Middendorf v. Middendorf

696 N.E.2d 575, 82 Ohio St. 3d 397
Ohio Supreme Court·Decided July 29, 1998·No. No. 97-261·Published·Cited by 275 cases

Opinion

Lundberg Stratton, J.

In this case, we examine the legal standards for determining when appreciation in separate property becomes marital property for purposes of the division of property in a domestic relations case under R.C. 3105.171. Max asserts that in order for a court to determine that an increase in separate property is marital property, the court must find that both spouses have expended significant marital funds or labor directly contributing to the increase or that the non-owning spouse must contribute substantial work to improvement and maintenance of the separate property. We disagree.

In Worthington v. Worthington (1986), 21 Ohio St.3d 73, 21 OBR 371, 488 N.E.2d 150, this court affirmed a trial court’s decision that held that the increase in value of separate property is marital property where the increase in value is the result of the couples’ expenditure of a substantial sum of marital funds and labor. The court in Worthington held:

“A trial court, in determining the division of property pursuant to the factors contained in R.C. 3105.18 and all other relevant factors, does not abuse its discretion by apportioning the appreciation in value of non-marital property as a marital asset, where significant marital funds and labor are expended to improve and maintain such property.” (Emphasis added.) Id. at syllabus.

However, the General Assembly codified a new definition of “marital” and “separate property” in R.C. 3105.171, which became effective on January 1, 1991. 143 Ohio Laws, Part III, 5226, 5452. R.C. 3105.171(A)(3)(a), as amended, states:

[400] “ ‘Marital property’ means, subject to division (A)(3)(b) of this section, all of the following:
(( * * *
“(in) * * * all income and appreciation on separate property, due to the labor, monetary, or in-kind contribution of either or both of the spouses that occurred during the marriage.” (Emphasis added.) 144 Ohio Laws, Part I, 1754-1755.

R.C. 3105.171(A)(6)(a) states:

“ ‘Separate property’ means all real and personal property and any interest in real or personal property that is found by the court to be any of the following: « ‡ ‡
“(in) Passive income and appreciation acquired from separate property by one spouse during the marriage.”

Finally, R.C. 3105.171(A)(4) states:

“ ‘Passive income’ means income acquired other than as a result of the labor, monetary, or in-kind contribution of either spouse.”

It is within the province of a court to construe laws enacted by the legislature. Cowen v. State ex rel. Donovan (1920), 101 Ohio St. 387, 397, 129 N.E. 719, 722. The primary purpose of interpretation is to ascertain the intent of the legislature. Ohio Assn. of Pub. School Emp. v. Twin Valley Local School Dist. Bd. of Edn. (1983), 6 Ohio St.3d 178, 181, 6 OBR 235, 237-238, 451 N.E.2d 1211, 1214. In interpreting legislative intent, the court must first look to the language of the statute. Provident Bank v. Wood (1973), 36 Ohio St.2d 101, 105, 65 O.O.2d 296, 298, 304 N.E.2d 378, 381. If the language of the statute is unambiguous, then the statute must be applied pursuant to its plain meaning. Id. at 105-106, 65 O.O.2d at 298, 304 N.E.2d at 381.

The plain language of R.C. 3105.17(A)(3)(a)(iii) unambiguously mandates that when either spouse makes a labor, money, or in-kind contribution that causes an increase in the value of separate property, that increase in value is deemed marital property. Kotkowski v. Kotkowski (May 19, 1995), Portage App. 94-P-0027, unreported, 1995 WL 378681; Hansen v. Hansen (Dec. 11, 1992), Lake App. No. 92-L-052, unreported, at 8, 1992 WL 366885.

The definition in R.C. 3105.171(A)(3)(a)(iii) differs from the “joint efforts” test in Worthington in that Worthington required an effort by both spouses before any increase in the value of separate property due to such efforts would be classified as marital property. R.C. 3105.171(A)(3)(a)(iii) requires only an expenditure or effort by either spouse. Thus, R.C. 3105.171(A)(3)(a)(iii) in effect supersedes Worthington for purposes of defining when appreciation of separate property is marital property. Nine v. Nine (Mar. 1, 1995), Summit App. No. 16625, unreported, 1995 WL 89478. Accordingly, the appellate court did not err [401] in affirming the trial court’s interpretation of R.C. 3105.171, that an increase in the value of separate property due to either spouse’s efforts is marital property.

We must now determine if there was sufficient evidence to support the trial court’s determination that there was an increase in the value of the stockyard during Max and Pat’s marriage and that the increase was due to the labor, money, or in-kind contributions made by Max. R.C. 3105.171(A)(3)(a)(iii). If the evidence indicates that the appreciation of the separate property is not due to the input of Max’s (or Pat’s) labor, money, or in-kind contributions, the increase in the value of the stockyard is passive appreciation and remains separate property. R.C. 3105.171(A)(6)(a)(iii); 3105.17(A)(4); see, also, Roberts v. Roberts (Feb. 18, 1993), Highland App. No. 92 CA 800, unreported, 1993 WL 49461.

A trial court has broad discretion in making divisions of property in domestic cases. Berish v. Berish (1982), 69 Ohio St.2d 318, 23 O.O.3d 296, 432 N.E.2d 183. A trial court’s decision will be upheld absent an abuse of discretion. Holcomb v. Holcomb (1989), 44 Ohio St.3d 128, 541 N.E.2d 597; Martin v. Martin (1985), 18 Ohio St.3d 292, 294-295, 18 OBR 342, 344, 480 N.E.2d 1112, 1114. “Abuse of discretion” is more than an error of law or judgment; it implies that the court acted in an unreasonable, arbitrary, or unconscionable fashion. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219, 5 OBR 481, 482, 450 N.E.2d 1140, 1142. If there is some competent, credible evidence to support the trial court’s decision, there is no abuse of discretion. Ross v. Ross (1980), 64 Ohio St.2d 203, 18 O.O.3d 414, 414 N.E.2d 426. Therefore, if there is some competent, credible evidence that there was an increase in the value of the stockyard during the marriage and that the increase in the valuation was due to labor, money, or in-kind contributions of either Max or Pat, or both, the increase in valuation is classified as marital property and subject to division.

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Middendorf v. Middendorf, 696 N.E.2d 575, 82 Ohio St. 3d 397 (Ohio 1998).

696 N.E.2d 575 (Middendorf v. Middendorf) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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