Ohio Case Law Review by Topic: May 2024

Edje v. Holmes, 1st Dist. Hamilton No. DR-2200117, C-230286, 2024-Ohio-1663

Marital Property: disclosure (retirement), equitable division (unequal division of retirement), tax consequences (retirement)
Spousal Support: voluntary underemployment

Dated: May 1, 2024
Affirming

The parties, a physician and an attorney, married in 2019 but began living separately by 2021. After a 2-day hearing, the magistrate ordered an unequal division of equity in the parties’ home and Wife’s retirement account, attorney fees to be paid by Husband, and denied Husband request for spousal support. Husband objected, but the trial court adopted the magistrate’s decision, noting his failure to attach a transcript of the proceedings.

Husband’s appeal followed, but he once again failed to attach a transcript of the proceedings to his brief.

Husband first objected to the unequal award of the house and equity to Wife, but the Court affirmed the trial court’s decision, noting that “[w]hen dividing marital property, R.C. 3105.171(C)(1) prescribes an equal division of property unless dividing the property equally would be inequitable” (emphasis added). Without a transcript of the proceedings, the Court limited its review. Further, in consideration of Husband’s failure to contribute to expenses for the house and financial “abandonment” of Wife following the marriage (notwithstanding his contribution of $84,000 to its purchase), such an award was not -the Court found- an abuse of discretion.

The Court likewise affirmed the trial court’s award of a pool table and crystal vase to Wife, finding that -notwithstanding other evidence presented by Husband- no meaningful review was possible without the transcript of the proceedings.

Husband argued the trial court abused its discretion when it awarded attorney fees to Wife, but the Court again disagreed. The award of $3,750 in fees to Wife was equitable in light of Husband’s conduct and discovery noncompliance.

In affirming the trial court’s decision not to award attorney fees to Husband, the Court agreed with the trial court’s finding that Husband was voluntarily underemployed. Prior to the divorce, Husband left a job as a corporate attorney to work remotely, and in anticipation of his own retirement. And the Court noted, once again, that Husband’s failure to attach the transcript of the proceedings necessarily limited its review of the appeal.

Husband further appealed the trial court’s award of $10,582.60 as his marital interest in Wife’s retirement accounts. The Court wrote: “the magistrate used an equal division as a starting point and simply factored the tax consequences into its division of [Wife’s] retirement funds.” Further, Husband had failed to provide records relating to his own retirement benefits during the proceedings, and the trial court thus found that the unequal division of Wife’s retirement benefits was equitable. Moreover, and perhaps more significantly, the Court found that by Husband’s failure to provide the trial court with evidence as to the value of his retirement, etc., he effectively waived any right to appeal the retirement division. In so finding, the Court again affirmed.

Editor’s Note: An EZ QDRO LAW shout out to Wife’s able counsel: Barbara Howard and Rachel Myers!

W.G. v. D.G., 8th Dist. Cuyahoga No. DR-21-384439, 113108, 2024-Ohio-1690

Marital Property: de facto date (termination of marriage), retirement

Dated: May 2, 2024
Affirming

The parties married in in 2004, and in 2012, Wife moved out and Husband filed for divorce. Husband later dismissed his complaint, but the parties continued to live separately until Wife filed for divorce in 2021. During the 2012 proceedings, a child support order was issued for payment from Husband to Wife, and remained in place thereafter.

The trial court subsequently adopted the magistrate’s recommendations, awarding Husband the entirety of the pension he began to accrue in 2015, and the right to claim the children for tax exemption purposes. The magistrate found that the use of a de facto termination date of marriage was appropriate, in light of the 2012 proceedings and parties’ separation thereafter. Wife’s objections to the findings were overruled by the trial court, which wrote:

[I]t is undisputed that the parties separated on unfriendly terms. The record does not indicate the parties were intimate after their separation. The only factors that weigh against finding the de facto termination of marriage date is the testimony of the Parties that [Wife] moved in and out of marital residence several times and may have had discussions of reconciliation for the children’s sake after the initial divorce was dismissed. However, in light of many of the other factors being satisfied, this holds less weight. As the Magistrate indicated, the [Husband’s] willingness to obtain and pay child support, and [Wife’s] willingness to receive it, is highly indicative of their intentions to remain separated. Therefore, upon review of the record, the Court finds that the Magistrate did not err when he found the Dill factors weigh in favor of the de facto dates of the marriage being from February 23, 2004 until March 23, 2012.

In her appeal, Wife asserted three assignments of error, arguing (1) that the trial misapplied the Dill test in determining the de facto termination date of the marriage, and should have used the factors laid out in Schweinfurth instead; (2) that the trial court accordingly erred in awarding Husband the entirety of his pension; and (3) that the trial court erred in awarding Husband the right to claim the children for tax exemption purposes.

