Calloway v. Calloway

832 S.W.2d 890, 1992 Ky. App. LEXIS 140, 1992 WL 126615
CourtCourt of Appeals of Kentucky
DecidedJune 12, 1992
Docket90-CA-001244-MR (DIRECT), 90-CA-001350-MR (CROSS)
StatusPublished
Cited by8 cases

This text of 832 S.W.2d 890 (Calloway v. Calloway) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Calloway v. Calloway, 832 S.W.2d 890, 1992 Ky. App. LEXIS 140, 1992 WL 126615 (Ky. Ct. App. 1992).

Opinion

GARDNER, Judge.

Appellant, Margaret J. Calloway (Mrs. Calloway), appeals from a Hardin Circuit Court order granting a dissolution of marriage and division of property. Appellee, Danny J. Calloway (Mr. Calloway) has filed a cross-appeal.

*892 Mr. and Mrs. Calloway were married in October, 1970. Three children were born of the marriage, two of whom are now emancipated. Mr. Calloway is employed as a welder, and Mrs. Calloway is a homemaker. Mrs. Calloway suffers from a progressive and debilitating disease which prevents her from working outside the home.

During the marriage, Mr. Calloway’s parents gave the couple a parcel of real property valued at approximately $10,000 on which a marital home was built. Mrs. Cal-loway’s mother also gave the couple a race car valued at approximately $7,000 which the family operated at various racing events for recreation.

In 1989, Mrs. Calloway filed a petition for dissolution of marriage in Hardin Circuit Court. The issues presented for determination included child custody, child support, visitation, maintenance, distribution of property, debts, attorneys fees, and costs. A domestic relations commissioner awarded Mrs. Calloway the marital residence, and awarded her mother the race car. The lower court, upon motion to amend, awarded Mr. Calloway a non-marital interest in the real property upon which the marital home was built, and awarded Mrs. Calloway the race car as non-marital property. The lower court also increased the value of the lot from $7,000 to $10,000, and awarded Mrs. Calloway maintenance as well as arrearage accrued under a prior temporary maintenance order. The remainder of the final order is not relevant for purposes of this appeal. Mrs. Callo-way’s mother, Edna Nelson, also filed an intervening petition seeking to protect any interest she may have in the race car.

The first issue on appeal is whether the lower court properly awarded the race car to Mrs. Calloway as non-marital property. It is Mrs. Calloway’s contention that the race car should have been awarded to her mother, who originally purchased the car for the parties. It is not readily apparent to this Court why Mrs. Calloway is seeking a result through the judicial process which she could accomplish by way of an inter vivos gift or a transfer for consideration. As it stands, Mrs. Calloway would be the sole owner of the race car and could simply give it or sell it to her mother if she so wished. Mr. Calloway contends that the lower court improperly classified the car as Mrs. Calloway’s non-marital property, or in the alternative, failed to take into account the degree to which he added value to the car. After reviewing the facts and the law, we must conclude that the race car was a gift to both parties and, though incorrectly classified as non-marital property, was properly distributed by the lower court.

The Kentucky Legislature has established statutory guidelines by which the assets of a married couple are divided upon dissolution of marriage. KRS 403.190 provides in part that

(1) In a proceeding for dissolution of the marriage or for legal separation, or in a proceeding for disposition of property following dissolution of the marriage by a court which lacked personal jurisdiction over the absent spouse or lacked jurisdiction to dispose of the property, the court shall assign each spouse’s property to him. It also shall divide the marital property without regard to marital misconduct in just proportions considering all relevant factors....
(2) For the purpose of this chapter, “marital property” means all property acquired by either spouse subsequent to the marriage except:
(a) Property acquired by gift, bequest, devise, or descent;

Furthermore, all property acquired by either spouse after the marriage is presumed to be marital in the absence of a clear showing that it is not. KRS 403.190(3).

In determining whether an item was a gift, consideration should be given to the factors which include the source of the money used to purchase the item, the intent of the purported donor, and the status of the marriage at the time of the transfer. O’Neill v. O’Neill, Ky.App., 600 S.W.2d 493 (1980). This determination must be based on the facts of each case. Id. A review of the facts of the instant case clearly indi *893 cates not only that the race car was a gift, but that it was a gift to both Mr. and Mrs. Calloway. It is undisputed that Mrs. Callo-way’s mother paid for the car and gave it to the parties, without consideration, for their mutual use and enjoyment. Together the parties used and maintained it, and there is nothing in the record which indicates that it was anything but a gift.

A difficulty arises, however, in disposing of the race car in a manner consistent with KRS 403.190. On one hand, the car clearly was a gift, and gifts are to be classified and disposed of as non-marital property. KRS 403.190(1) and (2)(a). Non-marital property is to be assigned to the individual spouse which owns the property. Id. On the other hand, the race car was owned, maintained, and enjoyed by both spouses, and thus cannot be the exclusive non-marital property of either spouse individually. KRS 403.190 does not directly address the nature of a gift from a third party to both spouses, and surprisingly, no Kentucky appellate court has had occasion to address the question. R. Petrilli, Kentucky Family Law, <24.8, at 300 (1988). Based on the Kentucky legislature’s clear intent that jointly owned property acquired during the marriage be divided upon dissolution in just proportions, we now hold that gifts during marriage from third parties to both spouses shall be treated as marital property upon dissolution. This holding, we believe, is a natural outgrowth of KRS 403.190, and is consistent with both the Uniform Marriage & Divorce Act and the limited number of decisions in other jurisdictions which have addressed the issue. Forsythe v. Forsythe, 558 S.W.2d 675 (Mo.App.1977).

The lower court classified both the race car and the lot as non-marital property, and based the division accordingly. For the above-noted reasons, we believe this to be in error. The more proper approach, we believe, is to classify them as marital property because they clearly were gifts to both parties, and to undertake their division based on the factors outlined in KRS 403.-190(l)(a)-(d).

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Bluebook (online)
832 S.W.2d 890, 1992 Ky. App. LEXIS 140, 1992 WL 126615, Counsel Stack Legal Research, https://law.counselstack.com/opinion/calloway-v-calloway-kyctapp-1992.