free loan and that it was to be paid back as Arielle was able to do so.  HUSBAND claims that Arielle did make payments on the “loan” and that the balance that she owed was $7,600.00 at the time of separation.  He stated that WIFE unilaterally forgave the loan after separation.  HUSBAND is asking for $7,500.00 to be included as a loan receivable in the marital assets.

            WIFE contends that the money for her daughter’s mortgage was a gift.  She admits that there was some discussion about the daughter paying them back, but that both parties told her not to make any payments.  WIFE asserts that before the parties separated, she told Arielle not to make any payments because HUSAND and WIFE had an agreement that the money was a gift.  The SM agreed with WIFE and found the money given to Arielle to be a gift.

            WIFE cites Tate v. Conner, 135 A.2d 799 (Pa. Super. 1957), and Mermon v. Mermon, 390 A.2d 796 (Pa. Super. 1978) and asserts that the law is settled that funds provided from a parent to a child are presumed to be a gift, and that the presumption of a gift must be overcome by clear and unequivocal evidence to the contrary.  The Court in Mermon indicated that there needs to be writings, documentation, or clear and unequivocal statements to rebut the presumption they money was not a gift.  Id at 799.  In Banko v. Malanecki, 451 A.2d 1008, 1010 (Pa. 1983), the Pennsylvania Supreme Court determined that once prima facie evidence of a gift is established, a presumption exists that the gift is valid unless rebutted with clear, precise, and convincing evidence. (citing Estate of Clark, 359 A.2d 777 (Pa. 1977)).

            In the instant case, Exhibit No. 54 is a “Gift Letter” for the funds given to the daughter, and this was presented to the lender.  The third clause of the Gift Letter states, “No repayment of the gift is expected or implied in the form of cash or future services by the recipient.”  During her testimony at the SM Hearing, Arielle said that she was “gifted” $10,000.00 from parents. (N.T. 9-12).  This is prima facie evidence that the money given for her to purchase her home was a gift.

            Arielle stated that here was some discussion with her parents about Arielle paying back the money “if” she had the ability to do so.  She did make some payments to them for about a 7-month period.  Arielle testified that neither parent made a demand for repayment, and her mother told her not to worry about paying them back.  She indicated that she and her father no longer communicate directly, but she does get texts from him and he has never asked for the money to be repaid.  Arielle would like to pay her parents back, but she testified that she is currently financially unable to do so.  (N.T. 9-13, 21-23).  Other than his own testimony, HUSBAND has not offered evidence to rebut the presumption that the funds were a gift to Arielle. 

            The SM was present to hear the testimony of the parties and Arielle related to the $10,000.00 contribution.  He obviously accepted the testimony of WIFE and Arielle to be credible.  He thus rejected HUSBAND’s argument that $7,500.00 of the amount contributed to Arielle should be listed as a loan.  We will not disturb the SM’s credibility determination. The entire amount contributed by the parties to Arielle for her house will be considered a gift that should not be included as part of our equitable distribution decision.

• Rental Value of the Marital Residence

            HUSBAND argues that SM erred and/or abused discretion in granting WIFE one half (1/2) fair market rental value in the marital residence, when she voluntarily vacated it.  The SM acknowledged that the idea of fair market rental value is a controversial one, and he spent considerable time in the SM Report laying the legal foundation for his decision.  HUSBAND and WIFE also presented their legal arguments on this issue.

            In Butler v. Butler, 621 A.2d 659, 668 (Pa. Super 1993), the Superior Court determined a scheme of equitable distribution may include a credit for one half of the rental value of the marital home to the non-possessing spouse.   However, that credit is not mandatory, and it may be offset by non-possessing spouse’s share of the costs of maintaining the marital home (i.e., mortgage, taxes, insurance, and maintenance). Id.   

            HUSBAND acknowledges that the SM has the discretion to award rental credit to a dispossessed spouse.  However, he argues that there can be equitable defenses against awarding credit.  Trembach, supra at 37.  HUSBAND cites Rhen v. Rhen, Lebanon County Court of Common Pleas Docket No. 2007-20502 (2010), finding that a spouse could not be considered dispossessed if he/she leaves the home without apparent justification.  He asserts that WIFE has unclean hands because she alienated affection by withdrawing from HUSBAND.  He insists that WIFE was having an affair with her co-worker.  HUSBAND claims that WIFE planned to leave the residence so she could pursue an extra-marital affair.

            WIFE argues that it was HUSBAND who alienated her with his constant allegations of infidelity and by breaching the marital trust by his surveillance of her. She claims that his behavior became threatening to the point that she purchased a handgun for protection against him.  Furthermore, WIFE avers that he changed the locks on the door and would not allow her to return to the residence.  WIFE insists that she was not having an extra-marital affair.

            This Court is reluctant to award rental credits when the parties have elected to live separately.  One inevitable consequence of one spouse moving out of the marital home is that there will be extra expenditures for setting up separate residences.  It is one of the “costs” of divorcing.

