Zell v. Zell

Opinion

NO. 80-66

I N THE SUPREME COURT OF THE STATE OF M N A A O T N

RAYMOND W. ZELL,

P l a i n t i f f and Respondent,

-vs-

V I C T O R I A M. ZELL,

Defendant and Appellant.

Appeal from: The D i s t r i c t C o u r t o f t h e N i n t h J u d i c i a l D i s t r i c t , I n a n d f o r t h e County o f T o o l e , The H o n o r a b l e R o b e r t M. H o l t e r , J u d g e p r e s i d i n g .

Counsel o f Record:

For Appellant:

C o n n e r , B a i z & O l s e n , G r e a t F a l l s , Montana

For Respondent :

Aronow, A n d e r s o n , B e a t t y & L e e , S h e l b y , 3lontana

Submitted on B r i e f s : May 1 4 , 1980

Decided : JUL 2 - 198D Mr. J u s t i c e Gene B. Daly d e l i v e r e d t h e Opinion of t h e C o u r t .

his c a s e p r e s e n t s a r e g r e t t a b l e s t a t e o f a f f a i r s

wherein t h e p a r t i e s t o a divorce are s t i l l d i s p u t i n g t h e

d i s t r i b u t i o n of m a r i t a l p r o p e r t y o r d e r e d by t h e D i s t r i c t

C o u r t i n i t s 1975 d e c r e e of d i s s o l u t i o n and a f f i r m e d by t h i s

Court. Z e l l v. Z e l l ( 1 9 7 7 ) , 1 7 4 Mont. 216, 570 P.2d 3 3 .

The f a c t s of t h i s c a s e a r e a d e q u a t e l y s e t o u t i n o u r

p r i o r opinion. B r i e f l y , t h e m a r r i a g e of Raymond Z e l l and

V i c t o r i a M. Z e l l was d i s s o l v e d i n a n October 20, 1975 d e c r e e

which d i s t r i b u t e d e q u a l l y t h e m a r i t a l p r o p e r t y of t h e p a r t i e s .

F o r p u r p o s e s of t h i s a p p e a l , i t i s n e c e s s a r y o n l y t o p o i n t

o u t t h a t t h e w i f e , a p p e l l a n t h e r e , was t o r e c e i v e t h e f a m i l y

r e s i d e n c e , and t h e husband was t o r e c e i v e a r e n t a l p r o p e r t y

and a l l farm machinery. The farmland owned by t h e p a r t i e s

w a s o r d e r e d t o b e p a r t i t i o n e d e q u a l l y between them, and c e r t a i n l e a s e s w e r e a l s o divided. The p r o c e e d s from t h e

1975 c r o p s w e r e t o b e d i v i d e d e q u a l l y between t h e p a r t i e s

a f t e r t h e husband was reimbursed f o r t h e c o s t s of p r o d u c t i o n

and a f t e r a l l e x i s t i n g encumbrances a g a i n s t t h e farm machin-

e r y and t h e f a m i l y r e s i d e n c e were d i s c h a r g e d . The a f o r e -

mentioned d i s t r i b u t i o n of m a r i t a l p r o p e r t y was c h a l l e n g e d by

t h e w i f e on a p p e a l and was a f f i r m e d by t h i s C o u r t i n o u r

p r i o r opinion.

The c o n t r o v e r s y now b e f o r e t h i s C o u r t a r i s e s o u t of t h e

p a r t i e s ' r e f u s a l t o c a r r y o u t the property d i v i s i o n ordered

by t h e D i s t r i c t C o u r t . The w i f e n e g l e c t e d t o convey h e r

i n t e r e s t i n t h e r e n t a l p r o p e r t y t o t h e husband, a s o r d e r e d

i n t h e D i s t r i c t C o u r t d e c r e e , and s h e c o n t i n u e d t o c o l l e c t r e n t s on t h a t p r o p e r t y u n t i l J a n u a r y 1979. The husband

f a i l e d t o a p p l y t h e n e t p r o c e e d s from t h e 1975 c r o p s t o

d i s c h a r g e a l l encumbrances a g a i n s t t h e f a m i l y r e s i d e n c e , which was awarded t o t h e w i f e . Both p a r t i e s f a i l e d t o

e f f e c t a n e q u a l p a r t i t i o n of t h e farmland u n t i l November

1978, and t h e husband, who c o n t i n u e d t o farm t h e p r o p e r t y

a f t e r t h e October 20, 1975 d i v o r c e , made no a c c o u n t i n g t o

t h e w i f e of h i s income d e r i v e d from t h e p r o p e r t y u n t i l 1979,

a l t h o u g h h e d e l i v e r e d a s h a r e of t h e c r o p t o h e r e a c h y e a r .