The Court disagreed with Wife on all counts, noting that a trial court generally has broad discretion to select a de facto termination date, if it finds that using the date of final hearing would yield an inequitable result. The Court observed this general principle remained in-tact, and even where in this specific case the trial court’s utilization of an earlier de facto date rendered Husband’s retirement benefits completely non-marital (as Husband’s pension only began to accrue after the de facto termination date). While Wife noted that the parties had filed a joint tax return, the Court found that this was outweighed by other Dill factors, including their less than friendly separation, separate finances and living arrangements, and lack of intimacy or intention to reconcile.

The Court similarly found against Wife’s arguments as to the child support exemption, noting that her substantially lesser income would diminish the effect of the exemption, compared to when applied to Husband’s.

Jackson v. Jackson, 10th Dist. Franklin No. 22DR-1401, 23AP-325, 2024-Ohio-1755

Marital Property: (OPERS), tracing (retirement into residential downpayment)

Dated: May 7, 2024
Reversing and Remanding

During the parties’ divorce proceedings, different assets, including residential and commercial property were awarded to them respectively. In addition to this, Wife was awarded the entirety of her OPERS pension. This summary focuses exclusively on said pension award.

In his appeal, Husband argued that the trial court failed to set forth its reasoning for assigning Wife the entirety of her pension, which had accrued in part during the parties’ marriage. The Court agreed, writing:

[I]t appears from the divorce decree that the trial court treated [Wife’s] pension as separate property. However, it is undisputed that some portion of [Wife’s] retirement benefit accrued during the marriage and thus constitutes marital property. The trial court erred when it failed to classify it as such and determine [Husband’s] proportionate share before ordering its disposition.

The Court reversed the trial court’s award of Wife’s OPERS pension. Although a portion of the pension accrued during the marriage, the trial court failed to classify it as marital property or determine Husband’s share. The Court found that the trial court did not make findings of fact or conclusions of law on the pension’s disposition and remanded the matter for proper classification and division in line with R.C. 3105.171.

Editor’s Note: Another point of interest related to the retirement was that the Court observed that Husband had also accrued an OPERS benefit, which was apparently partially earned prior to marriage, but that was liquidated shortly after the marriage and spent toward the couples’ residential downpayment. The Court further observed the decree determined this residential property as marital but was silent as to whether any portion of the downpayment contained a traceable separate property interest of Husband’s, related to his OPERS.

Williamson v. Williamson, 12th Dist. Butler No. DR2022-01-0052, CA2023-05-058, 2024-Ohio-1919

Marital Property: gift, separate property, tracing
ORC 3103.06(A): postnuptial agreements

Dated: May 20, 2024
Affirming

Following the parties’ marriage in 1982, they lived together in a residence that had been awarded to Wife pursuant to divorce proceedings from her prior marriage. In 1987, ownership of the home was transferred from Wife to Wife’s trust, via deed transfer signed by both parties. Then in 1997, Wife as trustee sold the house and deposited the proceeds into her personal account for downpayment on a new home. In order to secure better financing terms, the new home was titled in Wife’s name only. And at the time of the new home’s purchase, the parties executed a new trust agreement, signed by Husband as a disclaimant.

Wife filed for divorce in 2022, and following a contested hearing, the trial court found that Wife had not offered sufficient tracing evidence for her separate property claim, and determined that the parties’ home was marital property. In making this finding, the trial court found that the parties’ first home became a mixed, marital/non-marital asset during the marriage, and further that -by using her personal account for the purchase of the second home- funded the second trust with marital assets.

Wife was not persuasive in her claim of a separate interest in the [first home]. And as outlined above, Wife's use of the trust herein is tantamount to creating or offering to the Court a post-nuptial agreement, clearly invalid in Ohio.

“The sourdough starter of it all.”

The trial court awarded Wife ownership of the home, and Husband one half of the equity therein. Wife appealed, arguing that the trial court erred in not awarding the residence to her as her separate property. In her appeal, Wife argued that she had provided sufficient tracing evidence for her claim; that the second trust agreement was a valid postnuptial agreement under which the residence was her separate property; and that Husband had gifted her his interest in the parties’ home by signing the second trust agreement.

While separate property may be commingled and retain its status, the burden of proof to retain said status falls on the party claiming the separate property interest. Reviewing for manifest weight of the evidence, the Court agreed with the trial court’s finding: Wife had not sufficiently traced her interest in the home. No evidence concerning the (first home’s) loan balance in 1982 was presented at trial, nor was evidence presented concerning the parties’ respective contributions to the homes. Wife argued that Husband had failed to present a record of his helping with mortgage payments during the marriage, but the burden to present evidence, the Court reminds us, was on Wife to evince her own separate property claim.

