MCLEAN v. MCLEAN (2025)

MEMORANDUM DECISION

[1] Hugh B. McLean, Jr., (“Husband”) appeals the trial court's decree dissolving his marriage to Joetta L. McLean (“Wife”) and argues the court erred in dividing the marital property. Wife requests appellate attorney fees. We affirm the court's order and deny Wife's request for appellate attorney fees.

Facts and Procedural History

[2] Husband and Wife were married on June 17, 2017. On October 3, 2023, Husband filed a petition for dissolution of marriage. On April 22, 2024, the court held a final hearing at which Husband appeared pro se and Wife appeared by counsel. The court admitted evidence related to the parties’ bank and retirement accounts, a valuation of Husband's pension, and evidence related to other marital assets and the parties’ incomes. Husband testified that he worked for Caterpillar for 27.5 years, retired in 2016, received a pension, and had a 401(k). He testified that he purchased the marital residence in 2015, the parties built an addition to the home, he paid $39,000 toward the addition, and Wife paid $30,000 toward the addition. He testified that Wife previously owned a house, “so she would have gotten the increase of her house,” and “[s]he's now getting the increase of a more valuable house.”¹ Transcript Volume II at 46-47. Husband indicated that he went back to work after his retirement, he was paid on an hourly basis, “it's a temporary program, it's three years,” he “had one three year stint ․ at Caterpillar but working for a company called Populus,” and he was “on ․ year two of three with CFA working at Caterpillar and ․ ha[d] one more year on that contract.”² Id. at 48. Husband indicated that the parties did not have a premarital agreement. He stated, “I believe the law just says that the Court shall give consideration to premarital assets, I'm asking for full consideration of the timeframe it took to build ․ build my assets versus the timeframe of [the] marriage.” Id. at 56.

[3] Wife testified that she sold the home she owned prior to the marriage and contributed to the addition to the marital residence. She requested that the court award her forty percent of the marital property. When asked why she did not request an equal division, she replied, “[b]ecause I know that he has worked hard. But I have also worked hard.” Id. at 65. When asked “what are you asking for with the marital residence to offset what he would receive as the – the full value of his pension and 401(k),” Wife replied “in order to get the percent that I feel fair in the marriage that – that house has to come off of the – that's where our asset is for me to be able to move forward without him.” Id. at 64. When asked if her income changed when she married Husband, Wife testified “my income from my job stayed the same except for I did go down ․ one day a week,” “[s]o that affects my income now,” and “what social security takes into effect for what my social security would be has lowered.” Id. at 65. Wife indicated that she was sixty-five years old. On cross-examination, Husband asked “so you're asking not for the -- nothing for the 401(k) and nothing for the pension, but you're asking for a hundred percent of the selling price of the house,” and Wife replied, “[i]n order to get my forty percent that has to come from that because that's the only place that I can take it from. You don't want me to touch your 401(k) or your pension, so the only way that I can get to forty percent is to get the house.” Id. at 77.

[4] On May 16, 2024, the court entered an Order on Dissolution and Division of Marital Estate. The court found that Husband had purchased the marital residence prior to the marriage for $205,000, each party made financial contributions to the residence during the marriage, the parties listed the residence for sale at $550,000, and there was no mortgage on the residence. It found that Husband received a monthly pension payment of $3,036.21 which he earned prior to the marriage. The court found that the parties had joint bank accounts, that Husband had a 401(k) account with a value of $639,865.61 and an IRA with a balance of $9,989.57, and that Wife had a 401(k) account with a total value of $22,214 and IRA accounts with balances of $16,965.99 and $1,158. It found there were no marital debts. It also found Husband earned between $77,000 and $89,000 per year since his retirement and Wife was working thirty hours per week earning approximately $590.23 per week.

[5] The court found that Husband rebutted the presumption of an equal division of marital property. It found that “[t]his finding is based upon the extent to which assets of each spouse were acquired prior to the marriage and the short duration of the marriage (approximately six (6) years)” and that “all of Husband's pension and 401K were earned prior to the marriage.” Appellant's Appendix Volume II at 6. It further found that “Wife produced persuasive evidence that she relied on the marriage to her financial detriment,” she “reduced her working hours and income during the marriage which will impact her future social security benefits,” she “sold her residence to live with Husband and thereby forfeited any increase in the value of that property,” and her “current earning ability is significantly lower than Husband's earning ability.” Id. at 7. The court awarded 61.7% of the marital property to Husband and 38.3% of the property to Wife. The court awarded the marital residence to Wife, awarded Husband the full value of his pension and retirement accounts, awarded Wife her retirement accounts, divided the parties’ personal property, and ordered that the parties close their joint bank accounts and equally split the amounts on deposit.

Discussion

[6] Husband argues the trial court did not divide the marital estate in a just and reasonable manner. He asserts that the court failed to properly consider the short duration of the marriage and the extent to which he acquired assets prior to the marriage, that the evidence does not support the court's findings regarding the parties’ earning abilities, and that the court abused its discretion in considering Wife's sale of her prior residence. Husband also argues the court failed to consider tax consequences in dividing the assets.

[7] Wife maintains the court did not abuse its discretion in dividing the marital property and properly considered the factors in Ind. Code § 31-15-7-5. She argues that “Husband did not request a reduction of the overall net marital estate based on potential tax consequences” and that the court did not require him to withdraw any retirement funds. Appellee's Brief at 13.