On motion of t h e w i f e , a h e a r i n g r e l a t i n g t o t h e p e r -

formance of t h e t e r m s of t h e October 20, 1975 d e c r e e w a s

h e l d on F e b r u a r y 22, 1979, b e f o r e t h e same d i s t r i c t judge

who had p r e s i d e d a t t h e o r i g i n a l d i s s o l u t i o n p r o c e e d i n g s .

A f t e r t h e h e a r i n g t h e judge d i r e c t e d e a c h p a r t y t o f i l e a n

a c c o u n t i n g o f income and e x p e n s e s f o r t h e y e a r s 1975 t h r o u g h

1978 t o a s s i s t i n implementing t h e o r i g i n a l d e c r e e .

Following a second h e a r i n g on May 30, 1979, t h e judge

a p p o i n t e d a n a c c o u n t a n t a s a s p e c i a l m a s t e r t o make a com-

p l e t e r e p o r t of t h e income and e x p e n s e s of b o t h husband and

wife f o r the years i n question. A f t e r t h e s p e c i a l master

f i l e d h i s r e p o r t w i t h t h e D i s t r i c t C o u r t on August 2 1 , 1979,

t h e p a r t i e s made e x c e p t i o n s and o b j e c t i o n s t o t h e s p e c i a l

master's r e p o r t . A h e a r i n g w a s h e l d on September 27, 1979,

d u r i n g which b o t h p a r t i e s examined t h e s p e c i a l master and

s u b m i t t e d f u r t h e r e v i d e n c e and arguments.

On November 1 5 , 1979, t h e D i s t r i c t C o u r t e n t e r e d i t s

s u p p l e m e n t a l f i n d i n g s of f a c t , c o n c l u s i o n s of law, and

judgment, o r d e r i n g husband t o pay w i f e t h e sum of $11,912.69

w i t h i n t e r e s t a t t h e r a t e o f 6 p e r c e n t p e r annum from J u l y

1, 1976. The D i s t r i c t C o u r t e n t e r e d a f u r t h e r o r d e r re-

linquishing jurisdiction. Wife f i l e d a motion r e q u e s t i n g a

new p r e s i d i n g judge and a motion f o r a new t r i a l and t o

amend and a l t e r t h e s u p p l e m e n t a l f i n d i n g s of f a c t , c o n c l u -

s i o n s o f law and judgment r e l a t i n g t o p r o p e r t y m a t t e r s , which motion was d e n i e d by t h e new p r e s i d i n g judge f o l l o w i n g

a hearing. She now b r i n g s t h i s a p p e a l .

The ~ i s t r i c C o u r t s t a t e d i n i t s s u p p l e m e n t a l f i n d i n g s t of f a c t :

"2. The p r i n c i p a l d i s p u t e between t h e p a r t i e s r e l a t e s t o t h e income from t h e farm l a n d s owned by t h e p a r t i e s and from l e a s e d l a n d s d u r i n g t h e p e r i o d s t a r t i n g w i t h t h e y e a r 1975 and e n d i n g w i t h t h e y e a r 1978. The October 20, 1975, judg- ment p r o v i d e d t h a t t h e 1975 c r o p s grown on t h e s e l a n d s w e r e t o b e s o l d and t h e p r o c e e d s u s e d , f i r s t , t o pay c o s t s of p r o d u c t i o n ; second, t o d i s c h a r g e l i e n s and encumbrances e x i s t i n g a g a i n s t t h e r e a l and p e r s o n a l p r o p e r t y , and, t h i r d , any b a l a n c e t o b e d i v i d e d e q u a l l y between t h e p a r - ties. From t h e t i m e o f t h e d i v o r c e t h r o u g h t h e y e a r 1978, p l a i n t i f f c o n t i n u e d t o farm a l l of t h e deeded and l e a s e d l a n d . H e d e l i v e r e d o v e r t o d e f e n d a n t a s h a r e of t h e c r o p e a c h y e a r , b u t made no a c c o u n t i n g t o h e r of income and e x p e n s e s u n t i l 1979. The 1975 income w a s n o t a p p l i e d when r e c e i v e d i n a c c o r d a n c e w i t h t h e d i r e c t i v e s of t h e judgment. During t h e p e r i o d from October 20, 1975, t o September 2 1 , 1977, when t h e Supreme C o u r t d e c i s i o n was handed down, i t a p p e a r s t h a t no a c t i o n was t a k e n by e i t h e r p a r t y t o c a r r y o u t t h e t e r m s of t h e d e c r e e . T h e r e a f t e r , much of t h e d e l a y i n h a v i n g a n a c c o u n t i n g and a r r i v i n g a t a s e t t l e m e n t was due t o d e f e n d a n t ' s change of a t t o r n e y s and h e r i n a b i l i t y t o u n d e r s t a n d o r a g r e e t o t h e t e r m s o f t h e judgment.