In this case, HUSBAND was, for a period of time, able to retain possession of the marital home after separation.  He was also responsible for paying the mortgage, taxes and other expenses pertaining to his possession.  Effectively, HUSBAND paid for the privilege of living in a house, just as he would be responsible for paying the cost of living in any structure following separation.  More recently, possession of the marital house was turned over to WIFE, and she began paying expenses pertaining to the structure.  As with HUSBAND, WIFE paid for the privilege of living in the home.

The goal of §3502(a) is to equitably distribute the marital property, without regard to marital conduct.  We are reluctant to inject marital fault into the cauldron of equitable distribution under the guise of a rental value analysis. 

            Under the facts of this case, we will not award fair rental value for the marital home.  Neither will we award HUSBAND or WIFE with credits for the amount each paid in return for the privilege of living in the marital home.  We therefore grant HUSBAND’s exception that objected to the SM’s award of rental credit to WIFE relative to the marital home.  This approach is consistent with our recent decision in Tobias v. Tobias, C.P.Leb.Co. 2019-20625 (August 7, 2023), and with the reality that people who live in a marital residence should be expected to pay for that privilege.

• HUSBAND’s VA Disability Income

            HUSBAND receives a VA disability pension.  He receives an additional benefit of $147.33 per month based on his marital status.  From October 1, 2020 to July 31, 2022 HUSBAND received an additional $395.00 per month for spousal and dependent payments.  The SM determined that WIFE was entitled to a reimbursement of $8,690.00, for the latter, and entitled to a reimbursement of $147.33 per month from October 1, 2022 to Final Decree.

            HUSBAND argues that under 23 Pa. C.S.A. §3501(a)(6), veteran’s benefits are excluded from marital property.  He asserts that a veteran’s benefits may not be considered marital property, because they attach uniquely to the veteran for individual service to the country.  Williams v. Williams, 31 Pa. D&C. 3d 682, 683-684 Northumberland County Pa. CP 1983).  WIFE does not dispute that his VA disability payments are non-marital property, and she states that she is not requesting a portion of his benefits.  Instead, she is arguing that the purpose of the spousal and dependent payments is to inure a benefit on the spouse and children.  WIFE argues that since the funds were not spent for the benefit of her and the children, she should be awarded credits equal to the funds set aside for benefit of the WIFE and dependent children. 

            The parties agree that HUSBAND’s disability income is non-marital property for equitable distribution.  We agree with WIFE that the added payments were/are to help support dependents and spouse. There is a federal mechanism under 38 U.S.C.A. § 5307 that would allow an apportionment of the veteran’s disability payments to the spouse and/or dependents if it can be shown that the veteran is not supporting them. See also, Batcher v. Wilkie, 975 F.3d 1333 (Fed. Cir. 2020).

            We are reluctant to indirectly award WIFE with relief that she could have sought directly but chose not to.  As we have mentioned numerous times within this Opinion, the parties did endeavor to amicably separate their financial interdependence when separation occurred.  To be sure, disagreements arose regarding financial issues, many of which have been chronicled in this Opinion.  However, HUSBAND did undertake financial responsibilities to preserve marital assets and financial resources were expended to or for the benefit of the parties’ children.  Without conducting a lengthy hearing regarding the specific amount that was paid in VA benefits for his family and whether and how those payments were used, it would be very difficult for us retroactively assess a credit.  Given that WIFE could have complained earlier to the Veteran’s Administration and chose not to do so, we will simply not dive into this rabbit hole.  WIFE’s request for reimbursement of VA Disability payments will be denied. 

•  Fair Market Value of the Marital Residence

            HUSBAND procured a real estate appraisal by Rick Clay in July 2021, and Clay calculated the value of the property at $475,000.00.  WIFE obtained an appraisal in September 2021 from Frank Tomecek, Sr., and he calculated that the property to be worth $640,000.00.  HUSBAND claims that the parties stipulated that WIFE’s appraisal was more representative of the fair market value.  HUSBAND also provided testimony that the parties received a bona fide offer on the home by a third party for the sum of $609,000.00 with 2.5% seller assist^[15].

            The SM elected to take an average of the two appraisals and determined the value of the property to be $557,500.00.  He put emphasis on the fact that the appraisals were only done a few months apart from each other. (SM’s Report, page 11). 

            The Divorce Code does not set forth a specific method for valuation of assets, but the goal is to create an equitable distribution that favors “economic justice”.   Smith v. Smith, 904 A.2d 15, 18 (Pa. Super. 2006). In Aletto v. Aletto, 537 A.2.d 1383, 1389 (Pa. Super. 1988), the Pennsylvania Superior Court found that a trial court was within its discretion when it averaged the value of two appraisal amounts for the marital home.  In Wayda v. Wayda, 576 A.2d 1060, 167 (Pa. Super. 1990), the Superior Court determined that the trial court abused its discretion in failing to use an appraisal that was stipulated to by the parties (that court used an average of estimates submitted by each party).