[8] The division of marital property is within the sound discretion of the trial court. Love v. Love, 10 N.E.3d 1005, 1012 (Ind. Ct. App. 2014). We consider only the evidence most favorable to the court's disposition of the property. Id. Although the facts and reasonable inferences might allow for a different conclusion, we will not substitute our judgment for that of the trial court. Id. The court must divide the marital property in a just and reasonable manner, and an equal division is presumed just and reasonable. McGrath v. McGrath, 948 N.E.2d 1185, 1187-1188 (Ind. Ct. App. 2011) (citing Ind. Code § 31-15-7-5). The presumption may be rebutted by evidence of certain factors including the contribution of each spouse to the acquisition of the property; the extent to which the property was acquired before the marriage or through inheritance or gift; the economic circumstances of each spouse at the time of the disposition; the conduct of the parties during the marriage as related to the disposition or dissipation of their property; and the earnings or earning ability of the parties. Ind. Code § 31-15-7-5. The party challenging the court's division must overcome a strong presumption that it considered and complied with the applicable statute. McGrath, 948 N.E.2d at 1188. The disposition of the marital property is to be considered as a whole, not item by item. Id.

[9] The record reveals the parties were married in June 2017 and Husband filed for divorce in October 2023. The court admitted evidence related to the parties’ retirement and bank accounts, Husband's pension, the marital residence, and the parties’ other assets. It further admitted evidence regarding their incomes and their contributions toward purchasing and improving the marital residence. While Husband purchased the marital residence in 2015 and the residence has increased in value, the record reveals that both parties contributed to the improvements to the residence. Wife sold the home she owned prior to the marriage, both parties worked and had earned income during the marriage, Husband receives monthly pension payments, and the value of Husband's retirement accounts is substantial and significantly higher than the value of Wife's retirement accounts.

[10] The trial court was able to weigh the evidence and testimony regarding the property, the parties’ respective contributions in acquiring the property before and during the marriage, and their economic circumstances. We consider only the evidence most favorable to the court's disposition and conclude that Husband has not overcome the strong presumption that the court considered and complied with the applicable statute. We cannot say the trial court's division of the marital property was not just and reasonable. See Luedke v. Luedke, 487 N.E.2d 133, 135 (Ind. 1985) (observing it was apparent the trial court considered the source of the property and its future use and holding the court reached its conclusion in a fair and reasonable manner on the record and that reversal was not merited).

[11] To the extent Husband raises an argument related to tax consequences, Ind. Code § 31-15-7-7 provides that the court, in determining what is just and reasonable in dividing property, “shall consider the tax consequences of the property disposition with respect to the present and future economic circumstances of each party.” This Court addressed the predecessor to Ind. Code § 31-15-7-7 in Harlan v. Harlan, 544 N.E.2d 553 (Ind. Ct. App. 1989), summarily affirmed, 560 N.E.2d 1246 (Ind. 1990). This Court held that “[t]he thrust of the Statute is to recognize that there may be in the plan of division of marital property certain tax consequences which should be taken into account,” “[t]he clear inference is that only tax consequences necessarily arising from the plan of distribution are to be taken into account, not speculative possibilities,” and “[t]he Statute specifically limits the trial court to consider only the tax consequences ‘of the property disposition.’ ” Harlan, 544 N.E.2d at 555. The Indiana Supreme Court stated “[t]he Court of Appeals held that the statute requires the trial court to consider only the direct or inherent and necessarily incurred tax consequences ‘of the property disposition’ ” and summarily affirmed this Court's opinion. Harlan, 560 N.E.2d at 1246. See also Granger v. Granger, 579 N.E.2d 1319, 1321 (Ind. Ct. App. 1991) (noting a “taxable event must occur as a direct result of a court-ordered disposition of the marital estate” for the tax consequences to be considered), trans. denied; DeHaan v. DeHaan, 572 N.E.2d 1315, 1327 (Ind. Ct. App. 1991) (holding “only the immediate tax consequences of the property disposition may be considered”), reh'g denied, trans. denied. The trial court did not order Husband to withdraw any portion of the funds in his retirement accounts or to take an action which would result in an immediate tax consequence. Husband has not established that the court's order resulted in direct tax consequences of the property disposition. Further, there were several marital assets, which the court indicated were valued at $1,895,628, and Husband is receiving his pension. The evidence does not show that the court's order will result in a tax consequence which significantly alters the trial court's intended apportionment. We find no error.

[12] Wife requests appellate attorney fees “for having to defend this matter.” Appellee's Brief at 15. This Court is authorized to assess damages if an appeal “is frivolous or in bad faith,” and such damages “shall be in the Court's discretion and may include attorneys’ fees.” Ind. Appellate Rule 66(E). A strong showing is required to justify an award of appellate damages, and the sanction is not imposed to punish mere lack of merit, but something more egregious. Bessolo v. Rosario, 966 N.E.2d 725, 734 (Ind. Ct. App. 2012), trans. denied. To prevail on her request, Wife must show that Husband's arguments on appeal are “utterly devoid of all plausibility.” See id. While we do not disturb the trial court's order, we cannot say Husband's arguments on appeal are utterly devoid of all plausibility or that an award of appellate attorney fees is appropriate.

[13] For the foregoing reasons, we affirm the trial court's order and deny Wife's request for appellate attorney fees.

[14] Affirmed.

FOOTNOTES

1.   In his brief, Husband states that, “[a]t commencement of the marriage, Wife's home sold for $160,000 and had $127,000 mortgage.” Appellant's Brief at 10.

2.   The record indicates that Husband earned $55,165.80 in 2018, $62,910 in 2019, $59,355.78 in 2020, and $8,869.23 in 2021 from Populus and $77,017 in 2022, $89,304.99 in 2023, and $6,072 in 2024 from CFA.

Brown, Judge.

Mathias, J., and Kenworthy, J., concur.