Ohio Case Law Review by Topic: August 1, 2022 through September 30, 2022

Woeste v. Woeste, 12th Dist. Clermont No. 2019DRA00052, CA2021-09-055, 2022-Ohio-2825

Marital Property: retirement benefits (TSP), separate property, tracing

Dated: August 15, 2022
Affirming in Part, Reversing in Part, and Remanding

Pursuant to a 2019 entry, the parties’ marital home was ordered sold, with the proceeds split between the parties with Husband to receive credit for any taxes he directly paid. Husband’s portion was ultimately reduced for mortgage payments he had failed to make, along with other items.

In his appeal, Husband argued the trial court erred in its division of assets and liabilities, including proceeds from the sale of the marital home, proceeds from the sale of a different property, his Thrift Savings Plan (TSP) account, two bank accounts, and a charging lien from his prior attorney.

Husband argued that the value of the marital home increased “significantly” during his sole residency thereof, due to work and remodeling he undertook to increase its sale price. Finding that Husband’s testimony permissible under the opinion-owner rule, the trial court was nonetheless “free to give whatever weight it wanted to [it].” Husband failed to provide any actual amounts or supporting evidence as to the increased value of the property, or the cost of his improvements to it. The Court further noted Husband’s obligation (and failure, leading to the reduction of his share of the sale proceeds) to continue making mortgage payments on the property, and affirmed.

The trial court’s assignment of proceeds from the sale of the parties’ other property were similarly affirmed, for lack of any evidence of Husband’s purported tax and credit union payments.

Husband further argued that the trial court erred when it failed to assign him his pre-marital interest in his TSP account, and provided a statement he claimed showed the amount thereof. This statement, however, appeared to have been altered in an obvious manner, consisting of four pages from an identifiable 2018 account statement, and a fifth page that the trial court could not identify. Finding Husband’s arguments -based on this statement alone- did not meet his burden of proof for a separate property claim, the Court again affirmed.

Except for $351.36 which the Court determined had been stipulated to be Husband’s separate property, from the bank account of a business assigned to him, the Court similarly affirmed the trial court’s division of the two bank accounts in Husband’s name, and liability for Husband’s prior counsel’s charging lien.

“I wonder what they call that state?”

Jowiski v. Jowiski, 9th Dist. Lorain No. 97DU052353, 21CA011807, 2022-Ohio-2816

Marital Property: retirement benefits, separate property
QDRO: coverture (traditional v. frozen), impermissible modification
ORC 3105.171(I): (prohibition on modification)
Witness: expert

Dated: August 15, 2022
Reversing and Remanding

As part of the parties’ 1997 divorce, Wife was awarded a marital interest in Husband’s pension based on the below coverture fraction:

[T]he amount payable to [Wife] shall be the amount otherwise payable to [Husband] as follows: one-half (1/2) of the fraction the numerator of which is the number of years [Husband] participated in said plan while married to [Wife], the denominator of which is the total number of years [Husband] participates in said plan, times the benefits to be received.

In 2020, Husband filed a Motion to modify Wife’s QDRO award, alleging his ‘active’ contributions to the pension subsequent to the divorce both significantly increased his pension benefit, and constituted his separate property.

According to Husband, had he continued to not actively contribute to his retirement, he would have been entitled to receive approximately $1,700 per month in retirement benefits from [Husband’s pension]. Husband asserted that, after the divorce, he began actively contributing to his retirement, which significantly increased the benefits he was entitled to receive upon his retirement. According to Husband, as a result of his active contributions, he was now set to receive approximately $6,400 per month in retirement benefits.

Under the QDRO as then-written, Wife’s share of the pension would have been increased by Husband’s post-divorce ‘active’ contributions, and Husband thus moved for the revision and modification of the QDRO language.

At an August 2021 hearing, Wife requested a continuance to allow more time for her review of materials received from the pension, and directed a slur at the magistrate when her request was granted. The magistrate found Wife in contempt, subject to purge via $100 fine.

At a subsequent hearing, Husband’s expert witness testified that Wife’s entitlement, under the parties’ original intent, was $287.08 a month, but acknowledged that the QDRO as-written “did not distinguish between contributory and non-contributory portions of Husband’s retirement benefits.” The magistrate granted Husband’s motion, allowing an amended QDRO to be submitted for the $287.08 amount. The magistrate further found Wife in contempt of the trial court, ordering that -in lieu of jailtime- Wife was barred from filing any motions or objections until she paid her fine. Wife’s objections were dismissed on this basis.