            HUSBAND claims that the parties had stipulated that the higher appraisal is more representative of the property’s value.  WIFE disagrees. She claims that HUSBAND said that he would agree to the Tomecek appraisal if WIFE intended to retain the marital residence.  WIFE said that they stipulated to admitting both appraisals, but they never agreed to use the higher appraisal.  After reading the transcript, we concur with WIFE that the parties never agreed to using her appraisal. (N.T. 149-153).

            No testimony was taken from Mr. Tomecek or Mr. Clay.  Therefore, this Court has examined the two appraisals to make an independent determination of the value of the marital residence. Unfortunately,this jurist is not a qualified real estate appraiser, nor can he determine from the face of either appraisal report whether one or both of the appraisers erred in his analysis. 

            We encountered a similar situation in 2009.  In the case of Davis v. Davis, C.P.Leb.Co. No. 2006-20176 (December 2, 2009), both parties submitted appraisals of a husband’s dental practice.  Husband’s expert evaluated the practice at $276,300.00.  Wife’s expert opined that it was worth $614,500.00.  We stated:

“We cannot in good conscience adopt either of the valuations proffered by [the parties’ partisan experts].  Given the stakes involved – in excess of a third of a million dollars in valuation difference – and given our desire to render a decision based upon reality and not perspective, we will reject both business valuations proffered by both parties.”

In reaching this decision, we specifically rejected an approach that averaged the two valuations.  We stated:

“Although we doubt that the true value of Husband’s business is as high as [Wife’s expert] estimates, or as low as [Husband’s expert] calculates, it is possible that a credible analysis based upon generally accepted accounting principles could yield a result similar to the opinions of one of the current experts.  For us to simply use a figure that “splits the difference” would be to engage in blatant speculation.  We prefer not to do so.”

Ultimately, this Court invoked Pa.R.Ev. 706 and appointed a neutral expert to value the real estate.  That neutral evaluator rendered an opinion that was between the values proffered by the parties’ experts but was much closer to the number proffered by Husband than it was to the one proffered by Wife. 

            We were tempted in this case to invoke Pa.R.Ev. 706 to appoint our own expert to evaluate the parties’ real estate.  However, given the time and cost that would be incurred by yet another real estate appraisal, and given that we have evidence of a legitimate offer submitted for the real estate in 2020, we will not undertake to appoint a neutral evaluator.  That said, we also will not endorse the “split the difference” approach undertaken by the SM, especially since the two appraisals differed so dramatically.^[16] 

            In this case, we have evidence that a third party offered between $595,000.00 and $609,000.00 for the marital property.^[17]  This offer was received in August of 2020, which is relatively close in time to the date of separation.  Given this bona fide offer, we will value the marital residence at $602,000.00 instead of the $557,500.00 that the SM used.^[18]  Of course, like the SM, we must reduce this value by the encumbrance balances.  The SM determined at Page 11 of his report that the mortgage and line of credit balances totaled $353,865.61.  Deducting these balances from the revised valuation results in a net value of $248,134.39.  Because we have chosen to also reduce the home value by the cost of sale (See, Section Z infra), the new net value of the marital home that we will be using for purposes of distribution will be $205,994.39.

• Attorney Fees

            Both parties filed claims for attorney’s fees, costs, and expenses.  HUSBAND requested that all his attorney fees and expenses be paid by WIFE, plus he wants her to pay all the attorney fees and expenses for the contempt hearing.  WIFE requested that HUSBAND contribute to some of her attorney fees and expenses.  The SM denied both of HUSBAND’s requests and denied in part and granted in part WIFE’s request; her total award was $1,500.00.

            The SM was persuaded by testimony that HUSBAND’s filing of the Complaint of Contempt was not justified and caused WIFE to expend funds trying to defeat it (SM’s Report page 52).  The award for WIFE was for the costs and fees of defending the Complaint of Contempt.  As part of the justification for this decision, the SM cited from a Memorandum Opinion by Judge Walter, Russek v. Russek, No.1753-1980:

“…award of counsel fees in a divorce case is not intended to fully reimburse wife for all attorney’s fees she occurred or may incur…but it should be sufficient to prevent the denial of justice for her…”

            HUSBAND argues that the parties’ financial situations should ultimately determine whether the award of counsel fees is appropriate, since it is based on need.  Perlberger v. Perlberger, 626 A.2d 1186, 1206 (Pa. Super. 1993); Harasym v Harasym, 614 A.2d 742, 747) (Pa. Super. 1992).  HUSBAND claims that he exhausted his savings in pursuing his legal rights and he does not have the funds to meet his on-going legal needs and obligations.  HUSBAND insists that he was justified in filing his Contempt Petition because WIFE did not comply with his request for discovery.   Lastly, HUSBAND avers that he is not on equal footing with WIFE for litigation because she makes more than him, he has serious health problems, she is younger than him and she can accumulate more retirement earnings than him.  He believes that at minimum he should be awarded $5,000.00, the difference between what he and WIFE spent in attorney fees for the Special Master’s Hearing.