As for whether the trust agreement was a valid postnuptial agreement, the Court wrote:

[Husband] contends that Section XI is an invalid postnuptial agreement because at the time he signed the Second [Wife] Trust Agreement, postnuptial agreements were unenforceable in Ohio. We agree with [Husband].

While Wife argued that the Court should review the agreement under the current language of ORC 3103.06, the Court found no interpretation of the statute “that would indicate an express intention by the legislature for the statute to apply retroactively.”

Finally, the Court found that Wife’s claim that Husband’s signature on the second trust agreement failed to establish an inter vivos gift to her of the residence. An inter vivos gift, the Court wrote, must have three elements: (a) donor intent to make an immediate gift; (b) delivery of the gift; and (3) acceptance of the gift by the recipient. The Court held: “[t]here was no clear and convincing evidence presented that [Husband] gifted his marital interest in the home ot [Wife],” and affirmed.

Dilley v. Dilley, 11th Dist. Geauga No. 2008 DC 000591, 2024-G-0005, 2024-Ohio-2035

QDRO: merely implements decree (res judicata)

Dated: May 28, 2024
Affirming

Editor’s Note: this appeal stems from lengthy proceedings previously summarized on our blog here.

After terminating Husband’s spousal support obligations, the trial court in this matter issued amended QDROs for Wife’s interest in Husband’s retirement benefits. Husband sought to have new amended QDROs entered and submitted, alleging overpayment, but the trial court overruled his request. Such a request, the trial court found, constituted an attempt by Husband to relitigate issues already decided in the trial court’s 2022 spousal support decision, and were thus barred by the doctrine of res judicata.

Husband appealed, but the Court affirmed the trial court, finding that Husband’s claim was yet another attempt to relitigate issues that had been considered and adjudicated upon.

Morgan v. Morgan, 8th Dist. Cuyahoga No. DR-10-331959, 112972, 2024-Ohio-2067

Marital Property: life insurance (to secure property interest)
DOPO: attorney fees, contempt, impermissible modification, OP&F (DROP), survivorship

Dated: May 30, 2024
Affirming

In this case, Husband appealed the trial court’s judgment adopting the magistrate’s decision in post-divorce proceedings concerning life insurance and contempt.

The parties’ 2013 separation agreement required Husband to secure a $1,000,000 life insurance policy, naming Wife as sole beneficiary, to protect her interest in his Ohio Police and Fire (OP&F) pension and Deferred Retirement Option Plan (DROP) account. Husband subsequently and unsuccessfully moved the trial court to modify this provisioning, arguing that such a policy was prohibitively expensive. Numerous filings by both parties followed, and in 2023, the trial court scheduled multiple days of hearings to resolve the parties’ motions.

Husband filed a motion to continue the trial, owing to a conflict on his counsel’s part. His motion was denied. Following the hearing, the magistrate issued findings that Husband was in contempt of court, and that his “Irrevocable Life Insurance Trust” was not in compliance with the parties’ agreement, and failed to name Wife as sole owner and beneficiary. The magistrate also recommended an award of attorney fees to Wife. The trial court adopted the magistrate’s recommendations and Husband’s appeal followed.

In its opinion, the Court noted certain aspects of the parties’ testimony, including Husband’s admission that he had failed to comply with numerous provisions in the parties’ agreement, related to his pension and obligation to name Wife as beneficiary to a commensurate life insurance policy. During the hearing, Husband was also asked about an email exchange wherein Husband appeared to hold his noncompliance over Wife. Finally, Husband was pressed about the structure of the trust he created to comply with the agreement, but which named his children as beneficiaries, and gave his son ownership and control thereof.

The Court further found that -while the parties were required to cooperate in obtaining a term life insurance policy to protect Wife’s interest, and that this word had been interpreted in differing ways by the parties- the requirement that Wife be sole owner and beneficiary of the policy was clear. Husband knew of his obligation (as evinced by years of litigation) and yet had not complied. “This evidence amounts to [Wife] making a prima facie showing of contempt.”

Further, Husband’s assertions that he provided Wife with quotes for policies were undercut by his testimony at the hearing to the opposite.

Husband also appealed the trial court’s denial of his motion to modify the life insurance obligation. He argued that his life insurance requirement should be reduced, as he no longer participated in the DROP program. The Court rejected this argument, holding that Husband had agreed to the terms in the separation agreement, and no legal grounds existed to modify this obligation. The Court found that Husband's requests for modification amounted to an improper attempt to eliminate the insurance obligation, rather than a valid clarification.

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