"6. D e f e n d a n t ' s e x c e p t i o n No. 6 t o M a s t e r ' s re- p o r t a s k s t h a t p l a i n t i f f be r e s p o n s i b l e f o r t h e i n t e r e s t t h a t h a s accumulated on t h e encumbrance e x i s t i n g a g a i n s t t h e p r o p e r t y a t 800 F i r s t S t r e e t S o u t h s i n c e h e f a i l e d t o make a t i m e l y f u l l ac- c o u n t i n g and t h a t h e b e o r d e r e d t o d i s c h a r g e t h i s encumbrance a s p r o v i d e d by t h e October 20, 1975, judgment. The judgment p r o v i d e d t h a t t h e encumbrance e x i s t i n g a s of May 1 9 , 1975, be d i s - c h a r g e d from p r o c e e d s of 1975 c r o p income b e f o r e any p a r t of t h e income was d i v i d e d between t ? i e parties. The r e p o r t shows t h a t t h e p r o p e r t y i n q u e s t i o n was encumbered t o t h e amount of $16,065.10 on May 1 9 , 1975. The r e p o r t f u r t h e r shows t h a t t h e n e t 1975 income from t h e farm l a n d s , a f t e r r e i m - b u r s i n g p l a i n t i f f f o r c o s t s of p r o d u c t i o n , was $64,910.48. Encumbrances t o be d e d u c t e d t o t a l e d $21,355.68, which i n c l u d e d t h e $16,065.10 and $5,290.58 owing on farm machinery. This l e f t $43,554.80 t o b e d i v i d e d between t h e p a r t i e s a t $21,777.40 each. I t a p p e a r s f u r t h e r from t h e r e - p o r t t h a t p l a i n t i f f d i d not apply t h e r e c e i p t s from t h e 1975 c r o p i n t h a t f a s h i o n . H e d i d n o t pay o f f t h e encumbrance on t h e p r o p e r t y a t 800 F i r s t S t r e e t S o u t h . I n s t e a d , he d e l i v e r e d t o d e f e n d a n t 1975 g r a i n o f a v a l u e of $17,858.19, a sum s u f f i c i e n t t o pay o f f t h e encumbrance. De- f e n d a n t d i d n o t u s e t h e p r o c e e d s of t h e 1975 g r a i n sale f o r t h a t purpose, nor has she a p p l i e d any of t h e payments r e c e i v e d from p l a i n t i f f i n s u b s e q u e n t y e a r s f o r t h a t p u r p o s e , s o t h i s en- cumbrance s t i l l h a s n o t been s a t i s f i e d . Plain- t i f f d i d n o t d e l i v e r t o d e f e n d a n t any a d d i t i o n a l p a r t of t h e 1975 c r o p . I n e f f e c t , whatever b a l a n c e i s found by t h e C o u r t i n t h i s p r o c e e d i n g t o be owing t o d e f e n d a n t i s a c c o u n t a b l e t o t h e f a i l u r e of p l a i n t i f f t o a p p l y t h e 1975 s a l e s p r o c e e d s a s r e q u i r e d by t h e judgment. Plaintiff s h o u l d be c h a r g e a b l e f o r i n t e r e s t on t h a t b a l a n c e a t t h e r a t e o f 6% p e r annwn from J u l y 1, 1976, t h e approximate d a t e on which t h e f i n a l s a l e of 1975 g r a i n s h o u l d have been made."

These f i n d i n g s a r e n o t s e r i o u s l y i n d i s p u t e . Instead,

w i f e p r e s e n t s arguments amounting t o a c l a i m t h a t t h e D i s -

t r i c t C o u r t abused i t s d i s c r e t i o n . She c o n t e n d s (1) t h a t

husband s h o u l d be r e s p o n s i b l e f o r t h e a c c r u e d i n t e r e s t on

t h e r e s i d e n c e awarded t o w i f e ; ( 2 ) t h a t t h e D i s t r i c t Court

abused i t s d i s c r e t i o n by a l l o w i n g husband t o c h a r g e d e p r e -

c i a t i o n of farm machinery a g a i n s t h i s n e t income; and ( 3 )

t h a t s h e was n o t g i v e n a d e q u a t e a c c e s s t o h u s b a n d ' s income

and expense r e c o r d s , which were s u b m i t t e d t o t h e s p e c i a l

master and t o t h e D i s t r i c t C o u r t . W e f i n d t h e s e arguments

t o be w i t h o u t m e r i t .