            WIFE asserts that one of the factors to be considered in awarding attorney fees is the conduct of one of the parties which protract the litigation and increase the expenses of the proceeding.  Jacobs v. Jacobs, 884 A.2d 301 (Pa. Super. 2005); Marra v. Marra, 831 A.2d 1183, 1188 (Pa. Super 2003).  She contends that HUSBAND’s behavior exponentially increased her attorney fees.  WIFE claims that he contested all details of the divorce and distribution, refused to move out of the marital home, filed for APL on two occasions, and filed the Contempt Petition when she had provided all requested information.  She also asserts that she made efforts to reconcile with HUSBAND and then to keep the divorce amicable, but he has acted bitterly and vengefully.  WIFE points out that she earns more than HUSBAND because he quit his job, or they would be on equal financial footing.  She believes that HUSBAND’s own behavior during the proceedings has caused him to have a larger bill for attorney fees than was necessary, and that he should not be rewarded for his choices.

            In our opinion, both parties have been guilty of pettiness and vindictiveness throughout the proceedings.  However, if we were to characterize the total pettiness of both parties to be 100, we would attribute 65 to HUSBAND and 35 to WIFE.  The SM awarded $1,500.00 to WIFE for her attorney fees.  The SM noted that HUSBAND filed the Contempt Complaint, and then dropped it the day of the Special Master’s Hearing.  The SM found that HUSBAND’s “dilatory tactics” increased counsel fees on behalf of WIFE.  The SM had a front row seat to observe how the parties acted during the litigation process.  Given the above, HUSBAND’s request for reimbursement for attorney fees and costs is denied, and the recommendation that he pay WIFE $1,500.00 is affirmed.

• Alimony

            The SM denied HUSBAND’s request for alimony because he determined that HUSBAND has sufficient property to provide for his reasonable needs, and that he is able to support himself at this time with reasonable employment.  When considering the 17 factors for awarding alimony enumerated in 23 Pa.C.S.A. §3701(b), the SM determined that four (4) factors weighed against alimony, one (1) weighed slightly in HUSBAND’s favor, and the rest were neutral.

            HUSBAND argues that he needs alimony to meet his reasonable needs, particularly while he completes his graduate work, and WIFE has the financial means to do so.  He insists that he terminated his employment due to health issues, and that WIFE is younger and in substantially better health than him.  HUSBAND states that he is not able to access his retirement benefits at the present time without substantial penalty.  He admits that his expenses have been drastically reduced since he is no longer paying the mortgage and the HELOC but insists that he is still not able to bridge the gap between expenses and income.  HUSBAND believes that WIFE’s alleged marital misconduct should be considered in the analysis.

            The SM found that HUSBAND is looking for WIFE to finance his personal goals (in education), while the military is paying for HUSBAND’s tuition, fees, and books, and giving him a stipend while he is going to school.  The SM agreed with the assessment of the Vocational Expert that HUSBAND is capable of appropriate employment.  The SM concluded that if his recommendations are accepted, HUSBAND will have adequate property to provide for his reasonable needs.  Lastly, the SM considered the marital conduct and determined that if there was any marital misconduct, it was by HUSBAND when he was secretly filming WIFE and tracking her every movement.

            The purpose of alimony is to ensure that a financially dependent spouse can maintain their reasonable needs after the divorce.  Jayne v. Jayne, 663 A.2d 169, 174, (Pa. Super. 1995).  HUSBAND has had two lucrative careers, and still has the potential to make a comfortable income.  HUSBAND’s health issues are unfortunate, but he presented no evidence that he is physically unable to do the job that he left.  HUSBAND earned every one of his VA benefits, and he is fortunate to have a stipend while he increases his education level.  He has healthy bank accounts, and retirement income resources that most people would envy. By HUSBAND’s own admission, his expenses dropped significantly.  As it relates to marital misconduct, we join the SM in concluding that HUSBAND’s behavior in spying upon and filming WIFE is offensive.  To the extent necessary, we will also weigh the factor pertaining to marital misconduct against HUSBAND’s claim for alimony. 

            We find that the SM did not abuse his discretion in denying alimony to HUSBAND.  A consideration of all alimony factors simply does not support an award of alimony to HUSBAND.

• Cost of Selling Marital Home

            23 Pa.C.S.A. § 3502(a)(10.2) indicates that a court determining equitable distribution should consider “the expense of sale, transfer or liquidation associated with a particular asset, which expense need not be immediate or certain.”  This provision is consistent with decisional precedent dating back to 1987.  See, Zeigler v. Zeigler, 530 A.2d 445 (Pa. Super. 1987) (“Adjustment in the value of the residence for expenses associated with a contemplated sale may be an appropriate consideration in some equitable distribution cases.  We neither forbid nor require the practice.” Id at page 557); See also, D.D.G. v. S.R.G., 2021 WL 1235465 (Pa. Super. 2021) (Expenses associated with the sale of a house can be considered even if the house was not immediately listed for sale by one of the parties.)

