November 29, 1985
CARL R. BOWER, APPELLANT
Appeal from the Order entered February 13, 1985, Court of Common Pleas, Clinton County, Civil Division at No. 560-83.
Before: Tamilia,*fn* Johnson and Hoffman, JJ.
ING MEMORANDUM BY TAMILIA, J.
I dissent. Although in most instances we agree with the trial court's distribution of marital property, the 92%/8% division espoused by the majority seems to avoid altogether the equitable factor of equitable distribution. While we realize that equitable distribution does not necessarily connote an even partition, Semasek v. Semasek, Pa. Super. 479 A.2d 1047 (1984), Platek v. Platek, 309 Pa. Super. 16, 454 A.2d 1059 (1982), we feel that in this instance one in which neither party contributed the lion's share of their modest assets, such disproportionate allotment as that ordered by the trial judge constitutes a clear abuse of judicial discretion.
For purposes of determining the measure of each party's proper share of marital property, our courts have been provided with 10 elements to consider. 23 Pa.C.S.A § 401(d).
(2) Any prior marriage of either party.
(3) The age, health, station, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each of the parties.
(4) The contribution by one party to the education, training, or increased earning power of the other party.
(5) The opportunity of each party for future acquisitions of capital assets and income.
(6) The sources of income of both parties, including but not limited to medical, retirement, insurance or other benefits.
(7) The contribution or dissipation of each party in the acquisition, preservation, depreciation or appreciation of the marital property, including the contribution of a party as homemaker.
(8) The value of the property set apart to each party.
(9) The standard of living of the parties established during the marriage.
(10) The economic circumstances of each party at the time the division of property is to become effective.
Recognizing that the enumerated factors are not all-inclusive, we use them as a reference point in our analysis. Ruth v. Ruth, 316 Pa. Super. 282, 462 A.2d 1351 (1981).
The hearing master and the trial court found that the marriage was a childless one of relatively brief duration (5/80 - 8/83) between two young people (both in their mid-twenties at time of hearing), of comparable education (both high school graduates), (good) health, current income and future prospects. Neither had significant personal assets or liabilities. In short the parties began the process of distribution on roughly the same footing.
The major marital asset is a small dairy store operation which was purchased in 1980, shortly after the parties' marriage, for $28,000. This amount was composed of $5000 of the parties' joint savings, a $13,000 bank loan, and a $10,000 loan from appellant's father. The $10,000 has been completely repaid as has all but $3,820 of the bank loan. Of the 39 months between purchase of the business and the parties' separation, seventeen were spent under appellee's exclusive management. The store is in fact her sole source of income.*fn1 Although we agree with the master that because appellant in effect abandoned the business, warranting the award to appellee of a larger share, the court's distribution of this asset to appellee in its entirety skews the entire division scheme; it is this to which we object. The in toto assignment is based on the court's conclusions that the master incorrectly set the value of the business, and further, that if appellant receives a share either in the form of an interest or cash, he will be in a superior position to appellee. We fail to see how, after contributing materially, as the court recognizes, to the acquisition, and at least initially to operation of the shop, appellant should now be totally precluded from deriving the benefits of his substance and labor.
Under the distribution scheme fashioned by the master, appellant was to derive 28% of the net total interest in the business and appellee 72%. These fractions are roughly equivalent to the time period of each party's involvement over the life of the business, and we find them equitable in determining the proper apportionment of this asset.
The next problem is of valuation, the amount against which the percentages must be applied to result in some recompense to appellant. The court dismissed the master's valuation of the business, $14,248.07 net, as unsupported by the record and instead utilizes appellant's figures. We agree with the court that the source of the master's figure is unclear, and base our own calculations on the balance sheet provided by the business' accounting firm. Utilizing the C.P.A.'s formula, net value fair market value ($33,000), less liabilities ($11,950), plus inventory ($2000), we arrive at a figure of $23,050.*fn2 It is 28% of this figure, or $6454, which is due appellant from the business.
The next major bone of contention is the ownership of a 1983 Chevrolet Cavalier purchased by appellee out of proceeds of the business. Appellant argues that it should be valued at its original purchase price, $7800, rather than the $6000 (N.D.A. book value) figure assigned to it by the master. The trial court, while accepting the master's valuation revised its equal disbursement, awarding the entire amount to appellee.
The vehicle was acquired on August 11, 1983 - the same date that appellee filed her complaint in divorce, and therefore technically during the marriage. Although purchased from funds of the jointly-run business (and depreciated as an asset), its expenses were met entirely by appellee's sole exertions in operating the store from the time of appellant's departure. The vehicle is appellee's only means of personal and business transportation. Appellant by stipulation received as part of his share of marital property a 1978 Dodge pickup truck valued at $2000. In addition he has access to a company car and need pay only its road expenses for personal use. The cost of the Chevrolet has been factored into the business valuation of which appellant is already recovering an appropriate share. We agree with the previous decisions of the master and the trial court that this asset should be wholly appellee's.
Finally appellant argues that various personal property was erroneously awarded to appellee after the master had already outlined an acceptable, equal division. The master recommended that certain knickknacks, china, silverware, cooking utensils, small appliances and linens, none of which was assigned any value, were to remain in appellee's possession. The court adopted this assignment as do we.
One final issue concerns a non-marital asset, 12 shares of Dice Drug Co. stock acquired by the appellant on May 10, 1977, before the marriage. This issue relates to the increase in value of the gift after the marriage, pursuant to section 401(e)(1) which provides:
(e) For purposes of this chapter only, "marital property" means all property acquired by either party during the marriage except: (1) Property acquired in exchange for property acquired prior to the marriage except for the increase in value during the marriage.
We have construed this section to mean that an increase in value during the marriage of prior owned property is marital property subject to equitable distribution. Anthony v. Anthony and Tompkins v. Tompkins, Pa. Super. A.2d (filed , 1985) The trial court did not rule on this issue as he believed there were no appellate decisions to guide him. However, he and the master concluded that the stock and the increased value of $500 were non-marital property and awarded them to the appellant. In view of the overall distribution, and the assignment of all marital gift and household items to appellee, we see no need to disturb the dispositions of the increased value of the stock.
*fn1 Appellee's net salary is between $100-130/week. Appellant is an employee of the larger of two family owned businesses. His net salary is $150/week, and he received a $150 bonus at Christmas.
*fn2 The trial court found the value to be $25,000.
*fn3 Award figures include values of items which are listed in the master's report, and distributed by stipulation of the parties.