The Court ultimately sided with Wife’s argument in her appeal, finding that the magistrate’s contempt decision improperly barred her not only from making objections to the decision, but limited the scope of issues she could raise in her appeal.

The Court declined to rule on whether the trial court lacked jurisdiction to modify the decree without both parties’ consent, finding such review premature in consideration of the other issue’s reversal and the remanding of the matter back to the trial court.

Gantous v. Basing, 11th Dist. Geauga No. 2018 DC 000017, 2021-G-0005, 2022-Ohio-3001

Marital Property: tracing, valuation
OPERS

Dated: August 29, 2022
Affirming in Part, Reversing in Part, Remanding

As part of the parties’ appeal and cross-appeal, both Husband and Wife argued the Court erred in its assignment of their respective interests in the marital home, with Husband arguing against the trial court’s finding of Wife’s 100% equity therein, and Wife arguing against the award of $25,095 in marital interest to Husband.

Noting the multiple refinancing and loans taken and paid into during the parties’ marriage (using the house as security), and Wife’s failure to adequately trace her pre-marital ownership throughout, the Court sided with Husband and found that the “entire amount of equity in the home must be considered marital property.”

In another assignment of error, Wife argued the trial court failed to consider the parties’ respective Ohio Public Employee Retirement System (OPERS) benefits in its overall division of marital property. As of the parties’ divorce, Wife had already commenced her benefits under a single life annuity, barring any payments beyond her death, and Husband was not yet eligible to retire. The parties agreed to obtain valuations for their benefits, but had not done so as of their final hearing.

The magistrate concluded “that an equal division of the parties’ retirement benefits, by means of an equalization of the present cash out values or present actuarial values, or by the use of division of property orders, would be inequitable.” The [trial court] adopted the magistrate’s recommendation to “award each party’s OPERS annuity rights to him or her free from any claim by the other.”

In remanding, the Court found that the trial court retained a “duty to value and equitably divide the marital assets,” regardless of parties’ decision not to obtain their own valuations.

Haddox v. Haddox, 6th Dist. Lucas No. 1997-0600, L-21-1168, 2022-Ohio-3500

DOPO: merely implements decree, survivorship, valuation
Marital Property: ambiguity, retirement benefits
Witness: expert
STRS

Dated: September 30, 2022
Affirming

At the time of the parties’ 1999 divorce, Wife and Husband both held accrued pension benefits under Ohio State Teachers Retirement System (STRS). An expert witness was brought in to evaluate the parties’ respective retirement benefits, and as part of his testimony he valued the marital portion of Wife’s benefits in a $87,850.90 lump sum. Husband was awarded half of the marital value of Wife’s STRS benefits, minus offsets for his retained STRS benefits and the parties’ Social Security accruals. The trial court reserved jurisdiction to effectuate the division in the future, and no means of court-ordered division of Ohio public employee pensions existed at the time (the Division of Property Order, or DOPO, was established under ORC § 3105.90 , in 2002).

Wife began preparing for retirement in 2016, and Husband -upon being made aware of this- sent a letter to STRS, asking that a copy of the parties’ 1999 decree be added to both parties’ accounts. In its response to him, STRS: (a) wrote that the decree did not appear to require Wife to elect a survivorship option; and (b) informed Husband that no DOPO had been entered. Subsequent to this, STRS sent a letter to Wife informing her that her benefits would be reduced, pending resolution of Husband’s interest therein. Wife received several months of partial payments before they ceased entirely.

The parties began discussing the best ways to proceed, and Wife presented Husband with an affidavit releasing her to resume her benefit as a single life annuity. Husband refused, and six months later, Wife filed a motion for contempt.

In a subsequent hearing, the expert witness from the parties’ 1999 divorce calculated Husband’s interest in Wife’s STRS benefits (with offsets for his retained benefit and the parties’ Social Security benefits) in the form of a monthly dollar amount. The expert witness conceded that a percentage amount could also be used, and provided the trial court with a lump sum present value for the benefits. The expert witness agreed that the parties’ 1999 decree was silent on the issue of survivorship (whether Wife could commence her benefits under a single life annuity, or was required to elect a reduced survivorship annuity so that Husband would continue receiving benefits should Wife predecease him).