            In this case, the SM awarded WIFE with a credit representing 7% of the value of the marital residence.  The SM stated in his report:

“The parties agree to a 7% cost of sale.  The Special Master will be recommending a value of $557,500.00 for the marital home, 7% of which is $39,025.00 credit to Wife.  Since equitable distribution will be immediate and any adjustment for cost of sale is in the future, the Special Master will consider this as a credit rather than a reduction in the value of the marital home to be equitably divided between the parties presently.” (SM Report at page 30).

            Neither party filed an exception relating to the SM’s decision to award a credit for 7% of the value of the marital home.^[19]  However, as we contemplated the impact of the process used by the SM, we began to question whether that process was fair or in accordance with Pennsylvania law. 

The SM used the process of awarding a “credit” with respect to the 7% cost of transfer.  Credits afford a dollar-for-dollar reduction from the net amount payable by one spouse to another.  In this case, using the analytical device of awarding a credit would reduce the amount payable by WIFE to HUSBAND by $42,140.00.^[20]  Another approach to the costs of transfer would be to reduce the value of the asset by the anticipated costs of transferring it.  This is the approach sanctioned in the Zeigler case cited above.  Moreover, this approach reduces the gross value of the asset by the amount of the anticipated costs of selling it.  From an analytical standpoint, this is a much more appropriate way to consider the anticipated costs of a sale.  After all, if an asset is going to be sold, the net benefit receivable by the seller will be reduced by the costs pertaining to the transfer.

            In this case, we have chosen to reduce the value of the marital home by the $42,140.00 anticipated costs of transfer.  Doing so reduces the gross value of the marital home from $602,000.00 to $559,860.00, and it reduces the net – after deduction of the mortgage balance – value to $205,994.39.  This methodology therefore reduces the overall value of the marital estate and it reduces the value of properties currently in the possession of WIFE.  We believe this methodology is the correct one and we will employ it instead of the “credit” approach used by the SM.^[21]

III.       CONCLUSION

We commend the SM for the work he undertook.  That work served as a foundation for the decision we have rendered today.  Still, we have adopted a different approach than the SM did.  Most notably, we have directed a 50-50 split of marital property, which is slightly different than the one recommended by the SM.  In addition, we have determined that the cost of selling the marital home should have reduced the value of the marital home and should not have been awarded as a credit.  In addition, we have eschewed the award of credits for rental value and preservative expenses.  All of these decisions will have economic consequences for both HUSBAND and WIFE.  However, in the end, the decisions we have rendered will land the parties pretty close to where they would have been had they simply adopted the SM’s recommendation.^[22]  In this regard, we remind both HUSBAND and WIFE that being proven “right” does not always result in an economic windfall.    

Having addressed the parties’ numerous issues, we now need to put things together in order to render a decision.  We will begin by listing all marital assets and debts.^[23]  We will next identify which assets are currently possessed by HUSBAND and which are currently possessed by WIFE.  Other than liens encumbering the marital property, no marital debts currently exist.  However, both parties paid marital debts after separation, and we will identify who paid what.  Thereafter, we will set forth a list of credits awarded to both parties.

            Our final task will be to conduct a recapitulation of everything.  We will begin by determining how much WIFE will have to pay to HUSBAND to accomplish a 50%-50% distribution of assets.  Because WIFE paid slightly more than HUSBAND toward marital debts, and because WIFE is entitled to credits that exceed those for which HUSBAND is entitled, we will adjust the amount owed by WIFE to HUSBAND in order to arrive at a final figure.

            The charts needed to effectuate the above will be set forth below:

1. LIST OF MARITAL ASSETS

ALL MARITAL ASSETS	VALUE
Grand piano	$2,750.00
Two (2) tan stuffed chairs	$20.00
White trundle bed with mattress & matching horse comforter	$105.00
Black server table	$212.50
Black hutch with glass doors	$225.00
WIFE’s father’s tools, including vehicle ramps	$15.00
Circulon cookware set	$25.00
Large electric fireplace	$137.50
Horses, Clint & Moon	$0.00
Horse picture	$50.00
Three-piece worker’s set	$50.00
Outdoor patio set with chairs	$187.50
Patio storage box	$25.00
Manure spreader	$587.50
Wheelbarrow	$40.00
Horse harrow	$250.00
Four (4) barstools	$125.00
Wall mirror	$20.00
Indoor bench with cushion	$62.50
Ariens zero turn mower	$200.00
Old washing machine	$25.00
Handgun	$400.00
Washer	$200.00
Dryer	$150.00
2011 Eclipse horse trailer, 2007 Yamaha Grizzly Four-Wheeler and tan sectional sofa	$6,112.50
Diamond hoop pendent	$200.00
Diamond heart/sapphire band	$200.00
Pandora bracelet	$50.00
S-link bracelet	$150.00
Minnie Mouse bracelet	$40.00
Celtic cross pendent	$10.00
Wedding band	$100.00
Claddagh hoops	$10.00
Diamond hoops	$100.00
Double bracelet	$100.00
Wrought iron loveseat with coffee table	$25.00
Matching jelly cupboards	$57.50
Hall table	$15.00
Three-drawer base cabinet	$90.00
Pots, pans, kitchen items (minus CIrculon)	$50.00
Vizio 60” flat screen TV	$125.00
Television stand	$97.50
Banjo	$90.50
Element flat screen television	$45.00
Floor lamp	$10.00
Floor rug bedroom	$15.00
S&W Model 22A-1 semi-automatic pistol	$175.00
Taurus G2C 9mm semi-automatic pistol	$225.00
Sleigh bunkbed with mattress and box spring	$130.50
Miscellaneous decorations	$10.00
Chain saw	$50.00
Sun Dolphin kayak, paddle, life jacket, and car roof mounts	$125.00
Delta table saw	$30.00
Air compressor	$50.00
Stanley tool cabinet with tools	$105.00
Miscellaneous items in workshop	$20.00
Assorted lumber	$112.50
Troy Built snow blower	$152.50
Generic pressure washer	$112.50
Assorted garden tools	$10.00
Electric edger & fertilizer spreader	$5.00
Microwave	$5.00
Net value of marital home	$205,994.39
2006 Chevy Silverado	$4,585.00
2012 Toyota Highlander	$9,984.00
6,000 Iraqi Dinar	$0.00
USAA Account	$3,338.70
Discover Account	$3,575.28
APL Account	$9,675.67
JBT Account	$150.00
Fulton Bank Account	$64.56
PSECU	$14,000.00
Marital portion of HUSBAND’s military retirement	$174,941.00
HUSBAND’s Wells Fargo Parson’s Prudential 401(k)	$118,670.32
Marital portion of HUSBAND’s Valiant 401(k)	$6,328.37
HUSBAND’s Vanguard IRA	$104.07
WIFE’s Brick Property Service Retirement Plan	$193,510.74
WIFE’s Vanguard IRA	$261.71
Disney Award Points	$437.96
Sale of Tractor	$4,000.00
Miscellaneous Lumber	$125.00
Stimulus Benefits	$6,300.00
Vehicle Ramps	$0.00
TOTAL	$770,920.27

2. LIST OF MARITAL DEBTS PAID AFTER SEPARATION

MARITAL DEBTS	VALUE
Amount owed to Hershey Medical Center for bills incurred prior to separation	$2,520.00
Credit card balance as of separation	$2,976.98
Miscellaneous debt paid after separation from Discover Bank account	$4,804.96
TOTAL	$10,301.94

Amount paid toward marital debt by WIFE	$5,496.98
Amount paid toward marital debt by HUSBAND	$4,804.96
DIFFERENCE	$692.02

Amount to be paid to WIFE for payment of marital debt

$346.01

3. LIST OF NON-MARITAL ASSETS

NON- MARITAL ASSETS	VALUE
Bed, nightstand, dresser, area rug, television	$150.00
Used shower curtain and towels	$5.00
Holton trombone with case	$200.00
Barbie dolls	$40.00
Box of kid’s toys	$20.00
Additional box of kid’s toys	$25.00
Two (2) stuffed bears	$5.00
2014 Honda Vehicle	$–?–
2013 Chevy Sonic subject to the provisions set forth below	$8,000.00

4. MARITAL ASSETS CURRENTLY POSSESSED BY WIFE

MARITAL ASSETS in POSSESSION OF WIFE	VALUE
Net Value of Marital Home	$205,994.39
2012 Toyota Highlander	$9,984.00
3,000 Iraqi Dinar	$0.00
USAA Account	$864.34
Discover Account	$1,787.64
APL Account	$3,498.62
Fulton Bank Account	$64.56
PSECU	$7,000.00
Jewelry to be awarded to WIFE	$640.00
Disney Award points	$437.96
Vanguard IRA	$261.71
Personal property awarded to WIFE	$11,975.00
Brick Property Service Retirement Plan	$193,510.74
Stimulus Payments	$4,200.00
TOTAL	$440,218.96

5. MARITAL ASSETS CURRENTLY POSSESSED BY HUSBAND

MARITAL ASSETS in POSSESSION OF HUSBAND	VALUE
2006 Chevy Silverado	$4,585.00
3,000 Iraqi Dinar	$0.00
USAA Account	$2,474.36
Discover Account	$1,787.64
APL Account	$6,177.05
JBT Account	$150.00
PSECU	$7,000.00
Marital portion of HUSBAND’s military retirement	$174,941.00
HUSBAND’s Wells Fargo Parson’s Prudential 401(k)	$118,670.32
Marital portion of HUSBAND’s Valiant 401(k)	$6,328.37
HUSBAND’s Vanguard IRA	$104.07
Sale of Tractor	$4,000.00
Miscellaneous lumber	$125.00
Personal property to be awarded to HUSBAND	$1,938.50
Jewelry to be awarded to HUSBAND	$320.00
Vehicle Ramps	$0.00
Stimulus Benefits	$2100.00
TOTAL	$330,701.31