Wife a r g u e s t h a t b e c a u s e husband f a i l e d t o d i s c h a r g e

a l l encumbrances a g a i n s t t h e r e s i d e n c e awarded t o h e r a s he

was r e q u i r e d t o d o under t h e October 20, 1975 d e c r e e , h e

s h o u l d have been h e l d r e s p o n s i b l e f o r a l l a c c r u e d i n t e r e s t

r a t h e r t h a n merely 6 p e r c e n t p e r annum on t h e b a l a n c e found

owing t o t h e w i f e . T h i s argument m i g h t have some f o r c e i f

t h e w i f e had come t o t h e c o u r t w i t h c l e a n hands, b u t s h e d i d

not. The D i s t r i c t C o u r t found t h a t much of t h e d e l a y i n

c a r r y i n g o u t i t s o r i g i n a l d e c r e e was due t o t h e w i f e ' s

actions o r inactions. While t h e husband was a t f a u l t f o r h i s f a i l u r e t o d i s c h a r g e t h e encumbrances a g a i n s t t h e w i f e ' s

r e s i d e n c e o u t o f t h e p r o c e e d s of t h e 1975 c r o p s , t h e w i f e a l s o d i s r e g a r d e d t h e d e c r e e by f a i l i n g t o convey t h e r e n t a l

p r o p e r t y t o husband as a l l o c a t e d by t h e d e c r e e and by c o l -

l e c t i n g r e n t s from t h e p r e m i s e s . Thus, we are s a t i s f i e d

t h a t t h e D i s t r i c t Court d i d n o t abuse i t s d i s c r e t i o n i n

reaching an equitable solution. W e s t a t e d i n our previous

opinion:

" I t i s w e l l s e t t l e d i n Montana t h a t a d i s t r i c t c o u r t has f a r reaching d i s c r e t i o n i n resolving p r o p e r t y d i v i s i o n s and i t s judgment w i l l n o t b e a l t e r e d u n l e s s a c l e a r a b u s e of t h a t d i s c r e t i o n i s shown ... The c r i t e r i a f o r r e v i e w i n g t h e d i s t r i c t c o u r t ' s d i s c r e t i o n i s : Did t h e d i s - t r i c t c o u r t i n t h e e x e r c i s e of i t s d i s c r e t i o n a c t a r b i t r a r i l y w i t h o u t employment of c o n s c i e n - t i o u s judgment, o r exceed t h e bounds of r e a s o n i n view of a l l t h e c i r c u m s t a n c e s . " Z e l l v. Z e l l , s u p r a , 570 P.2d a t 35.

Rather than having a c t e d a r b i t r a r i l y , t h e District C o u r t must be commended f o r employing n o t o n l y i t s c o n s c i e n -

t i o u s judgment b u t a l s o t h e p a t i e n c e of J o b i n a t t e m p t i n g t o

p r o t e c t t h e r i g h t s of t h e p a r t i e s , n o t w i t h s t a n d i n g t h e f a c t t h a t b o t h p a r t i e s must s h a r e r e s p o n s i b i l i t y f o r r e f u s i n g t o

c a r r y o u t t h e t e r m s of t h e o r i g i n a l d e c r e e i s s u e d n e a r l y

five years earlier. The D i s t r i c t C o u r t g r a n t e d w i f e s e v e r a l

h e a r i n g s and a p p o i n t e d a n a c c o u n t a n t as a s p e c i a l master t o

d e t e r m i n e e a c h p a r t y ' s income and e x p e n s e s f o r t h e y e a r s i n

q u e s t i o n , a n appointment which would have been u n n e c e s s a r y b u t f o r t h e i n t r a n s i g e n c e of b o t h p a r t i e s i n complying w i t h t h e o r i g i n a l decree. The D i s t r i c t C o u r t f e l t , and we a g r e e , t h a t t h e r e h a s been a n u n j u s t i f i a b l e d e l a y i n complying w i t h

i t s decree. Should t h e r e b e any f u r t h e r d e l a y , t h e D i s t r i c t C o u r t i s , of c o u r s e , empowered t o u t i l i z e i t s contempt powers. There being no abuse of discretion, the judgment is

a £firmed.

We concur:

%&a*&& Chief Justice