As part of his testimony, Husband claimed that he had never received the STRS affidavit that Wife claimed he had refused to sign, until five months after she filed her motion for contempt. Husband also shared his preference that he receive his interest in one lump sum (available only if Wife reduced her monthly benefit by taking a partial lump sum payout, or ‘PLOP’), or that Wife be required to select a survivorship annuity to ensure his ongoing receipt of any monthly benefit.

In a subsequent magistrate’s decision, Husband was found to be in contempt which could be purged by paying the filing fee for the DOPO, Wife was ordered to pay Husband a dollar amount from her monthly benefits (the amount calculated by the expert witness), and Husband was ordered to pay attorney fees to Wife.

Following Husband’s filing of objections and Wife’s memorandum in opposition, the trial court deemed the 1999 decree ambiguous, noting STRS’ inability to interpret its assignment provisions and the lack of any DOPO-like means of division in existence when it was written.

Based on this finding, the trial court ordered that Husband retain a QDRO preparer to draft a DOPO as closely mimicking a coverture division separate interest QDRO as possible (the trial court noted that this being the prevailing method of division at the time of the decree and also in accord with a local rule in effect at the time of the decree under which QDROs were assumed by rule to be including certain well-known provisions including a separate interest (i.e., survivorship rights)).

Consistent with the norms of pension division described above, the trial court determined that [Husband] is entitled to survivorship benefits, and indicated in its order that such benefits would be incorporated into the divorce decree. Having found that [Husband] was entitled to survivorship rights, the trial court found that [Husband] could not be held in contempt for failing to sign the STRS survivorship affidavit forfeiting such rights, and vacated the magistrate’s contempt finding.

The trial court went on to assign Husband retroactive benefits from the time Wife first began to receive payments from STRS. Husband filed a motion two years later, in 2020, requesting that Wife be ordered to sign the DOPO prepared in accord with the trial court’s 2018 decision, and that the trial court enter an Amendment to Judgment Entry of Divorce, related in part to the loss of his survivorship interest due to Wife’s election of a single life annuity.

The trial court dismissed Wife’s objections, ultimately adopting the terms of Husband’s DOPO and entry, which were prepared pursuant to its prior 2018 decision. [Editor’s note: it appears ‘DOPO’ and ‘Entry’ are used interchangeably in this section of the Opinion.] In her appeal, Wife argued that: (1) the trial court erred when it approved the DOPO utilizing a percentage amount rather than the expert witness calculated dollar amount; and (2) the trial court erred in its consideration of her single life annuity election and acceptance of related provisions in its decision.

In arguing for dismissal, Husband claimed that Wife was barred in her appeal by the doctrine of res judicata, because she had failed to appeal the trial court’s 2018 decision including the finding of ambiguity in the original decree. Relying on Wilson v. Wilson, 116 Ohio St.3d 268, 2007-Ohio-6056, 878 N.E.2d 16, wherein the Supreme Court of Ohio examined whether a divorce decree contemplating further action on the part of the parties was a final appealable order, the Court iterated that a QDRO (or DOPO) merely effectuates the terms of the decree, and thus, that the trial court’s 2018 decision was a final, appealable judgment. The Court agreed that Wife’s claims were now barred, and affirmed.

Owens v. Owens, 1st Dist. Hamilton No. DR2000165, C-210488, 2022-Ohio-3450

Marital Property: stock, tracing

Dated: September 30, 2022
Affirming in Part, Reversing in Part, and Remanding

Husband had a stock account at the time of marriage with a specified number of like-shares. There was a liquidation and distribution of a certain number of shares nearly immediately after the marriage. The only other change in account value during the remaining history of the account was the due to marital contributions and dividend reinvestment. The parties did not dispute these facts.

However, Husband argued all shares held on the date of marriage remained his separate property at divorce. The trial court found that Husband failed to meet his burden to trace the separate property interest, and accordingly divided the account equally between the parties.

The Court of Appeals reversed, noting that Husband met his burden by providing testimony supported by detailed account records showing:

• the number of shares that existed on the date of marriage;

• only a single distribution was made during the marriage (which the Court aptly noted must have come from the liquidation of premarital shares, because the account records showed no change in account value between the date of marriage and the date of the distribution); and

• the only other change in value during the marriage was due to contributions and dividend reinvestments made during the marriage.

The Court did not return all of Husband’s original shares on the date of marriage to him, but did determine there was sufficient evidence to instead return the balance of the original shares minus the shares that were liquidated and distributed.

Blog Posts are intended to bring attention to developments in the law and are not intended as legal advice for any particular client or any particular situation. Please consult with counsel of your choice regarding any specific questions you may have.