6. LIST OF ALL CREDITS TO WHICH THE PARTIES ARE ENTITLED

	CREDITS	VALUE
To WIFE	Appraisal by Conrad Siegel of HUSBAND’s pension	$225.00
To WIFE	Expert testimony by Brian Bierly for Vocational Assessment	$1,500.00
To WIFE	Reimbursement of attorney fees	$1,500.00
NET CREDIT TO WIFE		$3,225.00

7. RECAPITULATION

50% of Marital Assets (of $770,920.27) to HUSBAND   Less Amount already possessed by HUSBAND Amount due to HUSBAND   Less excess amount of marital debt paid by WIFE Pre-credit amount due to HUSBAND   Less net credits awarded to WIFE   Net amount owed to HUSBAND

$385,460.13     -$330,701.31 $54,758.82     -$346.01   $54,412.81   -$3,225.00   $51,187.81

            The above amount cannot yet be considered “final” because the $8,000.00 received by WIFE when the Chevy Sonic was sold needs to be addressed.  If WIFE provides proof that Arielle has either received a vehicle or does not want the $8,000.00 amount, then the $8,000.00 will not be factored into any equitable distribution equation.  However, if proof regarding Arielle is not provided, then a debt of $8,000.00 to Arielle will be added and WIFE will be required to pay that entire debt.

            Our Court Order today will award HUSBAND the property set forth on Chart E above and WIFE the property listed on Chart D above.  We will order both parties to pay mortgages or encumbrances pertaining to property awarded to him/her.  Because credits were incorporated in the final amount owed to HUSBAND as set forth on the above-referenced Recapitulation, our Court Order will not include specific provisions relating to credits.  It will, however, include a paragraph denying the payment of alimony.  Ultimately, other than the property already in possession of the parties, our Court Order today will require WIFE to pay to HUSBAND the sum of $51,187.81.  Upon payment of that amount, most financial ties between HUSBAND and WIFE will be severed. 

            Before we conclude, we must also determine how the amount owed by WIFE should be paid.  We also must decide whether and when the parties’ joint mortgage will have to be satisfied.  As we render these decisions, we are confronted with the reality that interest rates have skyrocketed over the past several years.  As recently as 2019, a 30-year fixed rate mortgage could be obtained for roughly 3%.  Today, the rate is approaching 10%.  There is simply no way that anyone would be able to refinance a mortgage today at a rate anywhere close to what was available during most of the last decade.  This reality creates two problems for these parties.  First, the dramatic increase in mortgage rates will make it far more difficult for WIFE to refinance her house in order to pay the amount she owes to HUSBAND.  Second, any refinancing of the marital residence will require WIFE to satisfy the existing mortgage, and that will be economically disadvantageous given the significant increase in mortgage rates. 

            We recognize the legitimate interest that HUSBAND possesses in severance of all economic ties with WIFE.  We also recognize that the only clear way to accomplish such a severance would be to require WIFE to refinance the marital home.  However, WIFE may not be able to afford a mortgage with a significantly higher principle and a considerably higher rate than the one she is now paying.  The net effect of requiring WIFE to immediately pay a lump sum to HUSBAND while simultaneously removing his name from the mortgage may be that WIFE would be forced to sell the marital residence.  That was not the result the SM wanted to achieve, nor is it the one that we would prefer. 

            We will be affording WIFE with time to stabilize her financial situation before requiring her to refinance the marital home.  During this period of transition, we will permit WIFE to pay the existing mortgage at its existing rate.  In addition, we will permit WIFE to begin paying the amount she owes to HUSBAND at a rate of $750.00 per month, $150.00 of which will be deemed interest.^[24]  In three (3) years, we will require WIFE to remove HUSBAND’s name from any liens, mortgages or encumbrances plus pay the amount she owes to HUSBAND.  If WIFE chooses the option we have afforded of paying $750.00 per month, the amount she will have to pay to HUSBAND in three years will be a little less than $30,000.00.  This amount would be easier to blend into a newly financed mortgage.  Until the new financing is arranged, WIFE will continue to be responsible for paying the existing mortgage, and she will be required to indemnify and hold harmless HUSBAND from any responsibility to pay said mortgage. 

            The intent behind this paradigm is to help WIFE regarding the amount she owes to HUSBAND.  Hopefully, mortgage rates will decline to the point where WIFE will be able to refinance her house and pay everything owed to HUSBAND.  Our goal today is to afford WIFE with some degree of flexibility with respect to completing the severance of the financial ties created during the parties’ 26-year marriage. 

            Was the information regarding marital finances that was presented to us comprehensive and clear?  No, it was not.  Is our decision therefore perfect? No, it is not.  On the other hand, does our decision adequately address all of the major assets possessed by the parties?  Yes, it does.  Does our decision effectuate economic justice for HUSBAND and WIFE?  Absolutely! 

            It is our sincere hope that the decision we render today will end the dispute between Karen M. Raugh and Rodney L. Raugh.  It is our sincere hope that the parties and their children will find a way to move forward with their lives unencumbered by the unpleasantness that this divorce litigation has engendered. 

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[1] The one exception to this directive involves the vehicle ramps, which HUSBAND should return to WIFE.

