No. 02987 Philadelphia, 1982, Appeal from the Order of the Court of Common Pleas, Delaware County, Civil Division, at No. 80-15699.
Michael P. Dignazio, Media, for appellant.
Joseph L. London, Philadelphia, for Lehmicke, appellee.
Brosky, Wieand and McEwen, JJ. McEwen, J., concurs in the result. Wieand, J., files a concurring and dissenting opinion.
[ 339 Pa. Super. Page 561]
The issue before us on this appeal is whether the trial court erred in awarding to appellee, appellant's former wife, compensation for her contributions to her former husband's medical education.
The parties were divorced on July 7, 1981 under the terms of the Pennsylvania Divorce Code.*fn1 Pursuant to an order for Pre-Trial Conference, discussion of Mrs. Lehmicke's request for alimony, equitable distribution of property, counsel fees and costs was held on August 18, 1981. Because no settlement was reached on those issues a special Master was appointed who held hearings late in 1981. The Master recommended that appellee be awarded $1,525 in counsel fees and costs, that alimony be denied, that appellant's medical degree be considered marital property and that appellee be awarded $64,790.00 as her share of that property. Exceptions were filed to the Master's Report and the trial court affirmed the recommendations as to alimony, counsel fees and costs and awarded Mrs. Lehmicke $64,790.00 on equitable principles. This appeal followed.
[ 339 Pa. Super. Page 562]
Dr. and Mrs. Lehmicke were married on June 8, 1968. One child was born of the marriage. Dr. Lehmicke graduated from college shortly before the marriage. He was drafted in January, 1969 and served in the Army for approximately seventeen months during which time the parties resided in Baltimore, Maryland where Dr. Lehmicke was stationed. In July, 1970 the couple moved to Ohio where Dr. Lehmicke embarked on a three year accelerated program at Ohio State Medical School.
Mrs. Lehmicke testified that while her husband attended medical school she worked as a waitress five or six nights a week, earning between $30 and $40 a night. In the summers she also was employed as Recreational Assistant. Previous to the marriage she had worked as a nurse's aide. The monies Mrs. Lehmicke earned were used to support the family and possibly to some extent, to pay certain medical school tuition and expenses of her husband.
Dr. Lehmicke testified that while he was in medical school he received $240.00 per month in G.I. benefits. This money was used to make monthly payments on a car the couple had purchased. Dr. Lehmicke also borrowed $8,600 to help finance his education and received a $1,000 scholarship and $1,000 as payment for research projects he performed.
Dr. Lehmicke graduated from medical school in June, 1973 at which time the parties moved to Philadelphia where he began an internship. While the couple lived in Philadelphia Mrs. Lehmicke did not have a paying job.
The parties had been having marital difficulties since Dr. Lehmicke's second year in medical school and in May, 1974 they separated.
In September 1976 Mrs. Lehmicke began a two year nursing program at Philadelphia Community College. Her tuition and books were paid for by financial aid and scholarships. After she graduated Mrs. Lehmicke continued her education and in May, 1980 received a Bachelor's Degree in nursing.
[ 339 Pa. Super. Page 563]
At the time of the hearing Mrs. Lehmicke worked 3 or 4 days a week as a registered nurse. She and her son live in an apartment in Philadelphia. Dr. Lehmicke is a Board Certified pediatrician in private practice.
During their marriage the parties did not accumulate any significant property. Mrs. Lehmicke urges us to find, however, that the value of her former husband's medical degree and the consequent increase in earning capacity it promises should be divided between them based on equitable principles or in the alternative viewed as marital property subject to equitable distribution.
We will first address the question of whether Dr. Lehmicke's degree or future earning capacity is an assignable asset subject to equitable distribution.
Our research discloses that most jurisdictions that have considered the question have concluded that neither an advanced degree nor increased earning capacity is actually "property." For example, in In re Marriage of Graham, 194 Colo. 429, 574 P.2d 75, 77 (1978) the Colorado Supreme Court opined and we agree that:
An educational degree, such as an M.B.A., is simply not encompassed even by the broad views of the concept of "property." It does not have an exchange value or any objective transferable value on an open market. It is personal to the holder. It terminates on death of the holder and is not inheritable. It cannot be assigned, sold, transferred, conveyed, or pledged. An advanced degree is a cumulative product of many years of previous education, combined with diligence and hard work. It may not be acquired by the mere expenditure of money. It is simply an intellectual achievement that may potentially assist in the future acquisition of property. In our view, it has none of the attributes of property in the usual sense of that term.
In Mahoney v. Mahoney, 91 N.J. 488, 453 A.2d 527 (1982) the New Jersey Supreme Court while noting that "[r]egarding equitable distribution, this Court has frequently held that an "expansive interpretation [is] to be given to the
[ 339 Pa. Super. Page 564]
word 'property' (Id. at 495, 453 A.2d at 531), nevertheless the court observed also that it "has subjected to equitable distribution an asset whose future monetary value is as uncertain and unquantifiable as a professional degree or license." Id. at 496, 453 A.2d at 531.
The Court concluded that equitable distribution of the value of a degree or increased earning capacity would be improper. The Court noted the following problems: A professional license or degree is a personal achievement of the holder. It cannot be sold and its value cannot readily be determined. (Id. at 495, 453 A.2d at 531); Equitable distribution of a professional degree would similarly require distribution of "earning capacity" -- income that the degree holder might never acquire. (Id. at 497, 453 A.2d at 532); Moreover, any assets resulting from income for professional services would be property acquired after the marriage; the statute restricts equitable distribution to property acquired during the marriage. (Id. at 497, 453 A.2d at 532);*fn2 Valuing a professional degree in the hands of any particular individual at the start of his or her career would involve a gamut of calculations that reduces to little more than guesswork and even if such estimates could be made, there ...