[2] There were 22 Exceptions filed between the parties, but Counsel agreed at Oral Arguments that WIFE’s Exception # 2, concerning WIFE’s post-separation contributions of $1,686.70 into her retirement are non-marital property, and that HUSBAND’s post-separation contributions of $2,900.00 should also be excluded from the marital assets.

[3] HUSBAND’s employer would change every three years, depending on which contractor received the contract from the military.

[4] This included WIFE’s 1^st Exception and HUSBAND’s 12^th Exception.

[5] Factor 10.1: Federal, State, and Local tax ramifications associated with each asset to be divided, distributed, or assigned, which ramifications need not be immediate and certain; Factor 10:2: The expense of sale, transfer, or liquidations associated with a particular asset, which expense need not be immediate or certain.

[6] WIFE acknowledges that there was prior medical debt that was already satisfied and that they were co-signers on the daughters’ student loans, but the SM determined the latter to be the debt of daughters.

[7] This discussion will consider WIFE’s Exceptions 3, 5, and 7, and HUSBAND’s Exceptions 2, 3, and 4.

[8] Some items were on both lists.  For any item that was included on both appraisals, the SM used an average of the two evaluations for his value of the item. We will not disturb this decision.

[9] None of the photographs introduced by HUSBAND from the hidden cameras could be considered salacious.  However, we consider HUSBAND’s disclosure of innocuous photos to be a proverbial “shot across the bow” for WIFE.  We have little doubt that HUSBAND has more embarrassing photographs in his possession, and he wanted WIFE to realize that fact. 

[10] Truthfully, we considered ordering the parties to flip a coin regarding possession of the wrought iron furniture.  However, we did not want to join the frivolity of the parties by directing that their property be distributed based upon a game of chance.  

[11] Never before have we been asked to consider the cost of feeding a dog.

[12] As it relates to WIFE’s care of the pet dog, we will not even dignify her argument by spending time to address it.

[13] HSA stands for Health Savings Account.

[14] Separation occurred in September of 2020.  Thus, only three (3) months of the amount paid via a 2020 tax return could even arguably be considered as non-marital. 

[15] WIFE disputes this and claims the offer in August 2020 was for $595,000.00 with no seller assist. (N.T. 523-524).

[16] The more that courts employ an approach that averages expert opinions, the more that said experts will be incentivized to proffer unrealistic opinions that are unduly beneficial to the side that hires them.  See, e.g., Bradford H. Charles, “Rule 706: An underutilized tool to be used when partisan experts become ‘hired guns’”; Villanova Law Review, Volume 60 (November 5, 2015). 

[17] Both parties acknowledge that an offer was made for the house.  One party recalled that the offer was for $595,000.00 and the other recalled the amount as $609,000.00.  We will select a number that splits the difference between the parties’ recollections.  This is a practice we would not employ had the recollections been dramatically different.  However, because both parties recalled offers that were relatively similar, we will choose a number equidistant between the parties’ recollections. 

[18] Zillow currently estimates the property is worth $796,800.00.

[19] Both parties did file exceptions to the SM’s decision, and we have via this decision granted more than a few of these exceptions.  By definition, granting an exception alters the overall distribution scheme.  Because of this reality, a trial court must re-evaluate the resulting distribution scheme in order to ensure that it still effectuates economic justice for the parties.  As we undertook this global re-evaluation of this case, we noticed the cost of sale methodology of the SM.  Because we did not understand the SM’s intellectual rationale behind including cost of sale as a credit, we undertook additional legal research.  That research revealed the Zeigler decision that called for the cost of selling a home to be considered as an “adjustment in the value of their residence.” This prompted us to include this section within our Opinion.

[20] As noted above, our valuation of the marital residence was different than that employed by the SM.  If we were to use the same 7% estimate of costs that was used by the SM, the amount reflecting the cost of an anticipated sale would be $42,140.00. instead of the $39,025.00 determined by the SM.

[21] We ran the numbers to determine the difference between the approach we will be using and the approach used by the SM.  Using the SM’s approach would lower the ultimate amount WIFE will have to pay to HUSBAND by roughly $15,000.00.  This is not a de minimus amount.  We suspect that the SM realized that his approach would benefit WIFE, and that a “rough justice” view of this dispute required such a result.  Our decision today is more intellectually supportable, and we will employ it regardless of who our approach benefits. 

[22] Once again, we ran the numbers to determine the difference between our decision and the one rendered by the SM.  To be sure, our calculations were not definitive because the SM included awards of credits that had not been calculated and transformed into a dollar amount.  Still, it is obvious that our decision will end up providing HUSBAND with slightly more than he would have received under the SM’s approach.  However, the difference will undoubtedly be less than the legal fees incurred to fight over the issues addressed in this Opinion.

[23] Other than the parties’ horses Clint and Moon, we have omitted any “assets” for which we did not have credible proof of value.

[24] Thus, the principal amount owed by WIFE to HUSBAND will be reduced by $600.00 per month.  We did not use an amortization table to calculate the interest.  We recognize that this interest may be less than what would be generated in a financial marketplace.  So be it.